IEA report highlights India's bioenergy growth under policy frameworks

An International Energy Agency analysis confirms India's bioenergy sector is poised for major growth, backed by the E20 ethanol-blending mandate and a phased compressed biogas blending mandate from 2025. India, already the world's third-largest ethanol consumer and producer, offers businesses a predictable path for decarbonising supply chains and meeting corporate sustainability goals.

The International Energy Agency released an analysis of India's rapidly expanding bioenergy industry, confirming growth driven by consistent government backing and targeted financial incentives. India is the world's third-largest consumer and producer of ethanol. The government reaffirmed its E20 mandate targeting a 20 per cent ethanol blend in gasoline by late 2025, catalysing investments in grain-based and sugarcane-based distilleries. The Ministry of Petroleum and Natural Gas introduced a phased mandate for blending compressed biogas into the domestic gas supply starting in 2025.

The expansion affects distilleries, biogas producers, farmers, and rural entrepreneurs. Ethanol mandates support transport-sector decarbonisation and provide income for millions of farmers. The Sustainable Alternative Towards Affordable Transportation (SATAT) initiative drives compressed biogas adoption, creating a guaranteed market and encouraging processing-plant setup using municipal and agricultural waste. The GOBARdhan scheme and PM-PRANAM initiative provide financial assistance for biomass collection and storage, making participation economically viable while tackling seasonal air pollution from stubble burning.

Businesses should monitor the E20 blending target and the phased compressed biogas mandate beginning 2025 as guaranteed-demand signals for investment in distilleries and processing plants. The Global Biofuels Alliance, formed under India's G20 presidency, facilitates technical exchange and best practices among member nations. Aligning domestic manufacturing with global quality standards will be essential for export potential. For corporates, scaling bioenergy infrastructure offers a predictable path for decarbonising supply chains and fulfilling sustainability goals while mitigating oil-price volatility.

Key figure — E20 mandate target: 20 per cent ethanol blend in gasoline by late 2025