The government has approved an incentive scheme to promote domestic piped natural gas (PNG) connections, aimed at accelerating the expansion of clean, safe and affordable piped cooking gas to households across the country.
The scheme will come into effect from September 1, 2026, and will incentivise City Gas Distribution (CGD) companies to convert unbilled PNG connections into active connections and expand the PNG network to new areas.
India currently has 1.74 crore domestic PNG connections.
Benefits of PNG for households
PNG provides a safer and more convenient alternative to LPG cylinders and traditional cooking fuels. It is supplied through underground pipelines at low pressure, reducing risks associated with cylinder storage and handling. As PNG is lighter than air, it disperses quickly in the event of a leak.
The piped supply also eliminates the need to book, store or replace cylinders, with households paying for actual metered consumption. The government said PNG is generally cheaper than LPG on a per-unit energy basis, which can help reduce household fuel expenses.
As a cleaner-burning fuel, PNG produces fewer pollutants than conventional cooking fuels and can contribute to improved indoor air quality and lower carbon emissions. Continuous pipeline supply also removes dependence on cylinder delivery, particularly benefiting households in high-rise buildings and densely populated urban areas.
Steps to expand PNG access
The new scheme builds on several measures taken by the government to accelerate PNG expansion and facilitate the transition to cleaner cooking fuel.
Under the Accelerated Approval Framework and standardised Right-of-Way charges issued under the Natural Gas & Petroleum Distribution Order, 2026, applications for PNG infrastructure are expected to be processed more quickly within defined timelines and at standardised charges.
The government is also encouraging states to reduce VAT on natural gas to 5% to make PNG more affordable. Several states have already lowered VAT on natural gas.
Under National PNG Drive 2.0, initiatives include a portal for surrendering LPG cylinders, household notices, awareness camps and efforts to facilitate the conversion of LPG-using housing societies to PNG.
A unified PNG registration portal is also under development to provide a single-window digital platform for applying for and tracking new PNG connections.
Incentive structure
Under the APM/NAPM Incentive Scheme for Promotion of Domestic PNG Connections, eligible CGD entities will receive an additional allocation of 200 SCM of domestically produced, lower-priced APM gas for every incremental billed domestic PNG connection achieved during the performance period above the threshold level fixed for the respective geographical area.
The scheme will be implemented in two tranches over a period of six months.
The additional gas allocation will substitute costlier liquefied natural gas (LNG) currently procured by CGD entities for their compressed natural gas (transport) segment, thereby reducing their overall gas-sourcing costs.
According to the government, the resulting savings are expected to reduce the payback period for capital expenditure on domestic PNG connections from around 10 years to approximately three years.
The government said the scheme would provide CGD companies with a stronger financial incentive to expand household PNG connectivity and help bring clean, safe and affordable piped cooking gas to more households across the country.
