Government approves biofuel policy

Cabinet has cleared the national biofuel policy that aims at developing the native biomass feedstock for biofuel production. Ministry of new and renewable energy (MNRE), which coordinated for biofuel development previous year, has chalked out the policy draft.

A plan to establish National Biofuel Coordination Committee has also received approval from the government. To be supervised by Prime Minister, the committee will be responsible for providing policy guidance. There would be a Biofuel Steering Committee as well. This committee will be headed by the cabinet secretary. It will ensure the implementation of the policy.

In a statement, MNRE said “The Indian approach to biofuels is based solely on non-food feedstock to be raised on degraded or waste lands that are not suitable for agriculture, thus avoiding a possible conflict of fuel versus food security”.

By promoting biofuels, the energy demand of India can be met in an environment-friendly way. This would also make it less dependent on the import of fossil fuels.

According to the policy, the target is to blend 20 % biofuels including biodiesel and bioethanol by the year 2017. 10 % blending of ethanol and petrol had already been approved by the government and became effective from October previous year.

The biofuel policy also talks about offering financial incentives consisting of grants and subsidies for second version of biofuels such as cellulosic ethanol and algal biodiesel. The policy says “if it becomes necessary, a National Biofuel Fund could be considered”.

It is also contained in the policy that the Minimum Support Price (MSP) for non-edible oilseeds would be declared with timely revision to offer reasonable price to the cultivators. Bioethanol and biodiesel’s Minimum Purchase Price (MPP) would also be declared with timely revision.

Business Standard

December 25, 2009