GOBARdhan eyes 10-fold increase in CBG output: Puri

Why in the News

Compressed biogas (CBG) producers will now get both capital assistance and a guaranteed buyer from the Centre, with output targeted to rise from 0.4 to 4 to 6 million standard cubic metres per day. The Union Minister of Petroleum and Natural Gas formally launched the ₹23,731 crore GOBARdhan scheme to drive this ten fold increase.

What is compressed biogas, and what does GOBARdhan do with it?

1. What CBG is: CBG is methane rich gas made by processing organic waste and compressing it, so it works like CNG but comes from waste rather than gas fields.
2. Feedstock: The scheme targets agricultural residue, animal dung, food waste and other biomass.
3. Why it was introduced: The government wants to turn agricultural and organic waste into a new source of domestic energy.
4. Farmers as suppliers: The Minister said the programme would turn farmers from “Annadatas” (food givers) into “Urjadatas” (energy givers), since their waste becomes saleable fuel input.
5. The takeaway: Pairing a plant subsidy with an assured market tackles the two reasons CBG plants have struggled, high upfront cost and uncertain sales.

How is the support structured?

| Component (lifecycle stage) | Support | Main beneficiary | |—|—|—| | Greenfield CBG plants (plant build) | ₹1.25 crore per tonne per day (TPD) of eligible CBG capacity | New CBG producers | | Brownfield capacity (plant expansion) | 50% of the greenfield rate, for capacity added through fresh investment | Plant owners expanding output | | Upgrade of existing biogas plants (asset conversion) | ₹0.60 crore per TPD, with a ₹5 crore project ceiling | Biogas plant operators shifting to CBG | | Assured offtake (offtake and demand) | Up to 100% of eligible output bought at an administered price of ₹2,110 per mmBtu (million British thermal units, a unit of heat energy used to price gas), about ₹98 per kg | All CBG producers |

1. Project ceiling: Total capital assistance for one project is capped at ₹30 crore, counted across the scheme’s “two eligible capital-support components”, so large plants cannot draw unlimited subsidy.
2. Why offtake matters: The assured offtake is offered to make CBG projects commercially viable, because a plant sure of selling its output at a fixed price can raise loans against that income.

What does the scheme aim to achieve?

1. Cleaner energy mix: The output rise is meant to help lift natural gas, a cleaner burning fuel, to a 15% share of the energy basket by 2030.
2. Fossil fuel replacement: The scheme aims to replace about 10 million tonnes of fossil fuel with clean gas, cutting over 40 million tonnes of carbon dioxide emissions.
3. Organic manure: Plants would also yield around 250 million tonnes of organic manure for farmers as a by product.
4. Import savings: Domestic gas would save more than ₹40,000 crore in fuel imports.

Challenges

1. Scattered feedstock: Farm residue is seasonal and dispersed, so plants struggle to secure year round supply. Eg. The Sustainable Alternative Towards Affordable Transportation (SATAT) initiative missed its plant target.
2. Weak manure market: Organic manure competes with subsidised chemical fertiliser, so a key by product may not sell.
3. Grid distance: Plants far from city gas pipelines must truck compressed gas, adding cost.
4. Price risk: A fixed administered price can turn into a subsidy burden if imported gas becomes cheaper.
5. Operation and maintenance: Small biogas plants often fall idle once technical support ends.

Way Forward

1. Feedstock aggregation: Farmer producer organisations should run baling and collection hubs under the crop residue management scheme.
2. Manure offtake: Fertiliser companies should co-market fermented organic manure alongside chemical fertilisers.
3. Pipeline links: The Petroleum Ministry should fund last mile connections from CBG plants to city gas networks.
4. Blending obligation: Enforce the phased CBG Blending Obligation on city gas distribution networks so demand grows with supply.
5. Commissioning tracker: Publish plant wise commissioning and output data so slippage shows early.

Conclusion

The scheme turns biogas into an energy security instrument backed by both capital and a guaranteed buyer. Whether plants are actually commissioned and fed with year round feedstock will decide if the output target is met.

Key numbers

1. Value added to GDP: over ₹75,000 crore (scheme estimate).
2. Jobs: more than 1.5 lakh (scheme estimate).
3. Current share of natural gas in the energy basket: 6 to 7%.

Matching Previous Year Question

“[2025] Consider the following statements: Statement I: Of the two major ethanol producers in the world, i.e., Brazil and the United States of America, the former produces more ethanol than the latter. Statement II: Unlike in the United States of America, where corn is the principal feedstock for ethanol production, sugarcane is the principal feedstock for ethanol production in Brazil. Which one of the following is correct in respect of the above statements? (a) Both Statement I and Statement II are correct and Statement II explains Statement I (b) Both Statement I and Statement II are correct but Statement II does not explain Statement I (c) Statement I is correct but Statement II is not correct (d) Statement I is not correct but Statement II is correct Answer: D”