The Ministry of Petroleum and Natural Gas has amended the disbursal pattern of financial assistance for compressed biogas (CBG) projects to procure biomass aggregation machinery.

According to the amendments, CBG plants utilizing more than 50% biomass as feedstock for a 2 tons per day (TPD) capacity project are eligible for a financial support of ₹9 million (~$104,970).

All existing and upcoming CBG projects must use at least 50% or a minimum of 3,000 MT of biomass as feedstock annually to avail of the subsidy.

CBG plants utilizing less than 50% biomass as feedstock, but more than 3,000 MT of biomass annually, can receive financial support of ₹9 million (~$104,970) per 3,000 MT of agri-residue requirement.

The Ministry provides financial assistance for a maximum of 50% of the procurement cost of a biomass aggregation machine, up to ₹9 million (~$104,970) per project, whichever is lesser.

The CBG project must have installed or proposed CBG production capacity of at least 2 TPD.

To be eligible for a subsidy, the CBG projects under construction must have achieved at least 25% of their progression. However, at least 50% of the project must be completed before financial assistance is disbursed.

The CBG projects must not have availed of any financial assistance under any other government or state program.

The amendments also state that when applying for financial assistance, CBG producers must specify whether the machinery or equipment is proportional to the collected biomass. They must also list the available machinery and equipment.

After the application for financial assistance is approved, CBG producers can avail of 10% of the financial assistance as a mobilization advance, provided an equivalent bank guarantee is provided. The bank guarantee must be valid for a year. However, the financial aid will be extended per the project management agency’s requirements.

The bank guarantee will be forfeited if the project developers fail to comply with the program guidelines during the project’s execution.

CBG producers can apply for the financial assistance release in a phased manner within two years of receiving approval for their aid application.

Recently, the Ministry of New and Renewable Energy revised the guidelines for the National Biomass Program for the financial years 2022 to 2027 (Phase-I). These amendments aim to promote cleaner energy solutions, ease of doing business, and accelerate the adoption of biomass technologies across India.

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