Context: To boost bio-economy, to reduce dependence on fossil fuels UP govt has recently launched its Bioenergy Policy 2022, this scheme will be implemented by Uttar Pradesh New and Renewable Energy Development Agency (UPNEDA)

Key Focused points of the Policy:

Policy highlights 4 bioenergy components:

• Compressed biogas (CBG)
• Ethanol, 
• Biodiesel
• Bio-coal

UP govt. has sets target to generate:

• CBM-1,000 tn. Per day 
• Bio Coal- 4000 tn. Per day
• Bio Ethanol & Bio Diesel- 2000 tn. Per day by 2026-2027.

The scheme provides:

CBG Subsidy – Rs. 75 lakh per tonne

Bio coal Subsidy- Rs. 75,000 per tonne 

Biodiesel subsidy- Rs. 3 lac per Kl with a cap of Rs 20 crores.

Subsidies can be used by units for 

• Plant and machinery
• Infrastructure
• Construction
• Power supply, 
• Transmission system-related works, it doesn’t include administrative building and land costs.

As per the report, every Tehsil will have minimum of 1 Bioenergy Plant. (UP will have totally 350 Bioenergy units). 

Major Learnings:

• Electricity tariffs and tax exemptions:
  • 100% electricity charge waiver for 10 Years
  •  fees waiver on Stamp duty and sale deed
  • 0 Development Charges

• Land will be on lease at Rs 1 per acre:
  • land will be on non-transferable lease at the rate of Re 1 per acre to feedstock for minimum 30 Years.
  • A highway will be constructed for a 5 km approach road connecting that will connect with main Highway, if investors will be ready to invest up to 50 cr.
• Incentives on equipment:
  • Subsidy under the Sub-Mission on Agricultural Mechanization (SMAM) scheme.
  • 30% subsidy (max 20 lac) on purchasing equipment
  • In North-east the subsidy will go up to 100%.
• Online portal for single window clearance
  • UPNEDA’s Bioenergy online portal has a single-window clearance for potential investors.
• Coordination among state departments.

• Committee at district level will ensure the economic stability of bioenergy plants.

• The panel will manage the feedstock supply chain and ensure right costing.

Hurdles in Policy: 

• Feedstock’s supply for longer period, less than a fixed price is required to ensure the correct functioning for bioenergy plant.

• There is a huge disparity in the CBG and CNG procuring prices that needs to be fixed.

Date: 01.11.2022

Source: Down to Earth

By: Sudarshan Gurjar