PM JI-VAN Scheme: The Game-Changer for India’s Energy Security and Environment!
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The Pradhan Mantri JI-VAN (Jaiv Indhan- Vatavaran Anukool fasal awashesh Nivaran) Yojana, launched in March 2019, aims to support the establishment of Second Generation (2G) ethanol projects using lignocellulosic biomass and other renewable feedstocks. As of September 2023, Rs. 880 crore has been approved for various 2G ethanol projects, enhancing ethanol availability for the Ethanol Blending Petrol Programme and reducing dependency on fossil fuel imports.
What is PM JI-VAN Scheme
- Definition and full form: The Pradhan Mantri JI-VAN (Jaiv Indhan- Vatavaran Anukool fasal awashesh Nivaran) Yojana is a government initiative aimed at providing financial support for integrated bio-ethanol projects that utilize lignocellulosic biomass and other renewable feedstocks.
- Launch date and purpose: The scheme was launched in March 2019 with the primary objective of promoting the establishment of Second Generation (2G) ethanol projects. These projects are intended to enhance the production of bio-ethanol, thereby reducing environmental pollution and supporting the Ethanol Blended Petrol (EBP) programme.
- Financial outlay: The total financial allocation for the scheme is Rs. 1969.50 crore for the period from 2018-19 to 2023-24. This funding is distributed to support 12 commercial projects and 10 demonstration projects, with specific allocations for each type of project and administrative expenses.
Objectives of the Scheme
- Primary Goals
- Promote 2G Ethanol Production: The scheme aims to establish an ecosystem for setting up commercial projects and boost research and development in the Second Generation (2G) ethanol sector.
- Environmental Benefits: It seeks to reduce greenhouse gas emissions by substituting fossil fuels with biofuels, thereby contributing to India’s climate goals.
- Prevent Biomass Burning: By utilizing agricultural residues and other waste materials, the scheme aims to prevent the burning of biomass, which is a significant source of air pollution.
- Support Ethanol Blending Programme (EBP): The scheme is designed to enhance the availability of ethanol for blending with petrol, thus reducing the country’s dependency on fossil fuel imports.
- Economic and Social Objectives
- Increase Farmer Income: By providing a market for agricultural residues, the scheme aims to increase the income of farmers and reduce the practice of crop residue burning.
- Create Employment Opportunities: The establishment of 2G ethanol projects and the associated biomass supply chain is expected to generate employment in rural areas.
- Promote Swachh Bharat Mission: The scheme contributes to the Swachh Bharat Mission by utilizing waste biomass and urban waste, thereby promoting cleanliness and waste management.
- Technological Advancement
- Boost R&D: The scheme encourages research and development in 2G ethanol technologies, aiming to make these technologies commercially viable and scalable.
- Develop Indigenous Technologies: It supports the development of indigenous technologies for converting biomass to ethanol, reducing reliance on imported technologies.
Project Details and Progress
- Funding Details
- Maximum Financial Assistance: The scheme provides a maximum financial assistance of Rs. 150 crore per commercial project and Rs. 15 crore per demonstration project to enhance commercial viability and promote research and development in 2G ethanol technologies.
- Total Allocation: The total financial outlay for the scheme is Rs. 1969.50 crore for the period from 2018-19 to 2023-24. This includes Rs. 1800 crore for 12 commercial projects, Rs. 150 crore for 10 demonstration projects, and Rs. 19.50 crore for administrative charges to the Centre for High Technology (CHT).
- Implementation Agency
- Centre for High Technology (CHT): The CHT, a technical body under the Ministry of Petroleum and Natural Gas (MoP&NG), is the designated implementation agency for the scheme. It is responsible for overseeing the execution of projects and ensuring compliance with the scheme’s guidelines.
- Scientific Advisory Committee (SAC): The SAC of the MoP&NG is the nodal body for recommending eligible projects. It reviews proposals submitted by project developers and makes recommendations to the Steering Committee of MoP&NG for approval.
- Project Approval and
- Proposal Submission: Project developers interested in availing benefits under the scheme must submit their proposals to the CHT. These proposals are reviewed by the SAC based on specific selection criteria.
- Approval Process: Projects recommended by the SAC are approved by the Steering Committee of MoP&NG, chaired by the Secretary of MoP&NG. Approved projects receive financial assistance in multiple phases based on the achievement of predefined milestones.
