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The Centre on Friday allowed private bio-diesel manufacturers to sell directly to consumers. Prior to the announcement, only state-run oil firms and private companies with infrastructure investments of Rs. 2,000 crore were allowed to market petrol, diesel or bio-diesel.
“The Union Cabinet chaired by Prime Minister Narendra Modi today gave its approval for amending the Motor Spirit (petrol) and High Speed Diesel (diesel) control order for Regulation of Supply, Distribution and Prevention of Malpractices dated December 19, 2005.
“The amendment will allow private bio—diesel manufacturers, their authorised dealers and joint ventures of oil marketing companies (OMCs) authorised by the Ministry of Petroleum & Natural Gas (MoP&NG) as dealers and give marketing /distribution functions to them for the limited purpose of supply of bio—diesel to consumers,” the release read, adding that the decision would encourage the production of bio-diesel in India.
A ‘Bio-Diesel Purchase Policy’ had been announced in January 2006 for promotion of fuel that was less environmentally harmful and to enhance emission objectives. Oil marketing companies (OMCs) were to procure bio-diesel for blending up to 5 per cent with HSD at prices that would be decided by the OMCs themselves.
The amendment comes against the backdrop of problems faced in sourcing and financial difficulties faced by State-run companies. Bulk users, such as the Indian Railways, can now source the fuel directly.
“The investment and production conditions (as applicable) specified in the Marketing Resolution dated 08.03.2002 of MoP&NG will also be relaxed and a new clause added to give marketing rights for Bio-diesel (B100) to the private biodiesel manufacturers, their authorised dealers and JVs of OMCs authorized by the MoP&NG for direct sales to consumers,” the release added.
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