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INDIAN OIL CORPORATION LIMITED
(A GOVERNMENT OF INDIA ENTERPRISE)
Invites
Expression of Interest (EOI)
for
SETTING UP AN INTEGRATED LIGNO-CELLULOSIC ETHANOL PRODUCTION FACILITY IN PARTNERSHIP
WITH SUGAR MILL(S)
(Ref.: CO/BD/AE/EOI/LCE/Sugar mill)
Indian Oil Corporation Limited Alternate Energy & Sustainable Development – Group
SCOPE Complex, Core-6, 7, Institutional Area, Lodhi Road, New Delhi -110003
Page 2 of 22
Ref.: CO/BD/AE/EOI/LCE/Sugar mill Date: 08/12/2015
NOTICE INVITING EXPRESSION OF INTEREST (EOI)
Setting up an Integrated Ligno-Cellulosic Ethanol Production Facility in Partnership with Sugar mill(s)
IndianOil Corporation Limited (IndianOil) is a Government of India Enterprise with Maharatna Status and is also a Global Fortune 500 company. For furthering the vision of becoming a major integrated energy company with strong environment conscience, IndianOil has undertaken various biofuel projects in the country including ethanol blending. Now, IndianOil is planning to explore business opportunities in the area of ligno-cellulosic ethanol production in India through utilization of bagasse available with Sugar mills. In this regard, IndianOil invites all interested Sugar mills (herein after called BIDDER) having requisite experience/infrastructure/finance as enumerated in the EOI document to submit their proposals for providing bagasse as feedstock and setting up an Integrated Ligno-Cellulosic Ethanol Production facility at their premises. The purpose of inviting this EOI is to explore the availability of Bagasse as feedstock and know the willingness of Sugar mills for execution of project on “SETTING UP AN INTEGRATED LIGNO-CELLULOSIC ETHANOL PRODUCTION FACILITY IN PARTNERSHIP WITH SUGAR MILL(S)”. Interested parties may download the complete EOI document (ref: CO/BD/AE/EOI/LCE/Sugar mill, EOI Id: 2015_IOCL_63615), from the Central Public Procurement Portal of Government of India (https://eprocure.gov.in ). All revisions, clarifications, corrigenda, addenda, time extensions etc, to the EOI will be hosted on above websites. BIDDERs should regularly visit this website to keep themselves updated.
Page 3 of 22
NOTICE INVITING EXPRESSION OF INTEREST (EOI)
By
INDIAN OIL CORPORATION LIMITED
For
SETTING UP AN INTEGRATED LIGNO-CELLULOSIC ETHANOL PRODUCTION FACILITY IN PARTNERSHIP WITH SUGAR MILL(S)
1. INTRODUCTION
IndianOil Corporation Limited proposes to set up an Integrated Ligno-Cellulosic
Ethanol Production facility in partnership with Sugar mill(s). For this purpose,
IndianOil has prepared a conceptual framework for implementation of the said
project, which is enclosed with this EOI document. According to the same, Sugar
mill, Biomass conversion Technology provider and IndianOil will jointly execute
the project on following lines –
a) Sugar mill interested in setting-up an Integrated Ligno-cellulosic Ethanol
unit in its premises has to supply bagasse on sustainable basis as
feedstock for ligno-cellulosic ethanol production.
b) Biomass to ethanol conversion technology provider or licensor will be
responsible for preparation of detail engineering, supply of other raw
material, maintaining the product quality and provide corresponding
performance guarantee.
c) IndianOil to off-take Ligno-cellulosic ethanol and distribution of blended
petrol.
The capacity of proposed plant will be 55,000-60,000 tonnes of Ligno-cellulosic
Ethanol per year with an indicative capital cost of ~Rs 800 Crore. The Debt Equity
Ratio envisaged for the proposed project is 70:30. At this stage, the proposed
framework is tentative, and will be finalized after discussions with all stakeholders.
IndianOil therefore proposes to seek EOI from parties who may be interested to
partner in this project.
