Govt's move to hike LPG prices is PNG's gain

The government's move to hike LPG prices has made piped natural gas (PNG) a far more attractive option for consumers. In fact, for a family consuming one cylinder a month, the gas bill would be nearly half that of LPG cylinder purchased at market rate. At present, more than 500 households in the city are getting PNG supply while the distributor has set a target of 5,000 connections by March 2013.

The piped gas prices vary between Rs 25 per SCM (standard cubic meter) to Rs 35 per SCM depending on the usage. A family that consumes one LPG cylinder per month will consume about 15 SCM of piped gas, which will be billed at Rs 25 per SCM. So, the monthly bill will be about Rs 425 including 13% VAT. A subsidised LPG cylinder costs Rs 450 while the market rate is more than Rs 800. The government has now restricted the supply of subsidised cylinders to six per year per household.

"Those who use one or more LPG cylinders per month will benefit from PNG connection," Avantika Gas Ltd (AGL) managing director Pradeep Madan said. AGL, which started supplying piped gas in Indore from December 2011, has so far been able to reach only 500 households, as most people are reluctant to surrender their LPG connection. The company has to convince people that once they have piped gas they will not need LPG cylinders. AGL is a joint venture company of GAIL (India) Limited and Hindustan Petroleum Corporation Limited (HPCL).

The company officials are also trying to allay fears that the supply might be affected at a future date when the connection spreads to more households in the city. The company has a capacity for supplying 15 lakh SCM (standard cubic meter) of gas per day and can easily cover the whole city, as a single household needs an average of 0.5 SCM daily.

At present, piped gas is available in three colonies-Narayan Bagh, Kalani Nagar and Vijay Nagar. The next destination is Saket Nagar and the company has applied for permission for laying the pipelines. The project will entail laying of 40-km pipeline at a cost of about Rs 12 crore. Besides Saket Nagar, piped gas will also become available to residents of Manishpuri and colonies falling on the road leading towards Teen Imli.

The piped gas has several advantages over the conventional LPG. Firstly, consumers will not need to worry about booking the cylinders and with several safety measures in place, the risk of accidents has come down significantly.