06 Oct 2026
6 October, 2026 | Kolkata India wants to turn crop residue from a seasonal pollution problem into a rural fuel economy. But the real test begins after harvest: who collects the straw, who pays the farmer, who bears the transport cost, and what happens to the soil when the residue leaves the field? SummaryIndia already has hundreds of Compressed Biogas (CBG) projects either operational or under development, while government policy is gradually pushing biomethane into the transport and gas ecosystem. But crop residue is not an ordinary raw material. It is available only during a short harvest window, varies in moisture and quality, can be costly to collect and transport, and plays an important role in maintaining soil health.This makes the economics of CBG more complicated than simply building more plants. The success of India’s CBG economy will depend on whether farmers can reliably move crop residue from fields to processing plants at a cost that works for farmers, aggregators and plant operators alike - without creating new environmental costs in the process.The real question, therefore, is not how many CBG plants India can announce or build but whether India can make crop residue economically valuable without making its removal financially or ecologically costly. Can India’s Crop-Residue Economy Work at the Farmgate, Not Just at the Plant Gate? After the paddy harvest, the clock starts ticking. A farmer in Punjab or Haryana may have only a narrow window before the next crop has to be planted. The straw left behind is bulky, difficult to handle and expensive to move. Burning remains attractive precisely because it offers a fast solution to a time-sensitive problem. That is what makes Compressed Biogas (CBG) such an interesting proposition. Instead of treating paddy straw as something to dispose of, a CBG plant can treat it as a feedstock. Straw is collected, baled, transported and processed through anaerobic digestion. The resulting biogas is upgraded into biomethane and compressed for use as fuel, while the process can also generate organic manure. On paper, it is an elegant circular-economy story. But the field is much less tidy. The straw has to reach the plant on time and meet quality requirements. Trucks have to travel. Bales have to be stored. Farmers and aggregators need to be paid or compensated. The plant needs to remain operational. The gas needs a reliable buyer. Digestate needs to meet applicable standards and find a credible agricultural use. And all of this has to happen within a highly compressed agricultural season. That is the farmgate test. India’s CBG Sector Is Moving Beyond the Pilot Stage India’s policy architecture is no longer treating CBG as an experimental fuel. The Sustainable Alternative Towards Affordable Transportation (SATAT) initiative was launched in 2018 to build an ecosystem for producing CBG from waste and biomass. Oil and gas marketing companies including IOCL, BPCL, HPCL, GAIL and IGL have been inviting producers to supply CBG, while the government says long-term offtake agreements at assured prices are being executed. The policy push is becoming stronger as well. India’s CBG blending obligation has entered its mandatory phase, with a requirement of 3% for FY2026–27, rising to 4% in FY2027–28 and 5% from FY2028–29. As of 27 January 2026, the GOBARdhan portal reported 189 functional CBG projects across India. Uttar Pradesh had 37, Gujarat 25, Haryana 20, Karnataka 20, Maharashtra 20 and Punjab 10. That points to a rapidly emerging industry. But there is an important distinction: A functional CBG plant is not automatically a successful crop-residue supply chain. A plant can have the technology, an offtake agreement and the ability to produce gas. The harder question is whether it can secure enough suitable biomass, at a workable cost, year after year. THE SEASONAL RESIDUE FLOW Create a horizontal seasonal flow: Paddy harvest → Straw collection → Baling → Village aggregation → Storage → Transport → CBG plant → Biomethane → OMC/fuel buyer Under each stage, show the potential friction point: 15 –20 day harvest window | Moisture | Quality | Farmer payment | Storage loss | Transport cost | Downtime | Methane loss | Offtake Crop residue is a moving, seasonal supply chain - not a static national tonnage figure. Punjab Shows Both the Promise and the Problem Punjab is a natural laboratory for this question. The state has been promoting both in-situ and ex-situ crop-residue management. ICAR reported in September 2026 that Punjab has around 31.76 lakh hectares under paddy and nearly 20 million tonnes of straw generation, while stakeholders have been calling for stronger biomass aggregation, transportation, storage and assured offtake. That discussion reveals where the challenge is moving. The question is no longer simply how to convince farmers not to burn residue. It is how to build a system capable of handling the material once it is removed from the field. Punjab Energy Development Agency currently lists 57 allocated CBG projects, with a combined capacity of about 815.68 tonnes per day, based on paddy straw and other agricultural residues. Six projects, totalling around 107.48 tonnes per day, are operational, while another five projects with a combined capacity of 37.5 TPD are expected to become operational during FY2026–27. That immediately raises a larger question: Where will all the straw come from? Following the Straw to Lehragaga One of the most useful case studies is the Verbio biorefinery at Lehragaga in Sangrur district, Punjab. The plant began producing biomethane from agricultural residues in 2022. The company says the facility was designed to process