Raw materials for biofuel -where are they?
Lack of raw material, govt pricing dash biofuel dreams
Business Standard
The biofuel industry is finding it tough to remain in business, with
both government pricing and raw material availability working against
them. The government, on its part, has launched a massive programme to
develop high-yielding varieties of jatropha, a plant that can grow in
wastelands across India, to meet the severe raw material shortage for
the green fuel industry. Senior officials of the National Oilseeds and
Development Board (NOVOD) said 76 institutions across the country were
engaged in this research. A high-yielding variety should be available
in the next two to three years. Forty million hectares of land has
been identified by the government for cultivation once these
high-yielding varieties are made available.
But the issues are far more complex. For now, the responsibility of
developing green fuels for the future rests with several ministries.
The Ministry of New and Renewable Energy (MNRE) released a biofuel
policy last year. Now, the ministries of petroleum, rural development
and agriculture are looking into several implementation issues. The
Ministry of Rural Development has already set up a national mission on
biodiesel, while the Ministry of Petroleum is addressing the more
complex issues of distribution and pricing. The Ministry of
Agriculture, along with the Department of Biotechnology, is looking at
new research in these areas.
So much in the planning process is not quite helping business.
President of the Biodiesel Association of India, Sandeep Chaturvedi,
said: "Biofuels are meant to provide sustainable rural development.
The national policy on biofuels is a very well-intentioned policy
document. People have put in a lot of money into this industry. But it
is just too costly to produce." Officials at MNRE conceded there were
issues. "It will take time," an official said.
Chaturvedi said even though the government did not want to make any
profits on biofuels, the tax structures varied across the states. For
some businesses, it is simply unsustainable. "Ninety-nine per cent of
plants around Kakinada and Hyderabad have closed down," said a leading
manufacturer from western India, whose plant closed over two years
ago. An investment of Rs 225 crore had been made. "We are unable to
recover our costs at the price fixed by the government," he said.
There are others, who cannot even pay the interest to the banks on
their huge borrowings to set up the plants. Biodiesel production was
to be taiken up from non-edible oil seeds in waste, degraded and
marginal lands. The focus was on indigenous production of bio-diesel
feedstock and import of Free Fatty Acid (FFA) based oil, palm etc was
to be stopped. Manufacturers said while import of FFA had been
stopped, the non-edible oils were not being made available.
Source: http://www.business-standard.com/india/news/lackraw-material-govt-pricing-dash-biofuel-dreams/391105/
