Ministry of New and Renewable Energy Government of India

ISSUE 2 DEC 2009

A QUARTERLY MAGAZINE ON BIOMASS ENERGY, PUBLISHED UNDER THE UNDP-GEF BIOMASS POWER PROJECT OF MINISTRY OF NEW AND RENEWABLE ENERGY (MNRE), GOVERNMENT OF INDIA. PUBLISHED BY WINROCK INTERNATIONAL INDIA (WII)

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Field Review of Grid Connected Biomass Power Plants

Briquetting of Pine Needles A Viable Entrepreneurship Model

UNDP MNRE Initiative: Access to Clean Energy

MESSAGE FROM THE EDITOR

am delighted to place before you the second issue of the Bioenergy India magazine. I hope you would have enjoyed reading its inaugural issue. It would be my endeavour to bring before you as much value added information as possible on topical issues of primary interest to the stakeholders besides expert opinions of those belonging to academic, research, industry and non-governmental organizations, etc. We are no less interested in disseminating information on all the important issues confronting the field implementation aspects of biomass power projects. This issue contains an article on key issues, challenges and opportunities as evidenced through a field evaluation study of biomass power plants in three southern states of our country. Likewise, an initiative on extracting power through pine needle based briquettes by an Uttarakhand based NGO finds a special mention here. The Ministry of New and Renewable Energy (MNRE) is trying to enhance the market outreach of biomass and bagasse based cogeneration power in all possible forms. This issue features a Request for Proposal under the demonstration project namely, Establishment of fuel supply linkages in existing biomass/bagasse cogeneration power plants. The immdiedate purpose is to overcome the existing barriers as well as to make optimum use of the new technology advances in small capacity systems. It will also be our constant endeavour to include the international scenario of this emerging sector and this issue presents a brief glimpse into the European policy initiatives specific to biomass energy projects. Summary conclusions of our current understanding of the biomass energy area as presented through two important forums under the auspices of UNDP and Independent Power Producers (IPPs) find a mention here. Finally, I urge all of you to share your feedback, views, experiences, information, etc., related to this key sector for a wider benefit of the Renewable Energy community. Such an interaction will add further value to this publication and will help in ensuring that each issue is interesting, informative and relevant for our readers.

(K.P. Sukumaran)
Adviser & National Project Director

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Electricity generation from rice husk initiatives by MNRE in Eastern states

Paddy growing areas in the eastern parts of the country namely Bihar, Orissa, West Bengal and eastern parts of Uttar Pradesh are amongst the most backward areas which also have the lowest per capita electricity consumption. This brings out immense possibility for producing electricity from rice husk, i.e residues produced in rice mills in a decentralized mode in these States to meet subsistent as well as productive needs of electricity. A few initial projects supported by the Ministry in West Bengal, Orissa, UP and Bihar have successfully demonstrated that biomass gasifiers have the potential to produce electricity form rice husk, which is available abundantly in these States. The rice husk based gasifiers in rice mills are found to be reducing diesel consumptions by about 60-70%. As a result, payback period of the investment for such rice mills could be even between 912 months. There are more than 15,000 rice mills in Bihar, Orrisa, West Bengal and Eastern U.P Gasifier manufacturing facilities also exist in these States. Samta Smraddhi . Foundation, an NGO, which was an initiative by Mr. Gynaesh Pandey, an US based NRI, had taken up a few projects of rice husk based biomass gasifiers for providing electricity to remote and unelectrified villages in the West Champaran District of Bihar. Under these projects electricity is being provided for lighting to (4-6 hrs.) to 500-700 households from one system of rice husk based gasifier system of 32 kW capacity. A fixed amount is charged from each household depending upon the numbers of CFL used by the household. The Project has been running successfully based on a sustainable revenue model. Considering this potential, a detailed study was sponsored by the Ministry to a Professional Consultancy Organization namely M/s Ernst and Young Ltd. in order to assess the potential, identify barriers and also suggest improvements in the implementation strategy for promoting gasifiers. The Ministry, thereafter, initiated an intensified programme for promotion of biomass gasifiers in the rice mills as a part of its Biomass Gasifier Programme, which has been modified to achieve an improved and faster implementation of biomass gasifiers both for industries as well as for village based projects. In order to facilitate preparation of projects proposals and to have interface with financing institutions, the Ministry has retained the services of M/s. Beltron Telecommunications Limited, Patna. State Bank of India and Punjab National Bank have come forward to finance such projects. A series of interactive meetings were organized in the States of Bihar, Orissa and UP during the last three months involving biomass gasifier manufacturers, rice mill owners, financing institutions, non-governmental organizations, etc. in order to generate viable proposals in rice mills, villages, cold storages. These interactions have generated considerable interest amongst all stakeholders. Efforts are also being made to link powering mobile powers, irrigation pump sets, horticulture mission activities, etc. along with Gasifier Projects. One village level project has been initiated in February, 2010 in Village Mahada, District Buxar, Bihar to provide electricity for lighting and also to energise pump sets for irrigation.

Gasifier system installed at West Champaran District of Bihar

ISSUE 2 DEC 2009

contents
INDIA

06

Biomass based Power Generation at Tail-end of the Grid A new initiative by MNRE Biomass Gasification Current Status & Prospects

CHIEF PATRON
Deepak Gupta, Secretary, MNRE

10

PATRON
Gauri Singh, Joint Secretary, MNRE

EDITORIAL BOARD
Sudhir Mohan, Adviser, MNRE Preeti Soni, Head (E&E Unit), UNDP K.S. Popli, Director (Technical), IREDA J.R. Meshram, Director, MNRE

EDITOR
K.P Sukumaran, Adviser & NPD, MNRE .

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ASSOCIATE EDITOR
V.K. Jain, Director & NPC, MNRE

Field Review of Grid Connected Biomass Based Power Plants in South India Biomass Briquetting: An Overview

WINROCK EDITORIAL TEAM

Sobhanbabu P .R.K., Program Manager Urvashi Dogra, Sr. Program Officer Suneel Deambi, Consultant Jaison Jose, Sr. Program Associate

EDITORIAL OFFICE
Project Management Cell Ministry of New and Renewable Energy Block No. 14, CGO Complex, Lodi Road, New Delhi 110 003 Telefax : 011-24369788 Website : www.mnre.gov.in Email : jainvk@nic.in

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Briquetting of Pine Needles A Viable Entrepreneurship Model IREDA Financing of Biomass Power Projects UNDP MNRE Initiative: Access to Clean Energy Major Events Policy Incentives for IPPs and Investors for Wind & Biomass Power Generation News Snippets on Biomass Power European Policy on Biomass Energy Book Information
v

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Winrock International India (WII) S-212, 2nd Floor, Panchsheel Park New Delhi 110 017 Tel: 91-11-26013869; Fax: 91-11-26013876 Website : www.winrockindia.org Email : wii@winrockindia.org

PRINTED AT
Printer : Premier Fime P P Ltd, New Delhi Publisher : Ministry of New and Renewable Energy, New Delhi

DISCLAIMER
The views expressed by authors including those of the Editor in this magazine are not necessarily the views of MNRE or WII.

Magazine on Biomass Energy

December 2009

NATIONAL PROGRAM

Biomass based Power Generation at Tail-end of the Grid A new initiative by MNRE
Background
The National Action Plan on Climate Change (NAPCC) released on 30th June 2008 inter-alia includes specific action points for promoting deployment, resolving the barriers to development and commercial deployment of biomass amongst other renewable energy technologies and promoting biomass combustion and biomass gasification technologies. In the context of energy security and necessity to reduce greenhouse gas emissions there is urgent need for accelerated harnessing of all renewable energy sources especially biomass based energy, feeding power to the grid and off-grid applications. Promotion of distributed / decentralized, along with grid interactive, biomass based power generation would not only help in meeting the energy needs in rural areas but also help in reduction of transmission & distribution losses and ensuring sustainable energy supply to the industries.

Estimated Biomass Potential

Biomass, which is a Carbon neutral fuel source for production of electricity, holds considerable promise for India. Availability of biomass in India is estimated at about 540 million tonnes per year, covering residues from agriculture, agro industry, forestry and plantations. Principal agricultural residues include rice husk, rice straw, bagasse, sugar cane tops and leaves, trash, groundnut shells, cotton stalks, mustard stalks, etc. It has been estimated that about 70-75% of these wastes are used as fodder, fuel for domestic cooking and for other economic purposes thus leaving behind 120 150 million tonnes of usable agro industrial and agricultural residues per year, which could be made available for power generation. By using these surplus agricultural residues, about 16,000 MW of grid quality power can be generated with the presently available technologies. However, all the potential is not realizable as the biomass is available in a dispersed manner; its availability is seasonal and there are competitive uses. Apart from providing a much needed relief from power shortages, power projects based on biomass would generate employment in our rural areas.

Policy Support
India faces formidable challenges in meeting its energy needs of providing requisite quantities of energy of desired quality for sustained growth, at the rate of 89 per cent during the next 25 years. This would require a four-fold increase in energy supply with a six-fold increase in power generation installed capacity. The Government of India has initiated several reform measures to create a favorable environment for addition of new generating capacity in the country. A further boost to this sector has come with the implementation of Electricity Act 2003, which lays emphasis on use of renewable sources of energy for power generation. The Electricity Act 2003 and the National Electricity Policy 2005 has put in place a highly liberal framework for power generation. So far, 14 biomass potential states have announced preferential tariff as well as renewable energy purchase obligations. CERC has recently issued guidelines for tariff determination including biomass, which is a positive step towards development of renewable energy in the country.

Present level of Biomass Utilization for Power Generation

Keeping in view this vast potential, a number of technologies for converting biomass into power have been successfully developed, demonstrated and are techno-economically viable. Biomass combustion and bagasse cogeneration based power generation capacity of 2000 MW has been established in the country. About 800 MW projects are under implementation. The States of Andhra Pradesh, Chhattisgarh, Karnataka, Maharashtra, Punjab, Rajasthan and Tamil Nadu have taken lead role in this sector. In addition, about 100 MWe equivalent biomass gasifier systems have been deployed for thermal applications in industries and about 10 MW biomass gasifier systems are being used for meeting electricity needs of rural areas. Considering the present status of biomass based power generation and / or thermal applications, it is expected 6

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December 2009

that only about 30-35 million tonnes of surplus woody or non-woody biomass is being used annually for the existing and ongoing biomass projects. According to the Biomass Resource Atlas prepared by Indian Institute of Science, Bangalore, more than 300 districts in India have biomass potential between 10100 MW.

distribution component would not only stabilize the grid but also reduce the T&D losses and ensure sustainable supply of electricity near the biomass production and electricity consumption points. In the area of biomass gasification technology, significant development has been achieved in India and India is the leader in this technology. Biomass gasifiers of a few kilowatts upto several megawatts have been successfully developed indigenously. Promotion of gasifiers for providing decentralized energy and power for lighting, captive requirements of industries and productive purposes, such as water pumping, mobile tower charging, etc., in rural areas is being contemplated by the Ministry, especially in those states where captive biomass is available and availability of electricity is a major constraint.

NATIONAL PROGRAM

Need for small capacity Biomass Power Plants

Large biomass projects, of late, are facing problems in their operation due to the shortage of biomass available within a reasonable distance. This is because the biomass is finding a variety of competitive uses in the wake of increasing price of conventional fuel, mainly diesel, which is being substituted by biomass both in small and medium scale boilers and for other such applications. Biomass thus becomes a tradable commodity and its price varies as per the market. In that event, large Biomass projects become commercially unsustainable. While a sustainable and organized biomass fuel linkage can make the Biomass projects a successful venture, there is also a need to utilize biomass for small capacity project in a decentralized mode, to provide electricity in the rural areas at the tail end of the grid. In this context, the Biomass Gasifier technology, which is more efficient at this scale, assumes greater importance. There is a large gap in the demand and supply of electricity in the country especially in rural areas. The problem of providing power to rural areas would be critical even when infrastructure under RGGVY becomes ready, due to shortage of power in the rural grid; often electricity is either not available for extended hours during the day time or the grid voltage is very low, especially at the tail-end of the grid. This results in shifting of several productive activities, including operation of agriculture pumps to evenings, contributing to the evening time load peaking. Biomass based power plants using the locally available biomass resources for off grid / distributed and grid connected power generation of 250 kW to 2 MW capacity have been recently introdued in the Biomass Gasifier Program. Biomass power generating systems, both biomass gasifier and Boiler-Turbine-Generator (BTG) based, are now available commercially in the country upto MW scale. Setting up of such projects preferably at tail end of the grid, and having a decentralized Magazine on Biomass Energy December 2009

The program envisages implementation of such projects with an active involvement of Independent Power Producers (IPPs), Energy Service Companies (ESCOs), Co-operatives, Panchayats, SHGs, NGOs, manufacturers, entrepreneurs, promoters & developers etc.
Support for Biomass based capacity upto 2 MW Power Projects
The Ministry is promoting the following biomass based systems: Biomass gasifier based MW level grid connected power plants with 100% producer gas engines. Biomass based grid connected Boiler-TurbineGenerator (BTG) projects, preferably at tail end of the grid and having a decentralized distribution component would also be supported. The maximum installed capacity of each such project would be 2 MW. The program envisages implementation of such projects with involvement of Independent Power Producers (IPPs), Energy Service Companies (ESCOs), Co-operatives, Panchayats, SHGs, NGOs, manufacturers or entrepreneurs, promoters & developers, etc. 7

NATIONAL PROGRAM

Pattern of Central Financial Assistance (CFA)

Pattern of Central Financial Assistance (CFA) for various components is given below: Items Pattern of CFA

