Thermal power plants in the 300 km radius of Delhi have been directed to increase the use of paddy straw, which is currently burnt in the fields, causing huge air pollution. Farmers had neither any beneficial use of this straw nor a transport network to move it. Now, with air pollution causing serious health hazards, authorities are forced to find methods of disposal. This is one example of how biomass markets are changing in India.

India is boosting its biomass energy production with a $100mn national biowaste programme by augmenting supply chains, providing financial incentives and issuing mandates for thermal power producers to supplement coal with agricultural residues.

Local entrepreneurship, technological innovations and a pressing need to control air pollution are also increasing generation of biomass energy, which according to the IEA’s India Energy Outlook 2021 could supply 15% of the country’s total energy demand, but which only currently supplies 2.3%.

‘Co-firing of biomass in coal-based power plants is a key policy of the government towards energy security, reduced use of fossil fuels and at the same time to increase income of farmers,’ said Raj Kumar Singh, former Minister of Power and New and Renewable Energy, in a press note in June 2023.

Currently 47 thermal power plants in India supplement coal feedstocks with agro-residue. The amount of these supplies will rise, with the Ministry of Power mandating them to use 5% biomass in feedstock mixes from the financial year ending March 2025, to be increased to 7% during the year to March 2026, said an August 2023 Indian government communiqué.

According to the Ministry of Power, the country’s installed capacity of biomass power, bagasse (crushed sugar cane and sorghum residue) cogeneration and non-bagasse cogeneration plants was 10.23 GW last August (2023). India’s total power generation capacity is 428.3 GW, which includes 70.1 GW of solar energy generation capacity, reports the Ministry for New and Renewable Energy.

However, with comparatively high costs (which usually exceed power revenues), Indian biomass power is punching below its weight. According to the Sardar Swaran Singh National Institute of Bio-Energy, Punjab, 755mn t/y of agro-biomass residue are produced in the country. However, the Indian government said last November (2023) that it had statistics only of 300,000 tonnes being consumed for power for that year thus far, while orders for 3.1mn tonnes of biomass pellets had been placed.

Establishing financially-viable biomass supply chains is a major challenge as the product is seasonal, voluminous and of low calorific value. Dr Gururaja Rao Sridhar, Director General of the Sardar Swaran Singh Institute explains: ‘Supply chains are dependent on crop harvesting practices, transportation distance, pre-processing requirements, storage availability and residual biomass price and the quality degrades with time.’

Paddy straw
Paddy straw is a case in point. It is one of the most important agro-residues in India, with production exceeding 184mn t/y. However, according to Sridhar, it is a difficult feedstock to manage for energy generation applications because it has high ash and low calorific value in comparison to residue from wheat, cotton mustard and maize.

Laxit Awla, CEO at New Delhi-based renewable and green energy company SAEL Industries, says that the principal barriers to biomass energy are the capital cost of the boiler and turbines in a biomass power plant, as well as technology selection and supply chain issues. ‘It is not [like] solar, where you buy the land, put the plant and that’s it,’ he comments.

Indeed, according to Awla, the cost of electricity produced by SAEL is more than INR7 ($0.08) per kWh, which is higher than the price for household electricity and far higher than the cost of generating solar power. And that means government support is needed, with power tariffs generally negotiated with state-owned power distribution companies that sign long-term power purchase agreements of 15 years or more with suppliers.

Furthermore, India’s Ministry of New and Renewable Energy has earmarked INR8.58bn ($103mn) for April 2021 to March 2026 for assisting new and large plants making biogas, bio-CNG (compressed natural gas) and biomass-based power, along with manufacturers of bio-pellets and briquettes used in power plants. It is investing partly because biomass delivers additional benefits beyond security of energy supply. ‘Biomass-based energy is promoted by the Indian government due to its ability to mitigate environmental risks,’ notes Awla.

Stubble burning
A good example is stubble burning. The cropping pattern in the large grain-producing states of Punjab and Haryana leaves only a few weeks’ window in October and November to collect all the paddy residue. As the farmers of the region rush to prepare the fields for their next wheat crop, most of them burn the harvested paddy stumps, which have no economic value to them if biomass purchases are not made. These fires cause hazardous air pollution across northern India, causing serious health issues in the capital New Delhi and neighbouring cities. This is pushing the central government to explore policies that will stop paddy waste burning, including education campaigns and criminalisation. Creating a secondary biomass market is another solution to prevent burning.

