Ministry Sets Price Benchmarks for Biomass Pellets in Western and Northern Regions

The notification specifies biomass fuel prices for a year, starting November 8, 2023


The Ministry of Power (MoP) has revised the Biomass Co-Firing Policy to benchmark the prices for biomass pellets utilized in co-firing at thermal power plants. The initiative aligns with the broader goal of incorporating cleaner and more eco-friendly energy sources into the country’s power generation landscape.

The benchmark prices for non-torrefied biomass pellets in the Northern Region (excluding NCR) have been set at ₹2.27 (~$0.027) per 7,000 kcal. This price excludes GST and transportation costs at the pellet manufacturing plant site.

The specified pellets must also maintain a moisture content below 14% and a Gross Calorific Value (GCV) between 2,800-4,000 kcal/kg.

Similarly, benchmark prices for non-torrefied biomass pellets in the Western Region have been set at ₹2.24(~$0.026) per 7,000 kcal.

The moisture content and GCV criteria remain consistent, ensuring the quality and efficiency of the biomass pellets.

The Ministry issued the ‘Modification of Revised Policy for Biomass Utilization for Power Generation through co-firing in coal-based power plants’ in June this year. The objective is to create an environment that encourages the development and sustainability of biomass pellet supply chains, contributing to a greener energy mix.

Recognizing the importance of stabilizing biomass pellet prices, a committee on the price benchmarking of biomass pellets was also set up and tasked with conducting region-wise price benchmarking of biomass pellets to address the existing volatility in raw biomass prices and expedite the capacity addition of pellet manufacturing.

The Price Benchmarking Committee conducted a comprehensive study of the Northern and Western regions.

As per the committee’s suggestion, the biomass fuel price has been specified for one year, starting November 8, 2023.

Power utilities have been asked to adhere to the specified rates for biomass pellets to implement these benchmark prices successfully.

This strategic move is expected to stabilize prices and encourage the adoption of biomass co-firing practices, contributing to a cleaner and more sustainable energy future.

Last July, the Ministry noted that biomass co-firing in 35 thermal power plants across India had reduced COemissions by 100,000 tons. About 80,525 tons of biomass had been co-fired in 35 thermal power plants with a cumulative capacity of 55,335 MW until July 24, 2022.

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