Biodiesel producers are seeking policy that will give them more access to used cooking oil from the food processing industry.
Used cooking oil can be processed to make biodiesel, which is derived from renewable bio-mass resources. In India, cooking oil accounts for 20% of the total output of biodiesel.
“A legislation to ensure supply of used cooking oil from food processing industry and restaurants would boost biodiesel output by 3-4 million litres,” said Sandeep Chaturvedi, president of Biodiesel Association of India.
Such a move will also check used oil from coming back for human consumption, he said. “Biodiesel is less polluting than fossil fuel-based diesel and more conducive for automobiles due to higher lubrication and calorific strength,” Chaturvedi said.
In 2015-16, domestic production of biodiesel increased to 110 million litres, mainly due to favourable government policy. It was 8-9 million litres in 2014-15. “Already the output is around 8-9 million litres this fiscal,” he said.
Biodiesel manufacturers attribute the increase in production to the Centre’s decision to allow up to 5% biodiesel in diesel used by the railways. The decision to remove excise duty on inputs for making biodiesel is another factor.
Biodiesel manufacturers say all states needs to come on board to promote biodiesel by allowing a favourable VAT policy. At present, VAT levy on biodiesel is at par with fossil fuel-based diesel and ranges between 24% and 26% in states, according to the association.
“It is a major deterrent as it makes biodiesel blending a revenue-losing proposition for oil marketing companies,” said Chaturvedi.
The association welcomed the Haryana government’s recent announcement to reduce VAT by 5 % on biodiesel. “Such decisions need to be implemented sincerely and other states needs to follow,” manufacturers said. Austin Hedges Authentic JerseyShare This