MNRE’s Biomass-Based Cogeneration Program Extended by a Year

The program was announced in 2018 to provide financial assistance to bagasse and non-bagasse-based cogeneration projects

September 6, 2020


The Ministry of New and Renewable Energy (MNRE) has extended the validity of its biomass-based cogeneration program.

The program has been extended until March 31, 2021, or until the recommendations of the 15th Finance Commission come into effect, whichever comes first. The program was set to end in March 2020.

In its notice, the MNRE said that the program to support the promotion of biomass-based cogeneration in sugar mills and other industries would be extended without any change in scope, nature, coverage, and without creating any additional posts.

The Ministry added that the details of the program components, implementation methodology, financial assistance, the release of funds, and monitoring mechanism would remain unchanged. The expenditure for this program will be met with the budget provisions under the bio-power Head.

When the project was announced in 2018, the Ministry said it would provide central financial assistance (CFA) for projects utilizing biomass like bagasse, agriculture-based industrial residue, crop residues, wood produced through energy plantations, weeds, and wood waste produced in industrial operations. It promised ₹2.5 million (~$33,727)/MW of CFA for bagasse cogeneration projects and ₹5 million (~$67,454)/MW for non-bagasse cogeneration projects.

Last year, MNRE issued a notice clarifying the eligibility of power generated from the co-firing of biomass in thermal power plants as renewable energy. The government said that the power generated from the co-firing of biomass in thermal power plants is renewable energy and is eligible for meeting the non-solar renewable purchase obligations. Also, the Central Electricity Regulatory Commission was requested to develop a procedure for quantifying the energy produced from biomass in biomass co-fired thermal power plants reliably and accurately.

Earlier, the Ministry invited Expression of Interest to assess the potential of biomass power and bagasse cogeneration in India. In 2010-11, The Indian Institute of Science had conducted a study to evaluate the biomass power potential and estimated 18,000 MW to be the potential for biomass power in the country.

Nithin Thomas is a staff reporter at Mercom India. Previously with Reuters News, he has covered oil, metals and agricultural commodity markets across global markets. He has also covered refinery and pipeline explosions, oil and gas leaks, Atlantic region hurricane developments, and other natural disasters. Nithin holds a Masters Degree in Applied Economics from Christ University, Bangalore and a Bachelor’s Degree in Commerce from Loyola College, Chennai. More articles from Nithin.