around 100,000 tonnes of agricultural residue annually, with BioCNG production capacity of up to 33 tonnes per day, alongside large-scale production of humus fertiliser. Its gas is supplied into IndianOil’s retail network in Punjab. This is precisely the kind of plant the investigation should follow. Not because it should automatically be presented as a success story, but because it allows the reporting to examine the entire chain. Where does the straw come from? How far does it travel? Who aggregates it? What does the farmer actually receive? Is the farmer paid for the straw, or does the economic benefit primarily come from free collection? How much does baling cost? What happens when the straw is wet? What happens when the plant needs more feedstock than nearby farms can provide? What happens when the plant is not operating? And what happens to the material that comes out at the other end? Verbio has described its model as providing farmers with free straw collection while creating rural economic value. That is useful evidence. But “free collection” is not the same as a measured increase in farmer income. The reporting therefore needs the actual ledger. The Farmer’s Income Cannot Disappear Behind the Word “Waste” This is where the CBG story needs greater precision. Crop residue is often described as waste. For the farmer, however, it is not necessarily worthless. Depending on the farming system, residue can be incorporated into the soil, used for livestock-related purposes, sold into biomass-energy or industrial markets, or directed towards other value chains. In some cases, it may also represent a cost rather than an income opportunity. The relevant economic question is therefore not: “How much does a tonne of straw cost?” It is: “What is the farmer’s net position after the residue leaves the field?” That calculation should account for: payment received for residue, if any;baling and handling arrangements;transport responsibility;time saved;machinery costs avoided;alternative value of the straw;impact on field preparation;possible soil-nutrient replacement costs;and the reliability and timing of payment. A farmer receiving ₹X per tonne is not necessarily better off if removing the straw creates ₹Y of additional costs elsewhere. The article should therefore avoid using a headline straw price as a proxy for rural prosperity. FARMER NET-INCOME CARD FARMER NET OUTCOME Straw payment+Collection / handling savings+Avoided field-management cost−Transport or other deductions−Nutrient / soil-management cost=NET FARMER VALUE Use actual numbers from one documented farmer or FPO account. Do not present a modelled figure as observed farmer income. The Soil Cannot Become the Invisible Stakeholder There is another side to removing residue from the field. ICAR’s recent crop-residue work continues to emphasise in-situ management, including the incorporation of straw into soil. Its field programmes have highlighted potential benefits related to soil organic carbon, fertility, water conservation and nutrient retention. That creates a genuine competing viewpoint. One argument says: Take the residue away and turn it into fuel. The other says: Not all residue should be removed because some of it belongs in the soil. The article should not automatically choose one side. The more useful question is: How much residue can be sustainably removed from a particular farming system without undermining soil health? That answer will not be identical everywhere. Soil type, crop rotation, irrigation, organic-carbon levels, residue quantity, local machinery and competing uses can all influence the answer. A CBG plant therefore cannot simply define its feedstock requirement and assume surrounding fields can sustainably supply it. The field has an ecological budget too. The Logistics Problem Starts Long Before the Plant A bale of straw is not a pipeline commodity. It has to be collected from scattered farms and moved to aggregation points before reaching the plant. That creates a collection-radius problem. The farther a plant has to travel for its feedstock, the more complicated the economics become. The physical chain may look like: Field → Baler → Tractor/trailer → Aggregation point → Storage → Truck → Plant Every additional movement consumes time, fuel and money. There is also a seasonal mismatch. The plant may need feedstock throughout the year, while farms produce most of their straw within a narrow harvest window. Storage therefore becomes part of the business model. The investigation should seek: daily weighbridge records;bale counts;source-village records;average collection distance;storage duration;rejected loads;moisture readings;quality specifications;transport bills;and plant feedstock inventories. If those records cannot be provided, that absence is itself relevant evidence. Moisture Can Decide Whether the Economics Work Biomass is not uniform. Moisture affects its weight, storage behaviour and usable energy content. Poorly managed biomass can deteriorate during storage and create operational problems. That means two farmers delivering apparently similar bales may not be delivering the same usable feedstock. This makes moisture and quality rejection central to the investigation, not minor technical details. The plant’s contract should establish: What moisture level is acceptable?What happens when a load exceeds it?Is the farmer penalised?Is the aggregator penalised?Who pays for rejected material?Is the material returned?How frequently does rejection occur?How is moisture measured? A feedstock contract that looks attractive on paper can behave very differently once quality deductions enter the calculation. The Gas Is