Centre to states: Up PNG rollout, get additional LPG for business, Pg15

Key Highlights:

• The Centre is incentivizing states to expand Piped Natural Gas (PNG) access due to Liquefied Petroleum Gas (LPG) shortages caused by the West Asia conflict.
• States can receive up to 30% of their commercial LPG demand if they implement measures to accelerate PNG infrastructure rollout.
• India imports 60% of its LPG needs, with 90% of those imports passing through the Strait of Hormuz, which is currently disrupted.
• The government prioritizes LPG supplies to households, while commercial and industrial users face shortages.

Detailed Insights:

• The Ministry of Petroleum is urging commercial and household LPG consumers to switch to PNG to alleviate pressure on LPG supplies.
• States can receive an additional 1% commercial LPG allocation for forming state and district-level committees to approve City Gas Distribution (CGD) applications.
• An additional 2% allocation will be granted if states issue deemed permissions for laying pipelines to both old and new CGD applications after 24 hours.
• States can get 3% additional allocation for introducing a ‘Dig and Restore scheme’ for CGD entities, eliminating restoration charges and substituting them with a bank guarantee.
• A further 4% allocation is available for reducing annual rental/lease charges for laying/operating CGD networks to zero.
• CGD firms cite high right-of-use fees and pipeline digging charges by local bodies as factors dampening the CGD investment climate.
• Only 1.6 crore PNG connections are functional against a minimum work program commitment of 12.63 crore.
• Priority sectors like household PNG and CNG for transport receive 100% supply, while industrial and commercial consumers receive around 80%.

Key Concepts Involved:

• Liquefied Petroleum Gas (LPG): A flammable mixture of hydrocarbon gases used as fuel in heating appliances, cooking equipment, and vehicles.
• Piped Natural Gas (PNG): A natural gas distributed to residential, commercial, and industrial consumers through a network of fixed pipes.
• City Gas Distribution (CGD): The infrastructure and network for distributing natural gas to consumers in urban areas.