PNGRB Pushes for Wider Gas Access: Gajendra Singh, Member, PNGRB

Aug 06, 2024

PNGRB is collaborating with states to reduce taxes.

 

NEW DELHI. 06 August 2024: The Petroleum and Natural Gas Regulatory Board (PNGRB) is intensifying efforts to expand gas access across India, working closely with state governments to overcome regulatory hurdles in the City Gas Distribution (CGD) sector. This push comes as the country witnesses a significant expansion in gas infrastructure and consumption, with the number of Geographical Areas (GAs) covered by CGD networks surging from 34 before PNGRB's establishment to 307 currently.

 

Gajendra Singh, Member, PNGRB, speaking at FICCI's City Gas Distribution Summit 2024, emphasised the regulator's primary objective: "Our goal is to provide access to gas for all consumers, whether for PNG (Piped Natural Gas), industrial and commercial use, or CNG (Compressed Natural Gas)."

  

The CGD sector has seen remarkable growth, with gas consumption rising from 86 million metric standard cubic metres per day (MMSCMD) in 2007 to 189 MMSCMD currently. This growth is reflected in the expansion of the national gas pipeline network, which has extended from 14,000 km in 2018 to 24,000 km today.

 

Particularly noteworthy is the surge in industrial and commercial gas consumers primarily using Regasified Liquefied Natural Gas (RLNG). The CNG infrastructure has also expanded dramatically, with stations increasing from 280 in 2006 to 7,000 in 2024.

 

However, challenges persist, especially in the adoption of PNG for domestic use. Despite reaching 1.31 crore connections, PNG faces stiff competition from improved LPG services. "Replacing LPG with PNG is a bit of a difficult job," Singh admitted, citing consumer hesitancy and the costs associated with connection setup. 

 

To achieve this, PNGRB is actively engaging with state authorities to address tax disparities and infrastructure challenges. "We are meeting with state government officials to discuss how we can reduce taxes," Singh said. 

  

On the supply front, Singh assured that there are no major constraints, with both domestic gas and RLNG readily available. The current mix stands at 52% domestic gas and 48% RLNG.

 

The regulator remains flexible in its approach, willing to adapt regulations based on market needs and stakeholder feedback. This was evident in their decision to grant a two-year extension to all entities following the COVID-19 disruptions.

 

On occasion, Deepak Mahurkar, Partner- Fuels & Resources, PwC India, emphasised that customer economics drive gas adoption, with cost being the primary factor. He added that the government’s ambition is not only to increase gas consumption but also to reduce the supply chain carbon costs significantly.

 

During the event, the FICCI-PwC Knowledge Paper “Charting the Path Forward in CGD: Emerging Trends and Insights" was unveiled. The report offers a thorough analysis of sector-specific challenges and opportunities in the adoption of natural gas and the government's efforts to foster usage.