The Maharashtra Government has approved the “Maharashtra State Compressed Biogas (CBG) Policy 2026,” marking a major policy push to convert urban and agricultural waste into clean energy. The decision was taken at a Cabinet meeting chaired by Chief Minister Devendra Fadnavis on Wednesday, with the aim of strengthening sustainable waste management and advancing energy self-reliance in the state.
The new policy is designed to address Maharashtra’s growing waste burden, particularly in urban centres. The state currently generates around 24,500 metric tonnes of municipal solid waste every day from 423 urban local bodies. A significant portion of this waste is organic, but limited processing capacity has resulted in underutilisation, contributing to pollution at landfill sites and concerns over groundwater contamination.
In addition to municipal waste, Maharashtra produces more than 20 million metric tonnes of agricultural residue annually, much of which is either burned or left unused. The new framework seeks to change this by mandating source segregation of waste into organic and inorganic categories, making it easier to channel biodegradable material into biogas production systems.
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Under the policy, Compressed Biogas (CBG) will be expanded for use in industrial, transport, and domestic sectors. The government also aims to promote investment and employment in the bioenergy sector while contributing to India’s long-term goal of achieving net-zero carbon emissions by 2070. The plan includes utilising crops like Napier grass on wetlands and fallow lands, particularly in regions such as Marathwada, to enhance methane production.
To ensure financial viability, the policy requires CBG projects to process at least 200 tonnes of segregated organic waste per day. Smaller urban local bodies will be grouped into clusters, with the objective of establishing at least one CBG project per taluka. Farmer Producer Organisations (FPOs) will also play a key role by supplying raw materials such as sugarcane residue, soybean waste, and livestock manure.
The state has allocated ₹500 crore for Viability Gap Funding for 2026–27, with individual projects eligible for subsidies of up to ₹10 crore depending on capacity. Implementation will follow Public-Private Partnership or Hybrid Annuity models, supported by a dedicated digital platform connecting developers, farmers, and waste collectors, alongside administrative oversight from state and district-level committees.
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