Centre Urges States to Adopt Coal Gasification Incentives Following Adoption by Odisha, Maharashtra

Government Pushes for Coal Gasification Projects Amid Global Volatility

The Indian government has made significant strides in promoting coal gasification projects, a move aimed at reducing dependence on foreign imports and insulating the country from global price volatility. In a bid to boost the sector, the Centre has introduced a Rs 37,500-crore incentive scheme to promote surface coal/lignite gasification projects.

Key States Show Proactive Approach

Odisha and Maharashtra have already taken the lead by introducing their own state-level incentive schemes to attract investment in coal gasification projects. Coal Secretary Vikram Dev Dutt said that the Centre has effectively engaged with states, with some showing a proactive approach in realizing the potential of coal gasification. Dutt noted that Odisha and Maharashtra governments have moved swiftly to design incentive packages that will encourage industry to set up large-scale coal gasification projects.

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The Centre's scheme provides capital expenditure support for plant and machinery, while state-level incentive packages will help reduce operating expenditures. Coal and Mines Minister G Kishan Reddy highlighted the importance of state-level schemes, stating that the Centre is in regular discussions with states like Chhattisgarh, Uttar Pradesh, Jharkhand, Andhra Pradesh, Telangana, and Assam to bring in similar schemes.

The minister also emphasized the importance of investing in coal gasification projects in West Bengal, given the new government in power. The Centre's scheme is aimed at boosting clean energy production, reducing dependence on imports, and insulating the country from global price volatility and supply chain disruptions.

The government's push for coal gasification projects comes as the country seeks to accelerate its coal gasification programme, which is expected to support production of methanol, fertilizers, hydrogen, and chemicals. The national target is to gasify 100 million tonnes (MT) of coal by 2030, strengthening energy security and reducing dependence on imports of key products such as LNG, urea, ammonia, and methanol.

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