Page 4 of 22
2. TECHNICAL CRITERIA
S. No. Particulars Qualification Criteria 2.1 No. of minimum operational
Sugar mills (operational for the past 3 years period from the date of issue of this EOI)
3
2.2 Location of offered Sugar mill(s) Anywhere in India, but prefer in the States of Uttar Pradesh, Karnataka and Maharashtra
2.3 Minimum capacity of offered Sugar mill(s)
6000 TCD (Tonnes Crushed per Day)
2.4 Minimum Annual Turnover (during last 3 financial years)
Rs. 240 Crore
2.5 Minimum Net Worth (FY 2014-15)
Rs. 400 Crore
2.6 Supply of bagasse as feedstock Minimum supply per day (@ max. 10% moisture content)
600 Tonnes (excluding commitment to Co-Generation,
if any) Minimum supply per annum (@ max. 10% moisture content)
2.10 lakh Tonnes
Minimum supply days per year for Bagasse (@ 600 Tonnes per day)
350 days
Minimum storage facility available within the premises for bagasse
90,000 MT for ~150 days
2.7 Minimum spare land available within the premises for the proposed project*
40 Acres
2.8 Willingness to take equity stake by the BIDDER**
30% or more
2.9 Holiday/Blacklisted status The BIDDER must not have been debarred/ blacklisted by any Central/State Govt. department, agency, PSUs/ Institution/ Agencies/ Autonomous organization. The BIDDER shall submit a self-certification by an authorized person to this effect.
* The offered land must be situated within the premises of the Sugar mill. The
BIDDER should have a clear title of the land and there should not be any pre-existing
right in favour of a third party. In case of third party right, the BIDDER shall submit the
written permission/NOC from third party. The said spare land should be free from all
encumbrances.
** The capacity of proposed plant will be 55,000-60,000 tonnes of Ligno-cellulosic
Ethanol production per year with an indicative capital cost of ~Rs 800 Crore.
Page 5 of 22
3. GENERAL
3.1 This document contains 22 pages including the cover page and comprises three
sections namely, Notice Inviting EOI, Format for submission of EOI (Cover Letter
& Annexure I) and Term of Reference (TOR).
3.2 All revisions, clarifications, corrigenda, addenda, time extensions etc, to the EOI
will be hosted only on https://eprocure.gov.in. BIDDERs should regularly visit this
website to keep themselves updated.
3.3 The BIDDER shall also furnish complete audited annual financial statements for
last three financial years including balance sheets, profit & loss account statement
and all other schedules, self-certification of being not under liquidation, court
receivership or similar proceeding in support of their fulfilling the eligibility criteria.
The same to be provided for all the partners, wherever applicable.
3.4 EOI shall be submitted in hard copy at the address given below. EOI received
through Fax / E-mail shall not be accepted.
3.5 The EOI must be complete in all respects leaving no scope for ambiguity. It is in
the interest of the BIDDER to submit complete and comprehensive proposal
leaving no scope for IndianOil to raise any further questionnaire. IndianOil may
evaluate the BIDDER on the basis of documents submitted in the first instance in
order to adhere with project schedule requirement.
3.6 IndianOil will not be responsible for any cost or expenses incurred by the BIDDER
in connection with preparation or delivery of EOI.
3.7 The BIDDER is required to furnish all information and documents as called for in
this EOI in English language. Any printed literature furnished regarding this EOI
may be in another language, provided that the literature is accompanied by an
authentic English translation, in which case, for the purpose of interpretation of
the document, the English version will govern.
3.8IndianOil reserves the right to call the BIDDER for presentation at its office located
in New Delhi, India and may visit the Sugar mill sites of the BIDDER. The
BIDDER shall have no objection whatsoever in this regards and shall facilitate
IndianOil to obtain the same. IndianOil will not be responsible for any cost or
expenses incurred by the BIDDER for visiting its office at New Delhi, India for
presentation.
