Biodiesel Program in India – An Analysis

The Government of India approved the National Policy on Biofuels in December 2009. The biofuel policy encouraged the use of renewable energy resources as alternate fuels to supplement transport fuels (petrol and diesel for vehicles) and proposed a target of 20 percent biofuel blending (both biodiesel and bioethanol) by 2017. The government launched the National Biodiesel Mission (NBM) identifying Jatropha curcas as the most suitable tree-borne oilseed for biodiesel production.

The Planning Commission of India had set an ambitious target covering 11.2 to 13.4 million hectares of land under Jatropha cultivation by the end of the 11th Five-Year Plan. The central government and several state governments are providing fiscal incentives for supporting plantations of Jatropha and other non-edible oilseeds. Several public institutions, state biofuel boards, state agricultural universities and cooperative sectors are also supporting the biofuel mission in different capacities.

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Biofuels are increasingly being used to power vehicles around the world

State of the Affairs

The biodiesel industry in India is still in infancy despite the fact that demand for diesel is five times higher than that for petrol. The government’s ambitious plan of producing sufficient biodiesel to meet its mandate of 20 percent diesel blending by 2012 was not realized due to a lack of sufficient Jatropha seeds to produce biodiesel.

Currently, Jatropha occupies only around 0.5 million hectares of low-quality wastelands across the country, of which 65-70 percent are new plantations of less than three years. Several corporations, petroleum companies and private companies have entered into a memorandum of understanding with state governments to establish and promote Jatropha plantations on government-owned wastelands or contract farming with small and medium farmers. However, only a few states have been able to actively promote Jatropha plantations despite government incentives.

Key Hurdles

The non-availability of sufficient feedstock and lack of R&D to evolve high-yielding drought tolerant Jatropha seeds have been major stumbling blocks in biodiesel program in India. In addition, smaller land holdings, ownership issues with government or community-owned wastelands, lackluster progress by state governments and negligible commercial production of biodiesel have hampered the efforts and investments made by both private and public sector companies.

Another major obstacle in implementing the biodiesel programme has been the difficulty in initiating large-scale cultivation of Jatropha. The Jatropha production program was started without any planned varietal improvement program, and use of low-yielding cultivars made things difficult for smallholders. The higher gestation period of biodiesel crops (3–5 years for Jatropha and 6–8 years for Pongamia) results in a longer payback period and creates additional problems for farmers where state support is not readily available.

The Jatropha seed distribution channels are currently underdeveloped as sufficient numbers of processing industries are not operating. There are no specific markets for Jatropha seed supply and hence the middlemen play a major role in taking the seeds to the processing centres and this inflates the marketing margin.

Biodiesel distribution channels are virtually non-existent as most of the biofuel produced is used either by the producing companies for self-use or by certain transport companies on a trial basis. Further, the cost of biodiesel depends substantially on the cost of seeds and the economy of scale at which the processing plant is operating.

The lack of assured supplies of feedstock supply has hampered efforts by the private sector to set up biodiesel plants in India. In the absence of seed collection and oil extraction infrastructure, it becomes difficult to persuade entrepreneurs to install trans-esterification plants.

Matthew Stone, Renovare Fuels: Next Generation Renewables

Renewable fuels are playing an ever-increasing role in the UK transport industry. Driven by the UK Government’s efforts to reduce Greenhouse Gas (GHG) emissions, the Renewable Transport Fuel Obligation (RTFO) stipulates that, from January 2021, fuel suppliers will be required to increase the proportion of renewables within their total sales.

Led by a management team of experienced professionals that includes Business Development Director Duncan Clark, Renovare Fuels could play a pivotal role in helping UK fuel companies meet the strict new criteria being imposed.

renewable-diesel

Biofuels are increasingly being used to power vehicles around the world

The UK transport industry generated 28% of total UK pollution in 2019, making it the country’s most polluting sector. The robust RTFO scheme was implemented to drive sustainability in the industry through the reduction of GHG emissions.

Under the scheme, transport fuel providers who provide more than 450,000 litres of petrol, gas oil or diesel must incorporate a prescribed amount of renewable fuels within their overall fuel sales, or forfeit a per-litre penalty.

Under the terms of the RTFO, the amount of renewables fuel suppliers must include in their products rises every year. The strategy forms an integral part of UK Government efforts to reduce the amount of carbon produced by the transport sector – a vital element of bringing total GHG emissions to net zero by 2050. Fuel suppliers will be required to increase development of renewable fuel components to at least 10.68% of their total supply levels in 2021.

Introduced in the 1980s, standard renewables like biodiesel and bioethanol produce similar levels of carbon dioxide emissions to fossil fuels when they are burned. However, rather than being produced from finite resources, they are derived from biomass feedstocks. These are typically grown specifically for the production of fuel or produced using waste products from other industries, such as agriculture and food. Although biomass produces CO2 when burned, this is offset by carbon dioxide absorbed by feedstock during the production process, effectively creating a closed loop process.

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Lower GHG emissions and empowerment of rural economy are major benefits associated with bioethanol

In 2019, advanced development fuels were added to the terms of the RTFO, enabling fuel companies to integrate next generation biofuels into market supplies in addition to standard renewables.

With the exception of segregated fats and oils and renewable fuels of non-biological origin (RFNBOs), development fuels are synthesised from residual feedstock or sustainable waste. To qualify under the scheme, a development fuel must have a GHG saving of at least 60% more than that offset by fossil fuels. Renewable diesel must be blendable at a rate of at least 25% with conventional diesel, while still meeting the EN590 fuel specification. Fuels which possess these superior carbon neutrality credentials are eligible for double the amount of Renewable Transport Fuel Certificates per kilo or litre compared with standard renewable fuels.

As Matthew Stone – Renovare Fuels’ Chairman – explains, development biofuels overcome many limitations associated with first-generation biofuels. From a physical and chemical perspective, Renovare Fuels’ next generation biofuels are closer to conventional fossil fuels, particularly in terms of performance and end product quality, while producing just three grams of CO2 per megajoule of biomass – which is just 3% of that generated by fossil fuels.

Standard biofuels have a limited impact in reducing GHG emissions, chiefly due to the type of feedstock used and low fuel quality. In contrast, development fuels are much more efficient, since they are specifically designed to eliminate emissions throughout the production process, as well as radically reducing those produced when used as an end fuel. As Matthew Stone points out, next generation development fuels show vast potential, supporting the UK Government’s GHG reduction goals.