It also helps companies tap international finance. SAEL has secured $1bn in funds in the past year from various financial institutions, including the Norwegian Investment Fund, the US International Development Finance Corporation, the Asian Development Bank and the Mumbai-based Tata Capitals Cleantech Finance. SAEL will use the funds to finance its renewable energy portfolio, including the generation of biomass energy using agricultural residue. SAEL Industries already operates eight biomass consuming power plants with a capacity ranging from 10 MW to 18 MW.

Another plus point for governments seeking political payback for subsidies, however, is that biomass power plants also generate jobs. While a 50 MW solar plant employs about 50 people, a 15 MW biomass power plant provides direct employment to 250 people and to another 2,000 in the biomass supply chain, says Awla.

These incentives are encouraging Indian companies to improve the biomass power supply chain. A good example of an innovative company is Shree Ganesh Edibles in Khanna, Punjab, which operates a 15 MW plant by consuming 225,000 t/y of paddy straw. Charanjeet Singh, Fuel-in-charge Manager of the plant, says that its power is bought by six companies including a steel manufacturing plant with power consumption of 12 MW. Power from this plant costs the group INR4.5 ($0.05)/kWh, while the grid power for industries is priced between INR7 ($0.8) and INR12 ($0.15).

The biomass for the power plant is procured from farms located within a 30 km radius.

Farmers’ views
Jagdev Singh Sarpanch, one of the farmers, is also a campaigner against paddy stump burning in his district. ‘In 2021, I called government officials to discuss the issue with the fellow farmers in my village and it was decided that none of us will light fire to the fields,’ he explains. Instead, in the 2023 season, with the help of 100 employees, Sarpanch collected 9,000 tonnes of paddy straw from four villages.

Sarpanch owns five machines to cut and bale the paddy straw. He earns INR1,650 ($20) per tonne of dry straw, with mechanisation important for reducing overheads. ‘Transportation cost is the key here as half of the revenue is spent on recurring expenses like wages and fuel,’ he says.

He also has innovated by removing the INR1,000 ($12) per acre charge for removing the paddy straw.

Farmers are certainly happy. ‘This system is very good as the field is cleared very neatly and the straw is used for some good purpose,’ says Manjit Singh, a farmer working with Sarpanch for the last four years. About three tonnes of straw is harvested from one acre and every village has 1,000 to 1,500 acres of land. However, farmers also have some complaints, as ‘sometimes the aggregators do not respond quickly enough, and our next sowing gets delayed’, he adds.

‘This [biomass] system is very good as the field is cleared very neatly and the straw is used for some good purpose,’ – Manjit Singh, farmer

That highlights the need for an organised biomass collection structure with increased efficiency. There are already examples of such work. BiofuelCircle, a Pune, Maharashtra-based online platform for trading biofuels and biomass, has been operating since September 2021 in several Indian states and according to its CEO and co-founder Suhas Baxi, it is already trading about 50,000 tonnes of biomass every month.

‘We have more than 1,200 registered buyers and sellers, along with 20,000 farmers who directly offer biomass on our platform,’ Baxi says.

To collect biomass from the fields, local tractor owners with ideal capacity are onboarded to the company’s online platform ‘exactly the way Uber operates’. For a cluster of 10 villages, the biomass storage system needs one warehouse of 10,000 tonnes capacity.

The biomass collected in warehouses is made available to palette manufacturers and biomass companies through the trucking companies who are also joining the system. ‘More than 50 varieties of biomass are traded on our platform, including paddy straw, groundnut shells, sugarcane trash and coffee husk,’ says Baxi.

The price points on the platform are slightly higher than the ones offered by the Khanna business. Baxi notes that the cost of procuring biomass at the warehouses is about INR2,000 ($24)/t, and to the end customer at a distance of 50 km away is around INR3,000 ($37)/t.

If such innovation persists and biomass prices are reduced, the current reliance of this sector on government subsidies may be cut – perhaps clearing a road to economic sustainability.

• Further reading: ‘Bioenergy turns up the heat in the UK’. The UK’s journey on the road to net zero will be powered in part by sustainable bioenergy according to the government’s Biomass Strategy. But how much of this zero-carbon energy can the UK produce and how much is needed as part of the energy mix? 
• Burning forest biomass instead of fossil fuels and capturing some of the carbon emitted seems to be a win-win situation. However, that is not necessarily the case, according to Professor Michael Norton from the European Academies Science Advisory Council (EASAC), who argues that uncertainties around carbon capture plant performance and, particularly, varying carbon payback periods mean that nothing is certain.