2 days ago
New PNG Scheme Targets Three-Year Payback for Household Connections
The government has introduced a plan to help more homes get piped natural gas.
The plan gives gas distribution companies an incentive when they add new paying household customers.
Companies that exceed local connection targets can receive extra domestic gas.
This gas is expected to cost less than some imported LNG.
Lower costs could make it easier for companies to build more household connections.
The government says the time needed to recover the cost of a connection could fall from about 10 years to three years.
About 1.74 crore domestic PNG connections existed when the scheme was launched.
The plan will run in two parts over six months.
The Incentive Scheme for Promotion of Domestic PNG Connections was launched on August 18, 2026, and took effect on September 1.
The scheme aims to convert unbilled domestic PNG connections into active, billed connections and expand networks into new areas.
Eligible City Gas Distribution entities adding connections above geographical-area thresholds will receive 200 SCM of domestic APM gas per incremental connection.
Lower-cost domestic APM gas is expected to replace some LNG used by CGD entities, reducing their gas-sourcing costs.
The government projects that connection-investment payback periods will fall from about 10 years to nearly three years.
- Who
- The government and eligible City Gas Distribution entities authorised by the Petroleum and Natural Gas Regulatory Board.
- What
- A scheme that incentivises the expansion and activation of domestic piped natural gas connections.
- Where
- Across the country, covering 309 authorised Geographical Areas on the mainland.
- When
- Launched on August 18, 2026; effective from September 1, with implementation over six months.
- Why
- To expand access to cleaner household cooking fuel and improve the commercial viability of new PNG connections.
Key facts
- Existing connections
- Around 1.74 crore domestic PNG connections as of August 18, 2026.
- Payback projection
- Connection-investment payback is expected to decline from about 10 years to nearly three years.
- Gas incentive
- Eligible entities can receive 200 Standard Cubic Metres of domestic APM gas for each incremental billed connection above the local threshold.
- Coverage
- The network is being developed across 309 Geographical Areas.
- Implementation
- The scheme will be implemented in two tranches over six months.
- Expected effect
- Lower-cost domestic APM gas is expected to reduce gas-sourcing costs for City Gas Distribution companies.
Sources
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