Cabinet approves "Pradhan Mantri Jl-VAN yojana"

Financial support to Integrated Bioethanol Projects using lignocellulosic biomass and other renewable feed stock

The Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi has approved the "Pradhan Mantri JI-VAN (Jaiv Indhan- Vatavaran Anukool fasal awashesh Nivaran) Yojana" for providing financial support to Integrated Bioethanol Projects using lignocellulosic biomass and other renewable feedstock.

The JI-VAN Yojana will be supported with total financial outlay of Rs 1969.50 crore for the period from 2018-19 to 2023-24. Out of scheme fund of Rs 1969.50 crore, Rs 1800 crore has been allocated for supporting 12 Commercial projects, Rs 150 crore has been allocated for supporting 10 demonstration Projects and remaining Rs 9.50 crore will be provided to Centre for High Technology (CHT) as administrative charges.

Under this Yojana, 12 Commercial Scale and 10 demonstration scale Second Generation (2G) ethanol Projects will be provided a Viability Gap Funding (VGF) support in two phases:

a) Phase-I (2018-19 to 2022-23): wherein six commercial projects and five demonstration projects will be supported.

b) Phase-II (2020-21 to 2023-24): wherein remaining six commercial projects and five demonstration projects will be supported.

The scheme focuses to incentivise 2G Ethanol sector and support this nascent industry by creating a suitable ecosystem for setting up commercial projects and increasing Research & Development in this area.

Apart from supplementing the targets envisaged by the Government under EBP programme, the scheme will also have the following benefits:

a) Meeting Government of India vision of reducing import dependence by way of substituting fossil fuels with Biofuels.

b) Achieving the GHG emissions reduction targets through progressive blending/ substitution of fossil fuels.

c) Addressing environment concerns caused due to burning of biomass/ crop residues & improve health of citizens.

d) Improving farmer income by providing them remunerative income for their otherwise waste agriculture residues.

e) Creating rural & urban employment opportunities in 2G Ethanol projects and Biomass supply chain.

f) Contributing to Swacch Bharat Mission by supporting the aggregation of nonfood biofuel feedstocks such as waste biomass and urban waste.

g) Indigenizing of Second Generation Biomass to Ethanol technologies.

The ethanol produced by the scheme beneficiaries will be mandatorily supplied to Oil Marketing Companies (OMCs) to further enhance the blending percentage under EBP Programme.

Ministry of Petroleum & Natural Gas has targeted to achieve 10% blending percentage of Ethanol in petrol by 2022. Despite efforts of the Government such as higher ethanol prices and simplification of ethanol purchase system, the highest ever ethanol procurement stands around 150 crore litres during Ethanol supply year 2017-18 which is sufficient for around 4.22% blending on Pan India basis. Therefore, an alternate route viz. Second Generation (2G) Ethanol from biomass and other wastes is being explored by MoP&NG to bridge the supply gap for EBP programme. In this direction, "Pradhan Mantri JI-VAN Yojana" is being launched as a tool to create 2G Ethanol capacity in the country and attract investments in this new sector.

Centre for High Technology (CHT), a technical body under the aegis of MoP&NG, will be the implementation Agency for the scheme. The Project developers interested in availing benefits of the scheme, shall be submitting their proposal for review by Scientific Advisory Committee (SAC) of MoP&NG. Projects recommended by SAC shall be approved by Steering Committee of MoP&NG under the chairmanship of Secretary, MoP&NG.

Government of India launched Ethanol Blended Petrol (EBP) programme in 2003 for undertaking blending of ethanol in Petrol to address environmental concerns due to fossil fuel burning, provide remuneration to farmers, subsidize crude imports and achieve forex savings. Presently, EBP is being run in 21 States and 4 UTs of the country. Under EBP programme, OMCs are to blend upto 10% of ethanol in Petrol. The present policy allows procurement of ethanol produced from molasses and non-food feed stock like celluloses and lignocelluloses material including petrochemical route.

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