Revolutionising India’s energy future: Impact of Bio-CNG & Green Hydrogen on sustainability

As India races toward a cleaner and more sustainable energy future, Bio-CNG has emerged as a promising alternative to fossil fuels. With its potential to reduce pollution, manage waste effectively, and contribute to energy security, Bio-CNG is increasingly gaining attention in the country’s renewable energy landscape.

The government has been actively promoting this sector through various policy initiatives and incentives, ensuring that the shift toward sustainable fuel sources continues at an accelerated pace.

Nidhi Khare, Secretary of the Department of Consumer Affairs, and Ministry of New & Renewable Energy, Government of India, in conversation with Anoop Verma, Editor-News, ETGovernment, shares insights into the progress made so far, the challenges ahead, and how emerging technologies like hydrogen fuel and energy storage fit into India’s broader green energy vision.

Edited Excerpts:
What is the current status of Bio-CNG production in India? How has it evolved in recent years? What are the key policy initiatives and incentives supporting Bio-CNG production?
India has made remarkable strides in Bio-CNG production as part of its renewable energy push. Under the National Bioenergy Programme, we’ve been providing financial incentives to encourage the development of this sector. So far, we have supported 65 Bio-CNG projects, which together have an installed capacity of 508 tons per day.

One of the key programs driving this growth is the GOBARdhan Initiative, which promotes the conversion of organic waste like cattle dung and agricultural residue into biogas, compressed biogas (CBG), and Bio-CNG. Right now, there are 127 operational CBG plants under this initiative, producing around 805 TPD of CBG, with a total investment of over ₹4,407 crore.

Another significant step forward has been the SATAT (Sustainable Alternative Towards Affordable Transportation) initiative, which encourages Oil Marketing Companies to procure Bio-CNG. To further boost demand, we’ve introduced a blending mandate that starts with 1% in 2025-26 and increases to 5% by 2028-29. This will enhance adoption in both transport and household sectors.

We are also providing financial incentives for fermented organic manure sales and funding biomethanation projects under the Swachh Bharat Mission. We offer concessional custom duty certificates for the import of necessary plant and machinery. Several states, including Uttar Pradesh and Rajasthan, have launched their own incentive schemes, such as capital subsidies and tax exemptions, to attract more investment into this space.

What challenges does India face in scaling up Bio-CNG production, and how can these be addressed? What role do public-private partnerships play in accelerating Bio-CNG adoption?

One of the biggest hurdles in scaling up Bio-CNG production is the high capital investment needed to set up plants. Infrastructure costs, advanced technology, and securing a steady supply of raw materials make it a costly venture. To tackle this, we are establishing benchmark costs and recognizing authorized EPC contractors to help streamline investment.

Feedstock availability is another challenge. Agricultural and industrial waste supplies vary seasonally, making it difficult to maintain a consistent biomass supply. Encouraging farmers to sell crop residues instead of burning them and improving municipal waste segregation will go a long way in addressing this issue.

There’s also the challenge of offtake uncertainty. At present, OMCs are not legally bound to purchase Bio-CNG from producers, making long-term investments risky. We are actively considering regulatory changes to ensure a stable market and increase blending requirements.

Public-private partnerships play a crucial role in accelerating Bio-CNG adoption. The private sector brings in innovation, efficiency, and financial investment, while the government provides a strong policy framework and incentives. Such partnerships can also strengthen the logistics network, ensuring reliable feedstock supply and efficient distribution.

How can agro and municipal waste management be optimized to maximize Bio-CNG production? What successful global models can India replicate?
India generates around 228 million tons of surplus agricultural waste and 62 million tons of municipal solid waste annually. If managed properly, this waste could significantly enhance Bio-CNG production.

For agricultural waste, we need better pre-treatment methods and co-digestion techniques to improve biogas yields. Establishing dedicated biomass supply chains and incentivizing farmers to sell crop residues instead of burning them would also be effective. On the municipal waste side, enforcing stricter waste segregation policies will provide cleaner and more efficient feedstock for Bio-CNG plants.

