Govt Announces ₹23,731 Cr Funding for CBG, Sets Price Guarantee till 2036

New Delhi, August 6 – The central government approved a massive 23,731‑crore‑rupee allocation to the National Circular Bioenergy Scheme, popularly called ‘Gobardhan’, with the objective of reinforcing the biogas sector and uplifting the farming community.

Spanning the financial years 2027‑28 to 2036‑37, the programme will embed compressed biogas (CBG) as a cornerstone of India’s future energy mix. It strives to lift domestic CBG generation by roughly ten‑fold, lure large‑scale private investment, and create a robust circular bio‑economy nationwide.

A dedicated CBG offtake assurance mechanism will be instituted to ensure producers have a reliable, predictable market. City gas distribution (CGD) firms will be tasked to blend CBG into their pipelines – starting with 3% in FY 2027, rising to 4% in FY 2028, and reaching 5% from FY 2029 onward – across both CNG (transport) and PNG (residential) streams.

The scheme fixes the administrative price of CBG at INR 2,110 per MMBtu for a minimum ten‑year horizon, giving producers confidence in long‑term revenue while keeping the fuel affordable for consumers.

Eligible greenfield CBG projects can receive up to INR 2 crore per tonne‑per‑day of installed capacity, covering plant machinery, feedstock logistics, organic fertilizer processing, and other value‑chain assets. Brownfield capacity expansions are also eligible for the same financial support.

Infrastructure support will extend to cluster‑based trunk pipelines that connect CBG plants with CGD networks, lowering transport costs, enhancing supply reliability, and expanding market reach. A credit guarantee scheme aimed at MSME‑run CBG units will boost lender confidence and broaden institutional financing.

A dedicated CBG Ecosystem Challenge Fund will be created to speed district‑level implementation and reinforce local value chains, offering a unified platform for the entire CBG value chain under the Ministry of Petroleum and Natural Gas.