Cabinet approves National Policy on Biofuels-2018

New Delhi : The Union Cabinet chaired by Prime Minister Narendra Modi approved the National Policy on Biofuels - 2018, on Wednesday.Drafted in 2009 by the Ministry of New and Renewable Energy, the policy aims at promoting the use of biofuels in India, amid rising developments on the same at a global level.

The new policy, which was approved by the Cabinet, expands the scope of raw material for ethanol production by allowing use of sugarcane juice, sugar-containing materials like sugar beet, sweet sorghum, and starch-containing materials like corn, cassava, damaged food grains like wheat, broken rice, and rotten potatoes, unfit for human consumption for ethanol production.

The policy also takes into account the risk involved in inadequate prices for produce, and therefore allows the use of surplus food grains for production of ethanol for blending with petrol with the approval of the National Biofuel Coordination Committee.

With a thrust on advanced biofuels, the policy indicates a viability gap funding scheme for 2G ethanol biorefineries of Rs.5000 crore in six years, apart from additional tax incentives, and higher purchase price as compared to 1G biofuels. The policy also encourages the setting up of supply chain mechanisms for biodiesel production from non-edible oilseeds, used cooking oil and short gestation crops.

With the new policy in place, the Centre envisions a reduction in import dependency, cleaner environment through reduction of reducing crop burning and conversion of agricultural residues/wastes to biofuels, reduction in greenhouse gas emissions and other health benefits.

Furthermore, the policy is aimed at ensuring more efficient municipal solid waste (MSW) management, using technologies which can convert waste/plastic, MSW to drop in fuels.
By adopting 2G technologies, agricultural residues/waste which otherwise are burnt by the farmers can be converted to ethanol and can fetch a price for these waste if a market is developed for the same. Also, with farmers at a risk of not getting appropriate price for their produce during the surplus production phase, the conversion of surplus grains and agricultural biomass can help in price stabilisation.