India’s Biogas Subsidy Program
India’s Biogas Subsidy Program: A Complete Guide (2024)
Introduction
India, the world’s third-largest energy consumer, faces dual challenges: rising fossil fuel imports and agricultural waste pollution. To address these issues, the Indian government has heavily promoted biogas production through subsidies, aiming to:
✔ Reduce LPG dependency in rural households
✔ Convert farm waste into clean energy
✔ Cut methane emissions from untreated manure
This article explores India’s biogas subsidy program, covering:
✅ Key government schemes
✅ Subsidy amounts & eligibility
✅ Success stories & challenges
✅ Future policy directions
By the end, you’ll know how Indian farmers and entrepreneurs can access biogas funding and whether it’s a viable investment.
1. Overview of India’s Biogas Subsidy Programs
India has two major biogas subsidy initiatives:
A. National Biogas and Manure Management Programme (NBMMP)
- Launched: 1981 (revamped in 2018)
- Administered by: Ministry of New and Renewable Energy (MNRE)
- Goal: Install 1 million household biogas plants by 2025
- Subsidy: Up to 40% of cost (varies by state & plant size)
B. Sustainable Alternative Towards Affordable Transportation (SATAT)
- Launched: 2018
- Administered by: Ministry of Petroleum & Natural Gas
- Goal: Produce 15 million tons/year of Compressed Biogas (CBG) by 2030
- Subsidy: Fixed offtake price for CBG + bank loans
2. Subsidy Breakdown: How Much Financial Support is Available?
A. NBMMP (Household & Small-Scale Biogas)
| Plant Size | Total Cost (₹) | Subsidy (₹) | Beneficiary Contribution |
|---|---|---|---|
| 1 m³ (1-3 cows) | ₹18,000 | ₹7,000–₹9,000 | ₹9,000–₹11,000 |
| 2 m³ (4-6 cows) | ₹25,000 | ₹10,000–₹12,000 | ₹13,000–₹15,000 |
| 3 m³ (7-10 cows) | ₹35,000 | ₹14,000–₹17,000 | ₹18,000–₹21,000 |
✅ Additional benefits:
- Free maintenance for 5 years
- Training & technical support
B. SATAT (Large-Scale CBG Plants)
| Incentive | Details |
|---|---|
| Fixed CBG Price | ₹54/kg (linked to crude oil prices) |
| Bank Loans | Up to ₹10 crore at 6% interest |
| Land Subsidy | Some states offer discounted land leases |
✅ Guaranteed buyers: Oil marketing companies (OMCs) like IOCL, BPCL must purchase CBG.
3. Who is Eligible for Biogas Subsidies?
A. NBMMP (Household Plants)
✔ Farmers with 2+ cattle (cows/buffaloes)
✔ Rural households (urban areas excluded)
✔ No prior biogas subsidy availed
B. SATAT (Commercial CBG Plants)
✔ Entrepreneurs & companies
✔ Minimum plant size: 2 tons/day CBG
✔ Must sign 15-year offtake agreement with OMCs
4. How to Apply for a Biogas Subsidy?
Step-by-Step Process (NBMMP)
- 1.Contact a local biogas agency (e.g., KVIC, state nodal agencies).
- 2.Submit documents:
- Aadhaar card
- Land ownership proof
- Cattle ownership certificate
- 3.Get technical approval (site inspection).
- 4.Receive subsidy (after installation).
SATAT Application Process
- 1.Submit Expression of Interest (EoI) to OMCs.
- 2.Secure land & environmental clearance.
- 3.Apply for bank loans under SATAT scheme.
- 4.Sign CBG supply agreement with OMCs.
5. Success Stories: Where Biogas Subsidies Worked
Case Study 1: Punjab’s Dairy Biogas Boom
- Subsidy used: NBMMP (₹10,000 per plant)
- Result: 50,000+ household digesters installed, reducing LPG costs by ₹3,000/year per family.
Case Study 2: Maharashtra’s First CBG Plant
- Subsidy used: SATAT (₹5 crore loan at 6%)
- Result: 12 tons/day CBG sold to BPCL, earning ₹2.5 crore/year.
6. Challenges & Limitations
A. NBMMP Issues
❌ Slow subsidy disbursement (6–12 months wait)
❌ Poor maintenance support in some states
❌ Limited urban applicability
B. SATAT Challenges
❌ High capital costs (₹50–100 crore for 10-ton/day plant)
❌ Land acquisition delays
❌ CBG pricing volatility (linked to crude oil)
7. Future of Biogas Subsidies in India
Upcoming Policy Changes (2024–2025)
- New MNRE scheme: Biogas Purification Incentive (₹5/kg for upgrading to CBG).
- Increased SATAT targets: 10,000 CBG plants by 2030.
- Rural electrification push: Biogas-based microgrids in off-grid villages.
8. Is India’s Biogas Subsidy Program Worth It?
For Farmers (NBMMP)
✅ Yes, if:
- You have 2+ cattle & use LPG.
- Your state processes subsidies quickly.
❌ No, if:
- You live in an urban area (no subsidies).
- You can’t afford the 30–60% upfront cost.
For Entrepreneurs (SATAT)
✅ Yes, if:
- You can secure low-interest loans.
- You have a long-term offtake agreement.
❌ No, if:
- You lack ₹50+ crore capital.
- Your state lacks feedstock supply.
Conclusion
India’s biogas subsidy program offers strong financial support for:
- Rural households (via NBMMP’s 40% subsidy)
- Large-scale CBG producers (via SATAT’s fixed-price offtake)
However, challenges like slow subsidy processing and high capital costs remain.
Interested in applying? Start by contacting your state nodal agency or visiting the MNRE website!
