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I Look At Biodiesel As A Very Promising Sector - Umesh Waghdhare, Aris BioEnergy

Umesh Waghdhare, Managing Director of ARIS BioEnergy speaks to Siddharth Shankar from BW Businessworld about the journey of Aris in detail.

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Umesh Waghdhare, Managing Director of ARIS BioEnergy

Aris BioEnergy aggregates used cooking oils (UCO) from the eateries, restaurants, manufacturers, and food producers from various outlets and converts them into biofuel that increases the life of the engines. These biofuels are 95% carbon-free and environment-friendly. Umesh Waghdhare, Managing Director of ARIS BioEnergy speaks to Siddharth Shankar from BW Businessworld about the journey of Aris in detail.


We’ve heard a lot about biodiesel, and where are we with it in India? 

People have been manufacturing biodiesel with different feedstocks - Palm Stearin, acid Oil, and Tallow (Animal Fat). Since the time RUCO initiative by FSSAI began in 2018, the potential of local feed-stock i.e., cooking oil for biodiesel started garnering attention. Earlier we never had a channel in place to consider UCO as a feedstock for biodiesel and that is where Aris BioEnergy came into the picture. 

In 2018 when Aris started the operation of aggregating UCO from the food manufacturers, eateries, restaurants, it was a new concept and in a very nascent stage ( It still is and therefore the need for education). We did a lot of research and waited to analyze the market before starting the aggregation to see what’s happening with the UCO that is supposed to be discarded. We understood that most of the oil is going into the adulteration channel where the UCO is sold back into the food chain. The small eateries that couldn't afford the new oil every time were the primary buyers. This is where the UCO is to be dealt with responsibly. FSSAI, the regulatory body has notified in their guidelines that the limit of Total Polar Compounds (TPC) should not exceed 25% during frying, beyond which the oil is unsafe for human consumption and we at Aris are trying our best to educate our partners its perils.

We’ve seen the food industry explored in India in the past decade. So how do you feel there is a lot of re-used UCO, and I would like to understand what kind of collaboration or numbers you have?

Right now, we have more than 21,000 outlets registered with us in Mumbai, Pune, and the rest of Maharashtra. We have been aggregating from these outlets daily. And we are associated with Luxury hotels, cloud kitchens, the chain of restaurants, army canteens, government canteens, caterers, manufacturers and fryers.

When you collaborate with a restaurant, what is the incentive for the resturant?

We buy the oil from the restaurant at a mutually agreed price, collate it at our facility, and further send it to the refinery for converting it into Biodiesel.

What are your expansion plans?

ARIS has been aggregating from the major cities of Maharashtra. We have expanded our operations in Goa, Gujarat (Rajkot and Ahmadabad), and Karnataka (Bengaluru). Very soon, the aggregation will begin in Telangana too. 

Biodiesel causes lesser carbons emission making it a more viable fuel in India. So do you think aggregating from the Restaurants or the food chain would bring out the amount of biodiesel required to make it an alternative resource?

The requirement is huge and it is just a beginning, we have been developing our collection system and looking forward to building our quantum. The support from the government and the local bodies to promote awareness among the masses and stringent norms to discard the UCO rightly will directly impact the volumes for aggregation. The Biofuel policy of the Govt. of India prescribes a 5% blend of biodiesel with diesel by 2030. Whatever biodiesel we produce from UCO, it’s going to be procured by the OMCs and blended with diesel, in a similar pattern where ethanol is blended with petroleum. 

What are your current collection statistics and how much are you manufacturing right now?

ARIS has collaborated with a UK Company - Green Fuels Limited which is one of the leading manufacturers of biorefinery plants. ARIS and Green Fuels have a Joint Venture company called ARIS Green Fuels. The JV will be setting up 20 Biodiesel plants throughout the country.

The understanding allows both the companies to focus on their core strengths - ARIS on aggregation and expansion and Green fuel in setting up world-class refineries. ARIS estimates that they will be requiring a series of small refineries of almost 20,000 – 50,000 kg/day conversion. The new JV Company has an LOI from the OMC where the entire biodiesel produced from our unit will be supplied to them. The 1st refinery set-up we are coming up with is in Khopoli, Maharashtra. On the aggregation front, we are increasing our collection capacity at the rate of 20% every quarter. 

What kind of investment is going into this whole venture? What is the interest from venture capitalists in this particular field of biodiesel and alternative space?

We are looking at overall 100 crores of investment in the first phase. In the beginning, it was an OPEX model so, the initial investment was made towards developing the infrastructure for aggregation, technology, e-pipes, warehouses etc. We are receiving a lot of Interest especially because there is a conscious thrust from the Govt in this space. We are weighing our options and are in discussion with a few PE houses and investment agencies, where both the production and aggregation part is displayed to them.

There is a lot of talk about alternative fuels throughout the industry and the government. What kinds of interest have you got from the automotive industry for this initiative?

In the automotive industry, there are no engines right now where biodiesel is used directly but, it can be easily blended and used with regular fuel. So, if we have to look for other sectors apart from Auto, there is the Power Generator’s market which can be targeted. The more refined way of using biodiesel will be Sustainable Aviation Fuel (SAF) where the feed-stock largely is UCO. However, I am extremely optimistic that the automotive industry is already giving the flex engine a serious thought. 

Where do you see biodiesel or biofuel going forward in the large picture of alternative fuels in India? 

This is just a start. Right now, the way the government is supporting alternative fuel development is extremely encouraging. India’s biggest strength, in my opinion, is its population and the way consumption happens here. Therefore, the possibility of feedstock availability in our country is beyond comparison, it also has a lot to do with our eating habits.

I look at biodiesel as a very promising sector and the role it will play in the aviation industry in the coming years. The government is already providing support to ethanol blending in petrol for many years now and as mentioned by Mr Gadkari last week, if the mandate of flex engine comes into play people will be able to directly start using ethanol in their petrol vehicles. But, whatever blending proposals are there by the government, they are too wide for the renewable energy sector and needs to be built very meticulously and strongly. 

What is your plan for the next short-mid term?

As I mentioned earlier ARIS has collaborated with a UK Company - Green Fuels Limited which is one of the leading manufacturers of biorefinery plants. ARIS and Green Fuels have a Joint Venture company called ARIS Green Fuels. The JV is committed to setting up 20 Biodiesel plants throughout the country.

The idea is to set up aggregation in the larger cities throughout the country and once the collection is under equilibrium we will set up the manufacturing plant in that geographical area. ARIS BioEnergy will continue to expand throughout the country & we want to strengthen our position in other states of India, just the way we are in Maharashtra today. 

The more Govt supports this particular initiative the more renewable fuel will be generated in our country. 70% of the oil required/used in the country goes to the households and 30% to the commercial eateries. Generally, the 70% that goes into the household is consumed and whatever remains does not come out instead is discarded into the sinks which go into the sewage posing a hazard to the water bodies. The 2 major impacts created by the aggregation business are stopping the usage of UCO in human consumption and avoiding the oil to be discarded hazardously into the environment, thus making “HAR GHAR HEALTHY