‘Never waste a good crisis’: Zerodha's Nithin Kamath outlines alternative amid fuel shortage due to war in West Asia

Zerodha co-founder and CEO Nithin Kamath believes that India must turn this fuel shortage crisis due to the war in the Middle East into an opportunity to develop locally produced alternatives such as biogas.

“What's happening in the Gulf is a reminder of how critically dependent India is on a single region for most of its energy. Most of our crude and natural gas (LPG, CNG) is imported, and our vulnerability to disruption in these imports is obvious,” he stated in a post on social media platform X (formerly known as Twitter) on 20 March.

Noting that India's dependence on energy imports from the region have adversely impacted critical services, he outlined alternatives that the country can tap into for long-term resilience. Notably, Kamath is also founder and backer of the Rainmatter India fund for climate, deeptech, fintech, health and media, which backs companies in the biogas space.

‘Never waste a good crisis’: Nithin Kamath pushes biogas

“As the saying goes, never waste a good crisis. Now is when we should focus on alternatives like biogas, which we can produce locally and is also more environmentally friendly. India is currently tapping less than 1% of its biogas production potential. It is also important to continue efforts, even after the crisis has passed, to build long-term resilience,” he pointed out.

Kamath disclosed that Rainmatter fund backs a few companies in the space — Akshaykalpa, Farmwatt, Hasirudala, and Wisebin, but added that the sector needs more investment. “To actually move the needle … needs policy and capital at scale,” he added.

Why is biogas a long-term bet?

Kamath linked a 17 March blogpost from Zerodha / Rainmatter on the topic, which explored why biogas is the bet to make for India's energy security and its role in the country’s long-term energy mix.

• Over 50% of India's liquified petroleum gas (LPG), compressed natural gas (CNG) and piped natural gas (PNG) comes from imports. These serve households and “is central to how India cooks, moves and runs its industries”.
• It added that biogas — produced from organic waste through anaerobic digestion — is a domestic renewable alternative to natural gas.

• According to the report, replacing just 20% of natural gas consumption with domestically produced biogas could save India approximately $29 billion in import bills between FY25 and FY30.
• Biogas exists on a spectrum, including raw gas (for kitchens) to Compressed Bio Gas (CBG) (for use as transport fuel or grid blend), which can be implemented for different end uses.

Biogas instead of traditional fuel: How would the use cases work?

• The immediate opportunity it noted is in raw or lightly purified biogas piped at low pressure from a local digester to nearby households or commercial kitchens, and the supply chain stays hyperlocal.

Case in point: In Lambra Kangri village in Punjab’s Hoshiarpur district, a cooperative biogas plant has piped cooking gas to 44 homes for close to a decade. Households pay ₹200–300/month; compared to an LPG cylinder, which costs ₹700 or more. The slurry sells as a biofertilizer. The plant pays for itself.

• For farms, cow dung and urine go into the digester and the resulting methane can run farm operations and machinery for eight hours a day. The slurry goes back into the soil. No grid dependence, no fossil fuels.

Example: It noted that partner Akshaykalpa has over 1,750 farmers in this network across Andhra Pradesh, Karnataka, Tamil Nadu, and Telangana.

• For urban India, the report noted that wet organic waste from bulk generators i.e. apartment complexes, hotels, restaurants, and markets can serve as decentralized waste-to-energy infrastructure within the city.

Example: Hasiru Dala Innovations and Carbon Masters' JV called Sustainable Impacts has built this model in Bengaluru. They operate a few licensed wet waste processing facilities in the city authorized to handle organic waste from bulk generators and direct supply to hotels, restaurants, and industries as a substitute for LPG and CNG.

Nexus Novus and Wisebin JV, backed by Rainmatter, operates India’s first integrated waste management facility associated with an airport, processing 20 to 30 tonnes of waste per day at Kempegowda International Airport in Bengaluru.

Why is Zerodha / Rainmatter betting on this space?

The report noted that potential for biogas in India is huge. We at present have around 100 large-scale operational CBG plants and there is “significant catching up to do”. The CBG production potential from domestic organic waste alone is estimated at 62 MMT annually, against current output that is less than 1% of that figure.

In comparison, Europe has over 1,300 operational biomethane plants, where Germany runs more than 200. Further, China is also targeting 20 billion cubic meters of bio-natural gas annually by 2030, scaling industrial production aggressively despite most of its existing biogas infrastructure still being small and rural.

The report added that industry experts estimate with successful implementation, India can realize 15-20% of its total CBG potential (equivalent to 8-12 million metric tonnes per annum) within the next seven to eight years.

“The disruption of the past few weeks, whatever its duration, has made the strategic case clearer than ever. India cannot afford to leave 62 MMT of domestic biogas potential sitting largely untapped while it imports over half its natural gas requirements,” the report added.