Chandigarh, Dec 20 (IANS) The foundation stone of a 12 MW rice straw-fuelled power plant was laid in a Punjab village Tuesday by central Minister for New and Renewable Energy Vilas Muttemwar, who promised incentives for more such biomass power projects.

"Biomass-based power projects will get fiscal incentives like accelerated depreciation, tax holidays for 10 years and interest subsidy on term loans," the minister said in Baghaura village.

In addition, customs and excise duty exemption for equipment and machinery would be made available for such power projects.

According to the ministry, a 5 MW biomass power project holds the capacity to provide 100,000 mandays of employment a year in rural areas.

So far, four biomass projects of 28 MW capacity each have already been completed and six more projects of 87 MW capacity are under implementation in Punjab.