New CFA Rates For Biomass Pellet Manufacturing: MNRE Updates With Up To ₹210 Lakh Support

The Ministry of New and Renewable Energy (MNRE) has revised the Central Financial Assistance (CFA) rates for Biomass pellet manufacturing units under the Biomass Programme component of the National Bioenergy Programme (NBP). Originally notified on November 20, 2022, the scheme aims to support the production of briquettes and pellets, as well as Biomass (Non-Bagasse) based cogeneration in industries for the period from FY 2021-22 to 2025-26.

Under the previous guidelines, briquette and pellet manufacturing plants were provided CFA at a rate of ₹9 lakh per metric ton per hour (MTPH) of manufacturing capacity, with a maximum CFA of ₹45 lakh per plant.

The revised CFA rates are now as follows:

For briquette manufacturing plants, the rate remains unchanged at ₹9 lakh per MTPH, with a maximum CFA of ₹45 lakh per project.

For non-torrefied pellet manufacturing plants, the new rate is ₹21 lakh per MTPH of production capacity, or 30% of the capital cost for plant and machinery of a 1 MTPH plant, whichever is lower. The maximum CFA for these projects is now ₹105 lakh.

For torrefied pellet manufacturing plants, the new rate is ₹42 lakh per MTPH of production capacity, or 30% of the capital cost for plant and machinery of a 1 MTPH plant, whichever is lower. The maximum CFA for these projects is now ₹210 lakh.

These revised CFA rates apply to projects submitted to the Ministry through the Biourja portal under Phase 1 of the Biomass component of the National Bioenergy Programme after the issuance of this memorandum. All other aspects of the scheme, as detailed in the notification dated November 20, 2022, remain unchanged. This revision has been approved by the Department of Expenditure and the MNRE, following the concurrence of the IFD on July 16, 2024.