PNG: Beyond Business As Usual

S India transitions to a cleaner future, natural gas is emerging as a crucial bridge fuel.

- Pooja Sehbag Tanvi Khurana Research Associates at Chintan Research Foundation

Recognising its strategic role, the government aims to increase the share of natural gas in the primary energy mix to 15% by 2030 from the 2022 level. As a part of this push, expansion of city gas distribution (CGD) networks has come into focus, witnessing the fastest growing gas demand and becoming the second-largest gas consuming sector after fertilisers. Yet the segment seems to be facing various hurdles, especially on the regulatory and policy fronts.

The government has awarded 307 geographical areas across 12 bid rounds, spread over nearly 748 districts by 2024. The CGD companies—public and private—have committed to connect 120 million piped natural gas (PNG) users by 2030.

However, the actual rollout figures tell a different story. Currently, India has over 15 million PNG connections with nearly 1.6 million connections being added annually over the 2020-24 period. To hit the 2030 targets, the rollout of PNG connections would need to accelerate more than 10-fold, which translates to an addition of nearly 18 million connections annually over the next 6-8 years. Achieving this ambitious target requires a deviation from the 'business as usual' stance.