Only Half the Story CBG is not the end of the process. The plant also produces digestate or organic manure, creating the possibility of another circular-economy loop. Residue enters as agricultural feedstock. Gas leaves as fuel. Digestate can potentially return to agriculture. But that loop only works if the digestate is safe, compliant, usable and actually accepted by farmers. A previously reported case at the Lehragaga plant highlighted moisture-related concerns around manure specifications, showing why the by-product can become a commercial and regulatory issue rather than an automatic benefit. The investigation should therefore seek digestate analysis, not simply photographs of manure being loaded onto tractors. It should examine: moisture;nutrient content;contaminants;compliance with applicable standards;storage;farmer uptake;price;and actual field application. The circular-economy claim is incomplete if the digestate has nowhere credible to go. Methane Leakage Is the Other Side of the Climate Claim CBG can only deliver its intended climate benefit if the entire system performs properly. Methane is the product being captured and sold. It is also a powerful greenhouse gas if it escapes before capture, during processing, storage or upgrading. That makes methane leakage one of the most important evidence gaps in the story. A production number tells us how much methane became a commercial product. It does not automatically tell us how much methane escaped. The investigation should therefore ask for: Leak-detection methods, testing frequency, maintenance records, fugitive-emission data and corrective-action logs. If methane-leak testing is unavailable, the article should say so. Missing measurement should never be replaced with a generic claim that biogas is “clean”. The climate claim needs a boundary, a baseline and a measurement method. The Buyer Matters as Much as the Farmer The CBG business does not end when gas leaves the plant. Someone has to buy it. SATAT provides a potential route through oil and gas marketing companies, while the CBG blending obligation creates a growing policy-driven demand signal. But the reporting should still establish: Who is the actual buyer? What does the contract guarantee? What happens when production falls below contracted volumes? Who bears quality risk? How is the price determined? What happens if the plant cannot produce for several days? This is where the distinction between an announcement and an operating business becomes critical. A plant with a signed offtake agreement is not the same as a plant delivering gas reliably every day. Downtime Is the Number Nobody Wants to Headline A CBG plant can have impressive installed capacity and still produce far below its theoretical maximum. The reasons can range from feedstock shortages and equipment failures to maintenance, quality problems, transport disruptions, storage issues or market constraints. That is why the investigation should calculate: Actual uptime = Operating hours ÷ Available operating hours It should then compare: Installed CBG capacity with Actual average production That comparison is more informative than the nameplate number alone. The same principle applies nationally. India reported 189 functional CBG projects as of January 2026, but that figure does not tell readers how much each plant actually produces, how consistently it operates or what proportion uses crop residue as feedstock. Functional is not the same as fully utilised. CBG Is Not the Only Destination for Straw The market for crop residue is becoming more competitive. Straw can be directed towards CBG, biomass power, pellets and briquettes, biofuels and other industrial applications. The Commission for Air Quality Management has also directed Punjab and Haryana to increase the use of paddy-straw-based pellets or briquettes in brick kilns, with the mandated co-firing share rising to 30% from 1 November 2026, after 20% from November 2025. That means new CBG plants are entering a market in which multiple users may compete for the same seasonal material. This could benefit farmers. More buyers can mean more choices. But it can also create instability for plants that require predictable feedstock volumes. The investigation should therefore map the local residue market, rather than treating all available straw as if it automatically belongs to CBG. Perhaps the Answer Is Not One Technology This is where the story should resist a simple conclusion that CBG will “solve stubble burning”. ICAR’s work shows that in-situ residue management can reduce burning while supporting soil-related outcomes. Its work also stresses that machinery availability, maintenance and region-specific solutions matter. At the same time, ex-situ options such as CBG can create a market for residue that farmers otherwise struggle to manage. The stronger policy answer may therefore be a portfolio rather than a winner-takes-all technology race. Some residue can remain in the field. Some can feed CBG. Some can support industrial biomass demand. Some can move into other value chains. The right mix should be determined by soil science, economics, logistics and local conditions. Not by the number of CBG plants announced. What Would a Genuinely Working CBG Farmgate Model Look Like? A strong plant should be able to demonstrate at least ten things: 1. A defined collection radiusNot a vague reference to “nearby farmers”, but a documented sourcing geography. 2. Transparent farmer economicsWhat the farmer receives, what the farmer saves and what costs remain. 3. A functioning aggregation systemWho collects the bale, who owns it and who bears transport risk. 4. Quality controlsMoisture, contamination and rejection records. 