ADB, SAEL Industries sign ₹7.54 billion external commercial borrowing agreement
2 min read . Updated: 24 Mar 2023, 07:48 PM IST
PremiumEvery year, farmers in North India burn crop stubble in their fields to remove paddy residue, causing severe air pollution with devastating health effects in the region
The Asian Development Bank (ADB) and SAEL Industries Limited have signed an agreement of up to ₹7.54 billion to promote the generation of biomass energy using agricultural residue. It will help diversify India’s energy mix and reduce carbon intensity.
Every year, farmers in North India burn crop stubble in their fields to remove paddy residue, causing severe air pollution with devastating health effects in the region.
SAEL Industries Limited has developed a business model to use crop residues as fuel in waste-to-energy projects. The company aims to grow its portfolio to 3.5 GW over the next four years by adding 100MW of new biomass and 600MW of new solar capacity annually.
ADB’s support will fund the construction of five biomass powerplants in the districts of Bikaner, Churu, Hanumangarh, Jhunjhunu, and Sikar of Rajasthan.
“Establishing biomass power plants that can repurpose agricultural residue will help protect the environment while contributing to the government’s goal of expanding renewable energy sources and reducing carbon dioxide emissions," said ADB vice-president for private sector operations and public–private partnerships, Ashok Lavasa.
“It will also help increase income of local farmers through sales of agricultural residue and reduce burning of agricultural waste, contributing to improvement of air quality," he said.
Reducing air pollution and climate emissions while providing income to farmers fine particle matter (PM 2.5) levels rise with the yearly burning of crop stubble contributes to some of the world’s worst air quality1. High levels of PM 2.5 have been linked to health effects such as asthma and lung diseases.
More than half the land in Rajasthan is dedicated to agriculture. Local farms burn huge volumes of waste, including stalks, husks, and straw. This causes air pollution. The power plants will convert about 650,000 tonne of agricultural residues into electricity and are expected to generate 544 gigawatt-hours of energy per annum. This will help to avoid up to 487,200 tonne of carbon dioxide annually. Income of local farmers will rise through the sale of agricultural residue.
“By collecting the crop stubble to be used as fuel in our waste-to-energy plants, we contribute to combat one of our nation’s greatest health issues, while at the same time creating local employment and generate extra income to farmers and local entrepreneurs," said Jasbir Singh, chairman and managing director of SAEL Limited.
ADB’s assistance will have a powerful demonstration effect for biomass power by helping reduce risk perceptions and by creating awareness of its benefits and potential for use in other rural communities and developing member countries," Singh added.
SAEL Industries is a renewable company with strong focus on creation of green assets to contribute to transition to green energy with projects across biomass and solar power projects in various States.
ADB, on the other hand, a regional development bank established on 19 December 1966, promotes social and economic development in Asia.