India’s IOC plans subsidiary for green energy business

Indian state-controlled refiner IOC will form a wholly-owned subsidiary in India for its low-carbon and green energy businesses.

The new subsidiary will consolidate IOC's low-carbon and green energy businesses to meet the requirements of its 2046 net zero target, the refiner said in a stock exchange filing on 15 March.

The refiner will consolidate all its green assets "under one umbrella" and expand its operations across markets such as biofuels, renewable energy, green hydrogen and carbon capture, utilisation and storage (CCUS), its chairman SM Vaidya said at the IndianOil Green Energy Summit on 15 March.

"While IndianOil is committed to energising India's exponentially rising energy needs, we are also determined to be the flagbearer of India's green energy transition," Vaidya said. "We are thus scaling up our green endeavours with a definitive focus, and going forward, we will consolidate our green assets under one umbrella for better synergy."

The company aims to raise its renewable energy capacity from 239MW presently to 3GW by 2025, 35GW by 2030 and 200GW by 2050, he said. IOC will aim for 600,000 t/yr of biofuels production capacity by 2025, 4mn t/yr by 2030 and 7mn t/yr by 2050, as well as a capacity of 1mn t/yr of biogas by 2030 and 9mn t/yr by 2050.

IOC plans to raise its renewable energy capacity by 2.8GW through collaborating with state-controlled NTPC, Vaidya said, without providing further details.

The company is collaborating with Israeli private-sector firm Phinergy, which produces hybrid lithium-ion and aluminium-air battery systems, to form an entity called IOC Phinergy, Vaidya said. IOC is also setting up 4,700 charging stations and 66 battery-swapping stations for electric vehicles in India.

IOC has begun various initiatives in the biofuels sector over the past few years. IOC and US sustainable aviation fuel (SAF) producer LanzaJet in February agreed to pursue the production of SAF from alcohol in India. The refiner signed a deal with biotechnology provider Praj Industries in 2021 to boost production capacities for SAF, ethanol, biodiesel and compressed biogas (CBG).

The refiner has set up a paddy straw-based 2G ethanol plant and refinery off-gas based 3G ethanol plant at Panipat in Haryana state, the chairman said. IOC has commissioned 20 CBG plants under the government's Sustainable Alternative Towards Affordable Transportation (Satat) initiative, as well as set up 100 t/d and 200 t/d CBG plants in the states of Rajasthan and Uttar Pradesh, respectively.

India had previously set a target to roll out 5,000 CBG production plants to reduce its reliance on energy imports and control pollution. It currently has 31 CBG plants in operation and about 100 retail outlets selling biogas. The government in its April 2023-March 2024 budget earmarked 100bn rupees ($1.2bn) towards setting up 200 CBG plants and 300 community and cluster-based biogas plants under its Gobar-Dhan scheme.

India does not have an SAF mandate, but plans to blend 20pc ethanol in gasoline (E20) by 2025. Indian prime minister Narendra Modi launched E20 fuel at 84 retail outlets of oil marketing companies in 11 states and union territories on 6 February.

The refiner also said it intends to raise its share of India's energy market to 12pc by 2030 from 9pc currently.

By Pranav Joshi

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