The Ministry of Petroleum and Natural Gas has issued revised guidelines for disbursing financial assistance to compressed biogas (CBG) projects aimed at enhancing the use of biomass and supporting the procurement of biomass aggregation machinery.
Under the revised rules, CBG plants using more than 50% biomass as feedstock for projects with a minimum capacity of 2 tons per day (TPD) are eligible for a subsidy of Rs 9 million. The assistance is specifically meant to support the purchase of machinery used in biomass collection and aggregation.
To qualify, existing and upcoming CBG projects must either use at least 50% biomass feedstock or consume a minimum of 3,000 metric tonnes (MT) of biomass annually. Projects using less than 50% biomass but exceeding 3,000 MT per year can also claim the same financial support of Rs 9 million for every 3,000 MT of agri-residue utilized.
The ministry will provide financial aid for up to 50% of the cost of biomass aggregation equipment, with a cap of Rs 9 million per project, whichever is lower.
To be eligible, the CBG facility must have an installed or planned production capacity of at least 2 TPD. Projects under construction must have completed at least 25% of the work, and 50% of the project must be completed before the subsidy is disbursed.
Additionally, the revised policy bars projects that have already received support under any other central or state government program from applying.
CBG producers must provide details about the machinery and equipment in use, and confirm whether the proposed equipment aligns with the biomass collected. Once approved, project developers can receive 10% of the financial support as an advance, if they submit a bank guarantee of the same amount, valid for one year. This guarantee will be forfeited if the developers do not follow the program guidelines during execution.
Project developers have up to two years from the date of approval to request the release of financial support in phases.
These amendments are in line with the government’s push to promote cleaner energy, improve ease of doing business, and speed up the adoption of biomass technologies. The move follows recent revisions to the National Biomass Program guidelines for 2022–2027, introduced by the Ministry of New and Renewable Energy.
