Rural India has a vast potential of biogas eneration and application. During the past two decades. biogas has been promoted mostly as a cooking fuel in the rural areas. According to the prevailing practices in these areas, fuel for cooking is not being purchased but collected by the users from the farm fields and urrounding areas. Majority of rural population feels that biogas generation does not offer them direct/monetary benefits, and therefore many of them are reluctant to accept it. However
biogas, when used for production activities, say in small scale rural industries, may be able to fill the gap in energy availability and demand in the rural areas. Being a renewable source, biogas, when utilised properly, can replace the commercial and nonrenewable energy sources to a considerable extent in a variety of production activities. Biogas application in the above context has been found to be self sustaining, while fulfilling the rural energy demand. Other important aspects such as employment generation, socio economic and environmental impacts are also examined.