CNG, PNG to cost 10% less after Cabinet tweaks gas pricing norms
The government has approved a new method to fix the price of natural gas. It will make piped natural gas (PNG) cheaper by 10 per cent and lower the cost of compressed natural gas (CNG) by 6 per cent to 9 per cent.
FollowThe Union Cabinet authorised a new method for calculating natural gas pricing and set a cap or ceiling price to bring down the cost of CNG and piped cooking gas by up to 10%. The natural gas produced from legacy or old fields, known as APM gas, will now be indexed to the price of imported crude oil instead of being benchmarked to gas prices in four surplus countries like the US, Canada, and Russia, said Union I&B Miniser Anurag Thakur at a Cabinet briefing.
The updated price rules, according to the BJP-led central government, would provide a stable pricing system for domestic petrol customers, adequately safeguard producers from unfavourable market fluctuations, and give incentives for increasing output.
Also Read | RBI revises GDP growth projection to 6.5% for FY24, pauses repo rate revision
Following the decision, the CNG price in Delhi will be cut from Rs 79.56 per kg to Rs 73.59 and that of PNG from Rs 53.59 per thousand cubic meters to Rs 47.59. In Mumbai, CNG will cost Rs 79 per kg instead of Rs 87 and PNG will cost Rs 49 per scm instead of Rs 54.
Additionally, rather with the present procedure of bi-annual modifications, price rates will now be determined monthly.
Natural gas that is generated domestically is now priced by the government twice a year. After that, this gas is used to create CNG for cars, is pumped into homes for cooking, and is also used to create power and fertiliser.
Meanwhile, India has set a target to increase the share of natural gas in its primary energy mix from the current level of around 6.3 per cent to 15 per cent by 2030, as it aims to become a gas-based economy.
Also Read | Amid mass layoff, Amazon now plans to reduce employee stock awards: Report
