LPG: Will gas cylinders become a thing of the past in future?

The central government plans to replace the cooking gas cylinders with area-wise piped natural gas, i.e. PNG, in the coming times. This will be a step that can benefit the government in many ways.

What is the step of the government?

The government has asked the PNG industry veterans to identify places where a date (sunset timeline) can be fixed for the last use of LPG (Liquid Petroleum Gas). Through this, it has been asked to prepare a blueprint to deliver adequate gas supply through the PNG network in many areas. A person knowing the matter has given this information.

How will the government benefit?

The central government is spending Rs 6,100 crore on Liquefied Petroleum Gas (LPG) customers as a welfare subsidy through the Pradhan Mantri Ujjwala Yojana (PMUY). Apart from this, the government has to make arrangements of about Rs 22,000 crore to save the three government oil market companies from loss because they could not increase domestic gas prices even based on international prices in the last financial year.

Why did the government take this step?

The central government wants to increase the spread of PNG, and this step is also being taken because the demand for PNG decreased significantly last year. PNG prices are entirely based on market prices. Although the costs of LPG are also increasing continuously, they are being subsidized because the economically weaker sections are generally using it.

What is the government’s plan for the long run?

Apart from this, another person with knowledge of the matter saisaid that the government had asked the oil and gas companies to gradually withdraw from using LPG so that the gas can be used only through a the piped network. OMCs and other Oil & Gas companies have been asked to provide LPG through PNG only in cities for domestic gas consumption. If this experiment is successful, it can be implemented in many parts of the country.