Distributed / off grid power projects in rural areas and grid connected power Rs. 15,000 per kW projects with 100% producer gas engines or biomass based combustion projects Biomass gasifier systems retrofitted with dual fuel mode engines Rs. 2,500 per kW Captive power projects (captive power less than 50%) and / or feeding surplus Rs. 10,000 per kW power to grid in rice mills (with 100% producer gas engines or biomass based combustion projects). Projects involving installation of 100% gas engines with an existing gasifier Biomass gasifier projects for distributed / off-grid for rural areas and grid connected power projects for ensuring regular availability of biomass, provision of collection, processing and storage and operation & maintenance including compulsory AMC for 5 years after the guarantee period Support towards lighting devices and distribution network Rs. 10.00 lakh per 100 kW Rs. 1.50 lakh per 50 kW

Financial support limited to a maximum of 3 km i.e. Rs. 3.00 lakh per project (@ Rs. 1.00 lakh per km). Financial incentives of Rs.5000/per project to the banks / FIs, manufacturers, promoters, consultants & service providers for developing firmed up and bankable proposals for a minimum of 10 projects or above. Rs. 10,000/- per 100 kW, subject to maximum of Rs.1.00 lakh for a project of 1 MW capacity. A minimum service charge would be Rs. 10,000/- per site

Support towards project formulation

Service charges for Verification and Certification

Preparation of Detailed Project Reports (DPRs) for centralized distributed / grid connected / captive power generation projects: - Projects between 100-500 kW capacities - Projects above 500 kW capacities. - DPR is not required for the projects below 100 kW capacities. HRD & Training - O&M Technicians Course - Gasifier Entrepreneur Development Course - Awareness promotions such as organization of seminars, business meets, workshops, etc. Support for gasifier manufacturers / suppliers for establishing service centers in areas where cluster of systems, minimum 10, have been set up in one district / region. Special category states and islands

Rs. 0.50 lakh Rs. 1.00 lakh

@Rs. 2.00 lakh per course @Rs. 3.00 lakh per course Maximum upto Rs.3.00 lakh Rs. 5.00 lakh (One-time funding)

20% higher CFA

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December 2009

Grid connected project proposals should contain Detailed Project Reports (DPRs) covering salient features as per a format. The project developer should enter into agreement with the utilities for sale of power or 3rd party sale and furnish copies of the PPA, copies of all clearance from statutory angle along with loan agreement or supporting documents for meeting balance funds, etc. Only those grid interactive projects would be supported which have envisaged fuel linkage mechanisms to ensure regular supply of the required quantity of biomass feed stock and provision of collection, processing and storage of biomass. The projects based on BTG route should have a reasonable provision in relation to the project locations for decentralized distribution component and details should be provided in the project proposal. The Ministry provides Central Financial Assistance (CFA) @ Rs.15,000/- per kW for grid connected power projects with 100% producer gas engines or biomass based combustion projects as given in the table. In addition, financial assistance upto Rs. 1.00 lakh would also be available for preparation of Detailed Project Report (DPR) of grid connected / captive power generation projects. CFA as applicable under the scheme will be disbursed post-commissioning through one installment directly to the promoters or lending institutions / FIs after receipt of commissioning and verification reports and requisite documents. Besides financial incentives, fiscal incentives such as accelerated depreciation, tax holidays for ten years and capital subsidy for biomass power projects are also being provided. Biomass power projects can also avail the benefit of concessional custom duty and excise duty exemption for equipments and machinery. Loan is available through the Indian Renewable Energy Development Agency (IREDA).

NATIONAL PROGRAM

Besides financial incentives, fiscal incentives such as accelerated depreciation, tax holidays for ten years, capital subsidy for biomass power project are also being provided. Biomass power projects can also avail benefit of concessional custom duty and excise duty exemption for equipments and machinery.

For the purpose, the existing level of subsidy will be provided for the gasifier with 100% producer gas engine components. In addition, financial assistance upto 50% of the cost of plant and machineries, i.e., Vapor Absorption Machine (VAM) for cooling / chilling system and steam generating system from waste heat would be provided. Financial assistance would not be provided for land & building. It is planned that 25 demonstration projects be taken up in rice mills, replacing steam engines / boilers with biomass gasifiers coupled with 100% producer gas engines for power generation along with provision for meeting the entire thermal requirement through waste heat recovery. Under some of these projects, demonstration of cold storage or ice making units would also be taken up at feasible locations using waste heat for chilling / cold storage through VAM and steam generating systems. These projects would be taken up under Technology Demonstration Projects as per RD&D policy of the Ministry for Technology Demonstration, on 50:50 cost sharing basis.

Technology Demonstration on Waste Heat Utilization for Cooling / Chilling & Steam Generation
Biomass gasifiers and engines produce waste heat, which is presently dissipated to the atmosphere. Waste heat based cooling / chilling and steam generating systems are available in the country. In order to use the waste heat and to increase the commercial / economical benefits, it is proposed that the technology suitable for biomass gasifiers be demonstrated. Magazine on Biomass Energy December 2009

Details of the program and guidelines can be viewed at the MNRE website - http://www.mnes.nic.in/adm-approvals/ biomassgasifier.pdf

K P Sukumaran, Adviser & D K Khare, Director

Ministry of New & Renewable Energy Email: kpsukumaran@nic.in; dkkhare@nic.in

T E C H N O L O G Y

Biomass Gasification Current Status & Prospects

Introduction
Bio-resources have perennially met a very wide spectrum of human needs; be it food, fodder, feedstock, fibre or energy (amongst others). Developments during the last couple of centuries (with the discovery of coal and the beginning of the Industrial Revolution) have resulted in an increased use of synthetic materials and fossil fuels (followed by nuclear energy) as substitutes for bioresources in some important areas of both thermal and electrical applications. The shift away from bio-resources and their derivatives has been particularly dramatic in the developed world and in their utilization as chemical feedstock, building materials, fibre and as an energy source. This substitution has further resulted in a widely prevalent impression that continued heavy reliance on bio-resources implies lack of modernization and economic development of a nation, society or people at large. Such an impression has been particularly strong in the case of use of bio-resources for energy purposes and, to a large extent justifiable, as technology development for efficient and convenient utilization of bio-resources has assumed very low priority, because of various new energy sources that are seen to be very cheap and convenient for use. the risk of its clandestine use in the proliferation of weapons of mass destruction, air and water pollution, environmental degradation, need for empowerment of rural people and for an increased self-reliance, and last (but not the least), fear of climatological changes, particularly global warming.

Biomass Gasification
Of the various technologies for effective utilization of biomass, gasification has long been seen as a technology with tremendous potential and promise, particularly for small and medium scale power generation. Of course, the technology is equally suitable for a wide range of thermal applications. As biomass resources are dispersed widely (with generally low bulk densities), the ability of gasification technology to be deployed over a wide range of output ratings makes it ideal for distribution, production of energy/generation of electricity, thereby opening massive avenues both for employment generation and economic development in rural areas. While substantial technology development efforts have been made all over the world during the last three decades (many with extensive international and multilateral funding), substantial progress has only been made in a few countries, with India unquestionably being the leader in the field. Biomass gasification has not only reached a reasonable level of commercialization in India, but a small niche industry is slowly developing here with a number of gasifier systems being exported from India to various countries.

Biomass gasification has not only reached a reasonable level of commercialization in India, but a small niche industry is slowly developing here with a number of gasifier systems being exported from India to various countries.
Developments over the last decade or so would seem to signal that the wheel is almost coming a full circle, i.e. to a point where an increasing use of bio-resources (particularly for energy) is being seen as imperative and in the larger interest of mankind. The driving forces behind such a move cover a wide range of human concerns including the exhaustibility of fossil fuels, radiation and other hazards of nuclear energy, including Magazine on Biomass Energy December 2009

Technology Status
The two most popular gasifier types i.e. Updraft (or counter-current) and Downdraft (or co-current), have both been developed in the country, even though major efforts of the technology developers and manufacturers alike have been focused on the downdraft design. However, each design has its own set of strengths and weaknesses. Updraft gasifiers have significant multi-fuel capability, simpler design and hence lower investments, but suffer from relatively large quantities of tar in the gas stream. This design is seen to be more suitable for direct, closely coupled thermal applications since power 10

generation through internal combustion (IC) engines would require elaborate gas cleaning systems. However, at least one manufacturer in the country has been offering the updraft gasifier systems for power generation. Downdraft gasifiers, on the other hand, generally produce cleaner gas (though still requiring further gas cleaning for power generation application using I.C. engines, etc.), but have a lower fuel flexibility as compared to the updraft designs. Within the downdraft concept, systems have been developed in both the open core mode and also in a closed top mode (i.e. without and with throat). The country today boasts of having more than 10 active manufacturers of Biomass Gasifiers, duly registered with the Ministry of New and Renewable Energy (MNRE). A wide variety of gasifier systems are being commercially offered using different feedstocks and covering a spectrum of applications and output ratings. Over 200 such systems are likely to be added this year with exports likely to cover over twenty five countries. The status in terms of feedstock capability, applications and output ratings, etc., is briefly covered below:

T E C H N O L O G Y

Biomass gasifier designs

available that have greater multi-fuel capability.

Output Ratings
Depending on the feedstock type, the gasifier systems are now available with output ratings as low as 3 kWe and 10 kWth, while the largest unit ratings go upto about 2 MW (electrical) and over 6 MW. Related biomass processing rates go well above two tonnes per hour through single large gasifiers (with applications requiring even larger overall outputs, currently being met with the multiple gasifier units).

Thermal Applications
Once biomass is converted to producer gas, a wide range of thermal applications can be handled. This is because of the excellent combustion characteristics of the gas, coupled with total control and convenience that goes with the use of gaseous fuels. While applications requiring temperatures of upto 1100 oC have been handled with the producer gas alone, other applications with a higher temperature requirement have been met through the dual-fuel operation, mainly from gasifiers. An amazing array of thermal applications are now being met through biomass gasifiers, as can be seen from the partial list given below: CO2 Production Ceramic Tile Making Steel Annealing Aluminium Melting Steel Rolling Sericulture Gluten Drying Industrial Drying Spray Drying Cardamom Drying Rubber Drying Pulse Drying Precipitate silica drying Institutional Cooking Boilers Hot Air Generators Crematoria Thermic Fluid Heaters Though some of these applications have been one of a kind, many others have been replicated on a relatively large scale including those in sericulture, cardamom drying, ceramic tile baking, crumb rubber drying, CO2 production, etc. 11

Feedstock Capability
Starting with wood as a feedstock, the work over the last decade has resulted in a wide range of feedstock becoming acceptable in different gasifier designs. Different designs of woody biomass gasifiers could either accept uniform wood chips or a wide range of sizes in either chipped form or in cut, round pieces. Some of these designs can also accept briquettes of various agricultural and agro-industrial residues. Other residues and wastes used as gasifier feedstocks include bamboo, maize cobs, coconut shells, weeds like lantana camara, threshed mustard stalks, cotton stalks, maize stalks, groundnut shells and sun-flower husks, etc. There are other designs that largely work with the agricultural and agro-industrial residues including rice husk and other similar fine biomass materials. However, most of these gasifier designs do not accept the woody biomass as a feedstock. In the recent past, such designs have been developed that allow a quick change-over from wood-like materials as feedstock to fines like rice husk, etc., and vice versa. This is being seen as a step forward in the direction of development of a Universal gasifier, operating in a downdraft mode that could work on a variety of feedstock materials. Of course, as mentioned earlier, the updraft designs are already Magazine on Biomass Energy December 2009

T E C H N O L O G Y

FBG-250 at M/s Jasoriya Rice Mill, Burdwan

Power Generation in Dual-Fuel Mode

The entire cycle of biomass gasifier technology development in the country was started initially to save diesel in the commonly used diesel pumpsets and gensets through dual-fuel mode operation. While hundreds of these systems were set up as demonstration projects mainly for irrigation pumping, the application never really caught on as a regular, commercial option. However, greater success was achieved in dual-fuel mode operation through a number of rural electrification projects/decentralized generation projects (taken up by IISc, Desi Power, TERI and Ankur Scientific, etc.) and also for the captive power requirements in the industry. Over the last couple of years, sharp spurt in oil / HSD prices have made the cost of generation too high even in dual fuel mode, so that rural electrification / distributed generation through this route is no more viable. However, a large number of gasifier systems have also been installed in industrial units that still use diesel / furnace oil generating sets (in situations where power supply is totally unreliable, etc.) in the power range of a few tens of kilowatts to a few hundred of kilowatts. A large number of these installations are taking place in the Central and Eastern parts of the country.
Inauguration of 250 kWe Power Plant at AIMS, Karnataka

Various gasifier models and designs have been connected to the commercially available natural gas gensets, duly modified to operate on producer gas. The available range of output ratings and the list of suppliers have grown substantially during the last few years, with output ratings as small as 4 kWe (separately covered in the next section) to projects generating upto a few megawatts of useful power. This program is receiving substantial financial support from the MNRE in terms of Central Financial Allocations (CFA). Installations in the recent past have covered rural electrification, captive power (with a variety of users) as well as grid feeding.

Small Rating Systems for Remote Applications

Technology Development in this area during the last few years has indeed been extremely significant. A wide range of output ratings (from 4 kWe to 100 kWe) are now commercially available with the following attractive features: Totally stand-alone systems, with a built-in start-up Automation of gasifier and engine genset startups (without manual blowers / cranking) Excellent variable load response Attractive specific fuel consumption (around 1.0 1.5 kg /kWh) Built-in systems for biomass preparation (including exhaust based drying) Low initial investments Simple to operate and maintain If compared to the Solar Photovoltaic (PV) power packs, the initial investments are about one tenth per kW of installed capacity (and as low as one eigth per kWh of generation capacity due to low PLF of the solar systems). These developments have indeed opened up the possibility of biomass power packs being seen as one of 12

Power Generation in 100% Gas Mode

With power generation in a dual fuel mode becoming increasingly unviable on account of very high HSD prices (even if, it is only 25% of the total energy provider), emphasis has shifted to the biomass based power generation systems based on 100% gas utilization.