4 SUBMISSION OF EOI
The BIDDER must provide a Cover letter on his official stationery (letter head)
along with offer in the prescribed format provided with the EOI document as per
“FORMAT FOR SUBMISSION OF EOI”. The BIDDER is required to drop the
sealed envelope super-scribing:
Page 6 of 22
Expression of Interest ref: CO/BD/AE/EOI/LCE/Sugar mill - “SETTING UP AN
INTEGRATED LIGNO-CELLULOSIC ETHANOL PRODUCTION FACILITY IN
PARTNERSHIP WITH SUGAR MILL(S)”. The bid must contain complete EOI
along with all the supporting documents duly signed & stamped on each page and
shall be submitted in the Tender Box at the following address on or before the
due date and time.
Dy. General Manager (SD)
Indian Oil Corporation Limited,
Room No. 533, Core-6, 5th Floor,
SCOPE Complex, 7, Institutional Area,
Lodhi Road, New Delhi – 110003
Phone No: +91-011 24360282
Email: [email protected]
The applicant shall mention Company’s/Institution’s name, phone number & name
of contact person on the cover of the envelope.
5 LAST DATE/TIME OF SUBMISSION OF EOI
5.1 The EOI should be dropped in the tender box on or before 3.00 pm, 08/01/2016.
5.2 EOI submitted at any other place and after above time and date will not be
accepted.
6 IMPORTANT NOTE
This EOI does not constitute and will not be deemed to constitute any
commitment on part of IndianOil to set up the Integrated Ligno-Cellulosic Ethanol
Production facilities in India.
IndianOil has the sole discretion to qualify or accept the EOI and reject the
proposal without assigning any reason whatsoever.
Furthermore, this advertisement neither confirms the right nor an expectation on
any party to participate in the proposed EOI.
Page 7 of 22
FORMAT FOR SUBMISSION OF EOI
(to be printed on the official stationery of the BIDDER)
To,
Dy. General Manager (SD)
Indian Oil Corporation Limited,
Room No. 533, Core-6, 5th Floor,
SCOPE Complex, 7, Institutional Area,
Lodhi Road, New Delhi – 110003
Dear Sir,
Subject: Submission of Expression of Interest for “SETTING UP AN INTEGRATED
LIGNO-CELLULOSIC ETHANOL PRODUCTION FACILITY IN
PARTNERSHIP WITH SUGAR MILL(S)”.
With reference to your EOI inviting notice Ref. No: CO/BD/AE/EOI/LCE/Sugar mill
dated ………./2015 after examining, Term of Reference (TOR), technical criteria and
other details mentioned in the EOI document for “SETTING UP AN INTEGRATED
LIGNO-CELLULOSIC ETHANOL PRODUCTION FACILITY IN PARTNERSHIP
WITH SUGAR MILL(S)”, I/We hereby offer to submit Expression of Interest in
partnering the said project.
1. All the schedules and documents necessary in this connection are enclosed
hereto. All the documents/ photocopies of the documents have been self-attested
by me/us and the IndianOil is free to reject our candidature if any of the
documents/photocopies of the documents is/are found to be false or forged.
2. I/we, hereby also declare(s) that my/our organisation/firm is not debarred/
blacklisted by any Central/State Govt. department, agency, PSUs/ Institution/
Agencies/ Autonomous organization.
3. The information sought from me as per the EOI notice is enclosed in Annexure-I.
Yours Faithfully,
(Authorised Signatory)
Designation:
Date:
Place:
Page 8 of 22
Annexure – I
Name of the Project SETTING UP AN INTEGRATED LIGNO-
CELLULOSIC ETHANOL PRODUCTION
FACILITY IN PARTNERSHIP WITH
SUGAR MILL(S)
1.0 General Information
Name of the BIDDER / Firm submitting
EOI
Nature or legal status of the Firm
Name and address of associated
companies to be involved in the
project with relationship and role, if
any.
