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The Central Government has taken a major policy decision with the aim of providing safe, affordable and 24-hour uninterrupted cooking fuel to the kitchens of crores of homes across the country. The ‘Incentive Scheme for Promotion of Domestic PNG Connections’ prepared by the Ministry of Petroleum and Natural Gas has received the final approval of the Cabinet. this new plan 1 September 2026 It will be effective in the entire country.
The main objective of this ambitious scheme is to give impetus to the country’s gas-based economy and to financially motivate City Gas Distribution (CGD) companies to provide new domestic connections and activate inactive meters.
What is the new PNG incentive scheme and how will it work?
Currently there are approximately 1.74 crore domestic PNG connections in India. However, despite the laying of gas pipelines in many cities, the connections have not been made operational or people have not started active use of piped gas. Under the new incentive policy, companies will be given direct economic benefits:
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Allocation of 200 SCM Affordable Domestic APM Gas: The government will allocate 200 Standard Cubic Meter (SCM) of affordable APM (Administered Price Mechanism) gas for every additional active and billed domestic PNG connection by CGD companies above the fixed benchmark in their defined geographical area.
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Implementation in two tranches: This entire incentive scheme will be implemented in two special phases of 6 months each.
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Drastic reduction in costs: Availability of additional cheap domestic gas will help gas companies reduce their dependence on expensive imported LNG.
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Recovery of investment in 3 years: With this formula, the payback period of capital expenditure (Capex) of gas companies on infrastructure, which earlier used to be about 10 years, has been reduced to approximately 3 year Will remain. With this, companies will be able to rapidly expand their network to new residential areas.
What direct benefits will common consumers and families get?
After the implementation of the new rules from September 1, 2026, there will be many big positive changes in the daily life and monthly budget of common citizens:
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Freedom from the hassle of cylinder booking and delivery: PNG directly reaches your gas stove through an underground pipeline. There is no problem of running out of cylinder, booking refill, sharing OTP or waiting for the delivery boy.
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Postpaid metering like electricity bill: Consumers will be billed only for the amount of gas they use as per the digital meter. This ensures direct control over the kitchen budget.
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More economical than LPG: On a per unit energy basis, Natural Gas (PNG) is cheaper than conventional LPG cylinders, which will result in savings in fuel expenses every month.
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Best in terms of security: PNG is a lighter gas than air, so in case of any possible leakage, it immediately evaporates into the air instead of staying on the ground, due to which the risk of fire remains negligible. Apart from this, it is supplied to homes at very low pressure.
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Clean and environment friendly fuel: Burning of PNG does not produce any poisonous smoke or soot, which improves indoor air quality and protects women’s health.
Network expansion will gain momentum: Instructions to states for single-window approval
Along with this scheme, the Central Government has directed all State Governments and Union Territories to simplify and standardize the ‘Right of Way’ (RoW) rules for laying pipelines.
Single-window digital clearance will be given from municipal corporations and development authorities for laying pipelines in urban societies, multi-storey apartments and dense colonies. Apart from this, the Central Government is also urging the states to rationalize the VAT on natural gas and limit it to 5 percent so that PNG rates remain uniform and affordable across the country.
Unified digital portal will be created for new PNG connection
The government is also developing a central digital portal to make the application process transparent and easy for domestic consumers. Through this, a citizen of any city of the country will be able to check the availability of PNG at his address, apply online for a new connection and track his connection status real-time.
This new incentive scheme, which is going to be implemented from September 1, 2026, will prove to be a milestone in India’s clean energy transition and the national resolve to provide safe piped gas to every household.