India had a cumulative installed biomass capacity of about 520MW at the start of the Eleventh plan (2007-2012), the current plan period. The Ministry of New and Renewable Energy (MNRE) had set an ambitious target of 500MW for this plan period.
The ministry has now informed that they have achieved a capacity of about 460MW already in this plan period. This is commendable and they expect that the target would be more than surpassed.
The key to the success is that the biomass power projects are set-up as commercial projects through private investment at viable locations depending upon availability of biomass. Central Financial Assistance is provided to the Financial Institutions for reduction in the loan amount sanctioned for the projects.
Further MNRE has mentioned that they are encouraging setting up of biomass power projects through various technological routes namely combustion, gasification and cogeneration. Various fiscal and financial incentives such as capital subsidy linked with project capacity and fiscal incentives such as concessional customs duty on import of machinery and components, excise duty exemption, accelerated depreciation on major components and relief from taxes are being provided for setting up of biomass power projects. Besides, preferential tariff is being provided for sale of power from biomass power projects.
According to the most recent data given by MNRE, about 980 MW of biomass power has been commissioned and about 380MW of capacity is under implementation.
The state wise capacity of biomass power projects commissioned is shown in the chart below.
The capacity currently under implementation is shown in the chart below:
As often discussed, the key success of biomass projects has been the availability of feed stock. There has also been technological improvements in boilers that has enabled the feed stock variety that can be used to include sorghum, rice husk among other agro residues.
This has limited the biomass projects to a few states and some of the states with existing high-capacity commissioned like Andhra Pradesh, Karnataka and Tamil Nadu have negligible projects under implementation.
The newer states like Punjab, Madhya Pradesh and Maharashtra have been rapidly increasing capacity and have significant capacity under implementation.