1 day ago
India Rolls Out GOBARdhan Rules With CBG Price Support
The government has created new rules to turn organic waste into useful gas.
This waste can include cattle dung, farm leftovers and food waste.
The gas is called compressed biogas, or CBG.
Producers will have a better chance of finding buyers for their gas.
The government has also set a price for CBG for at least 10 years.
Some projects can receive financial help for building plants and collecting waste.
City gas companies will have to buy increasing amounts of CBG.
The rules are meant to help the industry grow and attract private investors.
The earlier SATAT programme will be brought into this new framework from September 2026.
The ₹23,731-crore GOBARdhan scheme will operate from 2026-27 to 2035-36.
Eligible CBG producers can receive assured offtake of up to 100% of output.
An administered price of ₹2,110 per million British thermal units will remain for at least 10 years.
The government will provide capital assistance of up to ₹30 crore per CBG project.
City gas distributors must progressively procure CBG for CNG and domestic PNG supplies.
- Who
- The Petroleum and Natural Gas Ministry, CBG producers, city gas distributors and GAIL are involved.
- What
- The government has operationalised the ₹23,731-crore GOBARdhan scheme with assured CBG offtake, price support and capital assistance.
- Where
- The scheme applies in India; the announcement was datelined New Delhi.
- When
- The operational guidelines were dated September 15; the scheme will run from 2026-27 to 2035-36, with price support through March 31, 2036.
- Why
- It is intended to make waste-to-energy projects more commercially viable, reduce revenue uncertainty and attract private investment.
CBG Producers and Government
City Gas Distributors
Market certainty
CBG Producers and Government
Assured offtake, a defined price and affordability support are intended to give producers greater revenue visibility and encourage investment.
City Gas Distributors
Distributors receive CBG procurement obligations that must be managed alongside existing gas-supply requirements.
Procurement enforcement
CBG Producers and Government
The framework is designed to ensure producers have firm contractual buyers through city gas or trunk-pipeline arrangements.
City Gas Distributors
A city gas distributor that does not execute a required firm offtake agreement could face measures affecting its APM or non-APM gas allocation.
Financial support
CBG Producers and Government
Producers can receive milestone-linked capital assistance, while GAIL receives affordability support capped at ₹10 per kg of CBG procured.
City Gas Distributors
The assistance and price framework impose additional procurement and compliance responsibilities on the gas distribution system.
Key facts
- Scheme cost
- ₹23,731 crore
- Scheme period
- 2026-27 to 2035-36
- Assured offtake
- Up to 100% of eligible CBG available for sale, subject to technical and operational feasibility
- Administered CBG price
- ₹2,110 per million British thermal units, or about ₹98 per kg at 95% methane content, excluding taxes and compression charges
- Price-support period
- At least 10 years, until March 31, 2036
- Capital assistance
- Up to ₹30 crore per CBG project
- CGD procurement obligation
- 3% in FY2026-27, 4% in FY2027-28 and 5% from FY2028-29 onward
Sources
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