How India can rapidly grow its biofuel usage as an alternative fuel?
A superpower in making, India has come a long way in terms of its economic progress. Today, the country is the 5th largest economy globally which is on its way to clinch the 3rd spot very soon. This makes it clear in the coming days, it is going to witness a massive increase in economic activities, push to domestic manufacturing and industrial growth, backed by favourable schemes and policies such as Atmanirbhar Bharat and Make in India. However, looking at these growth catalysts and considering the growing consumer base here, India in its run-up to become a USD 5 trillion economy faces an impending challenge of finding a balance between economic growth and sustainability, especially when its energy demands are growing rapidly.
Notably, the country has set its goals to combat climate change. It is committed to become a net-zero economy by 2070 and achieve 50% of its installed energy capacity from renewables by 2030. While setting the right targets and deadlines can definitely help address environmental concerns, it is vital to broaden the scope of the decarbonisation mission by pivoting the focus on biofuels which are one of the most viable solutions to solve current problems and meet future needs.
Switching to biofuels is also essential at a time when India is 85% dependent on imports to meet its oil needs. As per available data of the year 2022-23, the country consumed 85.90 million tonnes of diesel and the consumption of petrol stood at 34.98 million tonnes, up 13.4 per cent YoY. The country is one of the largest consumers of petroleum and to be able to achieve as a leader in the sustainability mission, it needs to accelerate its transition to cleaner alternatives like biofuels to curb greenhouse gas emissions, reduce the stress on its exchequer by cutting dependency on imports, and build a circular economy.
Biofuels have already been acknowledged as one of the most feasible solutions to the diminishing fossil fuels reserves along with many key advantages such as cost benefits, empowering rural economy, and reducing carbon footprint. They are made from biomass resources using a variety of materials such as plants, food & animal waste and farm residue. They have the ability to decompose naturally in the environment, which implies that they do not have the same negative impact on the environment as fossil fuels and do not add to pollution in the same way.
In addition to reducing dependence on fossil fuels, biofuels also serve as a catalyst to strengthen the economy by reducing government expenditure on fossil fuel imports, increasing farmers’ income by turning them from food producers to fuel producers, supporting new businesses mainly start-ups and achieving energy security and energy independence as well.
At this juncture, it is encouraging to see the Indian Government providing much-needed assistance to biofuels production. Due to the Government’s efforts, the country achieved the target of 10 percent ethanol blending in 2022 and saved as much as ₹53,894 crore in forex outgo from 10 per cent blending besides benefiting the farmers. Buoyed by this, the Centre has already advanced the target of 20 percent ethanol blending in petrol 2030 to 2025, which is promising. Additionally, policy intervention and schemes such as a policy for co-firing of biomass in thermal power plants, mandating minimum 5% co-firing of biomass along with coal, Sustainable Alternative Towards Affordable Transportation (SATAT) scheme to promote use of CBG in transportation sector, along with several incentives are giving the much-needed impetus to the sector.
Long distance covered but still a long way to go:
According to a report by the International Energy Agency (IEA), energy demand in India is growing at more than 3% on an annual basis and is expected to be the highest globally in the current decade due to rapid urbanisation and industrialisation. Thus, it is crucial to make sure that a majority of this demand is met with cleaner alternatives like biofuels. To meet the target, India needs to ramp up biofuels production, build and upgrade infrastructure including processing plants, blending pumps, storage facilities and distribution networks. In addition, the biofuels industry needs substantial investment in research, development and production.
India is currently experiencing an increasing interest in electric vehicles. While this transition gathers pace, the government must also promote use of biofuels in vehicles. Reports suggest that use of E20 leads to an estimated reduction of carbon monoxide emissions by about 50 per cent in two-wheelers and about 30 per cent in four-wheelers compared to E0 (neat petrol), which can truly be a game-changer. The governments must remove existing bottlenecks such as limited availability of feedstock, increase consumer awareness and acceptance of biofuels to achieve sustainability goals faster.
India is at a stage where its push to economic development is going to result in a massive surge in energy consumption. Meeting the energy demand can put stress on the exchequer like in the fiscal year of 2021-22, India’s expenses on importing crude oil amounted to USD 120.7 billion. The need is thus, to look for options which not just aid the decarbonisation mission but also contribute to economic resilience and biofuels are definitely one of them.
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