Punjab seeks feasibility gap funding for biomass projects

Punjab Chief Minister Amarinder Singh has written to the Centre reiterating his demand for viability gap funding for biomass power projects and biomass solar hybrid power projects to check stubble burning.

In a letter to Union Power Minister, New and Renewable Energy Minister, R.K. Singh, the Chief Minister has sought his personal attention towards framing of scheme and guidelines for promoting biomass power projects by providing one-time viability gap funding in a phased manner.

This, said Amarinder Singh, would go a long way in complying with the directions of the Supreme Court for tackling the problem of stubble burning in Punjab.

He again asked the ministry to provide to Punjab Rs 5 crore per megawatt (MW) for biomass power projects and Rs 3.5 crore per MW for biomass solar hybrid power projects to help the state address the problem of pollution arising from stubble burning.

The Chief Minister pointed out the issue was first raised by the state government in a letter dated February 5, 2019, seeking in-principle approval of viability gap funding at the rate of Rs 5 crore per MW for biomass power projects of 150 MW.

However, the ministry had responded on May 6 that there was no scheme in operation at present to provide viability gap funding for biomass power projects.

In his letter, Amarinder Singh recalled that at a meeting chaired by the Union Minister on November 6 last year to discuss the issues related to co-firing of biomass, it was decided the “Punjab government shall submit a proposal for installing the power plants exclusively based on the agro residue (paddy straw) and integrated residue collection system, seeking the grant or subsidy from MNRE for the proposal. The equipment may be procured under Make in India guidelines. The subsidy shall be linked to the operation of the plant, i.e. it should be ensured that these plants consume the committed amount of agro residue”.

Subsequently, the state had submitted a detailed proposal in this regard to the ministry, the Chief Minister said.

In fact, he said, as the matter of stubble burning came up before the apex court, the Punjab government, on December 12, 2019, again wrote to the ministry seeking the formulation of a new scheme for the viability gap funding, as sought by the state, in subsequent annual plans.

Underlining the need for such funding, the Chief Minister noted that agriculture production in the last decade had shown a remarkable upward trend, resulting in production of surplus quantities of food grains.

Punjab being an agrarian state produces about 20 million tons of paddy straw every year, and out of this, 7.5 million tons is utilized in domestic industry, while the remaining 12.5 million tons of biomass is equivalent to about 1,250 MW of power, he said.