1 MWe Power Plant, Coimbatore

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December 2009

Special Developments
While various technology developers and manufacturers have come up with a number of exciting initiatives and developments, just a few are being mentioned here: Development of kilowatt level operating, table-top demonstration models (demonstrated at various meetings and conferences) Mobile power packs of a few kilowatt ratings Combined heat and power systems (e.g. on a tea estate in Uganda), and, A trailer-mounted 200 kWe gasifier system used for the testing of Micro-Turbines in the US

T E C H N O L O G Y

9 kW System at Odenthurai

the most cost-effective and serious options for meeting the small scale, stand-alone power needs in remote areas, islands, difficult terrains and forest villages, etc. Over a hundred installations have been made during the last couple of years. A number of systems have also been exported to countries like Colombia, Vietnam, Sri Lanka, Cambodia, Madagascar, Italy and USA, etc. However, market dissemination of these systems has been sporadic inspite of tremendous potential mostly on account of somewhat ineffective policy initiatives.

Export Market Potential

Technology leadership of the country in small and medium size gasifiers clearly comes through in terms of exports being made to a large number of countries. Many of these exports have been one of a kind, i.e. mainly for technology demonstration purposes. However, some have been part of an overall business endeavour to develop the overseas markets. Multiple installations have already taken place in some countries indicating a slow acceptance of Gasifier for a Co-Gen System, Uganda the technology from India. Export orders have also come to the Indian companies through a competitive international funding mechanism, including orders from various UN agencies. Significant business relationships are also starting to develop (for international business development) between entities from different countries and Indian organizations active in the field of biomass gasification. A partial list of countries having purchased biomass gasifier systems from India is given here: USA Chile, Brazil, Guatemala, Colombia Switzerland, Italy, Germany, Sweden, Russia Australia, New Zealand Sri Lanka, Myanmar, Cambodia, Vietnam, Malaysia, Indonesia Russia, Ukraine, Latvia, Poland Mozambique, Uganda, Madagascar Contd on page 31...

4 kW Mobile Demonstration System

Trailer Mounted System in the US

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R E V I E W

Field Review of Grid Connected Biomass Based Power Plants in South India
Introduction
Biomass has been and is still one of the major energy sources within an agrarian developing country like India. Various biomass energy resources comprise fuel wood from the forest and wasteland, agro-residues, non-edible oil seeds and other degradable biomass. It is estimated that over 500 million tonnes of agro-residues are produced annually in India. After deducting the amount used as fodder and domestic cooking fuel besides other local uses, about 120 to 150 million tonnes of the surplus biomass supply is available annually. It transforms into an estimated biomass power production potential of the order of 17,000 to 22,000 MW. Out of this, almost 25% can come from the agro-processing based industries, like rice mills, sugar mills and oil mills, where huge quantities of biomass are produced as a by-product during various processes. The remaining power potential needs to be exploited from distributed farm level and distributed agroprocessing activities throughout the country. In addition, some power can be produced from the fast growing energy plantations on over 70 million hectares of wastelands spread over different states. Presently, MNRE is implementing the UNDP/GEF assisted project on Removal of Barriers to Biomass Power Generation in India. The defined objective of the current project is to accelerate adoption of environmentally sustainable biomass power technologies by removing the barriers identified, thereby laying the foundation for large scale commercialization of biomass power through an increased access to financing. Deloitte Touche Tohmatsu India Private Limited (DTTIPL) was awarded a study dealing with the biomass power plants installed in the southern states of Andhra Pradesh and Tamil Nadu. A significant objective of this study was to carry out an extensive review, analysis, synthesis of information/data collected, which would be validated through the field visits. This exercise was supplemented with meetings with key stakeholders for identifying major barriers and putting forth suggestions to overcome them. Magazine on Biomass Energy December 2009

F I E L D

Progress of Biomass Power Plant Installations

Since the mid-nineties, MNRE is implementing a program related to biomass based combustion and cogeneration power plants. So far, about 203 plants aggregating about 1,677 MW installed capacity have been commissioned in the different states of the country till November 2008, for feeding power into the national grid. Leading states in the installation of bagasse based cogeneration are Uttar Pradesh, Karnataka, Tamil Nadu, Andhra Pradesh and Maharashtra respectively. While in the area of biomass power, the leading states are Andhra Pradesh, Chhattisgarh, Tamil Nadu and Karnataka. There are about 171 plants based on the use of both biomass and bagasse cogeneration at various stages of implementation with an aggregated capacity of 1,950 MW. (Table 1)

Growth Pattern of Installations in Southern India

As mentioned earlier, the three states covered under this study (namely Andhra Pradesh, Karnataka, and Tamil Nadu) are amongst the top four leading states in the field of biomass power plant implementation in India. In the targeted region of south India, there are in all 63 biomass power plants. These have a cumulative installed capacity of 434.45 MW and have been commissioned so far in the following three states covered under the present study (Figure 1 on the next page). Andhra Pradesh 219.75 MW (40 units) Karnataka 81.00 MW (11 units) Tamil Nadu 133.70 MW (12 units) Andhra Pradesh took an early lead and presently has almost 33% of the total installed biomass power plant capacity in the country with installed capacity of 219.75 MW from the 40 plants. A majority (by more than 75%) of plants got commissioned during the period 2000 to 2004. The three districts of Krishna, Prakasam and Guntur have 16 plants installed with a cumulative installed capacity of 89.5 MW (more than 40% of state). In Karnataka, a majority of the plants (almost 75%) were installed during 2004 to 2005. Out of the total 11 plants, with a cumulative installed capacity of 81 MW, six plants 14

Table 1: Installations of biomass power and cogeneration plants in India

State Andhra Pradesh Chhattisgarh Gujarat Haryana Karnataka Madhya Pradesh Maharashtra Punjab Rajasthan Tamil Nadu Uttar Pradesh Total Biomass power (as on 30-06-2008) No of units Installed capacity (MW) 40 18 1 1 11 1 2 2 3 12 91 219.75 146.30 0.50 4.00 81.00 1.00 11.50 16.00 23.30 133.70 637.05 Bagasse cogeneration (as on 30-06-2008) No of units Installed capacity (MW) 18 1 16 20 2 17 26 100 124.05 2.00 180.78 102.50 12.00 179.00 352.50 952.83

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250

Types of Fuel Used

The main source of biomass being used in most of the power plants in Karnataka and Andhra Pradesh is rice husk, which is supported by other wide ranging variety of locally available seasonal biomass sources. However, in Tamil Nadu, Prosopis juliflora is the most widely used biomass resource for the power plants supported by other wide ranging varieties of locally available seasonal biomass sources (Table 2 presented on next page). During field visits to the selected sites it was observed that in Karnataka, coal (especially dolachar, which is a by-product of sponge iron cluster in Raichur region and is available at a low cost of Rs 1200 to 1500 per tonne) is being used in some plants upto the permitted quota. In Andhra Pradesh plants use minimal quantities of coal (maximum upto allowed quota) from the Singareni coal fields to cover any shortage of biomass availability or to substitute relatively high priced biomass (higher than coal). In Tamil Nadu, a majority of the plants were found mainly using biomass with negligible amounts of coal usage.

60

58 200

Annual Installed Capacity (MW)

50

47 44.5

48.5

40 32 30 30

150

28.5

26.5

100

20.5 20 12 10 2.75 0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 4.5 4.5 1 0 7.5 4 8 6 6 18 14.2 10 50

Year of installation
AP Installed (MW) AP Cumulative Capacity (MW) KK Installed (MW) KK Cumulative Capacity (MW) TN Installed (MW) TN Cumulative Capacity (MW)

Figure 1: Growth of installed capacities of biomass cogeneration plants in three states are located in the rice bowl area of Tungabhadra, in a cluster in Koppal, Bellary and Raichur districts with cumulative capacity of 40.5 MW. In Tamil Nadu the real impetus came recently in 2006, with the commissioning of three new plants with a cumulative capacity of 48.5 MW. A majority of these plants are located in the southern districts of Sivaganga, Ramanathpuram, Pudukkottai, Thoothukudi, Tirunelveli and Madurai with more than 80% share in the total installed capacity. There is also a lone biomass gasifier based grid connected power plant of 1.25 MW capacity in Coimbatore district. Magazine on Biomass Energy December 2009

Cumulative Installed Capacity (MW)

Fuel Supply
In India, though biomass is and likely to remain a major source of primary energy in the near future, it is yet to become a commercial commodity. It is still collected and used in the domestic sector and then sold in an unorganized market within the small and medium (SME) enterprises. Similarly, in most of the biomass based power plants, biomass supply is still an unorganized affair. Though, over time, linkages between the biomass 15

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Table 2: Summary of fuel usage

State Andhra Pradesh Coal usage Generally below allowable limit from Singareni coal field Main biomass Paddy husk Paddy straw Other biomass types used Stalks (Maize, cotton, Sunflower, Jowar, Red Gram, Bengal Gram) Cobs (Maize, Jowar) Groundnut shell Coconut shell Wood waste Coconut shell, husk Stalks (Gram, Jowar, Tur, Bajra, Ragi) Sugarcane tops and leaves Paddy straw Jowar husk-stalks-cobs Groundnut shell Wood waste Coconut fronds Paddy straw, husk Stalks (Cotton, Ragi, Maize, Jowar, Bengal Gram, Red Gram, Sunflower) Groundnut shell Cobs (Maize, Bajra, Jowar cobs Wood waste, Saw dust)

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Karnataka

Generally upto allowable limit. Recently cheap dolachar is being used

Paddy husk Coffee wastes Maize cobs-stalks Cotton Stalks Coconut frond

Tamil Nadu

Negligible coal

Prosopis juliflora Tapioca stalks

suppliers and plant promoters has been established informally, there is still no long-term supply contract or agreement between them. Normally, biomass is procured through the local biomass traders/suppliers, who in turn procure the biomass from the units producing biomass residue (i.e. as a by-product of the agro-processing units), farmers or individuals. In many cases, the farmer or individual biomass collector-supplier fetches the biomass to the power plant and delivers it on a cash basis. Normally, tractor/trucks are used for the transportation of this fuel. Loose biomass is normally procured from the surrounding region within a radius of 50-80 kms. This results in a higher transportation cost per tonne. High density woody biomass is procured from a 50-150 km radius and sometimes even as far as 200-300 kms.

Fuel Processing
Residues such as rice husk, sawdust and coffee husk are available and procured in a ready-to-use form. Other residues such as mustard stalk, cotton stalk and groundnut shell, etc. need to be pulverized before use especially in fluidized boilers. It has been observed that plants have adopted their own combination of residues owing to a variety of technical and economic reasons. Sometimes, a shift from one type of residue to the other also happens, because of economic considerations. By and large, many plants seem to rely only on the selective mill residues such as rice husk, coffee waste, sawdust and groundnut shell, etc. These are normally available in bulk quantities at reasonable prices in comparison to field obtained residues as the logistics of harvesting the field residues on a large scale has not been established so far. Woody biomass is also procured to supplement the agro-residue as and when required and often has to be procured from relatively longer distances.

Fuel Storage
Generally fuel is stored at the plant site partly in an open yard and partly in closed sheds so as to ensure availability of stock for the plant operation even during the monsoon or rainy season. On an average, plants stock fuel to the tune of 300-500 tonnes, which is equivalent to roughly 30-50 days of regular operation. Magazine on Biomass Energy December 2009

Fuel Costing
Biomass (agro-residue) prices are relatively dynamic in nature as compared to prices of fossil fuel and woody 16

biomass, which are relatively sluggish. The main factors that affect the price of agro-residue include cropping pattern and variation in production due to the effect of several factors. The price also depends on the opportunity cost, as biomass is normally available in a limited span of time during the year in accordance with the flow of harvest or agro-processing activity. Another factor that contributes to the landed price of agro-residues at the plant is the transportation cost due to low bulk densities. As mentioned earlier, rice husk is a major crop residue in the states of Andhra Pradesh and Karnataka, while woody biomass (prosopis juliflora, casurina, tapioca) is mainly used in Tamil Nadu along with a wide variety of agro-residues available locally, depending on the cropping pattern of the region. The cost breakup of the landed price of selected major biomass (rice husk, fuelwood, other agro-residues such as, stalks/cobs/shells, etc.) resource types are summarized in Table 3.

Biomass Scarcity and Rising Prices

A majority of biomass plants are confronted with an increasing scarcity of biomass which has to be procured from longer distances resulting in increased transportation cost. For instance, in the Gangavati belt of Karnataka, woody biomass is procured from as far as the Chikmagalur area of south Karnataka. The other major issue is rapidly rising biomass prices in the catchment area of the plant. At the initial stages of plant installation, the agro-residue was considered as waste and was thus available at throwaway prices with landed price of about Rs 500-1,200 per tonne. However, in recent times (last 4-5 years) biomass prices have gone up very rapidly. During the current year, rice husk price has gone as high as Rs 2,500 per tonne in the crowded biomass power plant clusters like Gangavati belt (Raichur, Koppal, Bellary districts) in Karanataka and Vijayawada (Krishna, Guntur, Prakasam districts) cluster as well as Kurnool-Mehboobnagar in Andhra Pradesh. The main reasons for the steep rise in rice husk price can be pointed down as Very close location(s) of the biomass power plants; almost 6-7 plants in an area of one district (about 50km radius). Several upcoming high biomass consuming industries like distilleries. Several other industries that require thermal energy inputs switching over from costly fossil fuels to relatively cheaper biomass fuels (to reduce fuel cost by almost 50-60%).

