Bihar Biofuels Production Promotion Policy, 2023

In order to broaden the coverage for production of biofuels, the Government of Bihar amended and renamed the Ethanol Production Promotion Policy, 2021 as the Bihar Biofuels Production Promotion Policy, 2023. This expansion broadens coverage to include Compressed Bio-Gas (CBG)/bio-CNG manufacturing units utilizing agricultural residues, animal dung, food waste, Municipal Solid Waste (MSW), and sewage water.

This policy aligns with the Government of India's National Policy on Biofuels, 2018. Bihar is traditionally a leader in sugarcane production and has high maize and broken rice production, creating significant potential for fuel-grade ethanol and CBG manufacturing.

• •Ethanol distilleries: Standalone distilleries (single or dual feed) producing 100% fuel-grade Ethanol developed as a Greenfield project.
• •CBG units: Units producing Compressed Bio-Gas (CBG) or bio-CNG.
• •Permitted Feedstocks: All feedstocks permitted under the National Policy on Biofuels, 2018 and subsequent updates from the NBCC.
• •ZLD requirement: Standalone Ethanol units must be set up on a Zero Liquid Discharge (ZLD) basis. Cost of setting up ETPs and Captive Power Plants is eligible for inclusion in the Approved Project Cost.
• •Tripartite / Offtake proof: Must submit either a Tripartite Agreement (Unit-Banker-OMC), OMC purchase order, purchase agreement/contract, or an Undertaking at Financial Clearance.

Special Class Investors top-up

For SC, ST, EBC, EWS, Women, Differently-abled, War-widows, Acid attack victims, and Third gender entrepreneurs (with 100% ownership): Capital subsidy is raised to 15.75% of Plant & Machinery (max ₹5.25 Cr), interest subvention rate and limit are increased by 15%, and tax related incentives are increased by 15% of the limit.

• •Sum total cap: The capping of the sum total of Interest Subvention Incentive under BIIPP 2016 and Capital Subsidy under this Policy is 50% of the Approved Project Cost (raised to 52.5% for Special Class Investors).
• •Central Scheme deductions: If an investor avails a subsidy under a Central Government scheme, that amount is deducted from the corresponding subsidy admissible under BIIPP 2016 or this Policy.
• •Single Asset double dipping: Dovetailing with other State Government policies is allowed, provided the unit does not avail subsidy against the same asset under multiple policies.

BIADA land is allotted to standalone Ethanol and CBG manufacturing units on priority, preference over other High-Priority sector proposals. PCC meetings clear applications for High-Priority sector units weekly, with land allotment applications processed within 7 working days.

1. 1Stage-1 Clearance: Submit application on the Single Window Clearance portal (swc2.bihar.gov.in) latest by 30 June 2024.
2. 2Land Allotment: Submit application on the BIADA portal; PCC clears it within 7 working days.
3. 3Financial Clearance: Submit application on swc2.bihar.gov.in latest by 30 June 2025 to lock in first-come-first-serve eligibility.
4. 4Commercial Production: Incentives are disbursed and processed after the unit commences commercial operations.