5. High and documented plant uptimeNot just installed capacity. 6. Verified methane managementLeak testing and corrective action. 7. A credible digestate pathwayTesting, compliance, price and actual agricultural use. 8. A contracted buyerWith clear price, volume and quality terms. 9. Soil safeguardsEvidence that residue removal does not undermine local soil-health needs. 10. An independently checkable ledgerThe plant should be able to show what entered, what was produced, what was rejected, what was sold and what returned to agriculture. THE CBG ACCOUNTABILITY LEDGER Build a single-page dashboard connecting four stages: FARMGATE → PLANT → OUTPUT → FIELD Track: Farmgate Tonnes collectedFarmers coveredAverage collection distanceFarmer net valueTransport cost Plant Tonnes receivedRejected loadsMoisturePlant uptime Output CBG producedMethane leakageBuyer/offtake Field Digestate returnedFarmers using manureSoil indicatorNutrient balance Every number should carry a date, unit and source. The Documents Should Decide the Story The investigation should not depend on a company presentation deck. The reporting file should seek: feedstock contracts;farmer agreements;FPO and aggregator agreements;weighbridge logs;bale movement records;farmer payment records;transport invoices;moisture and quality-rejection logs;plant production records;downtime records;offtake contracts;methane-leak testing;digestate laboratory reports;fertiliser-compliance documentation;soil assessments;air-quality data;environmental permissions;pollution-control records;and maintenance records. If an operator refuses a document, record the request and the response. If a government agency holds the document, seek it there. If a number cannot be independently verified, label it accordingly. The reporting standard should remain clear: announced, commissioned, operational, maintained and measured are not interchangeable terms. A plant is not a success because it was announced. A capacity figure is not production. A contract is not delivery. And a climate claim is not an outcome until the underlying result can be measured. The Real Test Begins When the Harvest Ends The CBG story is often told from the plant backwards. Look at the digester. Look at the gas. Look at the cylinders. Look at the truck leaving with fuel. But the real story begins much earlier. It begins with a farmer standing in a field after harvest and asking what to do with the straw before the next crop goes in. If CBG gives that farmer a dependable alternative to burning—while protecting soil health, keeping transport costs manageable and creating a genuine economic return—then the technology becomes more than a clean-fuel project. It becomes rural infrastructure. But if the plant depends on expensive long-distance transport, inconsistent feedstock, weak storage, uncertain payments, low utilisation or an unproven digestate market, then the problem has simply moved from the field to the supply chain. And that distinction matters. India does not need more tonnes of theoretical biomass. It needs working contracts, working logistics and working economics. Punjab’s latest crop-residue discussions already point towards this next challenge: nearly 20 million tonnes of paddy straw, a growing network of CBG projects and an urgent need to solve aggregation, transportation, storage and assured offtake while replenishing nutrients where straw is removed. That is why the future of CBG will not be decided inside the digester alone. It will be decided at the farmgate. The Final Farmgate Test When the crop is harvested, does the residue become fuel, income and soil-safe value—or does it simply become another expensive material that someone has to move? That is the question the CBG economy must answer. And it should answer it with evidence—not projections. CAN THE MODEL PASS? FARMER — Is net value positive? FEEDSTOCK — Is supply reliable? PLANT — Is uptime proven? CLIMATE — Is methane leakage measured? SOIL — Is residue removal sustainable? A CBG model should not be called successful until there is evidence on all five.Primary Sources Ministry of Petroleum & Natural Gas (MoPNG) — Compressed Bio Gas / SATAT[https://mopng.gov.in/en/refining/compressed-bio-gas/1000]Punjab Energy Development Agency (PEDA) — Bio-CBG Projects[https://www.peda.gov.in/bio-cbg-compressed-piogas-projects.php]Ministry of New and Renewable Energy (MNRE) — Waste-to-Energy Schemes[https://mnre.gov.in/en/waste-to-energy-schemes/]MNRE — Bio-Energy Programme[https://mnre.gov.in/en/bio-energy-overview/]ICAR — Punjab Crop Residue Management Action Agenda[https://www.icar.gov.in/en/punjab-stakeholders-forge-integrates-action-agenda-crop-residue-management]Punjab Agricultural University (PAU) — VERBIO India, Lehragaga CBG Plant[https://pau.edu/index.php?DO=viewEventDetail&_act=manageEvent&dataE=datae&intID=7702]PIB / Ministry of Jal Shakti — GOBARdhan Scheme and CBG Projects[https://www.pib.gov.in/PressReleasePage.aspx?PRID=2222150&lang=1&reg=3]PIB / Ministry of Petroleum & Natural Gas — CBG Blending Obligation[https://www.pib.gov.in/PressReleasePage.aspx?PRID=1989226&lang=2&reg=48]CAQM / PIB — CBG and Crop Residue Management[https://www.pib.gov.in/PressReleaseIframePage.aspx?PRID=2187847&lang=2&reg=48]National Green Tribunal — Punjab Crop Residue Management Status Report[https://www.greentribunal.gov.in/sites/default/files/news_updates/Status%20Report%20by%20State%20of%20Punjab%20in%20OA%20No.%20632%20of%202023%20%28In%20Re%20News%20item%20published%20in%20The%20Hindu%20dated%2006.10.2023%20titled%20Pollution%20takes%20a%20front%20seat%20as%20Stubble%20Fires%20Spike%20in%20Punjab.pdf] ...Read more