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Issues and Challenges

Based on the information and feedback gathered from secondary sources, insight gained through field visits to the selected power plants and discussions with the key stakeholders, an effort was made to identify the various issues and challenges being faced by biomass power plants as well as the major barriers impeding an enhanced promotion of biomass power plants in the states covered under the study. These are discussed briefly in the following few sections.

Table 3: Detailed break up of biomass cost (all figures in Rs)

Fuel type Rice husk Stalks/shells/cobs Fuelwood Rice husk Stalks/shells/cobs Fuelwood Rice husk Stalks/shells/cobs Fuelwood Collection price 1,500-2,000 600-1,200 900-1,350 1,500-2,000 900-1,350 1,500-1,800 1,500-2,100 450-800 1,200-1,650 Loading-unloading Transportation Fuel processing 150-250 200-300 200-250 150-300 200-300 230-500 150-300 150-250 200-400 100-200 100-150 100-200 100-200 50-100 150-250 Total 1,800-2,350 1,200-1,800 1,600-1,900 1,800-2,500 1,500-2,000 2,000-2,500 1,800-2,500 700-1,400 1,800-2,500

Andhra Pradesh 100-200 150-250 100-150 Karnataka 100-200 150-250 100-200 Tamil Nadu 100-150 100-150 100-150

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Overall view of a grid connected biomass combustion based power plant

R E V I E W
Economic Viability
A majority of the biomass power plant operators expressed serious concern over the reduced margins required to ensure economic viability of the plants in the recent years. The problem is due to the rising input biomass fuel prices and relatively lower feed-in-tariff offered. In fact, rationalization of the feed-in-tariff for grid connected renewable power, especially biomass power plants, is critical for ensuring the desired economic viability. During the last year or so, many biomass power plants in Tamil Nadu had closed down their non-viable operations due to increase in fuel prices. In the Gangavati belt in Karnataka, some biomass power plants have started using relatively cheaper fossil fuels, like dolachar (which is a by-product of the sponge iron units in the region) upto the maximum possible limit as per the prevailing regulation, so as to maintain economic viability of the plant operation, which is affected by the increasing rice husk prices.

to their seasonal availability. Huge working capital investment is required to procure and store large quantities of biomass during the season when biomass is relatively cheaper.

Plant Operations
From field visits as well as discussions, it was realized that biomass combustion based plant operations are now quite streamlined and have emerged out of the initial teething troubles with regard to smooth plant operations. As mentioned earlier, plants are facing problems in managing the biomass supply due to the competing industries in the neighbourhood and the major challenge is of managing the fuel cost with rising prices. The price rise is due to the competing usages which offer higher opportunity cost to biomass, which was earlier available as waste. Grid stability has been mentioned as an issue by plants that are connected to 33kV grid because frequent tripping causes problems in restarting and results in higher fuel cost (fuel wastage) as well as loss of revenue due to plant (unplanned) outage. However, plants connected with 132kV lines face negligible problems due to grid tripping. 18

Working Capital
Biomass power plants are relatively less capital intensive, but need a huge working capital owing to the manpower intensive nature of the operations and substantial fuel cost requirement. Biomass prices fluctuate widely due Magazine on Biomass Energy December 2009

Some plants in Karnataka and Andhra Pradesh also mentioned problems about the scarcity of skilled manpower. Manpower/worker/labour shortage during the harvesting season is quite a common problem. Recently, a few power plants have started bringing in manpower from states as distant as Orissa and Bihar.

collecting and analyzing the extensive field level data. There is a need to evolve a model or mechanism to ensure that such data is streamlined to make the biomass atlas dynamic as well as realistic, with the help of GIS and IT.

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Recommendations and Guidelines

In this section, an effort has been made to compile the learnings and insight gained through field visits and to give a few suggestions/recommendations which could prove helpful in formulating guidelines for enhanced promotion of electricity-energy through an optimal exploitation of locally available biomass energy sources, in a sustainable manner.

Developing Organized Biomass Markets and Rationalizing Input-Output Pricing

Traditionally, biomass remained non-commercial and a non-monetized commodity and is generally collected for consumption rather than purchased. In recent times, however, biomass is being sold for a price that is increasing rapidly with the rising demand for it as a cheap source of energy for a large number of process heat applications. Thus biomass has now become a monetized commodity, but it is still traded individually in an unorganized manner. There is a need to systematically develop a reliable market for biomass supply, wherein the movement of biomass for a variety of applications, besides its price, can be monitored. Thus there is a need to demonstrate the viability of biomass market or mandi system on a pilot basis, in different areas that have biomass potential as well as potential as a utilization market. This will help set a trend and benefit the growers to get maximum opportunity cost, the consumers to plan the operations and regulators to regulate the tariff.

Evolving Mechanism for Dynamic Realistic Assessment of Biomass Availability

Presently biomass assessment, merely based on the agriculture production data, crop-agro residue ratios (in some cases, stalk yield per hectare) for residue yield and prevailing consumption based on norms of per capita consumptions (based on available survey results) does tend to give a large biomass power potential. Field study reveals that there is an increasing scarcity of biomass due to the increased demand because of several upcoming biomass consuming industries in the region as well as shifting to biomass being an economically attractive proposition. The MNRE sponsored biomass atlas prepared by the Indian Institute of Science (IISc), Bangalore is definitely a good initiative, which involved a massive operation of

Appropriate Technology Selection for Matching Available Resource and Need

Presently, a majority of grid connected biomass power plants are either Rankine cycle based biomass combustion power plants or cogeneration plants. For harnessing the large untapped biomass power potential in the scattered or wide spread low agro-residue density regions or isolated small agro-processing clusters, other technologies like biomass gasification can be more suitable. Similarly, there can be a niche market for biomethanation based power plants for captive/grid connected power use, to tap the potential of high moisture content (or even slurry) by-product of a typical agro-processing sector, such as tapioca, coffee processing and rubber processing. In combustion based power plants too, power output can be maximized by raising boiler operating pressures from the present 60-62 bar to more than 80-85 bar, thereby achieving higher efficiencies. Similarly, on the lines of the Tamil Nadu pattern, it could be useful to switch from wet water cooled surface condensers to dry air cooled condensers in all the future biomass power plants, as they minimize the water requirements. 19

Heap of corn cobs being used as biomass fuel

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Rationalizing Feed-in-tariff
It is generally perceived that energy from nonconventional sources is infirm in nature and cannot be strictly dispatched, and hence is not amenable for a two part tariff; wind and mini-hydel projects being the best examples. However, biomass projects are capable of generating firm power and hence two part tariff is desirable to operate the plant at an efficient level. Also, with sharp variation in the price of input fuel cost, the two part tariff is convenient for accommodating the cost of price escalation. Therefore, it is proposed that all states should determine the tariff for purchase of power from biomass plants following a two part tariff mechanism.

Conclusions
Based on the learnings and insight gained through field visits as well as discussions with relevant stakeholders it can be concluded that there is still a large untapped potential of biomass energy in the country. However, it is important to implement the program properly, to avoid dense clusters and explore the option of promoting new technologies (higher pressures and temperatures in boilers) as well as promoting other technologies such as biomass gasifiers, sterling engines and biomethanation, to tap the distributed sub-megawatt biomass potential in

the country. It cannot be over emphasized that for effective implementation of biomass based power generation programs, the following critical aspects need due consideration. Evolving a mechanism for dynamic and realistic assessment of biomass resource availability with long term sustainability. This needs to be a continuous updation process. Ensuring the evolution of organized biomass markets (mandi) for streamlining the biomass supply and rationalizing the input-output prices for the power plants. Appropriate energy conversion technology selection for matching sustainable and available biomass resources and local power needs. Determining feed-in-tariff on rational basis for providing a level playing field to encourage the adoption of green renewable power. Evolving conducive dynamic policies for encouraging adoption of cleaner power generation through exploitation of local renewable resources to achieve energy security and a cleaner climate. Sanjay Mande, Manager
Deloitte Touche Tohamatsu India Pvt Ltd Email: smande@deloitte.com

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Call for Proposals

Demonstration Projects on Establishment of Fuel Supply Linkages in Existing Biomass/Bagasse Cogeneration Power Plants The Ministry of New and Renewable Energy, Government of India, is implementing a UNDP / GEF assisted Project on Removal of Barriers to Biomass Power Generation in India. The aim of the Project is to accelerate the adoption of environmentally sustainable biomass power technologies by removing the barriers identified, thereby laying the foundation for the large scale commercialization of biomass power through increased access to financing. As part of this project, the Ministry is contemplating establishing five projects based on different models of biomass fuel supply linkages to demonstrate improvement in sustainability and economic viability of the existing power plants that are facing problems in the improvement of required quantity of biomass. The partial financial assistance for such projects, with matching contribution from the promoter, will be limited to Rs. 100 lakh for projects having installed capacity upto 5.0 MW; Rs. 150 lakh for capacity above 5.0 MW and upto 7.5 MW and Rs. 200 lakh for projects with capacity above 7.5 MW. Proposals are invited from promoters of existing Biomass Power Plants, Cooperative Societies / Sugar Mills, NGOs and other Investors for the establishment of the above-mentioned projects. Interested Project Promoters / Organizations can obtain guidelines for submission of proposal from the Project Management Cell (PMC) established in the Ministry of New and Renewable Energy, B-14, CGO Complex, Lodi Road, New Delhi-110003, Telefax : 011-24369788, Email: jainvk@nic.in, or download from the Ministrys web site: www.mnre.gov.in. Last date for submission of the proposal has been extended to April 9, 2010.

The format and other details can be obtained from the Ministry or downloaded from MNREs website www.mnre.gov.in

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Biomass Briquetting: An Overview

Introduction
India has approximately 141 million hectares of arable land and agricultural output is around 800 million tonnes, which in itself generates 750 million tonnes of waste. Even after deducting 450 million tonnes, which is used as fodder, 300 million tonnes could be used for biomass generation. Crop residues which are not used as animal fodder, such as cane trash, paddy straw, coconut stalks, branches and mustard waste, are estimated to total around 75 million tonnes per annum. Agro-industrial residues such as bagasse, rice husk, groundnut husk, corn cobs, saw mill waste and de-oiled cake are estimated at around 150 million tonnes per annum. Horticultural waste would add another 75 million tonnes of waste per annum. Forest waste could be yet another major source of biomass residue. Briquetting of biomass thus carries tremendous scope and potential in converting the agro residues into a more usable form of fuel. Agro-residues in their compact form, i.e. briquettes obtained by different densification technologies, can be used for better utilization and improved efficiency. The combustion of these briquettes also improves performance as compared to their present utilization pattern. At present more than 60% of the briquetting plants are located in the states of Gujarat, Punjab and Tamil Nadu; about 30% plants are located in Uttar Pradesh, Maharashtra and Karnataka and the rest in Madhya Pradesh and Andhra Pradesh. Winrock International India undertook a thorough study on the performance of a number of units located in five states of the country Gujarat, Tamil Nadu, Karnataka, Punjab and Uttar Pradesh. Realizing the wide ranging benefits associated with biomass briquetting, the Ministry of New & Renewable Energy (MNRE), Government of India has been supporting the sector for a number of years. The study aims at examining the challenges or barriers faced by the industry and develope appropriate strategies aimed at accelerated promotion of briquetting in the country. Magazine on Biomass Energy December 2009

O V E R V I E W

Biomass Briquetting in India

The raw material for the briquetting industry comes from two sources (i) from agricultural fields after harvesting (e.g. sunflower stalks/husk, coriander waste) and (ii) agro based industries after processing the crop (e.g. rice husk and groundnut shell). Hence the farmers and the mill owners are two important stakeholders in the supply chain. The agents / middlemen who undertake the collection, loading and transportation of this loose biomass and sell to the briquette manufacturers, are the other important stakeholders. Briquetting activity is intense in the states of Gujarat, Karnataka, Tamil Nadu, and Punjab. Table 1 shows the approximate number of briquette manufacturing units in the states visited. Gujarat is the leading state in briquette production. There are more than 150 briquette manufacturers in the state and all of them use binder-less piston press machines.

Table 1: Distribution of briquetting units in the country

State Gujarat Tamil Nadu Karnataka Punjab Uttar Pradesh Maharashtra No. of units 150 50 45 40 5 85

Briquetting machines in Gujarat

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Apart from the predominant use of groundnut husk, every conceivable agro-waste is being used as feed stock in Saurashtra region of Gujarat. A majority of units in Gujarat are located in the Saurashtra region. The units have more than 5 to 6 machines of capacities in the range of 750 kg/hr to 1000 kg/hr and are equipped with grinders. Briquettes of size 65 mm and 90 mm are manufactured here. The reasons for Gujarats predominant position in briquette manufacturing and usage are as follows: Abundant raw material availability round the year especially groundnut husk Uninterrupted and adequate power supply. Major machinery manufacturers are located in Gujarat and spares availability is good. Availability of trained manpower. Dry weather conditions even the wet raw materials like bagasse (50% moisture) dry quickly without having to use driers Widespread market demand in industrial clusters such as Morbi (ceramics), Surat (textiles), and Vapi and Ankaleshwar (chemicals and pharma). There are nearly 50 briquette manufacturing units in Tamil Nadu. Many units came into existence after seeing the success of units in Gujarat. There are many industrial segments which have started using biomass briquettes as fuel in their regular processes. This is mentioned in Table 2.

