Prelims – Current events of national and international relations | International relations
Why in news?
The Centre approved an incentive scheme to accelerate domestic Piped Natural Gas (PNG) connections.
- Effective from – 1 September 2026.
- Target – Expand household PNG coverage and activate unbilled connections.
India currently has 1.74 crore domestic PNG connections.
Key Features
- Implementing entities – City Gas Distribution (CGD) companies.
- Incentives for –
- Converting unbilled PNG connections into active/billed connections.
- Expanding PNG networks into new areas.
- Scheme will be implemented in 2 tranches over 6 months.
- APM/Non-APM Incentive Mechanism
- Eligible CGD entities will receive an additional allocation of 200 SCM (Standard Cubic Metres) of domestically produced, lower-priced APM gas.
APM (Administered Price Mechanism)/Non - APM refers to the pricing/allocation framework for domestically produced natural gas supplied to priority sectors.
- This will be provided for every incremental billed domestic PNG connection achieved above the prescribed threshold for the respective geographical area.
- The additional APM gas will substitute costlier LNG currently procured for the CGD sector’s CNG (transport) segment.
- This is expected to reduce the overall gas-sourcing cost of CGD companies.
- Expected Impact – Payback period for domestic PNG infrastructure –
- Earlier – 10 years
- Expected after scheme – 3 years
- Creates stronger financial incentives for CGD companies to expand household connectivity.
- Promotes cleaner cooking fuel and reduces dependence on LPG cylinders.
- Supporting Government Measures
- Accelerated Approval Framework for faster PNG infrastructure approvals.
- Standardised Right-of-Way (RoW) charges under the Natural Gas & Petroleum Distribution Order, 2026.
- States encouraged to reduce VAT on natural gas to 5%.
- National PNG Drive 2.0 – LPG surrender portal, awareness campaigns and conversion of housing societies.
- Unified PNG registration portal – Proposed single-window digital platform for applying and tracking connections.
Benefits of PNG
- Safer – Underground, low-pressure supply; PNG is lighter than air and disperses rapidly.
- Convenient – Continuous pipeline supply; no cylinder booking, storage or replacement.
- Cost-effective – Consumers pay according to metered consumption.
- Cleaner – Lower pollution and potentially lower indoor air pollution and carbon emissions.
- Particularly useful for high-rise buildings and densely populated urban areas.
Reference
DDIndia| Incentive Scheme to Accelerate Domestic PNG Connections
