CNG, PNG Prices to Fall from January 2026

25 Dec 2025 CW Team

PNGRB Member A K Tiwari said the regulator has replaced the earlier three-zone, distance-based tariff framework with a two-zone structure to improve uniformity and reduce regional disparities. The previous system, introduced in 2023, resulted in higher transportation tariffs for regions located farther from gas sources. Under the revised structure, the Zone 1 tariff has been fixed at Rs 54 on a pan-India basis for CNG and domestic PNG consumers, compared with earlier rates that went up to Rs 107 in certain regions.

The rationalised tariff structure will benefit consumers across 312 geographical areas served by 40 city gas distribution companies, covering both transport users dependent on CNG and households using PNG for cooking. The PNGRB has directed CGD operators to ensure that the benefit of lower transportation costs is passed on to end consumers, adding that compliance will be closely monitored.

Alongside tariff reforms, the regulator is facilitating the expansion of gas infrastructure nationwide. Licences have been issued to ensure coverage across the country, with participation from public sector undertakings, private players and joint ventures. Several states have also reduced value-added tax on natural gas and simplified permission processes to support faster rollout. With lower prices and expanding infrastructure, the government expects increased adoption of natural gas, with the city gas distribution sector playing a central role in promoting cleaner fuel usage.

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Consumers using Compressed Natural Gas and domestic Piped Natural Gas across India are set to benefit from lower prices starting January 1, 2026, following a move by the Petroleum and Natural Gas Regulatory Board to rationalise gas transportation tariffs. The reduction will come into effect with the implementation of a simplified and unified pipeline tariff structure, which is expected to reduce costs for city gas distribution companies and translate into savings of around Rs 2–3 per unit for consumers, depending on location and applicable taxes. PNGRB Member A K Tiwari said the regulator has replaced the earlier three-zone, distance-based tariff framework with a two-zone structure to improve uniformity and reduce regional disparities. The previous system, introduced in 2023, resulted in higher transportation tariffs for regions located farther from gas sources. Under the revised structure, the Zone 1 tariff has been fixed at Rs 54 on a pan-India basis for CNG and domestic PNG consumers, compared with earlier rates that went up to Rs 107 in certain regions. The rationalised tariff structure will benefit consumers across 312 geographical areas served by 40 city gas distribution companies, covering both transport users dependent on CNG and households using PNG for cooking. The PNGRB has directed CGD operators to ensure that the benefit of lower transportation costs is passed on to end consumers, adding that compliance will be closely monitored. Alongside tariff reforms, the regulator is facilitating the expansion of gas infrastructure nationwide. Licences have been issued to ensure coverage across the country, with participation from public sector undertakings, private players and joint ventures. Several states have also reduced value-added tax on natural gas and simplified permission processes to support faster rollout. With lower prices and expanding infrastructure, the government expects increased adoption of natural gas, with the city gas distribution sector playing a central role in promoting cleaner fuel usage.

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