The technologies for briquette manufacturing can be categorized into four types as mentioned below: Piston Press Screw Press Hydraulic Piston Press Pelletization In India, as mentioned earlier, a great majority of briquette manufacturers are using piston press technology to manufacture briquettes of 65 mm diameter and 90 mm diameter. They use a wide variety of bio-residues as raw material, in different ratios, in order to optimize the quality of the briquette and its cost. The raw materials being used in a particular area depend on the cropping pattern and the seasonal variations in the availability of each raw material in that area. The pictures below and

Biomass briquettes

Table 2: Identified industrial clusters using briquettes as fuel

Type of Industrial clusters Tea factories Textile / garment factories Chemicals and Pharmaceuticals Tyre retreading industries Ceramic cluster Paper mills Rubber industries Location Nilgiris, Annamalai hills of Tamil Nadu Bangalore ( Karnataka), Ludhiana (Punjab), Tirupur (TN) Ahmedabad, Vapi, Ankaleshwar Ludhiana, Jalandhar, Bangalore, Mysore Morbi Ahmedabad Jalandhar Application Drying of tea leaf Steam generation for ironing of clothes Steam for the reactors Steam generation Baking of tiles Process steam Process steam

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A briquetting unit

above shows piston press machine and briquettes manufactured in a typical unit in Gujarat. For assessing the quantity of crop residues available for briquetting, it is imperative to understand (a) the area under agricultural crops, (b) cropping patterns and (c) current utilization of crop residues. The residue-to-produce ratio (RPR), which decides the quantity of agro-residue generated, varies from crop to crop. The straw to grain ratio of the cereals varies from 2.5 for maize to 1.6 for wheat. Straw, a low-density residue, is the dominant residue. Rice husk, a by-product of rice milling, accounts for 20% of paddy. Unlike the cereals, crops such as red gram, cotton, rapeseed, mustard, mulberry and plantation crops produce woody (ligneous) residues. The RPR is 2.3 for groundnut husk, 4.0 for coffee, it is 4.0 for cotton, and 2.0 for mustard. It is noted that every conceivable type of agro-residue is being used for briquetting especially in Gujarat where the activity is high when compared to other parts of India. The types of raw materials being used differ from region to region. The selection of raw material depends on the following factors: Cost of raw material Availability Moisture content The most preferred and abundantly available raw material in Gujarat is groundnut husk, which has low Magazine on Biomass Energy December 2009

ash and moisture content thus making it easily briquettable. Unlike other crop residues, groundnut husk is available round the year. However its availability is less during monsoon. Most of the other residues like coriander, castor and jeera are available from January to April. Sawdust is mainly available in the Kutch region of Gujarat and Kerala where many saw mills are located. Raw materials such as groundnut husk, sawdust, coffee husk, and mustard stalks are the best suited materials for briquetting and are used in major proportion in briquettes across the country. The availability of groundnut husk is more in Gujarat, Andhra Pradesh, Tamil Nadu and Karnataka. Coffee husk is mainly available in the Coorg region of Karnataka. Mustard stalks are available in Gujarat and Rajasthan. The moisture content of the raw materials must be in the range of 6 to 8% to minimize the wear and tear of the machine and get good compaction. Escalating raw material prices is a major cause for concern. Briquettes are priced between Rs. 4000 to Rs. 4800 per tonne.

O V E R V I E W

Potential Markets
The potential market for the briquetting sector is majorly in the tea industry. There are nearly 250 tea factories in Tamil Nadu. Presently 30-35% of them have shifted to briquettes and are satisfied with the combustion characteristics. Around 1.25 to 1.40 kg of briquettes are needed to make 1 kg tea which saves Rs 1 per kg of tea in cost of production. Each factory consumes 40 to 50 tonnes per month. This clearly indicates that demand is more than the supply. There is no supply of briquettes in monsoon months because the raw material is wet and cannot be briquetted. The current market demand is roughly 250 to 300 tonnes per day in the tea cluster alone. The demand for briquettes is also high in the textile cluster. There are around 300 units in Ludhiana, 800 units in Tirupur and 500 units in Bangalore in which 50 kg/hr to 200 kg/hr boilers are being used for steam generation. At present, over 25% of the units have switched over to briquettes. Each unit consumes 600 kg/hr of briquettes which results in savings to the tune of Rs. 6,000 per day. There is a potential market size of around 120 to 150 tonnes per day which is yet to be explored to the fullest. 23

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Problems Encountered by the Sector

Supply Side Issues
Rapidly increasing raw material prices (prices of some raw materials like coffee husk have gone upto Rs. 3,800 per tonne (from Rs 2,800 in 2007) is an issue resulting in increasing costs. Due to non-availability of raw material during the monsoon season, briquette units are forced to close down operations for 3 to 4 months. One of the difficulties being faced is the hazard of fire, which is common as raw material is stocked in open yards.

Technology Issues
There are many technological issues which Energy from biomass briquettes this sector is facing. The machines which are used for this purpose have high wear and tear cost and Seasonal availability of briquettes Non-availability of briquettes in monsoon season is parts need to be replaced frequently. Taper die and Split discouraging many interested user industries. die are to be replaced in 100 to 400 hours while Ram & Piston have to be replaced in 200 to 600 hours. The cost of a spare set is as high as Rs.14,000. Lack of Financial Issues understanding on briquette charging/feeding is also an issue. Also, if the raw material is not properly ground, Absence of soft line of credit there is a probability of jamming of the die. It is highly Loans with low interest rates are needed to make the industry more viable in the present situation. energy-intensive and the required total connected load is around 85 to 90 HP. Reluctance of commercial banks to lend and lack of Market Related Issues working capital support Briquette units have high working capital requirement. Wild fluctuations in raw material prices Their working capital requirement is as high as the capital cost in most cases. But banks are reluctant to sanction It is necessary that briquette units maintain surplus space to store enough quantities of raw material to make them working capital loans to briquette units as their stocks relatively immune to wild price fluctuations. are not worth pledging. In essence, banks need some other security in order to finance working capital loans High costs of raw material collection and for these units. transportation Delays in disbursement of subsidy Briquetting is very suitable for those who have easy and cheap access to raw materials. Agro-processing Many units in Gujarat have not availed subsidy as they industries belong to that category as they generate do not have time and manpower to follow up with the authorities. The subsidy disbursement process needs to their own captive raw materials and have an added be quick and streamlined. advantage of saving substantially on the transportation cost of raw materials.

Institutional Issues
Competition from fossil fuels Briquettes will be favoured by the industry only if their landed cost is below Rs. 4,000 per tonne. Magazine on Biomass Energy December 2009 Lack of village level institutions Lack of village level institutions for collection, storage 24

and transportation of agri-residue and biomass waste is increasing the foothold of supply agents, who are not only taking away large chunks of profits in the sector but also inducing high price fluctuations. Less involvement of state nodal agencies The briquetting industry deserves active support from state nodal agencies, which is not happening presently, barring a few cases.

through the cascade approach. This would provide technical support to SNA for developing master trainers for various types of end use industry/ sector/ cluster. Also, support is required to organize trainings at the local level. Training may be phased out later when sufficient awareness has been created in the end-use industry/ sector on handling briquettes in boilers and other heating appliances Quality assurance Briquette quality varies due to the raw material used, binder technology employed, pre heating etc., affecting its moisture content, combustion ability and calorific value. Adulteration of the briquette with non combustible substances to increase the weight also damages the boilers and other heating appliances. Hence, there is a need for standardization/certification of quality of the briquettes. For the same purpose, MNRE may commission a study to develop the standardization protocol. The testing labs could be accredited by SNAs depending upon the credibility and lab facilities available. Overcoming power shortages Reliable and uninterrupted power supply is essential for large-scale commercialization of the briquetting sector. MNRE should look into promoting the concept of developing existing briquetting plants along with gasifier based power plants to take care of the power supply for the briquetting units. A briquetting plant employing even a single machine of capacity 500 kg/hr can sustain a power plant of about 400 kW at full load. A part of the power requirement can be met through this mode of generation with the balance coming from the grid.

O V E R V I E W

Infrastructural Problems
Briquette units are located in rural areas where power supply is unreliable. Units are able to operate only around 8 to 10 hrs /day except in Gujarat where power shortage is minimal as compared to other states. Due to all these uncertainties, banks are not inclined to provide lending support to these units.

Strategies to Overcome Barriers

Strategies to Overcome Technological Barriers
Initiating focused research and development programs High electrical energy consumption and high wear rate of machine parts increases cost of production. There is a need to develop a research & development (R&D) strategy to increase the production capacity, to reduce the wear and tear, to increase the available time of machine and reduce the high power consumption. This R&D strategy has to focus on the operation, maintenance and monitoring issues like periodic maintenance requirements of machines, wear pattern/characteristics of critical components, lubricating oil, etc. Monitoring of moisture content of raw material and its impact on the operation of the machine has also to be taken care of. Also required is a comprehensive technical audit of different types of machines for complete technical mapping, to identify the problem areas. Technological support and training to end-use Industries/sector There is a need to perform comprehensive energy audits of combustion equipment using briquettes instead of other solid fuels. MNRE has to facilitate energy audits through State Nodal Agencies (SNAs) to develop suitable retrofits to optimize the efficiency of the combustion system for briquette use. The ministry can also organize trainings for various end-use sectors, along with SNA Magazine on Biomass Energy December 2009

Strategies to Overcome Financial Barriers

Restarting the IREDA line of credit IREDA was the only financial institution financing briquetting units in the country two decades back, with 28 briquetting units financed by it. But none of the units operated satisfactorily. Similarly, Uttarakhand Renewable Energy Development Agency (UREDA) also ran a scheme from 2003 to 2007, wherein 90% of the cost of the machinery was subsidized for briquette units in the state. 22 units, each with120 kg/hr or 250 kg/hr capacity and using saw dust, pine needles and lantana as raw materials were benefited from the scheme. The scheme was 25

discontinued from 2007 as the units became unviable due to high cost of production (increasing raw material prices) and low volume of operations, with the end user industries refusing to buy briquettes at the price of Rs.6,500 per tonne. Now, India has gained good operating experience in the piston press technology, with more than 250 plants installed with a success rate of 75%. The self-financed briquetting plants implemented since mid 90s are doing good business, especially in the western and southern regions. Thus, IREDA may consider re-starting their financing scheme. If IREDA is able to take care of the term loan requirements, commercial banks may come forward to provide working capital support to the entrepreneurs. Risk guarantee fund for briquetting sector IREDA may consider a Risk Guarantee Instrument to evince the support of banks in this sector to provide an impetus to commercial lending for briquetting enterprises/projects through part coverage of business and financial risks. Lack of knowledge with regard to the technology, the commercial chains, networks, marketing and the risks associated with such enterprises discourages financial institutions from financing such projects. IREDA will have to ensure simplicity, to institutionalize and embed the financing mechanism, both at the level of the entrepreneur and financing institution. The proposed fund intends to increase the comfort level of the lenders so that banks develop lending operations in these areas and also set in place the institutional apparatus and technical assistance services to articulate the policy goals of the enterprises.

O V E R V I E W

MNRE may consider supporting/ promoting models similar to warehousing/ storage of agricultural products on a public private community partnership basis, to ensure assured supply
investors who may share a part of the total profit earned. The private investors could also be briquette manufacturers, who find investment in this venture profitable, helping them have an assured supply of biomass at reasonable cost and maximizing the profits and viability. The stock maintained in these warehouses should be of sufficient quantity to deal with three months of production capacity. Promotion of briquetting in agro processing units Briquetting technology is well suited for agro-processing industries, which generate their own captive raw materials. It substantially saves on the transportation cost of raw materials. It is equally beneficial to those who have a large captive consumption of briquettes and are presently using agro-residues with low utilization efficiencies and/or expensive coal. MNRE may undertake mapping and identification of such agro processing units and take up special awareness generation and capacity building programs for promoting briquetting in them. Creation of extension support service A properly functioning extension support system for briquette manufacturers is crucial for wide-scale utilization of this technology. MNRE may consider developing extension support services for various stakeholders of this sector, with enhancement of the awareness of banks, industry associations and enterprises on aspects related to biomass energy and institutional strengthening as its key elements. Institutional strengthening, through training, provision of equipment and training materials, demonstrations and study tours may also help. The extension institute(s) and/or industry associations may conduct training courses for relevant groups in the country. Creation of extension support service MNRE may seek support of universities and national research institutes for provision of extension support 26

Strategies to Overcome Market Barriers

Adequate storage of biomass for continuous supply Erratic supply of raw material, wide price fluctuations and non availability of biomass during monsoon season affects the briquette manufacturers and the end-use sector due to lack of assured supply of briquettes around the year. The intermediaries (supply agents), rather than briquette manufacturers, have large stock yards to store the raw material in bulk quantities, increasing the margins of supply agents. MNRE may consider supporting/ promoting models similar to warehousing/ storage of agricultural products on a public private community partnership basis, to ensure assured supply. The storage facilities could be maintained by community groups or their federations and finances could come from private Magazine on Biomass Energy December 2009

services, which includes preparation and provision of information on new and improved briquetting technologies and equipment. Training of trainers (extension workers, industry associations, research institutes and NGOs) in new and improved biomass energy technologies is also an important step. Monitoring of new and improved biomass energy technologies and preparation of investment plans for new or improved biomass energy technologies also help in the purpose. The major stakeholders who would be influenced by the same are current and potential briquette using industries, biomass waste generating industries, research institutes (research and provision of information), industry associations, private consultancy companies for biomass energy technologies (existing or potential), equipment manufacturers, briquette manufacturers and banks.

