NexGen Energia Seeks Gold In CBG With 1000 CBG Plants Ambition

A clean fuel energy company, NexGen Energia is focused on exploring opportunities to establish green diesel refineries and Compressed Biogas (CBG) production units which it insists is set to be the ‘future fuel of India’. The company has pioneered in the art of making CNG (CBG) from locally sourced waste and agricultural waste in India, and it is also working on producing bio-fuel from garbage, under the Swachh Bharat Mission. NexGen Energia has commissioned one of the first CNG (CBG) production unit in Ambala, Haryana.  As India clearly charts out a clear roadmap to achieve a less carbon economy, Dr. Piyush Dwivedi, Founder and Chairman, NexGen Energia Ltd, in a conversation with Saur Energy presents the interesting prospects this field offers as an alternate clean fuel.

Q.1 As a clean fuel company, what is the level of interest you see in this segment specifically? Do you feel the current policy framework is enabling growth at a faster pace for this sector?  

There is growing interest in clean energy in India and in the ways of providing greater access to energy like biofuel and compressed biogas (CBG) to address energy costs, energy security and global warming concerns associated with fossil fuels. India alone will need 9% world energy to feed its growth by 2035. This growth is coupled by multi-faceted challenges such as the waste generation, pollution, growing vehicles, oil imports, loss of foreign exchange, global warming that is unfavorably touching everyone.

We see that the Government is committed to increase the use of clean energy sources and is already undertaking various large-scale sustainable projects and promoting green energy heavily. The Government of India wants to develop a ‘green city’ in every state of the country, powered by renewable energy. For CBG plant production the Government of India is also giving capital subsidy, tax benefits, GST benefits. Initiatives such as Swachh Bharat, Paris Climate Agreement and Sustainable Alterative towards Affordable Transportation (SATAT) are aimed towards clean, healthy empowered environment and society.

Q.2 Currently, what is the share of energy being generated through waste management?

India ranked sixth in the list of countries to make significant investments in clean energy at US$ 90 billion. India is the only country among the G20 nations that is on track to achieve the targets. On an average, 100 tonnes per day of municipal solid waste (MSW) is required to generate 1 MW of power. We can’t give an exact figure, but waste can be a good source of energy, and CBG and green diesel production as it is gaining momentum, and it will be a good alternative energy source in the near future.

Q.3 Why has movement been so slow on CBG Plants coming up, despite a target of 5000 by 2025? Which states are best placed to do well here?

Yes, the COVID-19 battle did slow down the economy. Uttar Pradesh, Rajasthan M.P., Maharashtra and Haryana are faring well here. Also, even now while the climate is favourable for the sector yet there are very few waste to energy plants despite the fact that solid waste generates 1.19 Lac Tons/day.

Q.4 How much of the inputs for a CBG plant are domestically sourced and manufactured? What is the typical capital cost on a plant? Ideal capacity and size?

An initial investment required for a CBG (CNG) production plant unit starts from 4.99 Cr. for 50TPD waste processing and 50Es upwards depending in location and raw material. Government of India and state governments are giving huge subsidy for the establishment of waste to CBG production plant. Apart from investment subsidy government is also giving GST benefits, Land use conversion and income tax benefits for CBG production plants.

Q.5 What is the kind of role effective waste management will play in the next decade or so as far as production of energy is concerned?

Speaking of numbers, India has about 75% dependence on oil and gas imports and is the third largest importer of oil and fourth largest importer of gas. Hence, there is an immense focus to push towards a gas-based economy. To fill in the demand, the share of environment-friendly fuel in the energy basket is likely to be increased from 6.2% to 15% by 2030. Like we can produce 62M Tons of CBG which will reduce import of CNG.

Q.6 With the Glasgow commitments in mind, what is the kind of support required by clean fuel players like you to make a significant difference? 

Besides current initiatives we expect following support in terms of single windows clearance for CBG Projects, priority finances at low-rate interest, capital subsidy increase, R&D centre promotion and skill developments.  NGE is one of the players in the sector which is creating its space and making a name with its expertise to adapt the new technologies and measures for different types of waste created.

These measures would reduce the quantity of wastes, generate a substantial quantity of energy from them, and greatly reduce pollution of water and air, thereby offering several social and economic benefits that cannot easily be quantified.

Q.7 What initiatives are you taking with respect to boosting ‘Local for Vocal’ and ‘Make in India’?

We are looking to spread our wing in the western part of the country. At NexGen Energia we plan to set up 1000 CBG units in which bio waste will be converted to CBG. Plans are also there to open over 1000 CNG (CBG) pumps in different locations. We will also be opening green diesel pumps and charging stations offering lucrative franchise opportunities.

Q.8 Transportation sector still uses 96% of fuel which is non-renewable. How do you see the transition to renewable energy happening by 2050? 

Transportation sector is expected to shift to 58% renewable energy by 2050 which will include 22% of biofuels. Therefore, we do want to make the best of the opportunity clean energy offers in India.

Q.9 From a Clean Energy perspective, do you think we need to completely switch to a new industrial model? What changes would you like to see?

Some companies like NGE are stepping forward to boost Local for Vocal and Make in India initiatives based on Swach Bharat mission through the production of energy from the waste and provide an innovative entrepreneurship opportunity for the business aspirant.

For instance, NGE has redefined the green energy sector with its unique business model, establishing a CNG (CBG) production plant through franchisee route with production buyback guarantee. This is an ideal profitable business opportunity on very low risk as CBG and bio fertilizer will be bought back by NGE which will be sold through its own distribution network. NGE will also support in branding, marketing, training vendors, technology transfer, structured operations etc. So, through this model maybe we can boost faster adoption and switch over to clean energy.