ADB, SAEL Industries sign INR 754 crore external commercial borrowing agreement to promote agri waste to energy projects in India


The Asian Development Bank (ADB) and SAEL Industries Limited have signed an agreement of up to INR 754 Crores Indian rupees (around $91.14 million) to promote the generation of biomass energy using agricultural residue, helping diversify India’s energy mix and reduce carbon intensity.

Each year farmers in Northern India burn crop stubble in their fields to remove paddy residue, resulting in severe air pollution with devastating health effects in the region.

 SAEL Industries Limited has developed a business model where crop residues are used as fuel in waste-to-energy projects. Company’s ambition is to grow its portfolio to 3.5 GW over the next four years by adding 100MW of new biomass and 600MW of new solar capacity annually.

ADB’s support will fund the construction of five biomass powerplants in the districts of Bikaner, Churu, Hanumangarh, Jhunjhunu, and Sikar in the state of Rajasthan.

“By collecting the crop stubble to be used as fuel in our waste-to-energy plants, we contribute to combat one of our nation’s greatest health issues, while at the same time creating local employment and generate extra income to farmers and local entrepreneurs. We are happy to have ADB partnering with us in these efforts,” said Mr Jasbir Singh, Chairman and Managing Director of SAEL Limited.

“Establishing biomass power plants that can repurpose agricultural residue will help protect the environment while contributing to the government’s goal of expanding renewable energy sources and reducing carbon dioxide emissions. It will also help increase income of local farmers through sales of agricultural residue and reduce burning of agricultural waste, contributing to improvement of air quality,” said ADB Vice-President for Private Sector Operations and Public–Private Partnerships, Ashok Lavasa. “ADB’s assistance will have a powerful demonstration effect for biomass power by helping reduce risk perceptions and by creating awareness of its benefits and potential for use in other rural communities and developing member countries.”

Norwegian fund Norfund has previously invested in SAEL Industries as an equity investment.

Reducing air pollution and climate emissions while providing income to farmers

Fine particle matter (PM 2.5) levels rise with the yearly burning of crop stubble contributes to some of the world’s worst air quality[1]. High levels of PM 2.5 have been linked to health effects such as asthma and decreased lung function, and the burning of crop stubble also contributes to reduced soil quality, requiring increased use of chemicals which causes other health issues.

More than half the land in Rajasthan is dedicated to agriculture. Local farms burn huge volumes of waste including stalks, husks, and straw, causing air pollution. The power plants will convert about 650,000 tons of agricultural residues into electricity and are expected to generate 544 gigawatt-hours of energy per annum, helping avoid up to 487,200 tons of carbon dioxide annually. Income of local farmers will rise through the sale of agricultural residue.

SAEL Industries is a renewable company with strong focus on creation of green assets to contribute to transition to green energy with projects across biomass and solar power projects in various States.

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members—49 from the region.