India's Gas Regulator Targets Pipeline Economics and Tariff Uniformity

The Public Gas Regulatory Board of India (PNGRB) has identified pipeline economics and tariff standardization as the primary drivers for the next phase of the country's natural gas expansion. Secretary Anjan Kumar Mishra stated that the regulator is shifting focus from mere supply addition to building a resilient, interconnected network capable of balancing availability and affordability.

India aims to increase the share of natural gas in its total energy basket from the current 6 percent to 15 percent. Achieving this target requires infrastructure that can reliably transport gas across the nation, necessitating specific reforms in bidding norms, network utilization, and the integration of alternative fuels like compressed biogas (CBG).

Regulator Redefines Pipeline Investment Incentives

Mishra noted that while the existing gas pipeline network has a transportation capacity of approximately 400 MMSCMD, utilization rates remain inconsistent, with several assets operating at low levels. To address this, the PNGRB is developing new bidding parameters specifically designed to mitigate volume risk for investors.

The strategy also includes enhancing the utilization of sub-transmission pipelines operated by city gas distribution (CGD) companies. By improving interconnections, the regulator intends to create network redundancy and reduce the duplication of infrastructure, thereby making the overall system more attractive for capital deployment.

Unified Tariffs Ease Distance Penalties

A key priority is the introduction of a unified tariff framework for CGD entities. This measure aims to remove the cost disadvantage faced by consumers located far from liquefied natural gas (LNG) entry points, moving the market toward a more uniform national pricing structure.

To support broader adoption, particularly for domestic cooking, the regulator is launching a 'My PNG' portal. This single-platform interface will allow consumers to request piped natural gas connections and manage queries, streamlining the process for end-users and operators alike.

Compressed Biogas Integration Accelerates

Compressed biogas is becoming a central component of the gas strategy, with blending levels already exceeding 2 percent. Mishra projected that CBG blending will reach 3 percent by March 31, 2027, supported by the Sampurna Gobardhan initiative which addresses project development and offtake challenges.

The regulator is also revising imbalance charges to assist smaller CGD entities and those serving difficult regions. These reforms, discussed at the ET Energy Leadership Summit, aim to create a stable regulatory environment that supports long-term investment in the sector.