City gas firms race ahead on CNG, lag on home connections

New Delhi: India's city gas firms are racing ahead on lucrative CNG stations but slow on low-margin home connections, driven by both operational difficulty and the very different competitive landscape the two segments face.

City gas distributors have overshot their target for CNG stations by 44% but fallen short of household piped-gas connections by 57%. As of October-end, companies had connected a cumulative 15.7 million households against a target of 36.3 million, according to the Petroleum and Natural Gas Regulatory Board (PNGRB) data. In contrast, they have built 8,406 CNG stations against a target of 5,855. Pipeline rollout too has lagged, with 301,247 inch-km laid compared with a target of 377,960.

Licences were awarded based on multi-year commitments to build CNG stations, connect homes and lay pipelines. Executives say that while CNG stations require investment and approvals, they are far more straightforward than the time-intensive process of entering neighbourhoods, securing permissions, building last-mile pipelines and installing household meters.