agro-industrial residues like groundnut shell, rice husk etc., for agents, in bulk quantities during off-season and at low prices. They then stock and sell to briquette units for a higher price when the availability is scarce. There is a need to develop community based institutions to create the critical mass required to eliminate the role of supply agents, so as to create a sustainable livelihoods option for the village community and maintain an assured supply of raw material at a reasonable price. The community based institutions could be federated into a cluster level institution to develop infrastructure for storage & transportation. MNRE could facilitate ties with schemes of other Ministries like the Ministry of Rural Development, that support the formation of village level institutions like self help groups, user groups and livelihood groups involved in livelihood and income generating activities. These schemes provide funds for capacity building and capital subsidies for establishing micro enterprises. MNRE needs to undertake capacity building for agencies and NGOs involved in identification and strengthening of these groups at the village level. Ensure a greater role of SNAs in promoting this sector SNAs need to play an important role in engaging with stakeholders at various levels for training, capacity building, forging alliances, extension support services and providing technical support. Ritu Bharadwaj, Senior Program Officer
Winrock International India Email: ritu@winrockindia.org

O V E R V I E W

Strategies to Overcome Institutional Barriers

Development and strengthening of village level institutions Raw materials used in briquette units is sourced through intermediaries/agents, who own a fleet of vehicles for collection and transportation of raw materials within 100 to 150 km radius and have huge stock-yards for storage. Supply agents procure the highly scattered agro-residues from fields after harvesting season, for free or by paying a very nominal price to the farmers. Farmers lack bargaining capacity as the quantity of raw material generated individually in small land holdings is not high enough to demand a good price. Supply agents also have tie-ups with agro-processing mill owners to procure the

Request for Articles

Bioenergy India is intended to meet the updated information requirements of a diverse cross-section of stakeholders from various end-use considerations, be it biomass combustion, gasification or cogeneration. To meet such an objective in a timely manner, the editorial team of the magazine invites articles, features, case studies and news items, etc., from academicians, researchers & industry professionals. The contributions should be of about 2,000-2,500 words (approximately 5-6 pages, which would include relevant graphs, charts, figures and tables). The two lead articles would be given an honorarium of Rs 1,500 each. Please send in your inputs along with your photograph to: Smriti Mishra (smriti@winrockindia.org) Winrock International India; 788, Udyog Vihar, Phase V, Gurgaon-122 001; Phone: 0124 430 3868

Magazine on Biomass Energy

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S T U D Y C A S E

Briquetting of Pine Needles A Viable Entrepreneurship Model

Background
Most of the rural population in the developing countries continue to rely heavily on biomass to meet their limited energy needs. However, the biomass utilization in the rural sector, such as for cooking, depends on the traditional wood burning stoves. These are very inefficient and polluting and often result in resource wastage besides causing indoor air pollution. According to the World Health Organisation (WHO), this killer (i.e. wood stove) in the kitchen is regarded as being one of the top-10 global health risks. The solution lies in taking a close look at the large quantities of biomass residues available in the rural agriculture societies. These residues mainly include rice husk, rice straw, wheat straw, corncob, coconut shell, bagasse, and many other agricultural residues as well. Despite the abundance of these residues, they are difficult to use due to their very low bulk density in addition to high moisture and ash contents. As a result, fuel wood often accounts for a major fraction of the total biomass use. Fuel wood is generally preferred due to its higher energy density, ease of convenience and transportation. Excessive use of fuel wood, however, is exerting undue pressure on the regions forest cover. It is compounded by the lack of suitable cost-effective technologies for utilizing biomass residues, which has resulted in gross under utilization and neglect of biomass residues as being a potential renewable energy (RE) source.

The loose unused biomass can be pelletized to a bulk density of more than 650 kg/m3 that can be easily transported and used for small and big thermal applications.
cafeterias and restaurants in order to replace LPG. The low cost, i.e. less than half the equivalent amount of LPG, will act as a main motivator for the end-users to switch to this clean energy alternative. Moreover, the replaced LPG will generate carbon credits. The process of briquetting biomass is a mature technology and is currently operational in different parts of India. The smokeless biomass chulhas for large scale cooking uses gasification technology and can be adapted. Their operational performance can be optimized so as to increase their efficiency for meeting the local energy requirements. Additionally, the densified biomass can be used to replace coal in the locally set up small scale industries, such as the brick kilns and boilers.

The Entrepreneurship Model

A business unit has been set up in Kotdwara in the hilly state of Uttarakhand. Within it, biomass briquettes using forest residues or agro-waste, (which include a widerange of residues such as dry leaves, grass, unwarranted weeds, forest residue, cow dung, sawdust from local sawmills) are being utilized apart from the highly inflammable pine needles that cause forest fires. These briquettes are then supplied to the brick kiln manufacturers, boiler operators for steam generation and food processing industries that normally use coal for heating purposes. The low cost and guaranteed availability of the densified biomass happens to be the main motivation for clients to switch to the clean energy alternative. In addition, smokeless midsize scale stoves based on gasification technology have also been developed that burn the briquettes and can replace the LPG stoves. These stoves are currently used in institutional kitchens such as restaurants, banquet halls, mid-day meal school program, company cafeterias and 28

Potential Applications
The loose unused biomass can be pelletized to a bulk density of more than 650 kg/m 3 that can be easily transported and used for small and big thermal applications. These briquettes have a calorific value of around 3,500 Kcal/Kg (as compared to 5,000 Kcal/kg of coal). 2.5 kg of such pellets can replace 1 kg of liquified petroleum gas (LPG) and 1.2 kg of biomass can replace 1 kg of coal. There are approximately 33 million households and institutional kitchens, which make use of LPG for cooking purpose in India. Agro-waste, forest residue and highly inflammable pine needles that cause forest fires can be used to make biomass briquettes. These briquettes can then be supplied along with a smokeless biomass chulha to the institutional kitchens, such as Magazine on Biomass Energy December 2009

temples. The revenues accrue from the sale of briquettes and cooking stoves as well as from the carbon credits that are generated by the replacement of fossil fuels. Several self-help groups working with the local micro-entrepreneurs at the village level are engaged to collect and store biomass. According to a recent report of the Uttarakhand Forest Department, more than 1 million tonnes of pine needles are available. The project has the necessary approval from the local authorities to access the forest waste required to expand the project activity. This project is not only able to address the energy problem with the use of pine needles, but also generates employment opportunities for the local youth.

C A S E S T U D Y

Pine needle briquettes being used to cook food

The Expansion Plan

The next logical step is to start 10 similar independent business units that will replicate the above project and thus produce 20,000-30,000 certified emission reductions (CERs) per unit. This is also expected to generate employment opportunities for more than 5,000 people in the rural areas and an additional 300 people in the semi-urban areas. Also, a total of 100,000 tonnes of fossil fuel will be replaced, thus possibly resulting in reduction of 200,000 tonnes of CO2 emissions. Net revenues from the sale of carbon credits alone at current rates will be around $3 million. However, an initial investment of around $200,000 per unit is required for setting up the factory and collection centers and developing the market for clean energy. The rate of return after 2-3 years of operation for the investors will be around 20%.

has resulted in a gross underutilization and neglect of biomass residues as a potential energy source. Excessive reliability on wood also exerts an undesirable pressure on the regions forest cover. The use of gasification technology combined with densification results in an efficient and clean burning of the available biomass and thus offers significant potential for utilizing the unused biomass for several applications such as commercial cooking, industrial boilers, and even small scale power generation units. The project aims to reduce CO 2 emission from burning fossil fuels which is mainly responsible for the climate change.

Conclusion
Our continued reliance on fossil fuels will also be reduced, which is now one of the top most national priorities. Currently India imports around 80-90% of its crude oil requirements annually and lately coal is also being imported, especially to run the ultra mega power projects. Furthermore, around 50% of homes, mostly in the rural areas, are still not connected to the grid. Therefore, projects like these will empower the rural population to fulfill their thermal and electricity needs. This will ultimately pave the way to develop sustainable businesses so as to generate some regular income for the poor farmers. Brijesh Rawat, Managing Director
Rural Renewable Urja Solutions Pvt. Ltd. Email: rawatbrij@yahoo.com

Environmental Gains Possible

Although biomass offers itself as a sustainable and carbon-neutral source of energy, yet its inefficient use results in wastage, indoor air pollution besides related respiratory and other health problems. Excessive use of fuelwood is also exerting pressure on the regions forest cover. No doubt, large quantities of the surplus biomass residues are available in India, but the difficulties experienced in using and transporting them have severely restricted their enhanced usage. Further, the nonavailability of suitable cost effective technologies for utilizing the biomass residues for clean energy purposes Magazine on Biomass Energy December 2009

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FINANCING SCHEMES

IREDA Financing of Biomass Power Projects

Background
The Ministry of New and Renewable Energy (MNRE) is an apex organization responsible for renewable energy based policy, planning and program implementation measures, etc., across the country. Its financial arm is known as the Indian Renewable Energy Development Agency (IREDA) Limited, which advances loan facilities to potential project developers, etc., at concessional rates in accordance with the type of scheme. Such a facility is also available for the biomass power generation and bagasse based cogeneration related projects with varying terms and conditions. Mentioned below is the table that highlights financial incentives available for the purpose. The table is followed by details of the financing norms for these projects.

Fiscal incentives available for biomass power generation

Item Income Tax Depreciation Description

100% depreciation in the first year can be claimed for the following power generation equipment: 1. Fluidized Bed Boilers 2. Back Pressure, pass-out, controlled extraction, extraction and condensing turbine for power generation with boilers 3. High efficiency boilers 4. Waste heat recovery equipment Tax Holiday 10 year tax holiday Customs duty Duty leviable for NRSE power projects of less than 50 MW capacity (under Project Import Category) is 20 % ad valorem. This covers machinery and equipment components required for generation of electric power. Central Excise Duty Exempted for renewable energy devices, including raw materials, components and assemblies Central Sales Tax General Sales Tax Exemption is available in certain states

Financing Norms and Interest Rates for Biomass/Cogeneration Based Power Projects
Small scale cogeneration (except sugar industry) projects upto 7.5 MW installed capacity attract interest rates ranging between 11.5 to 12.15%. The maximum possible period for loan repayment will be 10 years Promoter of such projects is expected to contribute a minimum of 30% of the total project cost IREDA will be making available a loan amount upto 70% of the total project cost Projects with more than 7.5 MW installed capacity (both for sugar and non-sugar industry) also attract equivalent interest rates in the range of 11.50 to 12.15%. Minimum applicable boiler pressure for capacities in excess of 7.5 MW should be 63 Kg/cm2 Magazine on Biomass Energy December 2009

The maximum possible period for loan repayment will be 10 years The promoter of such projects is expected to contribute a minimum of 30% of the total project cost IREDA will make available a loan amount upto 70% of the total project cost Biomass power generation projects based on direct combustion mode and with a capacity range of 1-10 MW are eligible for financing. The minimum applicable boiler pressure should be 63 Kg/cm2 The interest rate corresponding to four different categories (I-IV) will be in the range of 11.5 to 12.15% Maximum period for loan repayment will be 10 years and the project promoter is expected to pay 30% of the total project cost IREDA will make available an amount upto 70% of the total project cost 30

Biomass fuel processing machines in case of IREDA funded projects will attract an annual interest rate of 12.75% A loan amount upto 75% of the project cost will be made available by IREDA, thereby requiring a minimum promoter contribution of 25%. Such a loan is to be paid back in a period of 7 years The maximum moratorium period would be 2 years Biomass gasification (concerning 100 kWth and above) projects will attract an annual interest rate of 12.75% with upto 75% of the total equipment cost being available for financing. The maximum period during which the loan is to be repaid would be 5 years and would involve a maximum moratorium period of 2 years The promoter of such a project is expected to make a contribution equivalent to 25% of the total project cost

Minimum size of Sugar Plant should be 2500 TCD.

FINANCING SCHEMES

Biomass Power Generation

IREDA shall finance not more than one independent Biomass Power Project, excluding captive Biomass/ Bagasse based cogeneration, in one district Projects set up for captive consumption without grid inter-connectivity are encouraged Projects based on captive biomass/ energy plantation are encouraged Use of highly energy efficient equipment in Biomass Power Plants is encouraged Biomass direct combustion power projects exceeding 7.5 MW capacity upto a maximum of 10 MW, will be considered on case to case basis subject to careful examination, particularly with reference to: - biomass availability - presence of other Biomass power/ Biomass cogeneration projects in that area - linkage for off-season fuel - water availability, etc.

Other Points of Significance

Biomass Cogeneration Cogeneration and Industrial

Use of high energy efficient equipment in sugar/paper mills for supporting cogeneration projects is encouraged.

Source: www.ireda.in

...Biomass Gasification (Contd from page 13) Future Prospects

With an increasing commitment to deploy the renewable energy resources throughout the world, future prospects for biomass gasification have become better than before. The major constraint of the past i.e. adequate technology development and availability of reliable hardware has largely been overcomed. As biomass resources can be deployed on demand and for almost all types of applications, an increasing use of biomass gasification technology has become inevitable. The fact that biomass is generally available all over and the relatively low initial investments required should further help its increased market penetration. In terms of applications, grid-fed power generation is likely to dominate in developed countries, wherever Magazine on Biomass Energy December 2009 attractive policies are in place (i.e. in many European countries, particularly Germany, Italy, etc.). As against this, captive power requirements for the industry, thermal applications and distributed generation for remote/rural areas could open big opportunities in developing countries. Countries like India may also see more and more megawatt level power plants feeding into the grid, thereby strengthening the tail end voltage distribution. This may lead to improved power supply to rural areas through the grid, while simultaneously creating massive employment opportunities and economic development.

