National Policy on Biofuels

News: The government had notified new National Policy on Biofuels in 2018.


About National Biofuel Policy 2018:

Salient Features:

  • The Policy categorises biofuels as:
    • Basic biofuels- First Generation (1G) bioethanol and; biodiesel
    • Advanced Biofuels- Second Generation (2G) ethanol, Municipal Solid Waste (MSW) to drop-in fuels, Third Generation (3G) biofuels, bio-CNG etc.
  • It expands the scope of raw material for ethanol production by allowing use of Sugarcane Juice, Sugar containing materials like Sugar Beet, Sweet Sorghum, Starch containing materials like Corn, Cassava, Damaged food grains like wheat, broken rice, Rotten Potatoes, unfit for human consumption for ethanol production.
  • It allows use of surplus food grains for production of ethanol for blending with petrol with the approval of National Biofuel Coordination Committee.
  • Under the policy, a viability gap funding scheme for 2G ethanol Bio refineries of Rs.5000 crore in 6 years in addition to additional tax incentives, higher purchase price as compared to 1G biofuels will be provided
  • It encourages setting up of supply chain mechanisms for biodiesel production from non-edible oilseeds, Used Cooking Oil, short gestation crops.

Additional Information:

Biofuel: Bio fuels are liquid/ solid or gaseous fuels produced from biomass resources. They are used in place of, or in addition to, diesel, petrol or other fossil fuels for transport, stationary, portable and other applications.

Classification of Biofuels:

  • First generation biofuels: It refers to the fuels that have been derived from sources like starch, sugar, animal fats and vegetable oil.
  • Second generation biofuels – These are produced from non-food crops, such as cellulosic biofuels and waste biomass (stalks of wheat and corn, and wood). Examples include advanced biofuels like biohydrogen, biomethanol.
  • Third generation biofuels – These are produced from specially engineered energy crops such as algae.
  • Fourth-Generation Biofuels: It uses genetically modified (GM) algae to enhance biofuel production.

Indian Government Schemes for Promoting Biofuels:

Pradhan Mantri JI-VAN (Jaiv Indhan- Vatavaran Anukool Fasal Awashesh Nivaran) Yojana

  • The scheme was launched in 2019. It is implemented by Ministry of Petroleum & Natural Gas.
  • The scheme envisages providing financial support to Integrated Bio-Ethanol Projects using lignocellulosic biomass & other renewable feedstock

Sustainable Alternative towards Affordable Transportation (SATAT) scheme:

  • It was launched in 2018. It is implemented by Ministry of Petroleum & Natural Gas.
  • It envisages establishing 5000 Compressed Bio Gas (CBG) plants across the country by 2023.
  • Under this scheme, Oil Public Sector Undertakings have invited Expression of Interest (EoI) for procuring CBG from potential entrepreneurs and has offered an assured price for off take of CBG.

Ethanol Blended Petrol (EBP) programme

  • It was launched in 2003. It is implemented by Ministry of Petroleum & Natural Gas through Oil Marketing Companies (OMCs).
  • Under the programme, OMCs sell ethanol blended petrol with percentage of ethanol up to 10% subject to its availability. OMCs procure ethanol for blending in petrol.