New Delhi: Petroleum and Natural Gas Minister Hardeep Singh Puri on Thursday launched GOBARdhan, a Rs 23,731-crore Central government scheme for the Compressed Biogas (CBG) sector. The scheme aims to raise India's CBG production nearly 10-fold, to around 5 million standard cubic metres a day (MMSCMD). The Union Cabinet approved it on August 6. It sets out a 10-year framework running from 2026-27 to 2035-36. According to the Ministry of Petroleum and Natural Gas, the long-term framework is meant to give investors and lenders greater certainty.
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Puri said India's growing energy needs must be met through the combined goals of availability, affordability and sustainability. He said that also means developing more of the energy resources available within the country. CBG matters for India in particular, he said, because it can turn crop residue, cattle dung and other organic material into clean domestic energy. The process also produces organic manure and creates new economic opportunities in rural areas.
According to Puri, farmers, cooperatives, gaushalas (cow shelters) and local enterprises can take part at every stage of the chain, from collecting and aggregating feedstock to transporting and processing it. That, he said, strengthens the circular link between agriculture and energy. He called on industry, financial institutions, states, cooperatives and technology providers to turn the framework into operating plants and sustained CBG production. He linked that goal to energy security, rural prosperity and Prime Minister Narendra Modi's vision of "Waste to Wealth" and "Annadata to Urjadata".
Petroleum Secretary Dr Neeraj Mittal said India currently imports nearly half of its natural gas requirement. CBG, he said, offers a way to turn domestic organic waste into a domestic gas resource.
Dr Mittal said the sector's experience so far has exposed several constraints. Revenues have been volatile and support fragmented. The industry has also had limited long-term policy visibility. Feedstock assurance, offtake of organic manure and access to finance have been further problems, he said. According to the ministry, GOBARdhan tackles these issues by making the Petroleum Ministry the single nodal ministry for the sector. The scheme also offers predictable pricing, more certainty that gas will be bought, higher capital assistance, consolidated processes and more digital monitoring.
Mittal said state governments would play an important role in turning the national framework into projects on the ground. He pointed to enabling state CBG policies, feedstock assessments, suitable land banks, faster approvals and infrastructure support as ways they could do this.
The scheme replaces several standalone interventions with a single framework built on six components. These are CBG offtake assurance, a CBG pricing framework, capital assistance for CBG projects, development of pipeline infrastructure, credit guarantee support and a CBG Ecosystem Challenge Fund.
Under the offtake framework, CBG plants will be mapped to identified city gas distribution (CGD) geographical areas or CBG clusters, which the ministry says will give them a dependable route to market. The obligation to buy that gas falls on CGD entities under a CBG Obligation (CBO). It has been set at 3 percent in 2026-27, 4 percent in 2027-28 and 5 percent from 2028-29 onwards for the compressed natural gas (CNG) transport and piped natural gas (PNG) domestic segments.
Producers will be paid an administered CBG price of Rs 2,110 per million British thermal units (MMBtu), which the ministry says will give them better revenue visibility. Eligible greenfield projects can also get capital assistance of up to Rs 2 crore per tonne per day (TPD) of installed CBG capacity. This covers plant machinery and feedstock aggregation. It also covers equipment for processing fermented organic manure (FOM) and liquid fermented organic manure (LFOM) and for adding value to manure.
Getting gas out of plants has been a constraint, and the scheme addresses it through pipeline support. It covers up to 80 percent of eligible capital expenditure on pipelines that connect CBG clusters to trunk pipeline networks. Standalone plants connecting to CGD networks can get up to 50 percent.
Eligible CBG projects run by micro, small and medium enterprises (MSMEs) will have access to a dedicated credit guarantee mechanism. It will cover up to 85 percent of the amount outstanding at default, subject to prescribed project limits. The guarantee is capped at Rs 20 crore per project for general MSME projects and Rs 25 crore for MSME projects led by women.
The CBG Ecosystem Challenge Fund will support technology development, capacity building, and feedstock assessment and aggregation. It will also fund ecosystem development at the district level and value addition in organic manure.
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The scheme starts from an existing base. More than 217 CBG plants had been commissioned as of August, with a combined installed capacity of over 1,700 TPD, according to the ministry.
The ministry expects the scheme to save more than Rs 40,000 crore in foreign exchange and add over Rs 75,000 crore to gross domestic product (GDP). It also expects the scheme to create more than 1.5 lakh jobs. On the environmental side, the ministry projects that it will replace 10 million tonnes of fossil fuel with clean gas and cut more than 40 million tonnes of carbon dioxide emissions. It also expects the scheme to support the production of 250 million tonnes of organic manure.
Two implementation tools were released at the launch. The GOBARdhan Handbook is a reference guide to help developers, state governments and financial institutions understand the scheme and work through its CBG interventions. The Unified GOBARdhan Portal is a central digital platform meant to streamline applications, end multi-channel processes and make processing and implementation more transparent.
The event brought together representatives of central ministries and state governments, along with CBG developers, oil and gas companies, CGD entities, financial institutions, cooperatives and technology providers.
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