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Scheme to Support Promotion of Biomass based Co-generation in Sugar Mills and other Industries in the Country (up to March 2020)

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Nodal Agency


Ministry of New and Renewable Energy (MNRE)


Applicable Technologies


  • Biomass based co-generation technologies using:
    • Bagasse
    • Agro based industrial residue
    • Crop residues
    • Wood produced through energy plantations
    • Weeds
    • Wood waste produced in industrial operations
  • Municipal solid waste is not covered under the program


Eligibility Conditions


For availing term loans from financial institutions, the developer should be one of the following:

  • Registered company
  • Partnership firm
  • Proprietorship firm
  • Cooperative
  • Public sector company
  • Government owned firm


Scheme Period


May 2018 to March 2020




  • Rs.25 lakh/MW for bagasse based projects.
  • Rs.50 lakh/MW for non-bagasse based projects.
  • Back-ended CFA to be released after successful commissioning and commencement of commercial generation and performance testing.
  • CFA only for projects installing new boiler and turbines.
  • CFA for existing plants with expansionary plans – only for the enhanced capacity.





Timeline for completion of projects


24 months from the date of sanction of assistance, with an additional six months grace period if the developer faces delays beyond his control.


Incentives to State Nodal Agencies


Rs.1 lakh/MW or Rs10 lakh/project whichever is less – incentives for post installation monitoring of projects and sending periodic reports to MNRE.


Performance Inspection


  • Operation of the project for three months after the date of commissioning.
  • At least 72 hours continuous operation at minimum 80% of rated capacity.
  • To be carried out by the utility in whose area the project is located.
  • Charges to be borne by the developer.


Monitoring of Projects


By a team comprising representatives of utilities, SNAs, experts appointed by MNRE and ministry officials.




Various national and international standards for equipment utilized.









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