India Emerges as world’s 3rd Largest Biofuel Producer

Syllabus: GS3/ Economy

Context

• According to the Minister of Petroleum and Natural Gas, India has emerged as the world’s third-largest biofuel producer.
  • India has achieved 19.6% ethanol blending in petrol as of January and is on track to reach 20%, five years ahead of its original 2030 target.

What are Biofuels?

• Biofuels are alternative fuels made from plant and plant-derived resources.
  • Example: Bioethanol, Biodiesel, Green diesel, Biogas etc.
• Generations of Biofuels: Biofuels can be categorized into different generations based on the feedstocks used and the processes involved in their production.
  • First Generation: They are made from food crops like corn, sugarcane, wheat, and vegetable oils.
  • Second Generation: They are made from biomass extracted from agricultural waste or waste plant material like non-food feedstocks corn stover.
  • Third Generation: These are often derived from algae and other microorganisms. 
  • Fourth Generation: They are made from genetically modified species crops. These include synthetic biology and microorganisms engineered to produce specific biofuels.

National Policy on Biofuels, 2018

• The National Policy on Biofuels 2018 (amended in 2022) provides a framework for increasing the use of biofuels in India to enhance energy security.
  • It will allow more feedstocks for production of biofuels.
  • The Policy allows use of surplus food grains for production of ethanol for blending with petrol with the approval of National Biofuel Coordination Committee.
  • The policy will advance the ethanol blending target of 20% blending of ethanol in petrol to Ethanol Supply Year (ESY) 2025-26 from 2030.
  • It will promote the production of biofuels in the country, under the Make in India program, by units located in Special Economic Zones (SEZ)/ Export Oriented Units (EoUs).

Significance of Biofuel Expansion

• Economic Growth: The initiative has also saved India approximately Rs. 85,000 crore in foreign exchange by reducing crude oil imports.
• Environmental Benefits: The shift towards ethanol-based fuels has led to a significant reduction in CO2 emissions, which is equivalent to planting 175 million trees.
  • It promotes a circular economy by converting waste into energy.
• Benefits for Farmers: Ethanol production provides an alternative market for sugarcane, maize, and surplus food grains, boosting rural incomes.
  • It strengthens the sugar industry, making it less dependent on government subsidies.
  • During the Ethanol Supply Year 2023-24, Ethanol Blended Petrol (EBP) programme helped in payment of approximately Rs 23,100 crore to the farmers.

Challenges in Biofuel Expansion

• Feedstock Constraints: Sugarcane-based ethanol is water-intensive, putting pressure on water resources.
  • Slow adoption of second-generation (2G) biofuels, as technology is still evolving and expensive.
• Infrastructure Issues: Limited ethanol blending infrastructure, such as dedicated pipelines and storage facilities.
  • Inadequate refineries and blending stations, leading to supply chain inefficiencies.
  • There are challenges in transporting ethanol, as it is highly flammable and requires separate logistics.

Government Efforts for Biofuel Expansion

• Pradhan Mantri JI-VAN Yojana (Jaiv Indhan – Vatavaran Anukool fasal awashesh Nivaran Yojana): It promotes 2G ethanol production from agricultural waste and residues.
• GOBAR-Dhan Scheme (Galvanizing Organic Bio-Agro Resources Dhan): It promotes biogas and bio-CNG production from cattle dung and organic waste.
• SATAT Scheme (Sustainable Alternative Towards Affordable Transportation): It promotes Compressed Bio-Gas (CBG) production as a fuel alternative, targets the establishment of 5,000 CBG plants by 2025.

Way Ahead

• There is a need to strengthen financial incentives for advanced biofuels like 2G, 3G.
• Expand biogas and bio-CNG adoption in rural and urban transport.
• Invest in biofuel R&D for cost reduction and efficiency improvement.

Source: ET