PNGRB approves pivotal reforms in natural gas pipeline tariff regulations

New Delhi [India], July 4 (ANI): In a decisive move aimed at strengthening India's transition towards a cleaner, more efficient energy landscape, the Petroleum and Natural Gas Regulatory Board (PNGRB) has approved the Second Amendment to the Natural Gas Pipeline Tariff Regulations, 2025.
In a release, the PNGRB stated that these sweeping reforms underscore PNGRB's commitment to developing a more transparent, consumer-oriented, and investment-friendly natural gas infrastructure in India.
The reforms were approved during a recent Board meeting following extensive consultations with stakeholders across the industry. Anchored in the vision of "One Nation, One Grid, One Tariff," this regulatory overhaul reflects PNGRB's strategy to simplify the market structure, promote cleaner fuels, and build an inclusive gas-based economy.
Among the key reforms, PNGRB has reduced the number of Unified Tariff Zones from three to two, simplifying the natural gas transportation system across the country. This initiative ensures a more equitable tariff structure and enhances access to natural gas, especially in underserved regions.

In a consumer-centric move, the benefit of the Unified Zonal Tariff of Zone 1 has been extended nationwide to Compressed Natural Gas (CNG) and Piped Natural Gas (PNG) Domestic segments. This is poised to make natural gas more affordable for urban households and transport networks, thereby supporting broader clean energy adoption.

To stabilise tariffs and ensure efficiency in supply, PNGRB has mandated pipeline operators to procure at least 75 per cent of their annual system-use gas through long-term contracts (minimum three-year tenure). This will lower procurement risks, reduce transaction costs, and ultimately result in more predictable and affordable tariffs for consumers and investors alike.
The PNGRB added in the release that it has introduced a dedicated Pipeline Development Reserve, utilising earnings from pipeline entities that exceed 75% utilisation benchmarks to fund future expansion.
PNGRB has noted that 50 per cent of these net-of-tax earnings will be reinvested into infrastructure development, while the remaining 50 per cent will be passed on to consumers through tariff adjustments, creating a performance-linked, self-sustaining model for growth.

These reforms represent a strategic blend of regulatory innovation and stakeholder-centric governance, ensuring that both consumers and industry players benefit equitably. By realigning tariff structures, incentivising long-term planning, and reinvesting in infrastructure, PNGRB is laying a strong foundation for India's cleaner, greener, and more inclusive energy future.
PNGRB further added that it remains committed to enabling ease of doing business while keeping consumer affordability at the forefront, making natural gas the fuel of choice for India's evolving energy needs. (ANI)