The Government of Maharashtra has officially approved the Maharashtra State Compressed Biogas (CBG) Policy 2026, marking a significant step toward sustainable energy generation and scientific waste management across urban and rural areas. The policy, cleared by the state cabinet on April 22, 2026, aims to convert organic waste into clean fuel while boosting rural incomes, reducing pollution, and strengthening energy security.
At the core of the policy is the promotion of Compressed Biogas (CBG) production using a wide range of feedstock, including municipal solid waste, agricultural residue, cattle dung, market waste, and by-products from industries such as sugar factories. The initiative seeks to address key environmental challenges such as open burning of farm waste and inefficient disposal of urban garbage.
The state has made a budgetary provision of ₹500 crore for FY 2026–27 under the Viability Gap Funding (VGF) mechanism to support financially unviable but socially beneficial projects. Under this, developers can receive up to ₹75 lakh per tonne capacity, capped at ₹15 crore per project.
The policy mandates a minimum project capacity of 20 tonnes per day (TPD) of segregated organic waste or equivalent biomass input to ensure operational efficiency and economic viability. Both greenfield and brownfield projects are allowed, including decentralized, cluster-based (CBG hubs), and public-private partnership (PPP) models.
To streamline implementation, the Urban Development Department has been designated as the nodal authority. A state-level steering committee headed by the Chief Secretary will oversee planning, approvals, and inter-departmental coordination. Additionally, an executive committee and district-level coordination committees (DBCCs), led by District Collectors, will ensure smooth on-ground execution.
The policy also emphasizes the development of a robust supply chain for feedstock, encouraging long-term contracts between farmers, aggregators, and project developers. Farmer Producer Organizations (FPOs), cooperatives, and rural entrepreneurs are expected to play a crucial role in biomass collection and supply, creating new income streams in rural areas.
To facilitate project development, the government has introduced several incentives:
- Land allocation on lease basis at concessional rates (0.7% of ready reckoner value, with periodic revisions)
- Priority access to water and electricity
- Single-window clearance system for faster approvals
- SGST reimbursement of 2.5% post-commissioning
- Promotion of by-products like bio-fertilizers through registered distribution channels
Each district is expected to develop at least one CBG project per taluka, with priority given to areas with high biomass availability. The policy also integrates with central government initiatives such as SATAT, GOBARDHAN, and the Swachh Bharat Mission, aligning with India’s goal of achieving net-zero carbon emissions by 2070.
Beyond environmental benefits, the policy is expected to generate employment in both urban and rural regions, support circular economy practices, and reduce dependence on fossil fuels by promoting domestically produced clean energy.
With this policy, Maharashtra positions itself as a leader in waste-to-energy transformation, aiming to turn one of its biggest urban challenges—waste—into a valuable economic and environmental resource.
Also Read: KDMC Files FIR Against Two For Failing To Segregate Wet And Dry waste
