Page 38 - Policy Economic Report - September 2026

POLICY AND ECONOMIC
OIL & GAS MARKET

by 6.6 per cent and 5.8 per cent, respectively. Electricity generation recorded more moderate growth
of 0.6 per cent. In contrast, crude oil production declined by 1.0 per cent during December 2023,
highlighting continued challenges in domestic crude oil output.

The cumulative performance remained stronger than the monthly growth rate. During April–December
2023-24, the Index of Eight Core Industries recorded cumulative growth of 8.1 per cent over the
corresponding period of the previous year. Coal was among the major contributors to this performance,
with its cumulative index increasing by 12.5 per centduring the nine-month period.

The performance of the core industries highlights the continuing importance of coal and other
conventional energy sources in supporting India's industrial and electricity demand, even as the country
expands renewable-energy capacity. The strong growth in coal production during the period reflected
higher domestic availability and supported the broader energy system, while the decline in crude oil
production underlined India's continued dependence on imported crude to meet domestic demand.

9. India’s waste-to-gas potential could support 62 MMT of Compressed Biogas annually

India’s large and diverse organic waste base could provide a significant domestic source of renewable gas,
with the country estimated to have the potential to produce around 62 million metric tonnes (MMT) of
compressed biogas (CBG) annually, according to a report by Equirus cited by Firstpost. The assessment is
based on an estimated 472 MMT of annual feedstock comprising animal waste, agricultural residue,
municipal waste, sewage-treatment biomass and press mud from sugar mills. The development of this
potential could contribute to India’s energy security while simultaneously supporting waste management
and reducing environmental pollution.

Animal waste represents the largest source of potential CBG feedstock. Around 190 MMT of animal waste
could potentially produce nearly 25 MMT of CBG annually, accounting for approximately 41 per cent of
India's estimated CBG potential. However, the report highlights that the availability of waste does not
automatically translate into commercially viable feedstock. Only around 15 per cent of the total dung
generated in the country is estimated to be collectable, making the concentration of livestock and the
availability of sufficiently dense rural clusters important considerations for the economic viability of CBG
plants.

Agricultural residue represents another major opportunity. Around 150 MMT of paddy and wheat straw,
cane trash and other crop residues could potentially produce nearly 20 MMT of CBG annually. However,
the economics of utilising agricultural waste are closely linked to collection and aggregation infrastructure.
Since crop residues need to be collected within a relatively short period after harvesting, estimated at
around 45 days, efficient logistics and reliable feedstock supply chains would be critical for large-scale
deployment of CBG projects.

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