Details of Registration document of
the Firm (provide details & enclose copy)
Registered Address of Firm
Contact Person
Designation and address of Contact
person
Turnover & Net worth of the Firm
during last three financial years
(Please enclose copy of audited
annual reports)
Year Turn Over
(Rs Crore)
Net Worth
(Rs Crore)
2014-15
2013-14
2012-13
In case firm is a subsidiary, indicate
the role of parent company
Has applicant or constituent partner
have ever been debarred or
blacklisted? If so, please give details.
Page 9 of 22
2.0 Technical Information of Sugar mill & availability of Bagasse (if BIDDER has more than 3 Sugar mills to be offered for the said project, the below
mentioned information pertaining to each unit should be furnished separately)
Particular Sugar mill
1
Sugar mill 2 Sugar mill 3
Annual Capacity (TCD)
Location
Date of Commissioning
All Statutory clearances available (Yes/No)
Safety measure adopted (Yes/No)
Total mill area (in acre)
Spare area available for setting-up integrated Ligno-Cellulosic Ethanol Production facilities (in acre)
Average working days of Sugar mill
per year
Avg. Annual Sugar Production (Tonne)
Details of Distillery Unit, if available -
1. Capacity (KL per day)
2. Average working days per year
3. Avg. Annual Alcohol Production
(KL per annum)
4. Type of product
(e.g. potable, fuel ethanol etc.)
Annual availability of Bagasse (Tonne)
Page 10 of 22
Existing use of Bagasse: 1. Used in boiler
(in Tonne/annum) Or
(percentage of total bagasse generated)
2. Used in Co-generation Plant (in Tonne/annum)
Or (percentage of total bagasse generated annually)
3. Other use, including Sold to other parties (in Tonne/annum)
Or (percentage of total bagasse generated annually)
4. Surplus bagasse
(Tonne/annum or percentage of total bagasse generated annually)
Details of Co-generation Plant, if
available
1. Capacity (MW)
2. Average working days per annum
3. Annual power generated (kwh)
4. Internal Consumption (kwh)
5. Surplus Power supply to Grid (kwh)
6. Power selling price (Rs/unit)
7. Furnish the details on long term commitment for Co-generation/Power supply, if any
Page 11 of 22
3.0 Willingness to partner in the proposed project
Willingness to provide min. 40 Acre spare land in existing premises of Sugar mill for: Setting-up ligno-cellulosic ethanol
production unit,
Expansion/commissioning of distillery unit (if required)
Other support infrastructures
Yes / No
Willingness to supply a minimum of 600 MT/ day of dry bagasse (with a maximum of 10% moisture content) for 350 days of an year (please furnish the month wise assured availability of bagasse in format attached as Annexure-I(A)) if no, then please mention for how many days 600 MT/day supply of bagasse will be ensured per year (please furnish the month wise assured availability of bagasse in format attached as Annexure-I(B)) Please mention whether or not moisture content testing equipment for bagasse is available within premises?
Yes / No
........................... days
Yes / No
Quantity of surplus biomass such as cane trash, crop residues etc. available in the vicinity of sugar mill
Quantity : ......................... MT per year
An adequate storage facility is available for the said quantity of bagasse.
Yes / No
Willingness to invest equity in the
...............%
Page 12 of 22
project.
(The indicative cost of the proposed project is approx. Rs 800/- Crores) (BIDDER to indicate approximate figure for the same e.g. 30%)
...............Rs Crore
Authorized Signatory
Designation
Stamp
Date
Telephone/ email of authorized
signatory
Note: The BIDDER must submit all relevant documentary evidence with reference to above.
