Fuel barter model for biomass power generation in India

Background

In India, many biomass power plants have only a patchy supply of fuel at a competitive cost, as agricultural waste is available only for a short period of time around the harvesting season. At the same time, many farmers simply burn the crop residues for quick preparation of the fields for the next crop, creating serious local pollution.
In either case, the project owner has to construct huge storage capacity and deal with the fluctuations in the price of biomass.

Purpose

To develop a barter model linking the supply of electricity to farmers to a regular quantity of biomass supplied to the power plant throughout the year, creating a win-win-win situation for the farmer, the project developer and the utility, piloted around a proposed 8MW biomass plant in Rajasthan.

Main Activities

  • Design a survey to assess biomass availability; productive consumption of electricity and competing use of biomass in the specified area
  • Conduct the survey on the willingness and capability of farmers to organize themselves, the unmet energy demand, and potential for new businesses with more power availability 
  • Develop a preliminary concept for the business model and canvass it with farmers and the utility
  • Develop the final design, including material and energy flow sheet and commercial transactions flow sheet, and identify the financing needs for the residue collection system
  • Hold discussions with potential lenders
  • Conduct workshop in specified area to win greater participation of farmers

Expected Impact

  • For farmers, higher income from sale of biomass, a reliable power supply at no additional cost, and an alternative source of ash as manure
  • For utilities, a better tariff realization from a subsidised consumer category and improved contribution of renewable energy in fuel mix
  • For owners of the power plant, protection from fuel price volatility and uncertain fuel availability 
  • Reduction in land burning, and a net emission reduction of 25,000 tons of CO2e
  • Replication of the business model for rural biomass based power generation.

Project Information

Programme sector: 

Renewable Energy (RE) (Business&Finance)

Stage of project: 

Ongoing

Location: 

IN/India

Duration: 

2009 - 2010

Budget: 

€ 100,000 including co-funding from Indeen Bio Power Ltd

Implementing agency: 

DSCL Energy Services Co. Ltd

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