Installation of 5000 Kl per day capital cost and production cost per liter and government policy in india

The installation of a 5,000 liter per day ethanol production unit from food or agricultural waste in India involves significant capital and production costs, as well as considerations of government policy.

1. **Capital Cost**:
- The capital cost for setting up a 5,000 liter per day ethanol production unit can be estimated at around Rs. 85 crores (approximately $1.1 crores or $110,000 per liter per day), based on the 5,000 liter per day ethanol plant report by Saanvira Engineering Pvt Ltd.
- This includes the cost of machinery, equipment, infrastructure, and any necessary modifications to existing facilities.
2. **Production Cost per Liter**:
- The production cost per liter of ethanol is influenced by the cost of raw materials, energy, labor, and maintenance.
- Using food or agricultural waste as feedstock can reduce the cost of raw materials, but the cost of collection, processing, and preparation adds to the overall production cost.
- Estimates suggest that the production cost of ethanol from waste materials in India can range from $30 to $60 per liter.
3. **Government Policy in India**:
- The Indian government has been promoting the use of biofuels, including ethanol produced from waste materials, through various policies and incentives.
- The government offers subsidies and incentives to encourage the production and use of biofuels, which can significantly reduce the effective cost of production.
- For instance, the government provides a per liter subsidy for cellulosic ethanol, which can range from $1 to $1.08 per liter.
- Additionally, the government is pushing for tariff cuts in sectors such as agriculture to facilitate the import of corn for ethanol production, which could further reduce the cost of raw materials.

In conclusion, the capital cost for installing a 5,000 liter per day ethanol production unit in India can be estimated at around Rs. 85 crores (approximately $1.1 crores or $110,000 per liter per day), while the production cost per liter can range from $30 to $60, depending on various factors such as the cost of raw materials, energy, labor, and government subsidies. The government of India has a supportive policy framework that encourages the production and use of biofuels, which can further reduce the cost of production and make such ventures more economically viable.