B C Jain, Managing Director

Ankur Scientific Energy Technologies Pvt. Ltd., Vadodara Email: ascent@ankurscientific.com

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UNDP MNRE WORKSHOP

UNDP MNRE Initiative: Access to Clean Energy

The Government of India and UNDP have recently initiated a program entitled Supporting national development objectives with co-benefits of mitigating climate change. This initiative aims to support the Government of Indias efforts to fulfil national commitments under the UN Framework Convention on Climate Change and the Kyoto Protocol. The project proposes to support national efforts to reduce GHGs by focusing on the following themes (i) energy efficiency improvements in select energy intensive sectors (ii) enhanced access to clean energy, (iii) leveraging environmental finance and (iv) knowledge sharing. The Ministry of New and Renewable Energy (MNRE) is the implementing partner for the component of the project dealing with `enhanced access to clean energy In order to sensitize key stakeholders and to solicit feedback based on their past learnings, an inception workshop was organized in Casurina at India Habitat Center, Lodi Road, New Delhi on 23rd December 2009. The workshop began with a welcome address by Shri K P Sukumaran, Adviser, MNRE. He informed the participants about the Ministrys objective in organizing the workshop. He encouraged the participants to share their learnings and experiences from the past renewable energy projects and to provide feedback on the existing policies and programs for up scaling clean energy technology interventions so that a realistic strategy and action plan could be evolved. The inaugural session ended with a vote of thanks by Shri V K Jain, Director, MNRE. On behalf of MNRE and UNDP, he thanked Shri Deepak Gupta, Secretary, MNRE, Ms Gauri Singh, Joint Secretary, MNRE, Dr Preeti Soni, Assistant Country Director, UNDP and Shri K P Sukumaran for their support and encouragement towards this project. He thanked the speakers and participants for joining the workshop at such a short notice. In the end, he also thanked Winrock International India (WII) for their help in organizing the workshop. The First technical session was on Clean energy access: issues, challenges and way forward voices from the state. The session was co-chaired by Shri K P Sukumaran and Shri V K Jain. Magazine on Biomass Energy December 2009

Shri Deepak Gupta, Secretary, MNRE addressing the audience

The Chairpersons briefed the participants about how energy plays a crucial role in underpinning efforts to achieve overall development and in improving the quality of lives of poor people. However, energy access is a growing concern, wherein several million people still depend on traditional biomass to meet their cooking energy needs and they also lack access to electricity in their homes. Mainstreaming renewable energy to extend energy services to the rural poor seems extremely relevant not only in terms of stimulating regional development and in improving the quality of life, but also in enhancing livelihood opportunities for the vast majority of the rural population which is deprived of clean energy services. Inspite of the overall enthusiasm and activity, not much effort has been made to address the issue of access to clean energy. Given this above background, chairperson apprised the participants that the primary objective of the technical session, which was aimed at getting feedback from the grassroot level NGOs on their learnings and experiences from past projects in mainstreaming renewable energy. The purpose of the session was also to review the existing policies and programs of the government for up scaling clean energy technology interventions so that the gaps could be addressed and appropriate energy solutions for poverty alleviation in low-income households could be developed. The Chairpersons of the session encouraged representatives of the NGOs from different states and institutions to share their experiences on clean energy initiatives and contribute their expertise towards 32

developing a strategy for enhancing access to clean energy. The representative from CARD, an NGO working in the sector, emphasized the need for linking RE with livelihood programs of rural development. Development Alternatives, an organization, which has worked on REZ (rural entrepreneurship zone) model- centralized power station for local enterprises, brought forward points such as acceptance of the community for renewable energy technology is less and lack of awareness is a major challenge for commercialization. The second technical session was on Business models for clean energy access. The session was co-chaired by Shri K P Sukumaran, and Shri S N Srinivas, United Nations Development Programme. The Chairpersons briefed the participants and said that several barriers impede private investment in the commercialization of RETs and in the development of commercially viable business models for clean energy access. The major barriers include limited financing to defray high up-front costs associated with developing renewable energy projects, entrepreneurs unfamiliarity with structuring commercially viable businesses, tough competition from subsidized conventional energy sources that lower the market price for electric and thermal power and market penetration costs. Besides, there is the absence of an institutional mechanism that can allow enterprises that are harnessing renewable energy technologies to come together to script and articulate suggestions on policies which will encourage private investments in renewable energy, as well as connect with associations in other countries to form investment and trade links.

NGOs from the state of Orissa, Madhya Pradesh, Uttar Pradesh, Rajasthan, Bihar, Gujarat, Jharkhand and Chhattisgarh shared their experiences during the workshop. In order to accomplish the objectives as highlighted above, the following specific actions were proposed to be carried out. Design a framework to address gaps and up-scale clean energy technologies Based on a review of existing policies, schemes and programs, a feasible framework for up-scaling clean energy technology interventions, in the identified districts in the relevant states, will be designed. State Nodal Agencies (SNAs) will be involved in collating the experiences at the grass root level and will be the link with national level actions. Support to up-scale implementation The project aims to up-scale implementation through provision of technology packages, strengthening supply services (manufacturer development), demand development (by facilitating livelihoods), awareness, capacity building and skill development. The project activities will be a part of the district energy plans. Development of national strategy for Accelerated clean energy access The learnings here will serve as inputs to the process for developing a national strategy for Accelerated clean rural energy access. Strategic partnerships to leverage environmental financing Possibilities need to be explored for leveraging local level finances and strategic partnerships for climate change relevant initiatives. Knowledge sharing platforms and networking The project aims to provide inputs for environmental policy and climate change policy regimes through (a) strengthening database on mitigation and vulnerabilities, (b) providing a platform for discussion on climate issues, (c) supporting joint partnerships and activities aimed at knowledge sharing with different stakeholders. The following concrete deliverables were mentioned: Rural Energy Access Advisory Committee to be formed

UNDP MNRE WORKSHOP

Participants at the workshop

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and current scenario reviewed, Urja Sanghathan to be formulated to build in grassroot feedback for the activities in participating districts, Capacity building of Urja Sanghatan and training of trainers for rural franchise, Mainstreaming modern clean energy devices for meeting thermal applications in selected areas for the end uses of both the domestic sector and enterprises, Energy efficiency, electricity generation and distribution for 250 rural villages, Establishment of criteria for Renewable Energy Service Company (RESCO) as a viable business model, Demonstrating energy efficiency in villages, Supporting actions to reduce transmission & distribution losses, Developing communication strategy to disseminate the learning, Developing a national policy to accelerate an improved Access to clean energy, Exploring partnerships and strategies, Providing inputs for environmental policy and national as well at international climate policy regimes. The concluding session was chaired by Shri Deepak Gupta and the panelists included Ms Gauri Singh, Shri K P Sukumaran, Dr Preeti Soni, Ms Anjali Garg, Energy Specialist, South Asia Sector Sustainable Development Energy, The World Bank and Dr Kinsuk Mitra, President, Winrock International India. The Chairperson talked about the proceedings of the workshop and the key conclusions drawn from the recommendations of the participants. It was brought about in this session that the project will not only involve NGOs but also new generation entrepreneurs, technology suppliers, equipment manufacturers, self help groups, users associations and others in the renewable arena. The prime focus of the project will be on promoting sound economic/business models and on targeting unmet demand. This would also work towards evolving quantum and mode of financing. It was proposed that information related to the project be put on the website of WII with links from MNRE and UNDP website. This will be used for sharing project related information, documenting NGOs experiences, registration of NGOs, etc. Proper development of the operational manual is also a part of the project. Magazine on Biomass Energy December 2009

UNDP MNRE WORKSHOP

Major Events
Biomass 2010 Conference March 3031, 2010 Arlington, VA, USA Contact: biomassmeeting@courtesyassoc.com Algae Biofuel Workshop 2010 April 1213, 2010 Lecture Hall, India International Centre, 40 Max Muller Marg, New Delhi, India Contact: info@growdieselevents.com / growdieselevents@gmail.com Bio energy Markets Africa: Expanding sustainable bioenergy production Mozambique May 1113, 2010 Pestana Rovuma Hotel Maputo, Mozambique Contact: HEDON Household Energy Network Website:http://www.hedon.info/715/events.htm GreenEx 2010 May 1213, 2010 MTN Expo Centre. Johannesburg South Africa Contact: Cradle of Humankind, Muldersdrift Gauteng Email:smithalw@gmail.com Website:http://www.merlinwiz.com/ 18th European Biomass Conference and Exhibition May 37, 2010 Lyon, France Contact: biomass.conference@etaflorence.it International BIOMASS Conference & Expo May 46, 2010 Minneapolis, MN, USA Contact: service@bbiinternational.com ISES Asia Pacific Regional Conference on Renewable Energy June 27 - July 2, 2010 Yokohama, Japan Contact: re2010reg@convention.co.jp

The workshop concluded with a vote of thanks by Dr. Kinsuk Mitra. On behalf of MNRE, UNDP and WII, he thanked all the speakers and participants for sharing their valuable experiences and helping in achieving the objectives of the workshop.

Courtesy: WII Editorial Team

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Policy Incentives for IPPs and Investors for Wind & Biomass Power Generation
A seminar on Policy Incentives for IPPs and Investors for Wind & Biomass Power Generation was organized by Independent Power Producers Association of India (IPPAI), on behalf of the Ministry of New and Renewable Energy (MNRE), in association with the United Nations Development Programme (UNDP), India, and the Indian Renewable Energy Development Agency (IREDA) on December 17, 2009, at The Imperial, New Delhi, India. The program is to be implemented by the Indian Renewable Energy Development Agency and is a significant push by the government to take unilateral and voluntary action to support the growth of renewable energy technologies in the country, creating an attractive investment market for large independent power producers and foreign direct investors. The MNRE further announced that it will be simultaneously promoting biomass based distributed and grid connected power generation, in order to give a boost to renewable energy projects being developed by IPPs. The inaugural address at the seminar was delivered by the Honble Union Minister for New and Renewable Energy, Dr. Farooq Abdullah. Other eminent speakers included the following: Shri Deepak Gupta, Secretary, MNRE Ms Gauri Singh, Joint Secretary, MNRE Shri Debashish Majumdar, Chairman & Managing Director, IREDA Dr Pramod Deo, Chairman, CERC Shri Dilip Nigam, Director, MNRE Shri V P Raja, Chairman, MERC Shri Chintan Shah, Head - Strategic Business Development, Suzlon Energy Ltd. Shri M K Deb, Managing Director - Consolidated Energy Consultants Ltd. Shri Gokul Chaudhri, Partner, BMR Advisors Shri Amulya Charan, Managing Director, Tata Power Trading Co. Ltd. Shri Alok Kumar, Secretary, CERC Dr G C Datta Roy, Chief Executive - Energy Business, DSCL Energy Services Co Ltd. Shri Balawant Joshi, Managing Partner, ABPS Infrastructure Advisory Magazine on Biomass Energy December 2009 Shri V H Buch, Director, GEDA Shri Sunil Jain, Chief Operating Officer, Green Infra Ltd. The participants included senior members from Government organizations, Chairmen of Electricity Regulatory Commissions, Independent power producers, regulators, policymakers, investors, consultants, advisors, experts, wind power project developers, industry specialists and other stakeholders interested in renewable energy. Following are the key points of discussion related to the biomass energy that emerged during this event: Dr Farooq Abdullah The honourable minister announced that the Government would play the role of a facilitator and would not be a blocker in the efforts to help growth of power generation through renewable energy sources. He said that the Ministry is there to unlock the locks that have been locked for too many years to facilitate investment in the sector. He called for a lot more to be done to achieve targets and also stressed on the need for investors to take risks. Shri Deepak Gupta As far as biomass is concerned, Shri Gupta said there were many big projects to feed into the grid but added that the MNRE would also focus on the smaller, more manageable tail end projects to feed the local and catchment area which, apart from reducing raw material costs, will also strengthen the grid. He added that since 30-40% of India is without access to power, it has a moral imperative to use rice husk and other biomass products to provide an opportunity to give power to deprived villages. He also said that the generated power can be used in irrigation pumps which are diesel guzzlers, he added. Shri Harry Dhaul He spoke on the subject of incentivizing biomass generation and how it facilitated utilization of locally available feedstock, left a lower carbon footprint in transportation of fuel, operated on high plant load factors 35

I P P A I W O R K S H O P

(PLFs), was ideal for remote villages where off-grid systems could be set up, and was most suited for distributed generation projects since there were zero transmission and distribution losses. He added that it also led to increased local employment due to upstream and downstream activities, boosted growth in rural infrastructure and education and led to substantial multiplier benefits in the local economic and social framework. Dr G C Datta Roy Dr Roy spoke on the Development of Small Scale Biomass Based Distributed Power Generation in Rural Areas. He said that surplus availability for IPPs would be mainly from agro and forest waste and the competitive use of biomass would be the critical factor driving sustainability. Analyzing the economic competitiveness of using biomass, he said that next to captive usage, the most valued use of biomass is as fiber and added that brick kilns and cement mills can offer higher prices by as much as 25%, considering coal price parity. But, he also added that usage by these industries is not significant enough to appear as a competitive threat to biomass based power plants. He also felt that oil mills can offer much higher prices, because they have an opportunity of higher value realization by installing mini cogeneration power plants and exporting small quantities of power to the grid-which would provide the highest value realization from biomass. He also said that price parity would be governed by coal price parity and added that, at the tail end, competitive pressure would be a lot less.

Dr Roy spoke of the gaps in CERCs regulations on biomass based power generation and said that not having a standardized station heat rate for biomass based power plants has hampered generation. He mentioned that station heat rate is not defined at different power generation capacities, as is in the case of coal, and said that the station heat rate for biomass based power plants is arrived at depending on the of type of biomass and type of technology. He elaborated on the financial and economic viability of a typical biomass power project and spoke of the issues that dogged last mile DG models. He added that better grid connectivity and the possibility of learning from existing larger plants for scaling down, offers new opportunities for the development of 1-2 MW small IPPs as last mile DG plants. He also asked if tail end DG systems could be subjected to payment of OA charges and added that last mile DGs can make significant impacts on reducing T&D losses. In conclusion, he said that there is a strong case for the development of last mile grid connected biomass DG systems (1-2 MW) which require policy support during their development phase, including financial subsidy, which could be capital or generation based. He said that different tariff structures and rates, when considering partnership with rural communities, should be considered together with preferential dispatch, liberal grid connectivity, and freedom from rostering. He also suggested that liberal open access-capacity and charges, exemption from distribution charges, and cross-subsidy for such DG projects should be offered.

