Oil marketing companies issue over 200 LOAs to firms to set up biogas plants in T.N.

March 17, 2023 12:36 am | Updated 12:36 am IST - CHENNAI  

The public sector oil marketing companies have issued over 200 letters of authorisation (LOA) in the State to private parties for starting compressed biogas (CBG) plants using wet waste from municipal solid waste (MSW).

This is under the Sustainable Alternative Towards Affordable Transportation (SATAT) Scheme and gas produced from bio waste, including kitchen waste and poultry litter can be used for vehicles as well as cooking.  Under the LOAs, there is a off-take clause for the gas produced and the government has fixed a price for the same.

“The first CBG production plant in the State was setup at Namakkal in June 2020. This plant, which uses poultry litter, cattle dung and agricultural residue has been feeding CBG as automotive fuel to a network of Indian Oil retail outlets in Salem and Namakkal districts and to nearby industries. The plant also has bio-manure as a by-product, which is marketed separately,” said an official in Indian Oil.

N. Nagendran, CEO, Srinivas Waste Management Services Pvt Ltd, whose agency collects wet waste from 400 plus hotels, markets and hotels daily, said that they generate around 2,500 kg – 3,000 kg of compressed bio gas daily. “If we get 100 tonnes of food waste daily, we can get around 5,000 kg of CBG. However, that is not possible. Gas is produced based on standards. Around 1/3rd of the gas produced is supplied to hotels for cooking and the rest goes to be supplied as fuel for vehicles,” he explained. 

Sources in the oil and gas sector said that the CBG sector was quite new, and was very much in the developing stage. “There are not many takers though LOAs have been issued. This is because investment is quite high and returns take a while. The availability and cost of feedstock and connectivity too are issues. Technology too is in a nascent stage and people have to import equipment. But if someone manages it properly, it will become profitable in the long run,” explained a source.  

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