Page 13 of 22
Annexure – I (A)
Monthly Availability of Bagasse (with a maximum of 10% moisture content)
No. of Sugar mills
Quantity ( in Tonnes) Avg. Moisture
(%)
Avg. Fibre (%) Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Total
Sugar mill I
Sugar mill 2
Sugar mill 3
Authorized Signatory
Designation
Stamp
Date
Page 14 of 22
Annexure – I (B)
Monthly Availability of Bagasse (with a maximum of 10% moisture content)
No. of Sugar mills
Quantity ( in Tonnes) Avg. Moisture
(%)
Avg. Fibre (%) Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Total
Sugar
mill 1
Sugar
mill 2
Sugar
mill 3
Authorized Signatory
Designation
Stamp
Date
Page 15 of 22
TERMS OF REFERENCE (ToR)
FOR
SETTING UP AN INTEGRATED LIGNO-CELLULOSIC ETHANOL PRODUCTION
FACILITY IN PARTNERSHIP WITH SUGAR MILL(S)
BACKGROUND
At present, the estimated production of ethanol in the country is in the range of 2500-
3000 TKL which is primarily used for potable alcohol, chemical industries and ethanol
blending. India’s ethanol production is mainly based on sugarcane molasses, which
is limited. Any improvement in ethanol production is directly proportional to increase
in sugarcane production. However, considering available infrastructure & irrigation
resources, it is very difficult to increase sugar cane production.
The Oil Marketing Companies (OMCs) have been directed to sell Ethanol Blended
Petrol with percentage of ethanol up to 10% and achieve a mandatory target of 5%
overall Ethanol blending. So far, the ethanol availability is restricted to fulfill the
blending of about 2-3% only. To meet indicative target of 20% ethanol blending by
2017 (as per National Policy on Biofuels, 2009), the required quantity of ethanol is
estimated to be approximately 5500 TKL (CAGR @ 8.38%)
Fig. in TKL
Particulars 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22
Petrol Sale Projection
(8.38 % CAGR) 27596 29909 32415 35131 38075 41266
Ethanol Requirement
(@ 5% blending) 1380 1495 1621 1757 1904 2063
(@ 10% blending) 2760 2991 3241 3513 3808 4127
(@ 20% blending) 5519 5982 6483 7026 7615 8253
Further, the Ministry of Petroleum & Natural Gas (MoP&NG) through its
communication ref. no. P-32017/1/2014-CC (Part-I) dated 18.12.2014 has revised
mechanism for procurement of ethanol by OMCs. Now, the delivered price of ethanol
has been fixed in the range of Rs. 48.50 - 49.50 per litre.
Govt. of India has also emphasized on achieving energy security of the country with
a target of reducing import dependence by 10% by the year 2022.
To meet the additional demand of ethanol, the other options for ethanol production
needs to be explored. Ligno-cellulosic biomass based ethanol production has been
developed and adopted as one of the alternative options in few countries.
Page 16 of 22
Considering above mentioned developments, there is a potential market in the
country for ligno-cellulosic ethanol subject to commercial scale production.
In Indian context, surplus crop residues, energy crop plantation etc. are the potential
feedstock for ligno-cellulosic ethanol production. However, there are issues
pertaining to these feedstocks. The major issues are tabulated below:
Feedstock
Options
Existing Issues
Surplus
Agricultural
Residues
Surplus residue burnt in the fields
No mechanized aggregation
High transportation cost
Price sensitivity issues in long run
Energy crops
under wasteland
conditions
Limited availability of large scale wasteland
Small and scattered wasteland, leading to higher logistic
and transportation costs
Uncertain biomass yield of existing energy crops
Required supplemental irrigation and other agri-inputs
Plant Mortality, high gestation period etc.
Forest residues Legal and environmental issues
Wood waste No structured aggregation mechanism
Commercial scale availability is uncertain
In an era where there is a need for comprehensive development, the sugar industry
is one of the industries that have successfully contributed to the rural economy.
However, the business model of sugar mill is highly sensitive, due to market
dynamics and cyclicality of sugarcane production in the country which is leading to
un-consistence cane price for sugarcane farmers.
There is no commercial scale ligno-cellulosic ethanol production plant in the country.
However, biomass to ethanol conversion technology has been developed by various
organisations and commercial-scale plants on the same are operational globally.
Considering existing issues pertaining to various feedstocks, the bagasse available
at Sugar mills seems to be the promising near term feedstock for ligno-cellulosic
ethanol production. As feedstock is one of the key factors for the success of this
project, the role of Sugar mills is far most important.
