PNG Distributors may be Offered Sops to Ramp up Connections
Govt aims to quadruple PNG consumer base to one crore households in four years
The government is considering several options to incentivise city gas distributors to quickly ramp up piped natural gas (PNG) supply for cooking. These include barring of cooking gas cylinders in pockets, increasing installation fee that customers pay , persuading municipal bodies to reduce levies and accelerating clearances for pipelines, officials said.
Prime Minister Narendra Modi has set a target of quadrupling PNG consumer base to one crore households in four years, aiming to enhance the availability of clean, convenient and relatively economical fuel, especially in the eastern region. This has sent oil ministry officials and gas companies executives scrambling for ideas and resources. It has also encouraged gas companies to lobby the government for better financial and local regulatory terms.
“We know it’s not an easy target. Therefore, we have asked all gas companies to tell us ways in which we can help,“ said an oil ministry official. The oil ministry is planning to call a meeting of top officials of the municipal corporations of about 20 cities in a month or so to press for reduction in local levies and hasten clearances needed for laying pipelines, he said.
For fresh connections, gas firms have to pay fees that municipalities use to restore the roads dug up for laying pipelines. The charges vary among cities. In Mumbai, it . 21,000 for a connection, about 70% of is ` the total installation cost, an executive at Mahanagar Gas, the local gas distributor, said. He said the company loses about . 25,000 on every fresh connection as it can ` recover only ` . 5,000 from the customer.
This is why gas distributors want the one-time installation charge from customers to go up but a pricier connection can turn off new customers, harming the objective of faster expansion. A final call on this will be taken by the Petroleum and Natural Gas Regulatory Board, the regulator.