Public-Private Partnerships Is Key To Assam’s Biofuel Success, Says Assam Entrepreneur

Guwahati: Recognized for its agricultural and bamboo handicraft industries, Assam is transitioning from its traditional identity to a more dynamic, gas-based economy. Blue Core Energy, a venture working to explore Biofuel, is at the core of this evolution.   

Business North East (BNE) conducted an exclusive interview with Pankaj Gogoi, the Blue Core Energy leader spearheading initiatives that utilize innovative technologies to harness biofuels and renewable energy, and learned that the advent of Assam Bio-Refinery was a turning point. 

During the interview with Pankhi Sarma, Pankaj Gogoi underscored how bamboo-to-ethanol innovation has paved the way for a broader adoption of biofuels. 

Pankaj Gogoi, Owner, Blue Core Energy, with journalist Pankhi Sarma

Here are the excerpts from the Q&A interview:

BNE: Assam is primarily known for agriculture and handicrafts, especially bamboo. How do you see a gas-based economy transforming this perception and benefiting the region?

Pankaj Gogoi: The advent of Assam Bio-Refinery was a turning point in this direction. This initiative pioneered the conversion of bamboo into ethanol, demonstrating how innovative uses of bamboo can transform the industry. Assam Bio-Refinery has encouraged the state to take gas-based industries more seriously.

While bamboo was the starting point, other avenues for gas production, such as natural gas and renewable energy, are equally promising. Specifically, the concept of 'waste-to-energy' has immense potential in Assam, an agricultural state. Currently, agricultural waste is not utilized efficiently. By converting this waste into energy, we can manage waste effectively and fuel economic growth.

Potential raw materials include bamboo, sugarcane, and cow dung. The expansion of the dairy industry further ensures a steady supply of such materials. These initiatives can significantly contribute to building a robust gas-based economy reminiscent of how the oil industry once flourished in the region.

BNE: Biofuels have faced challenges in the past. What is the current scenario, and how could a shift to biofuels impact the regional economy?

Pankaj Gogoi: Transitioning to a biofuel-centric economy would significantly boost regional development. For example, producing 5 tons of gas daily requires about 150 tons of agricultural waste and cow dung daily. This creates immense demand for manpower in logistics, raw material collection, and plant operations. However, ensuring a consistent supply of raw materials remains a challenge.

Logistics is a critical component as a continuous supply chain must be maintained. Developing an efficient workforce to handle these requirements is essential. Moreover, industries are reliant on coal for wider commercial adoption. For example - brick manufacturing must transition to gas-based alternatives.

Our vision involves setting up eight plants across the Northeast, strategically located in areas with abundant raw materials like Napier grass. However, establishing the ecosystem for raw material cultivation, logistics, and supply chains will take 2–3 years. With this groundwork in place, Assam can truly harness the potential of biofuels.

BNE: How is Blue Core Energy contributing to this green energy initiative, and what challenges have you faced in this journey?

Pankaj Gogoi: Our journey began with a focus on bamboo ecosystems. Currently, we aim to establish eight gas plants across the Northeast. The first plant was initiated in Sonapur, but due to land-related issues, we had to relocate. Securing land and cultivating raw materials remain significant challenges. We expect the raw material cultivation to stabilize in 1–2 years, allowing us to begin production by the third year.

Other challenges include high capital investment requirements and logistical complexities. Each plant costs around Rs 25 crores, and despite a subsidy of Rs 4 crores for producing five tons of compressed biogas (CBG) daily, substantial upfront investment is necessary. The government can play a pivotal role by enhancing biofuel policies, offering upfront subsidies, and encouraging public-private partnerships to attract more entrepreneurs into this sector.

BNE: Could public-private partnerships (PPPs) mitigate these challenges?

Pankaj Gogoi: PPPs can bridge the gap between capital requirements and operational needs. Entrepreneurs often struggle to invest large sums upfront, but timely subsidies and government support can ease the burden. For instance, if upfront subsidies are provided, it becomes easier to establish infrastructure, prepare land for cultivation, and secure investor confidence. Investors will probably commit if they see government backing via subsidies and tax holidays.

A five to six-year tax holiday could significantly incentivize entrepreneurs to establish CBG plants, ensuring that initial operational challenges do not hinder long-term growth.

BNE: What subsidies or policy measures can further support entrepreneurs in the biofuels sector?

Pankaj Gogoi: There is a subsidy of Rs 4 Crores for plants producing at least 4.8 tons of gas daily, including additional GST and VAT rebates and electrical subsidies, and extending tax holidays by five to six years could provide extra relief.

Since gas plants need two to three years to achieve operational capacity fully, financial aid is essential during the initial phase, including a robust state biofuel policy that could foster collaboration between entrepreneurs and the government, driving encouraging more investments in the sector.

ALSO READ: Bamboo Development In Assam Aims For Innovation, Market Expansion

BNE: How can a gas-based economy contribute to cross-border trade with Southeast Asia?

Pankaj Gogoi: The infrastructure for cross-border trade already exists, with well-connected roads to Myanmar, Bhutan, Bangladesh, and Thailand, and if the gas economy of Assam scales up, we could export green energy to these neighbouring countries.

For instance, countries like Singapore are exploring waste-to-energy conversion, which aligns with our vision, and some valuable insights for optimizing gas production are gained from collaborations with international firms. For example, countries like Singapore are exploring similar waste-to-energy projects, and there is scope for collaborative efforts. A robust gas economy would benefit Assam and position it as a key player in the regional green energy market.

BNE: What is your vision for the future of biofuels and the gas economy in Assam?

Pankaj Gogoi: The biofuels sector is relatively new, with India's Biofuels Policy launched only in 2018. Securing seed capital and convincing investors of viability are the initial challenges that can be daunting. However, persistence and collaboration are crucial.

Infrastructure development, raw material cultivation, and efficient logistics are critical components. Entrepreneurs should also explore partnerships with government bodies and private investors to mitigate risks. The sector has immense potential to transform not only the energy landscape but also the socio-economic fabric of the region.