The Biomass Co-firing Policy is a critical step towards meeting India’s renewable energy targets and lowering greenhouse gas emissions from the power sector. But still it has not been accepted widely. Why?
As Secretary Power, Alok Kumar, at a recent event said, that the Mission is a new initiative which has a bright future, but the process may be complicated given the various stakeholders involved. “Though the progress is not as much as what was expected, but there is no need to give up hope,” Kumar had said.
Using biomass is still a cheaper option than imported coal and hence an economically viable alternative for all thermal power plants. The recently notified Energy Conservation (Amendment) Act, 2022 specifies that all thermal power plants will have to use renewable fuel sources either as energy or feedstock. But there is still hesitation among the generation utilities.
The State Generating Companies and Electricity Regulatory Commissions are still making slow progress in using biomass in their power plants. Therefore, the Ministry of Power is mulling suitable provision which will spur thermal power plants to use biomass along with coal as fuel.
The Revised Biomass Co-Policy of Ministry of Power dated October 8, 2021, impacts sectors such as power, coal, agriculture, MSMEs and the environment. Use of biomass in thermal power plants will not only enable generation of green electricity, it will also cut down coal consumption, create employment opportunities, reduce CO2 emissions, reduce air pollution and help in achieving India’s global commitment towards 45 per cent emission reduction by 2030.
All thermal power plants have been directed to use 5-7 per cent biomass pellets in their plants along with coal. So far about 1 lakh tonne of biomass has been co-fired in 42 thermal power stations. The Mission has already published the Standard Operating Procedure for co-firing and Model Contract Document for pellet procurement in order to facilitate the thermal power plants.
The pellet manufacturing sector is also being encouraged to bridge the demand-supply gap. There are now dedicated financial assistance schemes for biomass pellet manufacturing units from MNRE and Central Pollution Control Boards as well as easy availability of finance options from banks.
Priority lending
The government has now identified Biomass pellet manufacturing under Priority Sector Lending (PSL) guidelines of the RBI. The biomass pellets can also be procured through the government e-Marketplace by the thermal power plants.
The government is also working to resolve various regulatory hurdles in the sector like providing a Single Window for statuary clearances via NSWS and working on methodology for price assurance/benchmarking of biomass pellets.
In addition, SAMARTH mission has successfully executed training events.
Supply issues
According to the industry, a number of surveys of power plants have shown that there are concerns among power plant managers over the steady and consistent supply of biomass.
The availability and quality of biomass vary across regions in India. While some regions have an abundance of biomass, others face a shortage. Moreover, the quality of biomass also varies, which can affect its combustion efficiency and emissions. Therefore, there is need to ensure a steady supply of high-quality biomass to power plants.
Biomass pellets are difficult to store at plant locations for extended periods of time because they quickly collect moisture from the air, making them unusable for co-firing. Only pellets with a moisture content of less than 13-14 per cent typically can be burned alongside coal.
According to Gaurav Kedia, Chairman Indian Biogas Association, “Yes, in principle, biomass co-firing reduces emissions from outdoor crop residue burning and decarbonises the process of burning coal to produce energy. In fact, in her Budget address in 2022, Finance Minister Nirmala Sitharaman said that switching from coal to biomass in coal-based power plants could cut carbon dioxide emissions by 38 million tonne.”
But, India needs to focus only on surplus biomass. Biomass shouldn’t start competing with other existing assets. Surplus biomass can be identified by looking at the status — if it is being burned, decayed, or dumped, he pointed out.
Logistics challenges
The transport and storage of biomass can be challenging, especially in areas where infrastructure is inadequate. This requires specialised equipment and facilities, which can increase the cost of biomass co-firing. So, infrastructure and logistics need to be built so that biomass can be moved and stored more efficiently.
Also, Biomass co-firing requires specialised equipment, such as biomass grinders, conveyors, and storage systems. Additionally, power plants need to be retrofitted to enable biomass co-firing. Therefore, there is a need to develop and deploy the necessary technology and equipment for biomass co-firing.
The need of the hour is a robust regulatory framework that offers incentives and support for biomass co-firing which must be the foundation for the biomass co-firing policy. Also, a distinct, competitive market must exist for biomass in order to ensure equitable pricing and distribution.
The government on its part has formed five working groups under the mission and these are inter-ministerial. The nuts and bolts are being tightened, but still need a push. It is a local fuel and even farmers make money. Also, unlike ethanol programme which has oil marketing companies working as a platform, there is no intermediary here.
The Biomass Co-firing Policy needs to be backed by a strong policy and regulatory framework that provides incentives and support for biomass co-firing. Also, there needs to be a clear, competitive market for biomass to make sure that prices and distribution are fair.