The Ministry of Petroleum and Natural Gas has approved an Incentive Scheme for Promotion of Domestic PNG Connections on Tuesday marking a major initiative aimed at bringing clean, safe and affordable piped cooking gas to households across the country. The scheme will be effective from September 2026.


Under the scheme, Under the Scheme, eligible City Gas Distribution (CGD) entities will be allocated an additional 200 SCM of domestically-produced, lower-price Administered Price Mechanism (APM) gas for every incremental billed Domestic PNG connection achieved during the performance period, over and above the Threshold Level determined for the respective Geographical Area (GA).


The Scheme will be implemented over two Tranches spanning six months. The additional gas allocation will substitute the costlier Liquefied Natural Gas (LNG) that CGD entities currently procure for their Compressed Natural Gas (Transport) segment, thereby lowering their overall gas-sourcing costs.


According to the government, the resulting cost savings will potentially decrease the payback period for capital expenditure incurred on D-PNG connections from around 10 years to approximately three years. The scheme is aimed at encouraging CGD entities to expand household PNG connectivity more rapidly.


The new Scheme will directly incentivise the City Gas Distribution (CGD) companies to actively convert unbilled connections into working gas connections, and expand the PNG network to new areas. At present, there are 1.74 crore Domestic PNG connections across the country.


Designed for fast-track the expansion of active PNG connections, the scheme will ensure that more families can start using piped natural gas in their kitchens at the earliest, the press release stated.


The initiative is a part of Government's continued push for PNG expansion which includes efforts such as streamlined regulatory clearances, standardised Right-of-Way charges, encouraging states to reduce VAT on natural gas to 5%, National PNG Drive 2.0 and the development of a unified PNG registration portal.