The purpose of the project activity is to utilize the available biomass fuels such as Rice husk, soybean stalks and red gram stalks in the region effectively for generation of power. The generated power will be exported to the state grid for sustainable economic growth, conservation of environment through use of biomass fuels and Green House Gas (GHG) emission reductions. The project will also help to reduce the ever-increasing demand and supply gap of electricity.

Varam Bio Energy (P) Limited has a primary business mission of pioneering the utilization of low density crop residues which are otherwise burnt on the fields (leading to high particulate emissions) or allowed to decompose (leading to methane release).

The project adopts Rankine cycle of direct combustion technology, where the Biomass fuels can be directly fired inside the boiler. Since, the biomass fuel is considered as carbon neutral in nature, the electricity generation from the project activity is considered as clean form of energy. The biomass based power project is permitted to use fossil fuels (coal) to an extent of 25% of the annual fuel consumption. However, the project proponent has proposed to restrict the usage of coal at less than 10% of the annual fuel consumption. The project proponent proposes to use coal only for emergency purposes such as boiler start-up and/or conditions of high moisture content in biomass fuels, since coal is a high carbon intensive fuel and increases the GHG emissions into the atmosphere. The GHG reductions from the project activity are expected at 388,874 tCO2e over the crediting period of 10 years.

In addition to the mitigation of GHGs into the atmosphere, the project activity would also contribute to the following local benefits during its operation:

• Proper utilization of surplus biomass; • Generation of eco-friendly green power; • Avoidance of burning of agriculture waste;

The view of the project participants on the contribution of the project activity to sustainable development

Ministry of Environment and Forests (MoEF), Government of India, has stipulated the following indicators for sustainable development in the interim approval guidelines for CDM projects.

1. Social well-being
2. Economic-well being
3. Environmental well being and
4. Technological-well being

The project activity contributes to the above indicators in the following manner.

Social well being

• Collection and transportation of the biomass fuel from fields could generate direct and indirect employment opportunities to the rural people.

• Commercial value of agricultural residues will encourage the farmers to collect biomass from fields

• The proposed project would engage both genders in construction of the project, biomass collection; biomass processing etc. during operational lifetime of the project. This will lead to an increase in gender equity and hence prevent social disparities.

Economic well being

• The project will bring an additional investment to the tune of Rs. 444.50 millions, which is a significant investment in a green field project.

• The project acts as a nucleus for other economic activities such as setting up of cottage industries, shops, hotels etc around the area contributing to the economic development around the project area.

• The plant is generating commercial value to crop residues enabling the farmers to get better price out of their produce augmenting their income.

• The proposed biomass based power generating plant would contribute to the availability of continuous and sustained power to the local industries and agricultural farmers located in remote areas, there by avoiding the load shedding and low frequency of power.

Environmental well being

• The proposed project activity utilizes biomass potential available for power generation, which otherwise is dominated by fossil fuels such as coal, lignite and gas etc. The project will not result in an increase of GHG emissions and cause no negative impact on the environment.

• The project utilizes surplus biomass residues and thereby reduces dependence on fossil fuels to certain extent. The project conserves local resources, reduces pressure on the local environmento some extent, and provides improved health and other environmental benefits.

Technological well being

• The technology selected for the proposed project is a more energy efficient technology. The project uses a steam turbo generator with matching boiler of travelling grate type capable ofiring multiple fuels.

In view of the above, the project activity profoundly contributes to sustainable development and also meets the approved guidelines for CDM projects stipulated by the Government of India.