Home » Biomass » Lakshmi Energy & Foods to augment biomass (Rice Husk) capacity from 30MW to 105MW

Lakshmi Energy & Foods to augment biomass (Rice Husk) capacity from 30MW to 105MW

Lakshmi Energy and Foods Ltd. (LEF),  is one of the largest food grain processing companies in India. The company is among India’s largest producers of non basmati varieties of rice with a turnover of over 5.5 billion rupees. The company today boasts of as the fastest growing food companies in India. LEF, being a large mill has integrated facilities for rice bran oil.

Lakshmi Energy and Foods Ltd. (LEF) has taken a step towards creation of energy hubs at different locations in Punjab, using the by product, husk as the fuel in replacement of conventional fuel coal. Husk as well as straw is usually burnt away or used in few steam boilers.

However LEF has ventured into biomass-based energy business in 2008 by setting up 30 MW of power plant, using husk as fuel, at its factory premises located at Khamano in Punjab and had captive consumed all the husk as feed stock for the biomass plant. The company had entered into a PPA with Power Trading Corporation( PTC) for the sale of power.

According to this report, company’s Executive Director I S Gumber told PTI, “We have plans to hive off our green energy business and put it into a new subsidiary company which will be wholly owned by LEF.” The decision regarding floating of a new subsidiary is expected to be taken next month by the Board of Directors.

After launching a new subsidiary, the company may bring in fresh funds into energy business by diluting promoters’ stake to leading energy fund houses, he said. “The fresh funds will be used in expanding our green energy business,” he said.

LEF has aggressive plans to raise its power generation capacity to 105 MW in 3 years. Currently, the total asset size of the power business of LEF stands close to Rs 150 crore.

With a lot of technology being available and work being done to accept diverse feed stock for biomass as discussed ( here and here) this will be an increasing trend in the time to come in a country like India. The most important part of success of biomass projects in India has been the availability and price of feedstock.

The key challenge that the company might have to face would be with respect to the supply of feed stock for their expansion, which in the initial 30MW was coming out of captive consumption of their rice mill. Given that they have already created the energy hubs in Punjab and are already buying/using the rice, the biomass feedstock might not be a major challenge as it would for a biomass RE developer.

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