Budget 2022: Mandating Biomass Pellets in Thermal Plants
Stubble burning is a major concern for India’s National Capital Region, every winter. With the onset of winters, farm fires become common in states such as Punjab, Haryana and Uttar Pradesh. Burning of crops leads to a decline in the air quality and raises the pollution levels in neighboring areas such as Delhi.
In a bid to bring some respite to this growing concern, on February 1, 2022 the Finance Minster Nirmala Sitharaman during her budget speech announced that it has been mandated that thermal plants use biomass pellets as 5-7 per cent of their fuel mix.
The pellets are mixed with coal to generate electricity. Thermal plants use approximately 700 million tonnes of coal each year. Thus, mandating the use of biomass pellets serves the three fold purpose of encouraging farmers to convert crop stubble into pellets, gives the farmers extra income and leads to creation of employment opportunities. The mandate is expected to save close to 38 million metric tonnes of carbon dioxide annually. The plan is in strong support to India’s clean energy transition and commitments.