We already have success stories within India. For instance, the GOBARdhan plant in Indore, which is Asia’s largest municipal waste-based Bio-CNG facility, produces 17,000 kg of Bio-CNG and 100 tons of compost every day. Similar projects across India use paddy straw and energy crops like Napier grass to produce Bio-CNG efficiently. Instead of converting Bio-CNG into electricity, which is less economical due to low power tariffs, using it for transport and clean cooking is proving to be a more viable and sustainable option.

What are the key benefits of using Green Hydrogen for public transportation in India?
Green Hydrogen is a game-changer for public transportation in India. Since it produces no tailpipe emissions, it plays a significant role in improving air quality and making cities healthier places to live. It’s also highly scalable, as hydrogen can be produced in large quantities and stored efficiently, making it ideal for various transport applications.

Another major advantage is refueling speed. Unlike battery-electric buses, which take hours to charge, hydrogen fuel cell vehicles can be refueled in just a few minutes. This makes them particularly useful for long-haul and public transport operations. Additionally, these vehicles run quietly, reducing urban noise pollution.

What initiatives has the Indian government taken to promote hydrogen fuel for public transport?
The National Green Hydrogen Mission, launched in January 2023 with a budget of ₹19,744 crore, is a significant step toward hydrogen adoption. As part of this mission, we’ve launched five pilot projects for hydrogen-powered buses and trucks, involving 37 vehicles and nine refueling stations, with ₹208 crore allocated for financial support.

We are also conducting feasibility studies to evaluate hydrogen vehicles under real-world conditions and investing in infrastructure for hydrogen refueling stations. These steps will be instrumental in integrating hydrogen as a mainstream fuel for public transportation in India.

How does Green Hydrogen compare with electric buses in terms of efficiency, cost, and emissions?
Battery-electric buses are currently more efficient, with an operational efficiency of 70-80%, compared to hydrogen fuel cell vehicles, which range from 50-70%. However, hydrogen buses have a longer range and faster refueling times, making them better suited for long-distance routes.

While hydrogen buses are currently more expensive, costs are expected to decrease with technological advancements and higher production volumes. Both electric and hydrogen buses are essential for India’s decarbonization strategy, as neither emits tailpipe pollutants.

What are the key challenges and policy measures for large-scale energy storage in India?
Energy storage is a critical challenge for integrating renewable energy into the grid. High battery costs, limited grid infrastructure, and dependence on imported raw materials are some of the major roadblocks.

To address this, we have introduced Production-Linked Incentives for battery manufacturing, aiming to establish 50 GWh of domestic capacity. Additionally, we are providing Viability Gap Funding to support 13,200 MWh of battery storage projects. We are also offering ISTS waivers for solar and wind projects integrated with storage solutions, ensuring a stronger and more resilient renewable energy ecosystem in India.

ETGovernment is organizing the Rajasthan Renewable Energy Conclave on May 15. The aim of the Conclave is to conduct deliberations on the opportunities and challenges in the renewable energy sector in Rajasthan and the rest of India. What will be your message to the guests, intellectuals, and private company leaders who will be arriving at the Conclave?
This Conclave is a fantastic opportunity for all stakeholders to come together and chart the future of renewable energy in Rajasthan and beyond. My message to the industry leaders, intellectuals, and policymakers attending would be clear: collaboration is the key to success. We need to integrate innovation, investment, and implementation to make India a global leader in renewable energy.

Rajasthan, with its vast solar and wind potential, is already a front-runner in the sector. Now, it’s time to accelerate Bio-CNG adoption, energy storage solutions, and hydrogen-based projects. The government is committed to providing an enabling ecosystem, but the private sector must step up with investments and technological advancements. Together, we can drive the energy transition forward, ensuring sustainability, economic growth, and energy security for India.