- Monitoring and Evaluation: The progress of each project is monitored by the CHT. Funds are released in phases, contingent upon the successful completion of project milestones. The MoP&NG conducts periodic reviews to ensure the projects are on track and meeting their objectives.
- Approved Projects
- Commercial Projects: Six commercial Second Generation (2G) bio-ethanol projects have been approved under the PM JI-VAN Yojana. These projects are located in Punjab, Haryana, Odisha, Assam, and Karnataka.
- Demonstration Projects: Two demonstration projects have been approved, one each in Haryana and Andhra Pradesh.
- Project Status
- Panipat, Haryana: The commercial project at Panipat has been completed and dedicated to the nation. This project is a significant milestone in the scheme’s implementation.
- Bhatinda, Punjab: The commercial project in Bhatinda is in an advanced stage of construction and is expected to be commissioned soon.
- Bargarh, Odisha: The project in Bargarh is also progressing well and is in the advanced stages of construction.
- Numaligarh, Assam: The Numaligarh project is similarly in an advanced stage of construction, with expected commissioning in the near future.
Benefits and Impact
- Environmental Benefits
- Reduction in Greenhouse Gas Emissions: The scheme aims to reduce greenhouse gas emissions by promoting the use of biofuels, which are cleaner alternatives to fossil fuels. This contributes to India’s climate goals and helps in mitigating climate change.
- Prevention of Biomass Burning: By utilizing agricultural residues and other waste materials for ethanol production, the scheme helps in preventing the burning of biomass, which is a significant source of air pollution. This leads to improved air quality and public health.
- Economic Benefits
- Reduction in Import Dependency: The scheme supports the Ethanol Blended Petrol (EBP) programme, which aims to reduce India’s dependency on imported crude oil by substituting it with domestically produced ethanol. This helps in achieving foreign exchange savings and enhances energy security.
- Increased Farmer Income: By providing a market for agricultural residues, the scheme offers an additional source of income for farmers. This helps in improving their economic condition and reduces the practice of crop residue burning.
- Creation of Employment Opportunities: The establishment of 2G ethanol projects and the associated biomass supply chain is expected to generate employment opportunities in rural and urban areas. This includes jobs in the collection, transportation, and processing of biomass.
- Social Benefits
- Improvement in Public Health: By reducing air pollution caused by biomass burning, the scheme contributes to better public health outcomes. This includes a reduction in respiratory and other pollution-related diseases.
- Contribution to Swachh Bharat Mission: The scheme supports the Swachh Bharat Mission by promoting the use of waste biomass and urban waste for ethanol production. This helps in waste management and contributes to cleanliness and sanitation efforts.
- Technological Advancement
- Promotion of 2G Ethanol Technologies: The scheme encourages research and development in Second Generation (2G) ethanol technologies, making them commercially viable and scalable. This includes the development of indigenous technologies for converting biomass to ethanol.
- Support for Innovation: By providing financial assistance and creating a conducive environment for 2G ethanol projects, the scheme fosters innovation in the biofuel sector. This helps in the development of new technologies and processes for efficient ethanol production.
Policy and Regulatory Support
- Government Initiatives
- National Policy on Biofuels: The PM JI-VAN Yojana is aligned with the National Policy on Biofuels, which aims to promote the use of biofuels in the energy and transportation sectors. This policy provides a framework for the production, utilization, and promotion of biofuels, including ethanol.
- Ethanol Blending Programme (EBP): The scheme supports the EBP, which mandates the blending of ethanol with petrol to reduce the country’s dependence on fossil fuels. The government has set targets for increasing the ethanol blending percentage, with a goal of achieving 20% blending by 2025.
- Financial Incentives
- Excise Duty and GST: To encourage the production and use of 2G ethanol, the government has imposed an additional excise duty on non-blended fuels. Additionally, the Goods and Services Tax (GST) rate on ethanol for blending with petrol has been reduced to 5%.
- Subsidies and Grants: The scheme provides financial assistance in the form of subsidies and grants to support the establishment of 2G ethanol projects. This includes funding for both commercial and demonstration projects to promote the adoption of advanced biofuel technologies.
