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Business News›Industry›Energy›Power›Government's Rs 37,500-cr coal gasification scheme fails to attract bids

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Government's Rs 37,500-cr coal gasification scheme fails to attract bids
Synopsis

No applications were submitted for the Rs 37,500 crore coal gasification incentive scheme. The September 7 deadline passed without any private or public sector interest. This raises concerns about the viability of the coal ministry's ambitious gasification targets. The scheme aimed to boost clean energy and reduce import dependence.

Agencies

New Delhi: The government's ambitious Rs 37,500-crore financial incentive scheme for the promotion of coal gasification has found no taker so far, according to sources.



Despite the September 7 deadline, the scheme has received no application from any private or public player to set up projects under the programme, raising concerns over the viability of the coal ministry's push to gasify 75 million tonnes of coal and lignite, sources said.



A query to the coal ministry remained unanswered till the time of filing of the story.

Coal gasification refers to the process of converting dry fuel into synthetic gas (syngas), which is used as an alternative fuel and helps reduce carbon emissions. This process supports production of methanol, fertilisers, hydrogen and chemicals, cutting reliance on imports.



Also read: Share of electricity in India's overall energy mix to reach 45-50 pc by 2047: Official



The scheme marks a major step towards accelerating the country's coal gasification programme, strengthening energy security, and reducing dependence on imports of key products such as LNG, urea, ammonia and methanol. India holds one of the world's largest coal reserves of 401 billion tonnes and lignite reserves of 47 billion tonnes.



Coal accounts for over 55 per cent of the country's energy mix. Gasification converts coal/lignite into syngas, a versatile feedstock for producing fuels and chemicals domestically, enabling India to substitute high-value imports and insulate itself from global supply disruptions and price volatility.



India's import bill for key substitutable products, such as LNG, urea, ammonium nitrate, ammonia, coking coal, methanol, DME, and others, stood at approximately Rs 2.77 lakh crore in FY25, a vulnerability further exposed by the ongoing geopolitical situation in West Asia.



The incentive builds on the National Coal Gasification Mission (2021) and a Rs 8,500-crore scheme approved in January 2024, under which eight projects worth Rs 6,233 crore are under implementation.

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