The government has mandated blending compressed biogas (CBG) with compressed natural gas (CNG) with a target of 5% CBG blending by 2028-29.
11 Aug 2025 | 7670 Views | By Kiran Murali
While India is close to hitting the 20% ethanol blending target in petrol, the country is also pushing for biofuels in the transport gas sector. From this financial year, the government has mandated the blending of compressed biogas (CBG) with compressed natural gas (CNG) with an aim of 5% CBG ...
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While India is close to hitting the 20% ethanol blending target in petrol, the country is also pushing for biofuels in the transport gas sector. From this financial year, the government has mandated the blending of compressed biogas (CBG) with compressed natural gas (CNG) with an aim of 5% CBG blending target by 2028-29.
However, India’s largest city gas operator, Indraprastha Gas Ltd (IGL), is confident of achieving a 10% CBG blend in CNG instead of the 5% target, provided challenges related to feedstock aggregation, technology, financing and infrastructure are addressed.
“We are very bullish on the story of biogas…We are very confident that the government has set the target of 5% by 2030. But as a company, IGL, I am confident that we will be achieving 10%,” IGL Managing Director Kamal Kishore Chatiwal said while speaking at the International Conference on World Biofuel Day organised by SIAM.
While blending of CBG in CNG was voluntary till 2024-25, the government has mandated blending for transport and piped natural gas (PNG) for households in a phased manner from the current financial year, with a target of 5% by FY29.
CBG blending in total CNG and PNG consumption should be 1% in FY26, while the blending has to be increased to 3% and 4% in FY27 and FY28, respectively.
CNG is a cleaner and more efficient fuel than petrol and diesel, and is the second most popular fuel for passenger cars in India. CNG-powered cars accounted for almost 19% of the total passenger vehicle sales in India during the last financial year.
Biogas, which consists mainly of methane and carbon dioxide, is produced from organic matter such as food or animal waste. It has the potential to replace natural gas. Biogas has to be purified and upgraded to at least 95% methane by volume to be used as vehicle fuel.
The primary objectives of CBG blending are to drive demand for biogas within the City Gas Distribution (CGD) sector. This initiative is a strategic move to substitute imported Liquefied Natural Gas (LNG), which in turn will save foreign exchange.
Additionally, the blending aims to facilitate a circular economy by using waste for fuel and support India's broader goal of achieving net-zero emissions.
Challenges
Chatiwal noted that there is the feedstock for CBG is in abundance, but it is fragmented and not easily collected. For example, some areas might have five tons of waste, while others have just two or ten.
A key challenge is to aggregate these scattered resources and then segregate them for processing. Notably, municipal solid waste from cities represents a massive, untapped potential for CBG production, he said.
The second major challenge, which Chatiwal pointed out, is related to the financing of biogas projects. Though the centre and state governments have policies supporting the establishment of biogas plants, he said banks are reluctant to finance the projects.
“The centre gives some subsidy for setting up a plant and then some state governments also have subsidies. But the banks are currently reluctant to finance the projects that don't have any off-take agreement,” Chatiwal said.
Meanwhile, there are technological challenges as well. While the technology for the initial step of producing biogas using digesters is quite advanced and widely understood, the difficulty lies in purifying the raw biogas to make it suitable for blending with CNG.
“The digester technology is very mature and people are aware of that. But the challenge is with respect to the purification technology,” he noted.
The early standards for purification aimed for a 90% methane concentration, similar to natural gas. However, a key difference is that the impurities in purified biogas are primarily carbon dioxide, oxygen, and hydrogen sulfide, unlike natural gas, where the remaining portion consists of other hydrocarbons. Out of the three, the oxygen and hydrogen sulfide are critical impurities, he noted.