Policies

Policy Recommendations for Use of Biodiesel as an Alternative Fuel

Source: JOIN IEA/IRENA Policy and Measures Database
Last updated: 7 October 2016

The Economic Coordination Committee (ECC) of the Cabinet approved the “Policy Recommendations for Use of Biodiesel as an Alternative Fuel” which states that:
1. The Ministry of Water & Power in coordination with AEDB is responsible for the National Biodiesel Programme.
2. Biodiesel blending will be gradually increased to achieve 5% share, by volume, of the national diesel consumption by 2015 and 10% by 2025.
3. Oil Marketing Companies (OMCs) will purchase biodiesel (B-100) from producers and sell after blending with petroleum diesel (starting with B-5).
4. The Ministry of Petroleum & Natural Resources shall come up with the fuel quality standards for B-100 and blends up to B-20.
5. The Oil & Gas Regulatory Authority (OGRA) shall regulate the pricing mechanism of various blends of biodiesel and ensure its cost-competitiveness with non-blended diesel.
6. The Government shall provide buy back guarantees to biodiesel producers at a price determined by OGRA, and will make it mandatory for public sector vehicles running on diesel to use blended diesel.
7. Plant, machinery and equipment used in biodiesel production shall be exempted from customs duty, income tax and sales tax.

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