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Biomass Energy in India

Biomass in Indian energy matrix is very important for remote villages and urban clusters with decentralised settlements. Biomass related projects receives an investment of about $ 9251 million every year, leading to electricity generation of 5000 million units. Ministry of New and Renewable Energy (MNRE)  has set the national target is to achieve 10 GW of installed biomass power by 2022

India has a potential of about 18 GW of energy from Biomass. Currently, about 32% of total primary energy used in India is derived from Biomass. More than 70% of the country’s population depends upon biomass for its energy needs. India has ~5+ GW capacity biomass powered plants: 83% are grid connected while the remaining 17% are off-grid plants. The off- grid plants are divided between cogeneration plants that do not utilize bagasse, biomass gasifiers for rural applications and biomass gasifiers for thermal applications in industry. Around 70 Cogeneration projects are under implementation with surplus capacity aggregating to 800 MW.

State Focus
The leading states for biomass power projects are Maharashtra, Uttar Pradesh and Karnataka each one having more than 1 GW of Grid interacted biomass power. Other states with favorable policy and opportunities in Biomass are Punjab and Bihar.


Fiscal Incentives: Biomass Power Generation
MNRE has developed has developed an overarching policy for biomass and bagasse cogeneration. It includes financial incentives and subsidies, both for biomass projects and sugar mills that use this technology. Government gives 10 years Income tax holidays. Concessional customs and excise duty exemption for machinery and components for initial setting up of Biomass power projects. General sales tax exemption is available in certain States. State governments have also instituted their own incentives and subsidies and these initiatives differ across states.

Supply Chain

Even with decades of experience in managing biomass power, still their exists lots of gaps in the supply chain. The main scope for interventions are in collection and mobilization of the raw material to the plant; technical upliftment of the processing units including both bio as well as thermo plants; improving design and engineering aspects, promoting performance monitoring and management systems, conducting feasibility studies and focused research and development.

For further information, feel free to contact:
Deepshikha Sharma -
Rasmus Soltendieck -


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