Growing energy demands and environmental degradation with uncontrolled exploitation of fossil fuels have compelled the world to look for the alternatives. In this context, biogas is a promising candidate, which can easily be utilized in IC engines for vehicular as well as decentralized power generation applications. Primary constituents of raw biogas are methane (CH4) that defines its heating value, and carbon dioxide (CO2) that acts like a diluent. This dilution effect reduces the flame speed and heating value of biogas, eventually deteriorating the engine performances. Present article focuses on experimental evaluation and quantification of these variations of the engine performance. Three compositions of biogas: BG93, BG84 and BG75 (containing 93%, 84% and 75% of CH4 by volume respectively) were studied on a small CI engine in dual fuel mode. Moreover, to evaluate individual process inefficiencies, exergy analysis based on second-law of thermodynamics is implemented. Exergy balances for different compositions of biogas are presented. Biogas dual fuel operation showed 80-90% diesel substitution at lower engine loads. At higher loads, total irreversibility of the engine was increased from 59.56% for diesel operation to 61.44%, 64.18% and 64.64% for BG93, BG84 and BG75 biogas compositions respectively. Furthermore, combustion irreversibility was found to be decreasing with higher CO2 concentrations in biogas. BG93 showed comparable results to that of diesel operation with 26.9% and 27.4% second-law efficiencies respectively. (C) 2017 Elsevier Ltd. All rights reserved.