Challenges in Biofuel Production

India has emerged as the third-largest biofuel producer in the world. Biofuels are renewable energy sources derived from organic materials such as biomass and organic waste. These can be broadly classified into three types: Liquid Biofuels (including ethanol, biodiesel, and bio-methanol), Biogas (such as Bio-LNG and Bio-CNG), and Solid Biomass.

As of January 2025, India has achieved a 19.6% ethanol blending in petrol and is on track to reach 20%, five years ahead of its initial target for 2030.

Significance of Biofuels:

• Energy Demand Fulfillment: India contributes to over a quarter of the global net primary energy demand growth between 2017 and 2040.
• Environmental Impact: The promotion of biofuels has helped reduce CO2 emissions by 5.19 million metric tons and substitute 1.73 million metric tons of crude oil.
• Energy Security: The ethanol blending program has reduced dependency on imports and saved the country Rs. 85,000 crore in foreign exchange.
• Circular Economy: Biofuels promote a circular economy by transforming waste into wealth and providing broader socioeconomic benefits.
• Rural Development: The development of markets for agricultural residues and waste offers additional financial incentives to farmers.

Challenges in Biofuel Production:

• Feedstock Challenges: Issues include the lack of quality feedstock, competing demand for feedstock that affects food security, and a fragmented and complex waste supply chain.
• Technological Barriers: There is limited commercial viability for advanced biofuel production.
• Funding: High capital expenditure and uncertain profit margins make it challenging to secure funding.

Key Initiatives:

• National Policy on Biofuels 2018
• Pradhan Mantri JI-VAN Yojana
• Galvanizing Organic Bio-Agro Resources Dhan (GOBARdhan)
• SATAT Scheme for Compressed Bio Gas

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