Page 17 of 22
OBJECTIVES
IndianOil is sourcing ethanol for its blending with petrol for more than a decade. In
order to strengthen ethanol blending programme, it is proposed to set up an
integrated ligno-cellulosic ethanol production facility in partnership with Sugar mill(s)
in India. The major objectives envisaged for the proposed project are as follows:
Reduce import dependency and enhance national energy security by
leveraging upon locally available bio-resources for production of ligno-
cellulosic ethanol
Providing balancing tool to Sugar mills for cyclicality management through
creation of additional revenue stream
Boost rural prosperity through consistence additional income to sugarcane
farmers
Addressing climate change issue by enhanced use of ethanol blended petrol
METHODOLOGY / STRATEGY
A. Existing Business Model of Sugar mill
The revenue pattern of a typical integrated Sugar mill in India is encapsulated
as below:
Fig 1: Exiting Business Model and Revenue Pattern of Integrated Sugar Mill
Milling
Juice
Bagasse
Molasses
Press mud
Levy Sugar
&
Free Sugar
Surplus power
supply to grid
Potable liquor
Fuel Ethanol
Rectified Spirit
Bio-fertilizer
89%
2%
9%
Cane Production
Revenue Pattern Products Production Process
Page 18 of 22
B. Proposed Project
The existing business model of typical integrated Sugar mill has four revenue
generation streams (as reflected in the Fig.1). Out of which, the sugar
production is the major revenue contributor to the tune of 89%. However,
profitability of this revenue stream is highly sensitive due to cyclicality issues of
cane production.
In the proposed project, an additional revenue stream is envisaged through
ligno-cellulosic production from Bagasse. Presently, bagasse is used in boiler,
co-generation unit (produce power for internal consumption & power supply to
grid), sell of surplus bagasse etc.
It is understood that during the process of ligno-cellulosic ethanol production,
lignin remains as a solid particle to the tune of 18-20% of total biomass. This
lignin can be used to produce sufficient power to meet internal requirement of
Sugar mill.
At present, the power purchase price offered by State Government agencies
are in the range of Rs. 3 - 6 per unit. On other hand, the delivered price of
ethanol has been fixed in the range of Rs. 48.50 - 49.50 per litre.
There are several technologies available for biomass to cellulosic ethanol
conversion. However, these technologies need to proven on commercial scale
in India. At this stage, it is envisaged that revenue generation from ligno-
cellulosic ethanol will be 2-3 times greater than surplus power supply to grid.
Fig 2: Business Model of the proposed Integrated Ligno-cellulosic Ethanol facility at Sugar Mill
Milling Cane Production
Juice
Bagasse
Molasses
Press mud
Levy Sugar
&
Free Sugar
Power production for internal
consumption by lignin
Potable liquor
Fuel Ethanol
Rectified Spirit
Bio-fertilizer
Products Production Process
Ligno-cellulosic Ethanol
Page 19 of 22
C. Implementation Strategy
Preliminary, it is envisaged that the project shall be implemented through
formation of Joint Venture Company. The strategic partners of joint venture
are:
Sugar mill(s)
Technology Providers & licensors
IndianOil
It is proposed that integrated ligno-cellulosic ethanol production facilities shall
be established in the premises of existing sugar mill.
Various indigenous and global technologies are available for biomass to
cellulosic ethanol conversion such as Acid hydrolysis, Enzyme Hydrolysis,
Supercritical Hydrolysis etc. We have already interacted with various
technology providers and licensors. In order to identify the potential
technology provider as strategic partner for joint venture, a separated EOI will
be floated shortly.
