India Solar, Wind, Biomass, Biofuels – EAI

Government Incentives for Biomass Power Projects

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Biomass power projects can avail some incentives provided by the governments at both central and state levels. The table below summarizes the various incentives provided by the government for the biomass gasification projects.

Project Type

Capital Subsidy

Special Category States (NE Region, Sikkim, J&K, HP & Uttaranchal)

Capital subsidy

For other states

Biomass Power projects

  25 lakh X (C MW)^0.646

20 lakh X (C MW)^0.646

Bagasse Co-generation by private sugar mills

  18 lakh X (C MW)^0.646

15 lakh X (C MW)^0.646

Bagasse - Co-generation projects by cooperative/ public sector sugar mills

40 bar & above

40 lakh *

40 lakh *

60 bar & above

50 lakh *

50 lakh *

80 bar & above

60 lakh *

60 lakh *


Per MW of surplus power **

Per MW of surplus power **

(maximum support `8.0 crore per project)

(maximum support `8.0 crore per project)

*For new sugar mills, which are yet to start production and existing sugar mills employing backpressure route/seasonal/incidental cogeneration, which exports surplus power to the grid, subsidies shall be one-half of the level mentioned above.

** Power generated in a sugar mill (-) power used for captive purpose i.e. net power fed to the grid during season by a sugar mill.


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