How to Select the Right Land for Your Compressed Biogas (CBG) Business
How to Select the Right Land for Your Compressed Biogas (CBG) Business
Hello Businessmen,
Today, we’re diving deep into the compressed biogas (CBG) segment and the crucial first step to starting your business: identifying the right land.
Biomass is more than just pellets and briquettes. It’s a rapidly expanding sector that includes compressed biogas, biodiesel, bioethanol, sustainable aviation fuels, and more. If you’re planning a business in the “waste-to-energy” sector, a CBG project is a highly profitable and in-demand venture.
Why Site Selection is Critical for a CBG Project
In India, companies like HPCL, IOCL, and BPCL, as well as City Gas Distribution (CGD) companies, are actively seeking CBG producers. They issue “Expressions of Interest” (EOI) and offer long-term, 15-year agreements to purchase the gas you produce. While a 2-3 tonne per day CBG plant requires a significant investment of ₹12-15 crore (excluding land costs), a solid business plan and a well-chosen site can make the project highly successful. The right location ensures strong technical and financial viability and smooth government approvals.
Here are the key parameters for selecting the ideal land for your CBG plant:
1. Distance from Residential Areas
The site should be located at least one kilometer away from any residential area, village, or city. This distance is vital for safety, as CBG is considered a hazardous material. It makes obtaining the necessary licenses and approvals from authorities much easier and helps prevent potential issues with local communities.
2. Proximity to Gas Distribution Channels
Your site should be no more than 20 kilometers from a metro city or a City Gas Distribution (CGD) pipeline. This is crucial for minimizing the transportation costs of your produced gas. A shorter distance to the distribution network directly impacts your bottom line and ensures a more profitable operation.
3. Water and Land Conditions
You must ensure that there are no canals or drains within a 500-meter radius of your site. Additionally, the groundwater level must be at least 25 feet deep. A low water table is essential for the construction of the digester and the overall digestion process. High water levels can complicate construction and impact the project’s feasibility.
4. Electrical Infrastructure
For safety and efficiency, the selected plot should not have any high-tension electrical lines passing overhead. It is also highly recommended that an electricity substation is located within 500 meters of your site. The closer the substation, the lower your transmission costs will be, making it easier and more affordable to get a power connection for your plant.
5. Clear Land Title and Documentation
For any business to succeed, especially one requiring significant financing and government subsidies, the land documents must be flawless. Ensure the land title is clear, undisputed, and free from any loans. It’s crucial that the chain of title is clean for at least 30 years. Having clear documentation will prevent delays in obtaining project financing and government benefits.
By keeping these critical parameters in mind, you can ensure your CBG project is set up for success from the very beginning.
Complete Guide for Compressed Biogas Project
Consult With Experts
Reach Us
Call Us : 8683898080
E-mail Us : sales@kipfinancial.com
KIP Financial Consultancy Pvt. Ltd.
DSB – 38, Red Square Market, Hisar – 125001 (HR)
Leave a Comment