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Fuel barter model for biomass power generation in India

Biomass combustion and co-firing for electricty and heat

Alholmens Kraft, Finland, the world's largest biomass-fired power plant

Combustion is the most common way of converting solid biomass fuels to energy. Worldwide, it already provides over 90% of the energy generated from biomass, a significant part of which in the form of traditional uses for cooking and heating. Biomass of different forms can also be used to produce power (and heat) in small-scale distributed generation facilities used for rural electrification, in industrial scale applications, as well as in larger scale electricity generation and district heating plants.

Clean Development Mechanism market status: 

[This information is kindly provided by the UNEP Risoe Centre Carbon Markets Group]

Project developers of biomass projects in the CDM pipeline apply a variety of different CDM methodologies due to a variety of different feedstock and sectors where biomass projects are applied. Methodologies include ACM6 “Consolidated methodology for electricity generation from biomass residues”, ACM3 “Emissions reduction through partial substitution of fossil fuels with alternative fuels or less carbon intensive fuels in cement manufacture”, AMS-I.A.: Electricity generation by the user and AM36 “Fuel switch from fossil fuels to biomass residues in heat generation equipment”.

CDM projects based on biomass represent 13.6% of all CDM projects in the pipeline. Biomass projects have been the main driving force of CDM project development in many developing countries where agriculture is the main industry and agricultural wastes are abundant. Of the 277 registered projects, 168 are small-scale projects. [media:image:4] Example CDM project:

Title: “35 MW Bagasse Based Cogeneration Project” by Mumias Sugar Company Limited (MSCL) (CDM Ref. No. 1404)
Mumias Sugar is the leading sugar manufacturer in Kenya. It sells sugar through appointed distributors nationwide. The company has diversified into power production. The technology to be employed for the Mumias Cogeneration Project will be based on the conventional steam power cycle involving direct combustion of biomass (bagasse) in a boiler to raise steam, which is then expanded through a condensing extraction turbine to generate electricity. Some of the steam generated will be used in the sugar plant processes and equipment.
Project investment: USD 20'000'000
Project CO2 reduction over a crediting period of 10 years: 1'295'914 tCO2e
Expected CER revenue (USD 10/CER): USD 12'959'140

To develop a barter model linking the supply of electricity to farmers to a regular quantity of biomass supplied to the power plant throughout the year, creating a win-win-win situation for the farmer, the project developer and the utility, piloted around a proposed 8MW biomass plant in Rajasthan.


28° 36' 0" N, 77° 12' 0" E
Main activity and output: 
  • Design a survey to assess biomass availability; productive consumption of electricity and competing use of biomass in the specified area
  • Conduct the survey on the willingness and capability of farmers to organize themselves, the unmet energy demand, and potential for new businesses with more power availability 
  • Develop a preliminary concept for the business model and canvass it with farmers and the utility
  • Develop the final design, including material and energy flow sheet and commercial transactions flow sheet, and identify the financing needs for the residue collection system
  • Hold discussions with potential lenders
  • Conduct workshop in specified area to win greater participation of farmers
Expected impact: 
  • For farmers, higher income from sale of biomass, a reliable power supply at no additional cost, and an alternative source of ash as manure
  • For utilities, a better tariff realization from a subsidised consumer category and improved contribution of renewable energy in fuel mix
  • For owners of the power plant, protection from fuel price volatility and uncertain fuel availability 
  • Reduction in land burning, and a net emission reduction of 25,000 tons of CO2e
  • Replication of the business model for rural biomass based power generation.