The Association of Power Producers (APP) has stated that several thermal power plants in India failed to meet their biomass co-firing targets in the fiscal year 2024-2025 due to supply shortages and technical challenges. This statement comes after the Commission for Air Quality Management issued show-cause notices to six thermal power stations located near Delhi, proposing environmental compensation of INR 61.85 crore for the reported shortfall in biomass co-firing.
The APP attributes the shortfall to the underdeveloped domestic market for torrefied biomass pellets, which are required for power plants operating ball and tube mills. The association highlights that power producers face limited supplier capacity, frequent rejection of pellets due to high moisture or volatile matter, and a lack of solutions validated by original equipment manufacturers. Despite these constraints, generators have taken steps to improve compliance, such as Talwandi Sabo Power Limited, which set up a local torrefied biomass manufacturing unit to develop a stubble-to-biofuel supply chain.
As a result, Talwandi Sabo Power Limited improved its co-firing performance, achieving 4.33 percent co-firing in August of FY26 and reaching 5.07 percent year-to-date by 30 November 2025. The APP argues that this progress demonstrates that compliance improves as the biomass value chain matures and that earlier shortfalls reflected market limitations rather than operational reluctance. The association cautions that penalizing generators for factors beyond their reasonable control could impose financial stress without speeding up adoption.
The APP urges the government to consider existing provisions for relaxation in genuine cases, including a one-time waiver of environmental compensation for FY25 or allowing compliance to be carried forward. The association reiterates its support for efforts to curb stubble burning and improve air quality, calling for a collaborative approach to strengthen the biomass supply chain and enable sustainable co-firing across the power sector. By working together, the APP believes that the power sector can overcome the challenges associated with biomass co-firing and achieve a more sustainable and environmentally friendly energy mix.