Agri Business

Emerging opportunities in biofuel sector

MV Ashok | Updated on September 05, 2021

Globally, 140 billion tonnes of biomass are generated every year from agriculture

Agricultural wastes refer to the residues from the growing, harvesting and processing of raw agricultural products such as grains, fruits, vegetables, fish, meat, poultry, dairy products, etc. They are the non-product outputs of production and processing of agricultural products that may contain material that can benefit man but whose economic values may be less than the cost of collection, transportation, and processing for beneficial use. Their composition will depend on the system and type of agricultural activities and they can be in the form of liquids, slurries, or solids. Agricultural waste otherwise called agro-waste is comprised of animal waste also (manure, animal carcasses), food processing waste (only 20 per cent of maize is canned and 80 per cent is waste), crop waste (corn stalks, sugarcane bagasse, drops and culls from fruits and vegetables, prunings) and hazardous and toxic agricultural waste (pesticides, insecticides and herbicides, etc., besides waste from slaughter houses of animals, fish waste from fish landing sites and processing units.

Agricultural wastes are non-product outputs of production and processing of agricultural products that may contain material that can benefit man but whose economic values are less than the cost of collection, transportation, and processing for beneficial use. Estimates of agricultural waste arising are rare, but they are generally thought of as contributing a significant proportion of the total waste matter in the developed world. Agricultural development is usually accompanied by wastes from the irrational application of intensive farming methods and the abuse of chemicals used in cultivation, remarkably affecting rural environments in particular and the global environment in general. Generally, agricultural wastes are generated from a number of sources notably from cultivation, livestock and aquaculture. These wastes are currently used for a number of applications through the ‘3R’ strategy of waste management.

Agricultural wastes are generally said to contribute a significant proportion of the total waste matter in the developed world. Expanding agricultural production has naturally resulted in increased quantities of livestock waste, agricultural crop residues and agro-industrial by-products. There is likely to be a significant increase in agricultural wastes globally if developing countries continue to intensify farming systems. It is estimated that about 998 million tonnes of agricultural waste is produced globally every year. Organic wastes can amount up to 80 per cent of the total solid wastes generated in any farm.

Globally, 140 billion tonnes of biomass are generated every year from agriculture. This volume of biomass can be converted to an enormous amount of energy and raw materials. Equivalent to approximately 50 billion tonnes of oil, agricultural biomass waste converted to energy can substantially displace fossil fuel, reduce emissions of greenhouse gases and provide renewable energy to some 1.6 billion people in developing countries, which still lack access to electricity. As raw materials, biomass wastes have attractive potentials for large-scale industries and community-level enterprises.

In India

In India, informal estimates indicate that roughly around 235 million MT of surplus crop residue is produced out of which only around 10 per cent is converted into biofuel. As such there is a huge potential for this activity in India. Estimations indicate that 100 per cent utilisation of this surplus crop residue can potentially lead to providing 17 per cent of country's energy needs, creating additional source of income for farmers and creation of jobs in rural and industrial sectors.

Biomass types

Biomass in India takes various forms of residual stalks, straw, leaves, roots, husk, nut or seed shells, waste wood and animal husbandry as well as fish waste. Agricultural waste which is widely available, renewable, and virtually free, is an important resource which is discussed here. The major crops and waste utilised are the following:

 

Conversion of biomass into biofuel

 

Agriculture crop residue, food waste, and any other form of organic waste, (in general, “biomass”) can be used for producing energy. Biomass can be effectively converted to biomass-based power or biofuel. Generating biofuel like ethanol can also produce useful by-products such as bio-fertilisers.

Fully processed biomass briquettes

Biofuel is fuel that is produced through contemporary processes from biomass, rather than by the very slow geological processes involved in the formation of fossil fuels, such as oil.

Since biomass, technically, can be used as a fuel directly (e.g. wood logs), some people use the terms biomass and biofuel interchangeably. More often than not, however, the word biomass simply denotes the biological raw material the fuel is made of, or some form of thermally/chemically altered solid end product, like torrefied pellets or briquettes.

Biomass conversion technologies

 

Although there is an emerging trend on the utilisation of biomass conversion technologies from combustion of rice husk and sugarcane bagasse to gasification of other agricultural residues, biomass is still largely underutilised and left to rot or openly burned in the fields, especially in developing countries that do not have strong regulatory instruments to control such pollutive practices.

As a common practice, direct combustion of agricultural residue results in air pollution thereby posing risk to human and ecological health. Biomass is a renewable resource that causes problems when not used. The challenge, therefore, is to convert biomass as a resource for energy and other productive uses.

Various types of raw material for briquette making

There are advantages of using biomass. Biomass is a renewable resource that has a steady and abundant supply, especially those biomass resources that are by-products of agricultural activity. Its use is carbon neutral, can displace fossil fuels, and helps reduce Green House Gas (GHG) emissions while closing the carbon cycle loop. As the debate on food versus fuel intensifies, biomass can provide added income to farmers without compromising the production of main food and even non-food crops.

 

Emerging opportunities for rural entrepreneurs & FPOs

Against the above background, there is ample scope for entrepreneurs for aggregation of agricultural waste from farmers and supply it to briquette making units and for the units to do business with bioenergy companies that use biomass briquette as fuel for firing their boilers, etc. To help the various stakeholders in the value chain, a Pune-based agri-tech start up Biofuel Circle Ltd, has developed a digital platform with varied services offered founded in 2020 by Suhas Baxi and Ashwin Save - two industry professionals based in Pune. Biofuel Circle has developed a Digital Platform ‘My BiofuelCircle’ which is a subscription based three-sided Marketplace platform for Bioenergy Supply Chain for buyers and sellers and other stake holders like Financial Institutions, transporters and warehouses to engage in transactions with the platform acting as transport and storage service providers with other value-added services to help remove bottlenecks in the supply chain and create efficiency.

The impacts of the sector

This sector has several benefits. For example, it helps the environment as bioenergy does not add extra CO to the atmosphere unlike fossil fuels. Biofuels reduce greenhouse gas emissions and are a renewable source of energy. It has a social impact by organising and strengthening the Bioenergy supply chain would enable employment generation across rural and urban locations. It can benefit Farmers earning better prices with ability to earn hassle-free additional income, not once but for every harvest. This organised ecosystem also creates opportunities for new businesses in processing of biomass, storage solutions, and other interim processes. The platform enables opportunities for new local rural businesses and employment. The sector helps scaling up business resulting in increased reach and coverage which will bring more business due to more buyers. By increasing the number of bioenergy consuming companies for selling biofuel and getting better prices this sector will help in benefitting more stakeholders. Extending logistics for the coverage creates ease of operations and with multiple transporters registered on the platform, business will get competitive pricing and create operational efficiency. Financial Institutions get a chance to grow and help their rural and agri business portfolio.

Conclusion

Thus, the biofuel sector holds great promise as an income generating rural enterprise for farmers and farmers collectives like FPOs and there are several supporting initiatives like the support from agritech startup Biofuel Circle whose services can be considered for organizing such enterprises in rural areas.

(The author is a former CGM of NABARD and is currently with BAIF Research and Development Foundation, Pune as Senior Adviser.)

Published on September 05, 2021

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