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Centre Notifies Incentive Scheme for Domestic PNG Connections
The Centre notifies an incentive scheme to accelerate domestic Piped Natural Gas (PNG) connections through City Gas Distribution (CGD) companies. The scheme applies from 1 September 2026 and provides for expansion of household PNG coverage and activation of unbilled connections.
Incentive Scheme:
| Dimension | Key Details |
|---|---|
| Incentivised Activities | The scheme provides for incentives for two activities: converting unbilled PNG connections into active, billed connections, and expanding PNG networks into new areas. |
| Implementation Schedule | The scheme provides for implementation in 2 tranches over 6 months. |
| Domestic PNG Base (India) | Domestic PNG connections in India comprise 1.74 crore. |
| APM/Non-APM | APM/Non-APM comprises the pricing and allocation framework for domestically produced natural gas supplied to priority sectors. |
| Incentive Mechanism (APM Gas Allocation) | The incentive mechanism provides for an additional allocation of 200 SCM of domestically produced, lower-priced APM gas for every incremental billed domestic PNG connection achieved above the prescribed threshold for the respective geographical area. |
| Use of Additional APM Gas | It authorises substitution of costlier LNG currently procured for the CGD sector’s CNG (transport) segment. |
| Cost Effect | It provides for reduction in the overall gas-sourcing cost of CGD companies. |
| Payback Period (Domestic PNG Infrastructure) | The scheme provides for reduction in the payback period from 10 years to 3 years. |
| Supporting Government Measures | Supporting measures comprise an accelerated approval framework, standardised Right-of-Way charges under the Natural Gas & Petroleum Distribution Order, 2026, and encouragement to states to reduce VAT on natural gas to 5%. |
| National PNG Drive 2.0 | National PNG Drive 2.0 comprises an LPG surrender portal, awareness campaigns, and conversion of housing societies. |
| Unified PNG Registration Portal | The proposed unified PNG registration portal provides for a single-window digital platform for applying and tracking connections. |
| Benefits of PNG (As Listed) | PNG benefits comprise: safer supply through underground, low-pressure pipeline; convenience through continuous pipeline supply without cylinder booking, storage or replacement; cost-effectiveness through payment according to metered consumption; and cleaner fuel with lower pollution and potentially lower indoor air pollution and carbon emissions. |
| Use-Case Areas | PNG usefulness comprises high-rise buildings and densely populated urban areas. |