Mr. Vivekanand, Director (Finance, Taxation & Legal), FIPI began the session with the opening remarks. He said that several government efforts that are already undertaken towards energy transition, decarbonization, and environmental sustainability. One of the initiatives adopted by Govt is the National Biofuels Policy which includes ethanol blending programme. He said that with the target of petrol supplies with 10% ethanol blending achieved in June 2022, ahead of the original schedule of November 2022, the government has moved the 20% volume blending target for ethanol forward by 5 years to 2025-26, from an earlier target of 2030. He then highlighted that the main aim of implementation of biofuel policy is to reduce India's reliance on crude oil imports and to reduce Greenhouse Gas (GHG) emissions. Further, he said that India also has other opportunities in biofuels space including biodiesel for use in diesel vehicles and bio jet fuel as a replacement for jet fuel. The government has already established a 5% biodiesel target by 2030 which would require almost 4.5 billion litres of biodiesel per year. In case of bio jet fuel, MoP&NG has also announced indicative blending targets of 1% by 2027 and 2% by 2028 for international flights leaving India. Therefore, he highlighted that as provided for ethanol, production support, guaranteed pricing, and feedstock support are also crucial elements for achieving targets for biodiesel and bio jet fuel.

On the global front, he said that the world leaders have joined hands to form the “Global Biofuel Alliance” ('GBA'). The GBA will act as an expert hub and as a central repository of knowledge besides accelerating technology development and developing standards/certifications.  

Setting the context for the session, Mr. Kapil Bansal, Partner, Energy Transition & Decarbonization, EY, gave a broad overview about the categorization of biofuels into 3 varied forms- 1st generation conventional fuels – derived from sugar, grains etc.; 2nd generation advanced biofuels- derived from non-food crops, agricultural or municipal waste and synthetic fuels including renewable energy, water, and captured CO2. He said that at present, sustainable fuel volumes make up 2-4% of the global liquid fuel demand (3-4 tlp.a.), dominated by biofuels and with surge in demand beyond 2030, greater use of other types of feedstocks, including synfuels is expected.

He highlighted that with current policy scenario, global temperature is expected to rise by 2.5-2.9 degree Celsius by year 2100. Therefore, the role of bioenergy is crucial in decarbonizing industrial heating processes as well as in hard to abate sectors like aviation and shipping. He said that demand for biofuel is expected to increase as biofuels are going to play significant role in NZE target.

Mr. Rajesh Rawat, EY mentioned that globally biomass is expected to contribute 30% in fuel and heat energy mix and 15-20% in overall energy mix in 2050 net zero scenario with similar trend expected in India as well. He then mentioned about the commercially mature pathways that exist to produce biofuels and its derivatives such as Hydrotreatment for bio-gasoline, Anaerobic digestion for biomethane, Transesterification for biodiesel etc.

He mentioned that the Indian government has also been pushing for growth in the biofuels sector considering the country has an abundance of biomass with untapped energy potential of 50+GWe2. Various schemes and policies have like, National Biomass Programme, New national Biogas & organic Manure Programme (NNBOMP) scheme, National Biofuel Policy, National Biogas Mission, SATAT scheme, etc. have been implemented by the government within the last 6 years which helps boost the biofuels sector. He said that biomass contribution in Indian energy mix is expected to be around 15% by 2040 with majority of application in transport and industry. The use of biomass for tradition purpose of cooking is expected to be negligible and will be replaced by LPG-LNG with hydrogen blending and electricity.

He said that India currently has a total biomass-based electricity production capacity of 10.5 GW. Further he said that while ethanol blending with petrol has achieved 10% target in 2022 with further ambition to reach 20% by 2025, the bio-diesel market is still lagging due to lack of viable feedstock availability and limited govt incentives. He then listed the various sources of biomass-based energy potential of 50 GW which could be harnessed to achieve India’s 2070 NZE target viz- 13 GW from forestry & wasteland (with potential states being Maharashtra, Madhya Pradesh, Chhattisgarh, Gujarat, J&K); 28.5 GW from agri-resdiues surplus (with potential states being Punjab, Uttar Pradesh, Gujarat, Maharashtra) and 9.5 GW from solid and liquid waste (with potential states being Uttar Pradesh, Gujarat, Tamil Nadu).

Mr. Rawat then highlighted the economic benefits of using biofuels viz; reduced reliance on fossil fuel imports, job creation and economic growth, promotion of rural livelihoods, and other benefits such as energy independence, diversified energy portfolio, and reduced GHG emissions.

He also mentioned the various demand side interventions namely- National Biofuel Policy 2018, Ethanol blending Petrol Programme 2019, Biomass Co-firing, and recently announced Budget 2024 regulations on blending of CBG in CNG and PNG; to propel biofuel demand in the market. Further, he highlighted the importance of integrated biorefineries with 2G, 1G, CBG and other biofuels to meet growth transition fuels demand, along with collaboration with Indian OMCs technology research, pilot testing and commercialization of technologies in 2G, 3G and 4G biofuels space.

Lastly, he spoke about various operational, economical, and technical challenges viz; feedstock availability, upfront costs for biomass technologies/infrastructure, price volatility of biomass feedstocks, seasonal fluctuations in biomass supply, crop burning thereby preventing residue collection etc.

Mr Kapil Bansal and Mr. Rajesh Rawat from EY, then conducted the Q&A session and provided their views and opinions on various queries posted by participants.

Lastly, Mr. DLN Sastri, Director (Oil Refining & Marketing), FIPI in his vote of thanks, emphasized the role of biofuels in meeting India’s net zero targets.  He complimented EY team for an elaborative presentation on the topic covering varied aspects related to demand, technology, government incentives, challenges etc. He also thanked the participants from the energy industry for their active and interactive participation during the event.