D. Role & Responsibilities of Key Stakeholders
In proposed project, there are four major stakeholders described below:
Fig 3: Major Stakeholders of the proposed project
Integrated
Ligno-cellulosic
Sugar Mill
IndianOil
Technology
Provider
Sugar Mill
Government
Page 20 of 22
The role and responsibility of various stakeholders envisaged in the project
are furnished in Table 1 as below:
Table 1: Key roles and responsibilities of various stakeholders
Stakeholder Key roles and responsibilities
Sugar Mill Provide land in the existing promises of Sugar mill for
establishment of ligno-cellulosic ethanol facilities
Long-term contract for supply of bagasse and other
biomass such as surplus crop residues, cane trash
etc. available in the command area, as feedstock
Equity participation in the project
Technology
Providers &
Licensor
Project execution including basic design package,
detail engineering, supply of other raw material,
installation, operations etc.
Maintaining the product quality on sustainable basis
and provide corresponding performance guarantee
Equity participation in the project
IndianOil Ligno-cellulosic ethanol off-take and distribution of
blended petrol
Equity participation in the project
Government Provide financial and other support
E. Project funding
The Debt Equity Ratio envisaged for the proposed project is 70:30. IndianOil
will be the major equity partner with equity stake up to 50%. The remaining
equity contribution will be shared between Sugar mill and technology provider.
Further, Ministry of New and Renewable Energy (MNRE), Govt. of India, has
decided to set up 5 pilot plants for the production of ligno-cellulosic Ethanol by
providing viability gap funding (VGF) from National Clean Energy Fund
(NCEF). All efforts will be made to capture this opportunity. The materialization
of the same will reduce the debt requirement of the project.
Page 21 of 22
PROJECT BENEFITS
Commercial Opportunity
There are several cost effective measures available for the proposed project. Some
of the advantages are:
Vast experience of systematic aggregation of sugarcane by Sugar mill
resulting to ensured supply of bagasse
No additional transportation cost on account of bagasse aggregation
No feedstock price sensitivity issues in long run
Optimum utilization of existing Sugar mills infrastructure
Round the year operations and additional revenue stream for Sugar mill
Capex requirement limited to biomass conversion unit & distillery expansion
Transportation of Ligno-cellulosic through existing route
The Sugar mills already have necessary capabilities and infrastructure for execution
of the proposed project. The revenue stream from integrated ligno-cellulosic
production can provide better return as compare to power generation and will support
to Sugar mills for addressing cyclicality issues.
As mentioned, the commercial scale cellulosic ethanol plants are yet to be
established in the country. Therefore, the proposed project can act as launching
platform for technology providers & licensors to demonstrate the commercial scale
viability of their technologies. The positive results of the proposed project will open-
up the potential market to replicate the endeavour with various Sugar mills in the
country.
The IndianOil is largest marketing company of petroleum products. Hence, our
ethanol requirement for blending with petrol is also high. The additional supply of
ligno-cellulosic ethanol from the proposed project will be helpful to meet our ethanol
requirement.
Resultant to these advantages, a commercially viable business proposition could be
envisaged for all stakeholders.
Economic & Social Benefits
It is envisaged that the benefits of revenue generation from ligno-cellulosic ethanol by
Sugar mills will also be penetrated to sugarcane farmers in the form of consistence
and higher cane price. The sugar cane tops and trashes may also used as feedstock.
This will also provide some additional income to cane farmers. Apart from that
additional jobs creation is also anticipated through setting-up of these types of
projects. Hence, the proposed project could significantly contribute to socio-economic
development of rural India.
Page 22 of 22
Environmental Benefits
In combination, the proposed project will lower the Carbon emission level, which is
one of the most significant environmental issues, while creating additional rural
income and reducing India's dependence on imported fuel.
In line with available information, it is estimated that bagasse available with Sugar
mill to the tune of a minimum of 600 MT/ day of dry bagasse (with a maximum of 10%
moisture content) for 350 days of an year can produce ~55,000 MT of ligno-cellulosic
ethanol annually through available conversion technologies and blending of this
ligno-cellulosic ethanol with petrol will be result into reduction of ~66,000 MT of CO2e
emissions (considering Emission Factor (wt/wt) : Petrol (3.094) & Ethanol (1.884)).
***************
