Bihar Biofuels Production Promotion (Amendment) Policy, 2025

• 14 Jun 2025

Why in News? 

The Bihar government has introduced the Bihar Biofuels Production Promotion (Amendment) Policy, 2025, modifying its Biofuels Production Promotion Policy 2023 to encourage greater private sector involvement. 

• The amended policy aims to increase bioenergy output and accelerate the state’s progress towards renewable energy goals. 

Key Points 

• Bihar Biofuels Production Promotion Policy, 2023: 
  • About: The Bihar government launched the Bihar Biofuels Production Promotion Policy, 2023, by broadening its earlier Ethanol Production Promotion Policy, 2021, to expand the scope beyond ethanol to include Compressed Bio-Gas (CBG)/bio-CNG units. 
    • The policy promotes biofuel production using agricultural residues, animal dung, and waste, aiming to boost farmers’ incomes, create jobs, and align with the National Policy on Biofuels, 2018. 
  • Objectives: The policy aims to enable production of 100% fuel-grade ethanol and CBG/bio-CNG from all permitted feedstocks under the National Policy on Biofuels, 2018, and to promote greenfield standalone units for these biofuels in Bihar. 
  • Coverage: Greenfield standalone distilleries producing 100% fuel-grade ethanol (single or dual feed) and for units producing Compressed Bio-Gas (CBG)/bio-CNG. 
  • Incentives: The policy offers a capital subsidy of 15% of plant and machinery cost or Rs 5 crore (whichever is lower), while for SC, ST, EBC, women, differently-abled, war widows, acid attack victims, and third gender entrepreneurs, the subsidy is 15.75% or Rs 5.25 crore (whichever is lower). 
• Key Changes in Bihar Biofuels Production Promotion (Amendment) Policy, 2025: 
  • Land Lease: Up to 25% of BIADA-managed industrial land can now be leased for CBG units, with a 30-year lease at Rs 75,000 per acre annually. 
  • Date Extension: Stage-1 clearance deadline for compressed biogas (CBG) units extended to 31st March, 2027 via the Single Window Clearance Portal. 
    • Financial approval deadline for CBG projects extended to 31st March, 2028; applicable to private players and oil marketing companies (OMCs).