NEW DELHI: The ministry of petroleum and natural gas launched GOBARdhan, a central sector scheme for development of the compressed biogas (CBG) sector, on Thursday. The ₹23,731 crore scheme provides a framework to accelerate CBG development from FY27 to FY36 and increase domestic biogas production almost 10-fold to 5 million metric standard cubic metres per day (MMSCMD).
Mint explains how the wider adoption of biogas will help achieve energy security amid a globally volatile crude oil and natural gas market.
What does the GOBARdhan scheme entail?
The scheme aims to increase India's domestic CBG production almost 10-fold, mobilize large-scale private investment and create a vibrant circular bioeconomy across the country. It plans to achieve stronger rural livelihoods through new income opportunities for farmers, feedstock aggregators, cooperatives and rural entrepreneurs.
Scientific waste management through the productive use of agricultural residue, cattle dung, municipal organic waste and other biomass resources is another objective of this scheme. It comprises six key interventions – a pricing framework, offtake assurance, capital assistance, development of pipelines, credit guarantee support and a CBG ecosystem challenge fund to accelerate district-level implementation and strengthen local value chains.
How will CBG adoption help India in energy transition and ensuring security?
CBG is produced largely from agriculture waste including cow dung, poultry waste, animal waste, vegetable waste, food waste, rice straw, municipal solid waste, municipal sewerage, chicken waste and dairy waste. It is a cleaner alternative to natural gas.
According to the government, the CBG scheme can help India replace 20% of its natural gas imports. India imports 45-50% of its natural gas consumption and global supply shocks and price volatility bring major concerns for the country’s energy security. Any large-scale replacement of fossil use in India would be key for both energy security and transition.
How is the GOBARdhan scheme different from previous initiatives to boost CBG adoption?
One feature of this scheme is assured offtake. CBG plants will be mapped to city gas distribution (CGD) networks, which will buy the biogas, enabling a dependable route to the market. The procurement obligation of CGD networks has been prescribed at 3% in FY27, 4% in FY28 and 5% from FY29 onwards for compressed natural gas (transport) and piped natural gas (domestic cooking).
On Thursday, petroleum and natural gas minister Hardeep Singh Puri said: “It will succeed because for the first time you have guaranteed offtake.”
Further, the scheme introduces an administered CBG price of ₹2,110 per million metric British thermal units, providing greater revenue visibility to producers.
What financial incentive will the government provide to new CBG projects?
Eligible greenfield projects can receive capital assistance of up to ₹2 crore per tonne per day of installed CBG capacity, equivalent to ₹105 per kg of CBG, including support for plant machinery, feedstock aggregation and fermented organic manure and liquid fermented organic manure processing and manure value-addition equipment.
This is expected to ensure stable and remunerative pricing. According to the government, the framework provides long-term revenue visibility while protecting consumer affordability through a combination of government support and a market-based cost-sharing mechanism.
What is the current status of CBG production and adoption?
The government has made efforts to boost CBG production and adoption through different ministries. Some previous and existing schemes to boost CBG include Sustainable Alternative Towards Affordable Transportation, Market Development Assistance Scheme for organic manure, Biomass Aggregation Machinery Scheme, Development of Pipeline Infrastructure and central financial assistance for CBG plants under the National Bioenergy Programme.
As of 4 March, 120 CBG or biogas plants were registered on the Integrated Fertilizer Management System portal, and 44 memoranda of understanding had been signed between fertilizer marketing companies and compressed biogas operators.
From February 2025 to January 2026, 24 fertilizer marketing companies organized 15,690 Kisan Sangoshthis and awareness camps. GOBARdhan now takes this progress to the next level. Administered by the petroleum ministry, the scheme creates one integrated platform across the entire CBG value chain.