Ministry of Petroleum and Natural Gas is mooting a massive Rs 1.75 lakh crore investment in a bid to set up about 5,000 biogas plants using agricultural residue, cattle dung and municipal solid waste as raw materials, reports The Economic Times.
The state-owned fuel marketing companies will purchase the biogas from these plants at a rate of Rs 46 per kg, said Union Minister for Petroleum and Natural Gas Dharmendra Pradhan. This will bring down India's dependence on imports for meeting energy demand.
India imports 81 per cent of its oil requirements, and this move to extract biogas from biomass sources like agriculture residue, cattle dung, sugarcane press mud, municipal solid waste and sewage treatment left over is aimed at bringing down the imports.
"We are inviting Expression of Interest (EoI) from producers to offer Compressed Bio-Gas (CBG) that oil companies can use as a fuel for transportation,"
CBG is touted to be a suitable replacement for compressed natural gas (CNG) currently used in transportation.
Rs 46 is more than that of the domestic natural gas price; moreover, a hundred per cent off-take guarantee is also on offer, said Pradhan.
India imports 56 per cent of its natural gas consumption where 146 million standard cubic meters is the per day consumption.
There is potential to produce 62 million tonnes of CBG from wastes if so the share of natural gas in energy basket would rise by 6-7 per cent.
About 5,000 CBG plants are proposed to be established in the private sector, and it is reported to generate 75,000 direct jobs, he said.
Investment of around Rs.1.75 lakh crore would be required, of which Rs 70,000 crore investment would be needed for the establishment of the city gas distribution network (CGD) in 86 cities auctioned in the latest round. The total investment is reported to touch Rs 2.5 lakh crore, similar to the telecom sector, said the minister.
The newly established CGD network would help in expanding the number of CNG stations from 1,500 to 10,000 in five years and multiplying the household piped natural gas connections to 2.5 crore. The first CBG plant could roll-out within this quarter.
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