An Economical Assessment of Paddy Residue Supply Chain for Power Generation

Punjab, an agriculturally rich state, generates a substantial amount of biomass in the form of crop residues, particularly paddy straw.Despite its potential as a renewable energy source, much of the residue is burnt, contributing significantly to air pollution.The present study made an economic assessment of paddy residue supply chain along with challenges in utilizing surplus biomass for power generation in Punjab.Primary data were collected 30 farmers and 5 residue collectors in periphery of operational power plant i.e.Universal Biomass Energy Pvt. Ltd., in Sri Muktsar Sahib district during 2023-24.Analysis revealed that for adopters of ex-situ crop residue management (CRM) practices, 19.48 quintals of residue per acre was generated, with surplus largely sold or stored while for non-adopters 15.2 quintals per acre was produced, with most being incorporated, stored, or paid in kind.The baling operation, a key supply chain activity, was economically assessed, revealing costs of Rs 147.37 per quintal and net return of Rs 27.63 per quintal, BC ratio of 2.89 and payback period of 2.12 years.The average baling operation days were 42 i.e. about 458 hours with effective field capacity being 2.56 acres per hour.Among different variable expenses, the largest share was of transportation, accounting for about 27 per cent share in the total cost of baling the paddy straw.The paddy residue collectors faced operational challenges like high initial investment, labor shortages, and rising fuel expenses.Findings highlight the need for targeted interventions to promote sustainable residue utilization through enhanced awareness, CRM infrastructure, and market linkages, fostering environmental and economic benefits.