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Mandating Compressed Bio-Gas (CBG) Blending in CGD Sector

Why is it in the news?Top of Form


  • The Ministry of Petroleum & Natural Gas has introduced a significant policy mandating the blending of Compressed Bio-Gas (CBG) in the City Gas Distribution (CGD) sector, covering both the transport (CNG) and domestic (PNG) segments.
  • The move is part of a strategic initiative to promote sustainable practices, reduce dependence on conventional fuels, and contribute to environmental conservation.


CBG Blending Obligation (CBO)聽


  • The CBG Blending Obligation (CBO) is a phased approach designed to promote the production and consumption of CBG while displacing traditional petroleum-based fuels.
  • CBO aims to stimulate demand for CBG in the CGD sector, offering a sustainable alternative for both transportation and domestic use.
  • The policy is expected to attract significant investments, estimated at around Rs. 37,500 crores, and facilitate the establishment of 750 CBG projects by the fiscal year 2028-29.


Objectives of CBO

  • Stimulating CBG Demand in CGD Sector: Encourage the integration of CBG into the City Gas Distribution sector, fostering its use in both transportation and domestic applications.
  • Import Substitution for LNG: Promote the use of CBG as a substitute for Liquefied Natural Gas (LNG), contributing to reduced dependence on imported fossil fuels.
  • Foreign Exchange Savings: Achieve savings in foreign exchange by utilizing domestically produced CBG instead of importing LNG.
  • Circular Economy Promotion: Foster a circular economy by encouraging the production of CBG from biomass sources, such as agricultural residue, cattle dung, and municipal solid waste.
  • Assisting in Achieving Net Zero Emissions: Align with environmental goals by promoting CBG as a cleaner and sustainable fuel option, contributing to efforts aimed at achieving net-zero emissions.


CBO Roadmap

  • The CBO will have a voluntary phase until the fiscal year 2024-2025, after which mandatory blending obligations will come into effect.
  • The mandatory blending percentages are set at 1%, 3%, and 4% of total CNG/PNG consumption for the fiscal years 2025-26, 2026-27, and 2027-28, respectively.
  • Starting from the fiscal year 2028-29, the mandatory blending obligation will be set at 5% of the total CNG/PNG consumption.
  • A Central Repository Body will be responsible for monitoring and implementing the blending mandate.


CBG Composition

路聽聽聽聽聽聽 CBG is an energy-rich gas primarily composed of methane (around 90%), with low levels of carbon dioxide, hydrogen sulphide, and ammonia.

路聽聽聽聽聽聽 It is produced through the anaerobic decomposition of biomass sources, including agriculture residue, cattle dung, sugarcane press mud, and municipal solid waste.


Other Biofuel Initiatives

  • The government has undertaken various initiatives to promote biofuels, including setting initial indicative blending targets for Sustainable Aviation Fuel (SAF) for international flights.
  • Schemes like SATAT (Sustainable Alternative Towards Affordable Transportation) and GOBAR-DHAN (Galvanizing Organic Bio-Agro Resources Dhan) aim to further promote the use of biofuels in various sectors.

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