India could double biofuel production by 2030 with stronger policies

Ethanol and compressed biogas (CBG) are leading growth.

India’s production of liquid and gaseous biofuels could more than double by 2030 if policies are strengthened, according to a new report from the International Energy Agency (IEA).

The report said that enhanced policy measures could unlock opportunities across ethanol, compressed biogas, biodiesel, and sustainable aviation fuels.

It also highlighted that biofuels can strengthen India’s energy security by reducing reliance on imports, support economic development and job creation—particularly in rural areas—and contribute to the country’s emissions reduction goals.

These benefits align closely with India’s national energy and climate objectives and are underpinned by abundant agricultural residues and organic waste, a key resource for modern bioenergy production.

“India’s success in scaling up bioenergy shows what is possible when you have clear targets, predictable policies and coordination across government,” said IEA Executive Director Fatih Birol.

Since 2018, India’s ethanol consumption has grown from under 2 billion litres to over 11 billion litres, making it the world’s fourth-largest producer of liquid biofuels.

Compressed biogas (CBG) has also seen strong growth, supported by 11 national policies since 2018, with around 170 plants currently operational and nearly 300 more under construction.

Meanwhile, sustainable aviation fuels and other innovative biofuels are attracting growing investor interest as the aviation industry seeks low-emission alternatives.

Under the IEA report’s baseline forecast, reflecting current policies and market conditions, India’s use of liquid and gaseous biofuels is expected to rise by more than 50% by 2030, with ethanol and CBG leading the way.

In an accelerated scenario, with enhanced policy support, improved feedstock access, and expanded supply chains, biofuel consumption could more than double, representing a sixfold increase from 2020 levels.

The report calls for four key actions, namely a national sustainable fuels roadmap, integrated supply chains and infrastructure, innovation support for emerging fuels, and strong carbon accounting and sustainability frameworks for international markets.