Context

• The gas crisis of 2026, marked by LPG shortages, volatile LNG prices, and rising import bills, reflects a deeper structural weakness.
• For a country aiming at sustained economic growth and global manufacturing leadership, energy insecurity is a major strategic risk.
• The urgency now lies in rapidly transitioning toward self-reliance and reducing dependence on external energy sources.

A Growing and Unsustainable Energy Gap

• India’s energy demand continues to rise sharply, while domestic supply lags behind.
• With crude oil import dependence at 88.6% and domestic production meeting only half the gas requirement, reliance on LNG imports is increasing. Energy demand is projected to triple by 2047, widening the gap further.
• This imbalance exposes the economy to global price shocks, geopolitical disruptions, and currency volatility, which fuel inflation and strain public finances.
• Infrastructure limitations worsen the issue. Despite high regasification capacity, utilisation remains low due to pipeline constraints and demand mismatches.
• Additionally, LPG supply chains depend heavily on imports from West Asia, making them fragile.
• Recent shortages in major cities, accompanied by extreme price spikes, demonstrate the system’s vulnerability.
• While short-term government interventions offer relief, they fail to address the root problem of import dependence and systemic inefficiency.

Compressed Biogas: A Strategic Opportunity

• Compressed Biogas (CBG) presents a powerful solution that integrates energy security, environmental sustainability, and rural development.
• India has an estimated potential of 62 MMT annually from agricultural residues, animal waste, and municipal waste, yet current production remains minimal.
• This gap reflects an execution failure, not a resource shortage. Government initiatives like SATAT and GOBAR-DHAN provide policy support, financial incentives, and assured offtake.
• However, progress is hindered by fragmented feedstock supply, delayed financing, complex regulatory approvals, and an underdeveloped digestate market.
• Without a strong operational ecosystem, scaling CBG remains difficult despite clear policy intent.

Steps to Unlock the Full Potential of CBG

• Feedstock Security Framework
  • Reliable biomass supply must be ensured through state-wise mapping, efficient aggregation models, and long-term contracts.
  • Aligning feedstock types with appropriate technologies will enhance efficiency and project viability
• Simplified Regulatory and Financial Systems
  • A single-window clearance mechanism can reduce delays significantly.
  • Financial innovation through viability gap funding, green bonds, and carbon credits can improve project economics and attract private investment.
• Promotion of Energy Crops: India should promote energy crops such as Napier grass. Allocating a small share of agricultural land can create a stable biomass base without affecting food security. This approach supports diversification and strengthens supply reliability.

Toward Meaningful Energy Reform

• With timely action, India can scale CBG production to 20 MMT by 2030. The benefits extend beyond energy.
• A strong CBG ecosystem can reduce stubble burning, improve air quality, generate rural employment, and increase farmer incomes.
• It also supports a circular economy by converting waste into valuable energy.
• Incremental changes are insufficient and a structural shift in energy production and consumption is necessary.
• The success of the ethanol blending programme proves that transformation is possible with clear policy direction and effective implementation.

Conclusion

• The choice lies between continued reliance on volatile global markets and building a resilient domestic energy system.
• CBG offers a practical pathway toward energy transition and long-term stability.
• The path forward is clear; what remains is decisive and timely action.