- Regulatory Measures
- Ethanol Purchase Agreements (EPA): Oil Marketing Companies (OMCs) are required to enter into long-term Ethanol Purchase Agreements (EPAs) with ethanol producers. These agreements provide offtake assurance for 15 years, ensuring a stable market for the ethanol produced under the scheme.
- Feedstock Diversification: The policy encourages the use of diverse feedstocks for ethanol production, including agricultural residues, municipal solid waste, and other renewable materials. This helps in ensuring a consistent supply of raw materials for 2G ethanol production.
- Research and Development Support
- R&D Funding: The scheme allocates funds for research and development in 2G ethanol technologies. This includes support for pilot projects, demonstration plants, and the development of indigenous technologies for converting biomass to ethanol.
- Collaboration with Research Institutions: The government promotes collaboration between industry and research institutions to advance the development of 2G ethanol technologies. This includes partnerships with universities, research labs, and international organizations.
Challenges and Future Prospects
Challenges
- Feedstock Supply Chain
- Inefficient Collection and Transportation: The supply chain for biomass feedstock is inefficient, involving challenges in collection, aggregation, transportation, and storage. This inefficiency increases the overall cost of production.
- Regional Concentration: The production of bioethanol is heavily concentrated in certain regions, leading to non-uniform availability across the country. This regional disparity complicates the logistics and increases transportation costs.
- Technological and Financial Barriers
- Nascent Technology: The technology for 2G ethanol production is still in its early stages in India, leading to high production costs and financial viability issues. There is a need for extensive research and development to make these technologies more cost-effective.
- High Capital Investment: Setting up 2G ethanol plants requires significant capital investment, which poses a challenge for many potential investors. The financial stability of key domestic suppliers, such as sugar mills, is also a concern.
- Regulatory and Policy Issues
- Inter-State Movement of Ethanol: Only 14 states have implemented the amended provisions of the Industries Development and Regulations Act, which facilitates the inter-state movement of ethanol. This lack of uniform implementation hinders the efficient distribution of ethanol across the country.
- Environmental Clearances: Ethanol production plants fall under the “Red category” and require environmental clearances under the Air and Water Acts. This process can be time-consuming and may delay the establishment of new plants.
Future Prospects
- Expansion of Production Capacity
- Augmenting Ethanol Production: To achieve the target of 20% ethanol blending by 2025, India needs to significantly increase its ethanol production capacity. This includes both sugarcane-based and grain-based ethanol production.
- Utilization of Wastelands: A sizeable portion of India’s land area is wasteland, which can be utilized for the cultivation of energy crops such as Napier Grass and Bamboo. This can provide a sustainable source of biomass for ethanol production.
- Policy and Financial Support
- Increased Budgetary Allocation: There is a need to increase the budgetary allocation under the PM JI-VAN Yojana and include more biofuel projects within its ambit. Extending the time limit of the scheme beyond 2023-24 can also support the nascent biofuel sector.
- Production Linked Incentive (PLI) Scheme: Including biofuel projects under the PLI scheme can provide incentives based on sales, performance criteria, and local value addition. This can improve project viability and attract large-scale investments.
- Technological Advancements
- Research and Development: Continued investment in R&D is crucial for developing cost-effective and efficient 2G ethanol technologies. Collaboration between industry and research institutions can accelerate technological advancements.
- Single Window Clearances: Implementing a single window clearance system for new and expansion projects can expedite the approval process and reduce delays in setting up ethanol production plants.
- Environmental and Economic Benefits
- Reduction in Greenhouse Gas Emissions: Increasing the production and use of 2G ethanol can significantly reduce greenhouse gas emissions, contributing to India’s climate goals.
- Energy Security and Rural Development: Enhancing ethanol production can reduce dependency on imported crude oil, improve energy security, and create employment opportunities in rural areas, thereby supporting economic development.
The Pradhan Mantri JI-VAN Yojana is a pivotal initiative aimed at fostering the production of Second Generation (2G) ethanol, thereby reducing India’s dependency on fossil fuels, enhancing energy security, and mitigating environmental pollution. By promoting the use of agricultural residues and other renewable feedstocks, the scheme not only supports the Ethanol Blended Petrol (EBP) programme but also contributes to rural development and public health improvements.
Practice Question
Discuss the challenges and future prospects of the Pradhan Mantri JI-VAN Yojana in promoting Second Generation (2G) ethanol production in India. (250 words)
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