I P P A I

W O R K S H O P

Call for Advertisements

We invite organizations to advertise their profiles and products in the Bioenergy India magazine. Advertisements focusing on the Biomass Energy sector will be offered a space in the magazine. Special discount is available for insertions in more than two issues. For details, please contact Sasi M at sasi@winrockindia.org The advertisement tariff is as follows: Particulars Back Cover Front and Back Inside Cover Inside Full Page Inside Half Page Colour (Rs) 20,000.00 18,000.00 15,000.00 8,000.00 Black and White (Rs) 10,000.00 8,000.00 3,000.00

Magazine on Biomass Energy

December 2009

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News Snippets on Biomass Power

Diesel Replacement in Rice Mills by Biomass Gasifiers
Presently rice mills make use of import dependent diesel for meeting their captive power requirements. With due realization of this fact, the Ministry of New and Renewable Energy (MNRE) has recently launched an ambitious scheme for promoting rice husk based biomass gasifier systems in the rice mills. The underlying rationale is not only to save diesel but also provide economical and reliable solutions for their captive power needs. In fact, there is an enormous potential for saving fossil fuels via this route of renewable energy technology utilization. A special financial package is now in place for this purpose, under which a Memorandum of Understanding (MOU) was signed between the State Bank of India, Patna and M/s Beltron Communications Ltd., Patna in the presence of Shri Deepak Gupta, Secretary, MNRE on 8th January, 2010. Through this technical & financial mechanism, about 500 rice mills would be able to avail the benefit by setting up biomass gasifier systems during 2010 which would lead to the saving of about 20-25 million liters of diesel annually and at the same time avail the benefits of a reliable power supply.
Source: www.mnre.gov.in

N E W S S N I P P E T S

(PEDA) has already commissioned a biomass power capacity of 14 MW so far. A total capacity of 282 MW spread over 27 sites across the state is likely to be commissioned by December 2010 in a phased manner. These plants have capacities ranging between 6-20 MW. Of these, M/s Green Planet Energy Private Limited is setting up the maximum biomass power capacity of around 145 MW in the state.
Source: www.peda.gov.in

Multi-fuel 10 MW Biomass Power Project for CDM Benefit

Maharashtra Energy Development Agency (MEDA) is also encouraging the use of biomass power projects in the state. M/s AA Energy Limited is currently setting up a 10 MW biomass power project at Desaiganj in Wadsa Tehsil of Gadchiroli district of the state. This project will utilize the surplus biomass residues obtained primarily from rice husk and other biomass materials like stalks of soya bean and tur etc. These materials available locally would be used to generate power through sustainable means without causing any negative impacts on the surrounding environment. This project is expected to result in greenhouse gas (GHG) abatement of 149,047 in CO2 equivalent.
Source: www.mahaurja.com

Punjab Targets to Harness 3,000 MW of Biomass Power

The state government of Punjab is targeting to produce around 3,000 MW of useful power by putting to use 20 lac tonnes of agricultural residue being generated here every year. Such a policy initiative is expected to mitigate the acute problem of pollution, which is caused due to the combustion of paddy residue in the open. Also, it may help tackle the decreasing productivity of the land on account of the heat produced by this fire. Importantly, setting up biomass projects would also earn carbon credits worth crores for the state exchequer. As per the available estimates, 28 biomass plants would begin to produce around 80 MW power by December 2010, whereas the next lot of 28 plants is expected to take the combined power from biomass upto 700 MW. There would be multiple benefits available, which also include the strengthening of the rural economy. The state nodal agency i.e., Punjab Energy Development Agency Magazine on Biomass Energy December 2009

Waiver of Environmental Clearance for Biomass Projects

The Ministry of Environment and Forests has just issued a draft notification dated December 1, 2009 for making certain amendments in the Environment Impact Assessment (EIA) notification of 2006. Under this, power plants upto 15 MW capacity, which are based on biomass and use auxiliary fuel such as coal/ lignite/ petroleum products upto 15%, will be exempted from the EIA requirement.
Source: www.moef.nic.in

Companies keen to Set Up Biomass Power Plants

Tamil Nadu state government has always considered generation of electricity from wind power as a standby option during acute power crises. 37

S N I P P E T S

Now, however, many companies have approached the Tamil Nadu Energy Development Agency (TEDA), urging it to give them permission to start biomass plants. If that permission comes through and if the Tamil Nadu Electricity Board (TNEB) clears the proposal, 487 MW of biomass power can be generated in the coming years. Biomass, a renewable energy source, is produced by plants during photosynthesis. It contains organic matter that can be used to produce energy or heat. The estimated power generation potential from surplus biomass in Tamil Nadu is 487 MW, according to a district-level study carried out by Anna University and the Ministry of New and Renewable Energy Funding. Currently, 111 MW of biomass energy is produced by 17 units in various districts across Tamil Nadu, including Pudukottai, Dindigul and Kanyakumari. One 10 MW generating unit and a 7.5 MW unit will come up soon in Tiruvannamalai and Krishnagiri, respectively. Some plants that can generate 40 MW of biomass energy are yet to start functioning. Nine companies have approached us for power generation; together they can generate 100 MW. But they are yet to get the green signal from TNEB, said a senior TEDA official, adding that many more companies had approached TEDA for starting biomass plants. According to the Tamil Nadu Electricity Regulatory Commissions tariff order issued in May 2006, the rate for purchase of power by TNEB is Rs 3.15 per unit. In May 2009, the rate was increased to Rs 4.50 per unit. Companies feel that it is a good rate as they spend Rs 2,450 on one tonne of raw material. Hence many companies are keen on setting up units here, the official explained. A company that wants to start a biomass generation plant has to approach TEDA with a proposal, which will be studied by a standing committee headed by the chairman of TEDA. The committee has been formed by the state government to select biomass-based power projects and examine applications from prospective entrepreneurs. Once the committee clears the project, TNEB clearance, too, is mandatory. The TEDA official said that raw material used to generate biomass energy would be agricultural residue, including coconut shells, rice husk and cane trash. Raw material Magazine on Biomass Energy December 2009

N E W S

for biomass generation has to be cultivated. For example, people starting units usually have plantations nearby. Hence, even wastelands can be developed, he said, pointing out that nearly 8,000 tonnes of agricultural residue was needed to produce one megawatt a year. The cost of setting one biomass unit works out to Rs 5 crore. As of now, we are generating nearly 150 MW of biomass power and in the coming years we will have the full capacity of 487 MW, he added.

Oriental Green to Invest in Biomass Power Plants

Oriental Green Power (OGP), a renewable energy generation company promoted by Chennai-based Shriram EPC, would invest Rs 730 crore for setting up biomass-based power plants. T. Shivaraman, managing director and chief executive of Shriram EPC, said, We have set a target to list OGP by March 2011. The company wants to give thrust on renewable energy both in the domestic and international markets. The investment would go into setting up of 146 MW plants, each MW entailing Rs 5 crore, reports Business Standard. Most of these would be ready by December 2010. The company currently operates biomass plants with a total production capacity of 22 MW, he said. The company would fund the project through debt, which would constitute 70 per cent and equity, comprising the remaining 30 per cent. The company has also entered into a licence agreement with Envirotherm of Germany for air blown gasification technology for producing fuel gas, which will replace furnace oil and liquefied petroleum gas, among others.

India, Germany Sign Rs 140 Crore Agreement for Biomass Power

The Indian Renewable Energy Development Agency Limited (IREDA) and Germanys Development Bank KfW signed an Agreement on Thursday, 8th October, for financial assistance of 19.971 million euros (Rs. 140 crores) for the Promotion of Biomass Power Generation in India.

Source: The Bioenergy Site News Desk

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European Policy on Biomass Energy

The European Union (EU) has been actively developing and promoting the production cum use of Renewable Energy (RE). It diversifies the use of energy sources and contributes to securing the energy supply. The objective is also to develop new industries and technologies. The European countries initially agreed on an indicative target for supply of 12% of energy from RE including biomass, by 2010. To accomplish this target, new laws were adopted for establishing the national targets for renewable electricity and biofuels in the transport sector. This was mainly done to boost the level of RE deployment in the EU countries. Also, the private sector was especially encouraged to make the necessary investments. In 2007, the EU leaders took an even tougher stand by establishing the target of achieving 20% of the energy requirement from RE sources, by 2020. Various national targets have since been proposed for each country in order to reach 20% for EU as a whole. The use of biomass based power plants is bound to grow as will cogeneration, where steam generated during electricity production is not wasted, but can be used in the district heating systems. Biomass boilers will be increasingly used in the buildings, by replacing oil or electric water heating systems. The Commission adopted a new Energy and Climate Package, including the RES Directives, on 23rd January, 2008. This sets the national binding targets for the Member States for achieving the target of 20% from RE sources in energy consumption by the year 2020. The RES directive includes a proposal for a sustainable scheme for biomass, etc. The projections made for the Renewable Energy Road Map suggested that biomass has the potential to make very significant contributions to reaching the 20% target. However, concerns have also been expressed that such contributions may endanger efforts for sustainable provision of biomass. There are calls to regulate this through the introduction of a wider biomass sustainability scheme. Thus, the Commission has launched a consultative mechanism so as to provide inputs into a report concerning the requirements on a sustainability scheme for energy uses of biomass in 2009. In all, bioenergy exploitation within the European member countries is expected to bring in commercial maturity within the most promising technologies, in order to attain the following objectives: ensure highly efficient combined heat and power from biomass permit large-scale, sustainable production of advanced biofuels The graph shows the gross electricity generation from Biomass in the United States and European Union. The graph shows that biomass generation is on a steady increase in Europe but not in the US. In fact, the growth in the US has flattened out in the period 2002-2007.

INTERNATIONAL POLICY
Source: www.risi.com

EU27 and USA: Gross Electricity Generation from Biomass, 1996-2007 Currently, various bioenergy technologies are at different stages of maturity. A longer term research program will support the development of a sustainable bioenergy industry in Europe beyond 2020. The total public and private investment needed in Europe, over the next 10 years is estimated at 9 billion euro. The contribution to the EU energy mix by 2020 from the cost-competitive bioenergy used in accordance with the sustainability criteria of the new RES directive could be at least 14%. It could also help in generating around 2 lakh jobs, which also emphasizes the need for launching the capacity building initiatives at several levels.

Source: www.ec.europa.eu

Magazine on Biomass Energy

December 2009

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INFORMATION

Books
Title: Publisher: Editor: No. of Pages: Price: Biomass to Renewable Energy Processes CRC Press Jay Cheng, North Carolina State University, Raleigh, USA 517 $99.95 / Rs.5,126 bioenergy products such as biogas, ethanol, butanol, biodiesel, and synthetic gases. The book discusses anaerobic digestion of waste materials for biogas and hydrogen production, bioethanol and biobutanol production from starch and cellulose, and biodiesel production from plant oils. It addresses thermal processes, including gasification and pyrolysis of agricultural residues and woody biomass. The text also covers pretreatment technologies, enzymatic reactions, fermentation, and microbiological metabolisms and pathways. It explores the engineering principles of biomass gasification and pyrolysis and potential end-products. Editor Jay Cheng has assembled contributors from multiple engineering disciplines, reflecting the breadth and depth of the field. These experts discuss the fundamental principles of the processes for bioenergy production, supplying the background needed to understand and develop biofuel technologies. They provide the foundation for future work and development on what can be a clean, green, renewable, and sustainable energy source for years to come.

BOOK

A possible solution to the energy challenge, i.e., biomass energy production is heavily dependent on sugarcane and corn production and is vulnerable to the fluctuation of the feedstock price. New technologies need to be developed to convert abundant biomass such as lignocellulosic materials into energy products in a costeffective and environmentally friendly manner. An introduction to fundamental principles and practical applications, Biomass to Renewable Energy Processes explains the theories of biological processes, biomass materials and logistics, and conversion technologies for

Title:

Publisher: Editor: No. of Pages: Price:

Biomass And Alternate Fuel Systems: An Engineering And Economic Guide Wiley-AIChE Thomas F. Mcgowan, Michael L. Brown, William S. Bulpitt 264 $89.95 /Rs. 4,345

conventional and alternate fuels. This book is an update and expansion of the Industrial Wood Energy Handbook by a team from the Georgia Institute of Technology in 1984. It introduces new technologies not available at the time of the early version. Biomass and alternate fuels offer cleaner, renewable ways to produce energy, can greatly reduce operating costs, and are mostly carbon neutral. Biomass and Alternate Fuel Systems: An Engineering and Economic Guide provides readers with an understanding of these environmentally friendly fuels alongside step-by-step guidance for converting these fuels into energy. In addition to biomass, the book also covers other alternate fuel sources such as biogas, reclaimed oil, used tires, cooking oil, solid wastes, and coke. The case studies in the book help readers understand how they can install and operate energy systems to reap all the benefits of biomass and alternate fuels.

This book explains the characteristics of renewable fuels, especially biomass and wood, and the cost-effective and environment-friendly methods of handling, storing and burning these fuels. It also talks about economic evaluation method, introduction of the pollution control equipment for limiting the emission from fuel combustion, case studies, and costs and carbon emission comparisons between

Source: www.amazon.com

Magazine on Biomass Energy

December 2009

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