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PROBLEMS & ISSUES TO BE ADDRESSED

for power generation or methanol production however depends on the overall economics.
Biomass gasification is more versatile than biogas production, since this route does not require
specific types of biodegradable materials. A plant would produce syngas via gasification
followed by methanol to gasoline section. Assuming the cost of the methanol to gasoline
section is about 20% of the total investment, the investment for processing 2000 TPD biomass
is of the order of 350 Million US $ (Approximately Rs. 2,500 Crore) . The rate of return for this
plant producing synthetic gasoline is difficult to estimate since internal rate of returns (IRR)
is sensitive to the gasoline selling price. All the associated assumptions and estimates are
available in this report [113].
In another estimate it is seen that a processing plant of 4000 Kg/Hr for MSW and other biomass
producing about 2,300 KWH energy, will cost about Rs. 38.5 Crores for power generation via
syngas. Although this plant will produce producer gas, it will not use oxygen and will not have
any facility for shift reaction or methanol synthesis reactors [116]. However, for this scale it is
possible to use liquid phase methanol reactor where there could be significant reduction in
cost. In liquid phase synthesis the separation of carbon dioxide and shift reactor may not be
required. The only addition will be a liquid phase methanol reactor and air separation unit.
Therefore the cost for a methanol plant will not be much more than that of the power plant. In
general the additional cost for air separation unit (ASU) and methanol reactor adds up to about
one third of the base cost [103].

It is clear that a small plant for methanol production may not be very economically viable.
However, when we focus towards waste management, it is worth considering and could be
compared with the normal practice of producing energy. In India our waste usage is much
lower than the world standard. Assuming about 30% additional cost for a waste to methanol
plant over the combined cycle power plant, we can at least set up few demonstration units
within the country. With liquid phase methanol synthesis, it may be possible to develop a small
capacity viable unit for methanol production from bio waste. There will not be much feed pre-
treatment or gas post treatment. There is strong justification for an indigenous research project
for development of such a pilot unit with conventional gasification as well as plasma based.

5.2 Sustained Supply of Feedstock

Availability of coal in large quantity for mega scale and IGCC plant with power and methanol
production is not a problem, particularly if it is located near the mines. Transportation over
a long distance not only adds to the cost but also risks interruption during transit. The issue
is that the plant has to be matched with the demand in the surrounding area. If methanol
is produced along with power this will provide better flexibility to balance the demand and
production between power and methanol or DME.
Currently, there are not many large biogas plants in the country to supply adequate quantity
of biogas for reforming and methanol/DME production. However, as discussed earlier, large
dedicated biogas plants may be considered for conversion to syngas and methanol/DME.
Regarding MSW, the development of proper collection system is important. Both for biomass
and MSW, seasonal variation has to be taken into account to ensure the sustained supply of
feedstocks at reasonable cost.

For immediate DME requirement, sustained methanol supply will not be an issue since it is
likely to be available in the market and it does not take very long time to set up dehydration
plants.
5.3 Scale of Facility or Distributed Small Scale Units

Due to the fact that India has a large gap between methanol production and consumption,
large mega plants are necessary not only to reduce dependence on import but also for

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