Background

India has a rapidly growing economy, placing increasing demands on energy supply to power its development. Alongside this, the Indian electricity grid is dominated by fossil fuel powered generation which makes CO₂ emissions per kWh relatively high at approximately 0.9 tCO₂/kWh.

Common practice involves investing mostly in medium or large-scale fossil fuel fired power projects. This is mainly due to the assured return on investment, economies of scale and easy availability of finances. It is not common to invest in renewable technologies because of the higher capital costs and thus a lower return on the money invested.

India, and Uttar Pradesh in particular, possesses great potential to provide power from sugar waste (bagasse) left over from the sugar cane industry. In India there is an estimated 3,500 MW potential, whilst in Uttar Pradesh alone, power from sugar waste could meet 15% of the current installed capacity.

In Uttar Pradesh the opportunity to generate clean energy, from waste biomass from the established sugar cane industry, is huge. Yet examples of such initiatives are few and far between. Carbon finance is being used to change the common practice within this area and maximise the use of a renewable waste biomass product to generate energy.

The project

This project involves using waste bagasse, the fibre left over after the sugar manufacturing process, as a fuel for power and heat generation.

Through carbon finance, a new high pressure boiler and 23 MW turbo generator have been installed at the Khatauli sugar mill in Uttar Pradesh. These are run on the waste biomass from the sugar plant, producing clean renewable power for the sugar plant’s steam and electricity needs, and also exporting renewable electricity to the Indian power grid.

Without the project, the factory would have continued to use India’s northern regional grid for their electricity needs, generated predominantly from fossil fuel sources.

Other benefits

Social: The power plant has provided employment for many local people, both during its construction and now that it is up and running. Jobs at the power plant bring additional income to an area dominated by rural farming. Economic: By generating its own electricity and selling green electricity to the grid, the factory is generating an income stream using the waste bagasse.

The inflow of carbon credits from the project has helped create a model for the country’s sugarcane industry that could be replicated widely.

Environmental:
The Khatauli biomass project has led to a reduced demand for carbon intensive energy resources at the sugar mill. It will also generate clean renewable electricity in a country dominated by coal powered generation, reducing greenhouse gas emissions and other pollutants.