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The Implications of India’s Revised Roadmap for Biofuels: A Lifecycle Perspective

BioRefineries/Renewable Fuel Production, Business News/Analysis, Farming/Growing, Feedstocks, Field/Orchard/Plantation Crops/Residues, Funding/Financing/Investing, History of Advanced Biofuels, India, Infrastructure, Not Agriculture, Opinions, Policy, Sustainability
March 8, 2022

by Promit Mookherjee (Observer Research Foundation)  Transport activity in India has increased more than sevenfold over the last two decades, its gasoline-fuelled pathway leading to a rapid rise in negative environmental externalities. To decouple the sector’s growth from high emissions, policymakers are scaling up efforts to deploy cleaner fuels for the sector; in particular, liquid biofuels have received a significant push. However, while biofuels help lower emissions at the point of use, their lifecycle impacts are heavily dependent on the biomass pathway adopted. Thus, the environmental and social benefits of biofuels are closely linked to the intricacies of the broader agricultural and economic system. This brief assesses India’s current biofuel pathway from a lifecycle perspective, identifies the gaps in the present policy, and proposes a long-term sustainable strategy.

Indian Approach to Biofuel Production

In India, the Ethanol Blending Programme in 2003 was the first significant policy step related to liquid biofuels. It mandated a five-percent blending rate for ethanol in petrol for nine states and four union territories, which was extended to the whole country in 2006. The Biofuel Policy, implemented in 2009, was more ambitious, mandating a 20-percent blending rate for both ethanol and biodiesel by 2017. The 2009 policy also moved beyond molasses-based ethanol production to the direct use of sugarcane juice.

Despite these measures, ethanol production remained low in the ensuing years. Issues in the sugarcane supply chain prevented production, and oil-marketing companies were unable to get bids for most of the amount offered for purchase. This prompted a slew of measures in the next few years, including the reintroduction of administered minimum support price and the opening up of alternate routes for ethanol production. By 2018, blending rates reached around four percent, followed by a faster uptake in the subsequent years. As of 2021, the Government of India claims a blending rate of 8.1 percent.[9]

The 2009 Policy also outlined a clear pathway for biodiesel production, utilising non-edible oils—specifically, Jatropha Curcus. A large-scale plantation programme was envisaged, focused exclusively on government/community wasteland and degraded/fallow land in forest and non-forest areas. This approach is distinct from other countries, and the Policy provided incentives for non-edible oilseed production as well as guaranteed purchase prices and incentives for setting up expeller units and biodiesel plants. However, the pathway ran into several issues. The oil yield from the Jatropha plant, as well as the required levels of fertilisers and pesticides, fell significantly short of the projections. Indeed, by 2018, a substantial portion of biodiesel production was using multiple feedstocks, not just Jatropha. At present, the biodiesel blending rate in India continues to be as low as 0.1 percent.

The latest update to the Biofuel Policy was made in 2018 and aims at achieving 20-percent blending rate for ethanol and five percent for diesel by 2030. In line with the previous approach, the Policy reiterated the need for a biofuel production pathway dependent on 2G technologies using waste biomass. Thus, the 2018 Policy also focuses on improving research in 2G technologies and developing sustainable solutions in the long run.corn/

However, in 2021-22, there has been a pivot from the policy articulated in 2018. The GoI has announced a scaling up of its ethanol blending ambitions—most notably, the deadline for achieving a 20 percent blending rate for ethanol has been set at 2025. To enable faster transition, the Union government has doubled down on 1G biofuels. In addition to sugar-based production, the use of food grains has been allowed, which includes maize as well as surplus rice from Food Corporation of India (FCI) stocks. The loan interest subvention scheme has also been expanded, to include grain-based distilleries apart from sugar or molasses-based distilleries. The recently constituted “Expert Committee on Roadmap for Ethanol Blending in India by 2025,” has outlined a reconfigured approach to meeting the new targets[10] that requires 13.5 billion litres of ethanol to be produced by 2025—a sixfold increase from the 2.7 billion litres produced in 2021.[11] The plan is to obtain 6.8 billion litres from sugarcane and 6.6 billion litres from food grains, which will have a significant impact on the agriculture sector.

The Impact of India’s Pivot from the Biofuel Policy

The GOI’s increased biofuel ambition demands a shift towards 1G production and edible feedstocks, with serious implications on lifecycle benefits.

Thus, India’s present approach to biofuel production presents the following key challenges from a lifecycle perspective:

  1. The low yield for sugarcane and maize in India will require land-use change, significantly affecting embodied emissions.
  2. The agricultural sector receives subsidies for inputs and power, in addition to MSP, leading to unsustainable use of water and fertilisers.
  3. Land revival programmes are inhibited by the lack of a robust mechanism for the classification of wastelands and complicated land ownership patterns
  4. The use of competing agricultural feedstocks can create conflict between different agricultural lobbies. Just recently, sugarcane farmers wrote a letter to the prime minister, alleging that OMCs were increasingly favouring ethanol from maize, affecting their livelihoods.[29]
  5. Promoting 1G biofuels will lead to technology lock-ins, delaying the switch to 2G feedstocks. Incentives for sugarcane- and maize-based production will be difficult to repeal once implemented, given the strength of agricultural lobbies in most states.

Policy Recommendations

For a sustainable transition, the long-term biofuel pathway should be based on waste (2G) and algal biomass (3G). Such approaches will ensure reductions not only in oil imports but also in carbon emissions. Estimates by the IEA suggest that halving carbon emissions by 2050 will require 90 percent of all biofuels to be produced from wastes. Furthermore, a waste-based pathway will ensure higher levels of biofuel production, since a larger part of the biomass can be apportioned for fuel production, without posing a threat to food security and land. In the long run, waste-based biofuels will also be cheaper for consumers, since the raw materials are cheaper than edible feedstock. In India, the cost of ethanol is significantly higher than in other countries, due to government-regulated pricing of agricultural commodities. It can also be an effective solution to the problem of air pollution arising from the burning of agricultural wastes.

