In its push for adoption of greener energies, Reliance Industries has tied up with DBS Bank India to set up a financing program for farmers and aggregators for the management of crop residue that will be used to produce compressed biogas (CBG).

The conglomerate, which is aggresively pursuing opportunities in non-fossil fuels, is also working on the generation of CBG touted as an alternative to CNG and other fossil fuels. Farmers usually burn agriculture residue since they don’t have the means, the infrastructure and the logistics required to process them. DBS has been roped in as the finance partner for this.

“Though the technology for CBG has evolved, commercialisation requires new infrastructure and value chain engagement involving farmers across the States,” a statement by DBS said.

“In addition to being an alternative fuel to meet the growing domestic demand for gas, it also benefits the local agricultural economy of India by providing farmers with an additional revenue stream and helping them avoid penalties linked to the burning of residue,” it said.

RIL has already started on a massive program to set up biogas facilities across the country starting with Barabanki in Uttar Pradesh. This plant is expected to reduce carbon emissions by 40,000 tonnes annually. The plan is to set up about 100 CBG plants across the country over the next five years. This would help in consuming more than 5.5 million tons of agricultural residue and organic waste, leading to 2 million tons reduction in carbon emissions annually.

The company is setting up biogas facilities at multiple locations in UP by using surplus agro residue and organic waste.

Company officials said that the program would proceed gradually state-wise, considering the dynamics of the agricultural community and farmers, aggregators in each state.

RIL has not announced any investment figure for the CBG project but reports had suggested that it would be spending about ₹500-600 crore.

DBS Bank would offer customised financing for the standard supply chain model. “The financing will enable the ecosystem development for vendor partners to aggregate agri-residue as inputs for the Reliance Compressed Biogas production plants across India. The funding structure will ensure that the logistics are designed in a way that this new stream remains competitive and achieves enhanced commercial scale,” the statement said.