Archive · 21 Aug 2026
India’s Rs 23,731 Crore GOBARdhan Scheme Fuels CBG Investment Debate
India has approved a large program to make fuel from organic waste.
This fuel is called compressed biogas, or CBG.
The program will provide money to help companies build CBG plants.
It also creates rules requiring more CBG to be blended into gas used by vehicles and homes.
Analysts think companies that build CBG equipment could benefit.
City gas companies may also benefit because they can distribute CBG through existing networks.
TruAlt Bioenergy is seen as a more direct bet on producing the fuel.
However, high feedstock costs, construction delays and expensive CBG could reduce profits.
The Union Cabinet approved the Rs 23,731 crore GOBARdhan scheme for FY27-FY36 to expand compressed biogas production.
The scheme offers capital assistance of up to Rs 2 crore per tonne per day and a fixed price of Rs 2,110 per MMBTU.
CBG blending in CNG and domestic PNG is targeted at 3% in FY27, 4% in FY28 and 5% from FY29.
Analysts identify Praj Industries as a potential technology and EPC beneficiary, while TruAlt Bioenergy offers direct production exposure.
Feedstock costs, project delays, plant utilisation, procurement economics and CBG cost pass-through remain key risks.
- Who
- The Union Cabinet, CBG producers, technology and engineering companies, city gas distributors and oil marketing companies are involved.
- What
- India approved the Rs 23,731 crore GOBARdhan National Circular Bioenergy Scheme to expand compressed biogas production.
- When
- The scheme will run from FY27 to FY36, with CBG blending targets rising from FY27 and reaching 5% from FY29.
- Where
- Across India, including city gas distribution networks and multiple CBG production locations.
- Why
- The program aims to convert organic waste into clean fuel and organic manure, create rural income, and establish CBG as a larger commercial energy industry.
Downstream and technology exposure
Direct CBG production exposure
Preferred route to the theme
Downstream and technology exposure
Analysts describe city gas distributors such as Indraprastha Gas and Mahanagar Gas as a lower-risk way to access rising CBG volumes because they can procure from third-party producers and use established networks.
Direct CBG production exposure
TruAlt Bioenergy is presented as a more direct listed producer play, with multi-location expansion, feedstock capabilities and a joint venture with GAIL (India) supporting its position.
Operational risk
Downstream and technology exposure
City gas distributors may avoid the biomass sourcing, plant operations and rural logistics challenges associated with captive CBG production, although their margins could be pressured by CBG’s higher cost compared with APM gas.
Direct CBG production exposure
Direct producers take on feedstock sourcing, plant execution and utilisation risks, but may capture more of the upside if projects scale successfully.
Where value is created
Downstream and technology exposure
Praj Industries could benefit from technology and EPC demand because equipment suppliers can receive orders across the CBG buildout, regardless of which operators succeed.
Direct CBG production exposure
TruAlt Bioenergy could benefit directly from CBG sales and production growth; an analyst estimates it could account for around 22% of industry CBG volumes at full scale, with CBG EBITDA margins above 50%.
- Total outlay
- Rs 23,731 crore
- Implementation period
- FY27 to FY36
- Capital assistance
- Up to Rs 2 crore per tonne per day of installed CBG capacity
- Fixed pricing framework
- Rs 2,110 per MMBTU
- Blending target
- 3% in FY27, 4% in FY28 and 5% from FY29 in CNG transport and domestic PNG
- Potential technology beneficiary
- Praj Industries
- Direct production play
- TruAlt Bioenergy