Centre Rolls Out Incentive Scheme to Speed Up Piped Cooking Gas Connections

Ziraat Times Team Report

New Delhi: The government has launched a new incentive scheme aimed at accelerating the rollout of Piped Natural Gas (PNG) connections to households across the country, as part of a broader push toward cleaner and more affordable domestic cooking fuel.

The Incentive Scheme for Promotion of Domestic PNG Connections was announced on August 18, 2026, and took effect from September 1, 2026. It is designed to speed up the expansion of City Gas Distribution (CGD) networks — the pipeline infrastructure that delivers gas to households, businesses and industries — which are developed by entities authorised by the Petroleum and Natural Gas Regulatory Board (PNGRB). These entities currently operate across 309 Geographical Areas covering the entire Indian mainland. As of August 18, 2026, the country had 1.74 crore active domestic PNG connections.

How the scheme works

The scheme targets two goals: converting existing but unbilled PNG connections into active, billed ones, and expanding the pipeline network into new areas. It will run in two tranches over a six-month period.

Each Geographical Area has been assigned a minimum connection target. CGD entities that add billed domestic connections beyond this threshold will earn an additional allocation of 200 Standard Cubic Metres of gas per incremental connection. This bonus gas comes from domestically produced, lower-priced Administered Price Mechanism (APM) gas.

Crucially, this additional APM gas allocation is meant to replace the costlier Liquefied Natural Gas (LNG) that CGD companies currently purchase for their Compressed Natural Gas (Transport) segment. By substituting expensive LNG with cheaper APM gas, companies can lower their overall gas-sourcing costs — giving them a stronger financial incentive to connect households faster. Officials say this could cut the payback period on capital spent for a domestic connection from roughly ten years down to about three.

What it means for households

Officials are pitching PNG as a safer, more convenient and cheaper alternative to cylinder-based cooking gas. Key benefits cited include:

• Safety: Gas flows through underground pipelines at low pressure, eliminating the need to store or handle cylinders. Being lighter than air, it disperses quickly in case of a leak.

• Convenience: No booking, storage or cylinder replacement is required — gas is available around the clock, with billing based on metered usage, similar to electricity or water.

• Cost savings: Households pay only for the gas they consume, and PNG typically costs less than LPG on a per-unit energy basis.

• Cleaner burning: PNG produces fewer pollutants than conventional cooking fuels, improving indoor air quality and lowering carbon emissions.

• Reliability: Continuous pipeline supply removes dependence on cylinder delivery logistics, a particular benefit for high-rise buildings and dense urban neighbourhoods.

Supporting measures

Alongside the incentive scheme, the government has introduced several supporting initiatives to widen PNG’s reach:

• Faster approvals: An Accelerated Approval Framework has been notified under the Natural Gas and Petroleum Products Distribution (Through Laying, Building, Operation and Expansion of Pipelines and Other Facilities) Order, 2026, along with uniform charges for pipeline Right-of-Way. Applications for laying pipelines will now be processed on priority within defined timelines.

• Lower VAT: States are being encouraged to cut Value Added Tax on natural gas to 5 percent, a move several states have already adopted, making piped gas cheaper for end users.

• National PNG Drive 2.0: A nationwide campaign held from January 1 to June 30, 2026, to accelerate domestic PNG connections across Geographical Areas.

• Unified registration portal: A single-window digital platform is being developed to simplify applying for and tracking new PNG connections.

Outlook

Officials describe the scheme as aligning the commercial interests of gas distribution companies with the government’s broader goal of expanding access to clean cooking fuel. As pipeline networks extend into more areas, authorities expect household dependence on gas cylinders to decline steadily, with piped gas becoming a standard utility in Indian homes.