Indian Oil Companies to invest Rs10,000 crore for Bio-CNG plants

State-run oil marketing companies Indian Oil Corporation (IOC); Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) plan to spend nearly Rs10,000 crore to set up Bio-CNG plants across India to promote clean fuel and reduce the country’s fuel import bill.

The Bio-CNG plan will be detailed in the national biofuels policy to be released this month. The policy will detail a Rs1 trillion investment opportunity under Waste-to-Wealth projects.

Bio-CNG is a purified form of biogas with over 95% pure methane. It is similar to natural gas in its composition (97% methane) and energy potential. While natural gas is a fossil fuel, Bio-CNG is a renewable form of energy produced from agricultural and food waste.

IOCL is taking the lead in terms of setting up plants for generation of Bio-CNG so that farmers can supply biomass instead of burning it. IOCL will buy back Bio-CNG and sell the same.

This January, IOCL signed a memorandum of understanding (MoU) with the Punjab government to set up biogas and Bio-CNG plants in the state.

IOCL will be setting up a plant in Haryana shortly. In 2018, 42 plants will become operational which will be scaled up to 400 over the next three to four years.

These Bio-CNG plants would be multiple in number and would be phased evenly so that 100-150 tonne per day rice straw becomes available. Converting bio-mass to compressed biogas and bio-CNG will not only help curb the menace of stubble burning but also create additional income for farmers.

IOCL will execute the plan in north India, BPCL and HPCL will replicate the model in western, southern and eastern India.