The Chairman of the Indian Biogas Association Gaurav Kadia urges the government to simplify bioenergy regulations and finance models to unlock the sector’s true potential

In the heart of India’s bioenergy revolution, where ambitious targets and progressive policies are shaping the future of clean energy, there is a growing industry sentiment that is calling for something more – something that could bridge the gap between good intentions and desired results.

Giving a voice to industry sentiment, Gaurav Kedia, Chairman of the Indian Biogas Association (IBA), advocates for the kind of transformation that could turn India’s bioenergy vision into reality. It’s not just about pushing policy incentives, Kedia said, during his conversation with BusinessWorld, It’s about creating an environment where that policy can thrive, where innovation is not let down by bureaucracy, and where small investors are empowered to scale.

More Than Just Money, It’s About Movement
As India accelerates its efforts in bioethanol blending and biomass substitution, financial incentives are pouring in. However, Kedia believes there’s a missing link that even the best subsidies cannot address.

He points to Uttar Pradesh, where the state government has added additional subsidies to the Central Government’s bio-compressed natural gas (bio-CNG) scheme. “The government is offering Rs 4 crore for a 5 tonne per day compressed biogas (CBG) plant at the national level, and in UP, they top it up with another Rs 3.75 crore. That’s significant financial support,” Kedia acknowledged.

But his concern is deeper than just the financial aspect – it’s about the barriers to implementation.

Kedia emphasised the importance of not just a ‘push’ from policies, but also the need for a pull – something that draws investors in and keeps them moving forward.

To illustrate, he explained how setting up a bioenergy project requires multiple layers of clearance: from pollution control boards to explosive departments, from central government approvals to local NOCs. The result? Projects often get delayed, causing frustration among investors.

 Single-Window Clearance
In Kedia’s vision, the key to unlocking the full potential of bioenergy lies in streamlining the process. “What we need is a single-window clearance system. Right now, there are so many different departments to approach and policies to follow, which creates bottlenecks,” Kedia said with a sense of urgency. “If we simplify that process, it would make it easier for investors to navigate and execute their projects.”

The single-window clearance would enable both Central and State Governments to offer a consolidated and transparent process. Instead of handling multiple, separate applications and waiting for approvals from different departments, an all-in-one window would allow project developers to get quicker decisions, accelerating project timelines and improving overall efficiency.

“We need clarity and simplicity,” Kedia said, pointing out that a clear-cut implementation framework is crucial to avoid confusion. Without it, mid-sized investors – those who often don’t have the bandwidth to manage complex regulatory hurdles – will continue to be discouraged.

 Blended Finance: A Fresh Approach to Bioenergy Funding
Kedia agreed that in a country like India, financing remains a critical challenge, especially for bioenergy ventures which come with high upfront costs. “If we can provide access to easier finance, more investors would come into the space,” he said. But it’s not just about cheaper loans – it’s about creating innovative financial models.

He emphasised the idea of blended finance as a way to merge public and private capital. Imagine a fund where public money is blended with private investment and philanthropic contributions. Kedia explained that this could create a funding pool where returns are not the sole objective. “Some investors might prioritise environmental impact over profits, while others look for financial returns,” he said. “Blended finance could accommodate both, helping bioenergy projects at their nascent stages.”

This approach would not only lower the barriers to entry but could also allow India to experiment with smaller pilot projects.

Social Dynamics: The Human Element of Bioenergy
While technical and financial barriers often dominate discussions, Kedia goes beyond numbers and policies. He was deeply concerned about the social aspect of bioenergy, particularly when it comes to the farmers who provide the feedstock that bioenergy plants rely on.

“For bioenergy to truly succeed, we must understand the relationship dynamics between the farmer and the bioenergy industry,” Kedia emphasised. “We live in a relationship-driven society, and farmers are the heart of the bioenergy supply chain. Their needs must be factored into the business models, especially in a market like India, where farmers are cost-sensitive and prefer hard cash payments.”

Kedia proposed a more symbiotic approach, one that acknowledges the human element at the core of India’s bioenergy plans. “We need to create village-level entrepreneurs who can talk to farmers in their own language and understand their concerns. The model cannot work unless it considers the social side of things,” he said.

He suggested that an intermediary who understands local culture and can effectively communicate the project’s long-term benefits will be key to aligning the farmers’ interests with the bioenergy industry’s goals.