PNGRB approves reforms to natural gas pipeline tariff regulations

The Petroleum and Natural Gas Regulatory Board (PNGRB) has approved the second amendment to the Natural Gas Pipeline Tariff Regulations, 2025, introducing a set of changes to simplify tariffs and improve access to natural gas across India.

One of the key revisions is the reduction in the number of unified tariff zones from three to two. This move aims to streamline the country’s natural gas transportation network and enhance access in underserved areas.

In a bid to support wider adoption of natural gas, the benefit of the lower unified tariff under Zone 1 will now be extended nationwide to both Compressed Natural Gas (CNG) and Piped Natural Gas (PNG) segments, including for use in domestic households.

Pipeline operators will now be required to procure at least 75% of their system-use gas through long-term contracts of three years or more. This step is aimed at improving supply efficiency and creating more stable tariffs.

A new Pipeline Development Reserve has also been introduced. Operators with more than 75% pipeline utilisation will be required to allocate 50% of their post-tax earnings to infrastructure development, while the remaining 50% will be returned to consumers via tariff adjustments.

Approved during a recent board meeting, the changes follow stakeholder consultations and are aligned with the government’s "One Nation, One Grid, One Tariff" framework.

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