Pune-based BiofuelCircle, a five-year-old start-up that has launched a unique farm-to-fuel ecosystem connecting farmers, has set up 70 biomass banks over the past three years, its co-founder and CEO, Suhas Baxi, said.
“Typically, these units involve an investment of about ₹3 crore and generate annual revenues in the range of ₹3 to ₹4 crore. The biomass banks have created a growing network of rural enterprises linked to the biomass supply chain,” Baxi told businessline.
The company views each biomass bank in its network as an independent rural micro-enterprise designed to operate on commercially viable principles.
10 units already profitable
“The first ten units in our network are already profitable, while the next 25 units are steadily progressing toward the same stage of profitability. Based on current performance trends, a typical unit becomes EBITDA positive within 12-18 months and can achieve a capital payback period of roughly three to four years,” said Baxi.
BiofuelCircle co-founder and CEO Suhas Baxi
No unit of the company has yet completed a full four-year cycle. Though long-term proof will emerge over time, early indicators strongly suggest that profitable and sustainable rural enterprises can be built around biomass aggregation and supply chains, said the firm’s co-founder and CEO
“Beyond financial viability, these enterprises also create local employment and establish structured markets for agricultural residues,” he said, adding that the farm-to-fuel-to-soil model has the potential to become economically self-sustaining when implemented at scale.
Role of subsidies
Subsidies should serve as an investment accelerator rather than a financial crutch. “Like most infrastructure-driven sectors, bioenergy businesses typically require a three-to-five-year payback horizon, and policy incentives can help attract early capital and prioritise investment in the sector,” said Baxi.
However, the long-term sustainability of the business cannot depend on subsidies. If a model requires ongoing subsidies for operational viability, it indicates a structural weakness, he said.
Biofuel’s focus is on building supply chains and operational processes first, which establishes a reliable biomass aggregation and logistics system. This will ensure feedstock is available at “predictable” prices for bioenergy products and industrial users.
Baxi said bioenergy alone will not eliminate fossil fuel dependence, but it can reduce reliance on fossil imports and diversify the energy mix. “When integrated with other renewable sources such as solar and wind, decentralised bioenergy contributes to stronger energy resilience and supply diversification,” he said.
No reliance on carbon credits
In India, the transition is visible through initiatives such as ethanol blending and the growing adoption of compressed biogas as a substitute for conventional fuels in mobility and industrial applications, the company’s co-founder and CEO said.
BiofuelCircle is trying to build a reliable supply chain through its digital biomass marketplace, which connects producers, aggregators and industrial buyers through common systems and processes.
“By enabling transparent price discovery, structured contracting and data-driven supply management, the platform helps reduce fragmentation, improve supply reliability and stabilise biomass markets. We are also deploying GIS and GPS-based data intelligence to map farmland, crop patterns, and residue availability, enabling better planning of aggregation infrastructure and logistics,” said Baxi.
On not relying on carbon credits and sustainability incentives, he said such incentives should act as an added benefit that rewards environmental impact. They cannot be the determining factor in financial viability, he said.
Published on April 5, 2026