The following are some policy suggestions for ensuring long-term and sustainable increase in biofuel production:

  1. Expanding 1G biofuel, rooted in sustainable land use: Instead of a top-down target-based approach, the proliferation of sugarcane and maize for ethanol should be part of a broader, sustainable land-use strategy. The GoI must develop a criterion for identifying land with potential for conversion to energy crops; such criteria must not be restricted to the simplistic classification of wetlands prevalent today. Global standards, such as the ones developed by the Roundtable on Sustainable Bio-material (RSB), can provide a guide but will have to be adapted to the Indian context. Overall, the standards must account for crucial factors such as net GHG emissions, local pollution, food security, land laws, and resource availability. Newer institutional arrangements must be made, to monitor compliance to the standards, before implementing specific projects.
  2. Developing sustainable supply chains for 2G feedstock: There is currently little data on the suitability of different 2G feedstock. Each potential lignocellulosic feedstock has its advantages and disadvantages (See Table 2). It is imperative to formulate a roadmap for 2G feedstock, with a focus on those that minimise land-use change and promote a circular economy. Since most of these feedstocks have a low density, transport costs are usually high. An integrated 2G biofuel roadmap must address this, taking into account spatial and temporal constraints. This will require an understanding of the availability of feedstock as well as the technological requirements for conversion to biofuels. Already, a significant amount of research has been done on models for optimising supply chains for 2G fuels.[30],[31] Going forward, the GoI must collaborate with research institutes to develop a viable model for India.
  3. Financing research and development for 2G biofuels: Most of the 2G biofuels, such as cellulosic ethanol and biomass to biodiesel, are in the early phases of commercialisation. Faster uptake of these fuels is hindered by the high costs of production and high risks, which throttle innovation. To tackle this issue, public enterprises should scale up investment in pilot projects for 2G biofuels. The Pradhan Mantri JI-VAN Yojana already aims to provide INR 1,969 crores to develop 22 projects focused on 2G technologies. The scope and budgetary outlay for such schemes should be expanded. Further, international grants and loans should be redirected towards 2G fuels, and existing frameworks (e.g., the Clean Development Mechanism) can be leveraged to direct funding to this sector. To this end, it will be crucial to establish the value proposition for 2G fuels, starting with a comprehensive lifecycle emissions inventory of 1G and 2G. Government policy and mandates can help accelerate the demand for these products and enable the creation of viable markets for these fuels. Innovation will also need to be encouraged through fiscal incentives, such as tax credits for the production of cellulosic biofuel and loan guarantees for pilot projects. Some of the measures have already been successfully applied in other countries.

  1. Support for alternative feedstock for biodiesel production: While using Jatropha for biodiesel production eschews the food-security issue, it accounts for limited production. Thus, the Biofuel Policy must expand the list of feedstocks that can be sustainably used. This will require a twofold approach. First, alternative non-edible vegetable oils should be considered for plantations and biodiesel production. India has 11 tree species that have high oil content in their seeds and can be used for producing biodiesel.[33] The GoI must focus on a comprehensive mapping of these and formulate a roadmap for utilising them. Further, government support should be provided to projects aimed at developing more efficient methods of extracting oil from oilseeds. Second, the use of waste or recycled oil for biodiesel must be enhanced. While India has approximately 33 biodiesel units that can utilise repurposed cooking oil, most suffer from a lack of feedstock availability. According to the Food Safety and Standards Authority of India (FSSAI),[34] India produces around three million tonnes of used cooking oil (UCO), 60 percent of which goes back to the food chain, leading to adverse health impacts. Currently, the FSSAI does not have the resources required to enforce the established standards for the disposal of used cooking oil. Thus, larger agencies such as State Pollution Control Boards must be deployed, and the procurement of UCO for conversion to biodiesel strengthened. OMCs have already issued an EOI seeking biodiesel made from UCOs, and the government has announced a scheme for greater procurement of UCO. Going forward, such efforts need to be sustained and amplified.     READ MORE

 

Promit Mookherjee, “The Implications of India’s Revised Roadmap for Biofuels: A Lifecycle Perspective,” ORF Issue Brief No. 526, March 2022, Observer Research Foundation.

Govt exploring possibilities of making telecom towers switch diesel to ethanol: Nitin Gadkari (Economic Times; includes VIDEO)

 

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synthetic methane/e-methane synthetic natural gas Syria Tailoring Rule Taiwan Tajikistan tall fescue tall oil tallow tallow tree tamanu/nyamplung Tamarix tank-to-wheel tank cars tankers tanker trucks Tanzania tariffs taro tar sands Tasmania tax benefit tax credit taxes tax incentives tax parity tax policy tea teach-the-teacher teacher teacher resources teacher training technical course Technical Readiness Levels techno-economic analysis technology transfer tech transfer telephone utility poles Tennessee termites terpenes terrestrial carbon testing Texas textbook Thailand theft therapeutics Thermal catalytic depolymerization (TCD) thermal deoxygenation thermocatalytic conversion thermochemical conversion thermochemical liquefaction Tibet Tier 3 Tier 4 tilapia tillage Timor-Leste tires tobacco tobacco tree Togo Tokyo toluene Tonga tool Toronto torrefaction totai Toxic Substances Control Act (TSCA) trade trade dispute/discrimination trade group trade organization Trade Policy trade 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