Excise Duty Waiver: A Game Changer for India's Biogas Sector

The Indian government's recent decision to waive excise duties on biogas, blended with compressed natural gas (CNG), marks a significant advancement in the nation's energy sector. The Indian Biogas Association (IBA) announced that this move, outlined in Union Budget 2026, could potentially attract up to Rs 1 lakh crore in investments.

Currently, achieving a 5 percent biogas blending nationwide could necessitate 2.5-3 million metric tons per annum (MMTPA) of compressed biogas (CBG), resulting in investments ranging from Rs 45,000-55,000 crore. By 2032, with policy clarity and stable prices, this figure is expected to double, further positioning India toward its 2070 Net Zero target.

The excise waiver not only aids in reducing gas prices but also drives private investments, fortifies energy security, and promotes environmental and rural development. CBG, as a renewable resource derived from waste, offers considerable environmental benefits, cutting greenhouse gas emissions by up to 90 percent. The policy change promises steady revenue for producers, reduced costs for consumers, and improved marketability for biogas projects.