Context: The Union Minister of Petroleum and Natural Gas, Shri Hardeep Singh Puri, launched GOBARdhan, the Central Sector Scheme for development of the Compressed Biogas (CBG) sector.
- The Scheme, approved by the Union Cabinet on 6 August 2026 with an outlay of ₹23,731 crore, provides a ten-year framework from FY 2026–27 to FY 2035–36 for accelerating CBG development in India.
- The scheme aims to increase domestic CBG production nearly 10-fold (to around 5 MMSCMD) with a long-term framework that gives investors and lenders greater certainty.
- The Scheme introduces an administered CBG price of ₹2,110 per MMBtu, providing greater revenue visibility to producers.
- Eligible greenfield projects can receive capital assistance of up to ₹2 crore per TPD of installed CBG capacity, including support for plant machinery, feedstock aggregation and FOM/LFOM processing and manure value-addition equipment.
- To address gas evacuation constraints, support of up to 80% of eligible capital expenditure is available for pipelines connecting CBG clusters to trunk pipeline networks and up to 50% for standalone plants connecting to CGD networks.
- A dedicated credit guarantee mechanism for eligible MSME-based CBG projects will cover up to 85% of the outstanding amount at default, subject to prescribed project limits.
- The guarantee cap is ₹20 crore per project for general MSME projects and ₹25 crore per project for women-led MSME projects, providing enhanced support to women entrepreneurs in the CBG sector.
- The CBG Ecosystem Challenge Fund will support technology development, capacity building, feedstock assessment and aggregation, district-level ecosystem development and value addition in organic manure.
- India’s CBG ecosystem has already established a foundation for further growth, with 217+ plants commissioned as of August 2026, with an installed capacity of more than 1,700 TPD.
- The Scheme aims to increase domestic CBG production nearly ten-fold over its ten-year implementation period.
- The Scheme is expected to generate significant economic and environmental benefits, including more than ₹40,000 crore in foreign-exchange savings, over ₹75,000 crore added to GDP and more than 1.5 lakh jobs.
- It is also expected to replace 10 million tonnes of fossil fuel with clean gas, reduce more than 40 million tonnes of CO₂ emissions and support the production of 250 million tonnes of organic manure.