http://www.deccanherald.com/content/594973/used-cooking-oils-boost-biofuel.html
Used cooking oils boost biofuel economy
Sandeep Chaturvedi, Feb 6, 2017:
The Ministry of Petroleum & Natural Gas has given a big push for the
ethanol blending programme, and is close to achieving 5% blending at
national level
Biodiesel is being promoted world over as a green fuel to mitigate
harmful exhaust emissions from diesel vehicles. Besides helping in
reducing the air pollution, biodiesel improves lubricity of low sulphur
diesel fuels required for meeting Euro III & Euro IV emission norms.
It is safe to handle, as the flash points of biodiesel are higher than
the conventional diesel. Blending of biodiesel with diesel would result
in the reduction of un-burnt hydrocarbons, carbon monoxide and
particulate matter in auto emissions, and will be in line with the
objectives of the auto sector.
It is promising to note that the government has taken unprecedented
initiatives in the field of biofuels in the last two years. That has
enabled the starting of this green industry that was almost written off
during the last 10 years. Several policy interventions and clearing of
many hurdles in implementation of national blending targets can be
achieved by a comprehensive national policy.
The Ministry of Petroleum & Natural Gas (MoP&NG) has given a big push
for the ethanol blending programme, and is close to achieving 5%
blending at the national level. The biodiesel blending programme, which
was started on August 10, 2015, as a pilot in four cities, has now been
extended to six states and sold through nearly 3,000 retail outlets in
the country within a year. The Railways slowly but surely has started
consuming biodiesel across its various zones.
The government is well aware about the potential of biofuel in India.
Biodiesel is the most appropriate tool being envisaged to achieve the
GHG (greenhouse gas) reduction targets. In order to bring about
substantial reduction in emissions, it is essential that biodiesel is
made widely available to the common man through the retail outlets of
the Oil Marketing Companies (OMCs). The MoP&NG or Railways can only
create a conducive marketing environment, but the key taxation issues
can only be addressed by a national policy.
Biodiesel: Fueling future
There are several benefits associated with the promotion of biodiesel.
If Indian Oil, Bharat Petroleum Corporation (BPCL) and Hindustan
Petroleum Corporation (HPCL) buy a total of 20 million litres of
biodiesel from local manufacturers, it will tremendously help India,
which imports 80% of its crude oil, to reduce its oil import bill.
It is heartening to note that the oil ministry is pushing for biodiesel,
and has set a target of seven-fold expansion in India’s biofuel market
in the next six years. As per the ministry’s estimate, blending 5% of
biodiesel with diesel and 10% ethanol with petrol can expand the biofuel
market to Rs 50,000 crore by 2022 from about Rs 6,500 crore currently.
For this, India would need 6.75 billion litres of biodiesel and 4.5
billion litres of ethanol.
OMCs are at present selling biodiesel in West Bengal, Odisha, Andhra
Pradhesh, Telangana, Tamil Nadu and Gujarat, after procuring it from
biodiesel manufacturers and blending it.
To tide over the shortage of biodiesel, a policy is needed to assure
regular supply of used cooking oils (UCOs) from restaurants, hotels and
other food processing industries, as cooking oils have a large share in
the production of biodiesel, and can be easily made available. Cooking
oil accounts for 18-20% of the total output of biodiesel. The benefits
would be two-pronged, as it will be saving the health of the masses
since it would be removed from the food chain and used as a feedstock
for green fuels.
Also, the national policy could support the oil seed collection in the
tribal areas, thereby, creating employment opportunities in the tribal
areas. The industry has geared up to deliver three million tonnes of
biodiesel by 2019. This will provide half a million direct jobs, and one
million jobs to ancillaries. The direct and indirect jobs would be four
million.
Challenges
India is at the threshold of rapid scaling of the biofuel programme, and
still faces many challenges that need to be addressed. The industry has
sought Value Added Tax (VAT) relaxation on blending of biodiesel from
states for promoting green fuel blending and energy security in the country.
Currently, VAT on biodiesel blending goes up to 14-30 % in several
states, and the industry has warned that if the states do not provide
promotional VAT rate on B5 blends, the biodiesel blending in the retail
segment would be killed.
The states are required to declare a promotional VAT rate for biodiesel
blending. A small levy of 10 paise per litre on High Speed Diesel (HSD)
could fund the entire blending programme.
Andhra Pradesh, Telangana, West Bengal, Tamil Nadu and Gujarat are
leading biodiesel producing states and these states charge 24 -30% on
blending. The Centre provides excise relief for biodiesel blends, that
is, once duty paid diesel is blended with biodiesel, no additional duty
is required. But none of the states has come forward to offer
promotional VAT. This has resulted in biodiesel getting taxed at the
rate of 24-30% in the blended form.
The current blending programme is largely supported by the central
government. The sector has been demanding a changed National Policy for
Biofuels, which will encourage investment and create millions of jobs
with overall environmental protection.
UCOs and biodiesel
Used Cooking Oils (UCOs) are a major health concern, resulting in
obesity and cancer in masses. There is a need to create awareness about
the health hazard. The UCOs could be used as a feedstock to manufacture
biodiesel.
There is also a need for a national policy on the UCO that should ensure
end traceability for vegetable oils, material balance by all major
vegetable oil consumers. UCO sales only to authorised collection agency
will ensure UCO elimination from our food chain.
India produces nearly 22 million tonnes of oil and nearly two million
tonnes of UCO is available for blending. Imagine a city like Delhi with
a large amount of UCO can provide huge scope for blending and this can
further enhance biofuel economy. Used oil collection in system in metro
cities will certainly offer urban jobs.
{The writer is President of Biodiesel Association of India (BDAI)}