CBG Price Hike Concerns Downplayed by Indian Government

The Indian government has downplayed concerns that higher procurement prices for Compressed Biogas (CBG) could lead to increased costs for consumers of CNG and household PNG. According to the Ministry of Petroleum and Natural Gas, the revised CBG procurement price of ₹2,110 per MMBtu represents an increase of about 43 per cent from the existing rate of ₹1,478 per MMBtu.

However, the ministry clarified that this increase does not directly translate into a rise in CNG or domestic PNG prices. The Centre will provide affordability support of ₹10 per kg of CBG, equivalent to roughly ₹215 per MMBtu for gas containing 95 per cent methane.

This means the effective CBG cost recoverable from the gas consumer base would be around ₹1,895 per MMBtu, compared with ₹1,478 per MMBtu currently. This represents an effective increase of approximately 28 per cent rather than the headline 43 per cent rise.