G20 Biofuel Alliance: $500 Billion opportunity in 3 Years, says IBA Study

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G20 Biofuel Alliance: $500 Billion opportunity in 3 Years, says IBA Study

G20 Biofuel Alliance: $500 Billion opportunity in 3 Years, says IBA Study

Industry News
Sep 12,23

According to the Indian Biogas Association (IBA), a biofuel coalition has the potential to create opportunities valued at $500 billion within the next three years for G20 nations. The IBA's study underscores the significance of these findings, given that India is currently hosting the G20 leaders' Summit in New Delhi.

The study indicates that biogas alone could generate opportunities worth $200 billion, considering its minimal investment requirements compared to other energy generation methods and the easy availability of raw materials. It further emphasises that bioenergy, particularly biogas, has the potential to entirely replace fossil fuels, especially in the pursuit of decarbonising the transportation sector.

In 2016, the G20 adopted a voluntary action plan to promote renewable energy, committing its members to increasing the proportion of renewables in their energy portfolios. India has notably boosted its share of renewable energy in its overall energy mix, achieving a compound annual growth rate (CAGR) of approximately 22% over the past six years. Solar energy, in particular, has expanded twentyfold over the past decade, with solar and wind energy experiencing CAGRs of roughly 38% and 30%, respectively.

The study suggests that an initial investment of $100 billion in financial support will be necessary to kickstart the biofuel industry, with each G20 partner contributing $5 billion over the next three years. This anchor investment is expected to catalyse further private investments and biofuel production, particularly in the biogas sector. The study underscores the importance of creating a favourable regulatory environment across G20 nations and sharing technological advancements to ensure the success of this biofuel alliance. It also stresses the need for promoting international cooperation and sharing best practices among G20 countries.

Facilitating the transfer of machinery and equipment among G20 partners is deemed crucial for the biofuel alliance's success. This collaborative effort is expected to reduce G20 nations' dependence on fossil fuels and potentially trim billions from their non-fossil fuel import bills within the next three years, aligning with their Sustainable Development Goals.

The study anticipates enhanced energy security and job creation within each country, while improved air quality and a healthier environment could result in substantial healthcare savings, amounting to billions.

According to the Ministry of New & Renewable Energy, current biogas and Compressed Biogas (CBG) production in India stands at 1151 metric tons per day. With further sectoral support, even conservative estimates project a rise to 1750 metric tons per day by 2025, within the next few years.

Regarding biomass availability, India boasts abundant potential biomass resources. Leveraging these resources as feedstock for CBG plants could result in an impressive production capacity of 170,000 metric tons of CBG per day. This capacity could potentially replace one-third of crude oil imports or three times the imported LNG, the study suggests.

Furthermore, the study notes that the average cost for each biogas plant is approximately $4.25 million. With the government's target of establishing 5,000 biogas plants, this presents an extensive opportunity valued at over $200 billion.

Source: Business Standard