By Anushka Gutte & Mrigakshi Tandon, Research Associates, Policy

In May 2016, the government launched the Pradhan Mantri Ujjwala Yojana that aimed at providing 5 crore Liquefied Petroleum Gas (LPG) connections in the name of women of the Below Poverty Line (BPL) household. Research suggests that only 18 percent of rural households in India have access to LPG as cooking fuel, whereas the rest use different, more tedious, unclean and hazardous means for cooking. Moreover, access to LPG connections is largely limited to the urban and semi-urban areas covering the middle income and affluent households. People belonging to BPL category or rural areas have little or no access to these connections. They predominantly use ‘chullahas’ where they burn wooden sticks in the stove for cooking, which makes these families, especially the females therein, vulnerable to harmful fumes.

Use of unclean cooking methods not only increases the Indoor Air Pollution (IAP) but also causes serious health problems such as lung cancer, heart diseases and acute respiratory illness. The launch of this scheme is a crucial step in reducing IAP. A report by UNEP attributed 488,200 deaths/year to indoor pollution in 2015. It is also believed that a transition to modern cooking fuels is a highly cost-effective health intervention. An LPG connection would also reduce the time and effort spent by women in collecting solid fuels (wood, cow dung). 

The target for each financial year from 2016-2017 to 2018-2019 was set at 2 crore LPG connections. With the distribution of 7.19 crore LPG PMUY connections by 2019, the all India LPG coverage went from 61.90% (May, 2016) to 94.30% (April, 2019). As we take a look at the scheme’s achievement, it’s a remarkable progress in such limited time. But on a closer look we see that the scheme failed to encourage substantial and sustainable use of LPG among its target beneficiaries. The CAG report on PMUY shows that although the number of connections are high, the target beneficiaries of the scheme fail to go in for a refill after their first supply has been exhausted. An average household in India would require 9 refills per year to fulfill its cooking needs. But the average annual refill consumption for a PMUY beneficiary was only 3.21 refills per year as on 31st December, 2018. 

While the LPG connections have been increasing at a faster rate, the number of refills only increased after the scheme was introduced but reduced in the last year. There are numerous barriers that the BPL population faces in accessing a refill. Although the government covers up the initial cost and supply, factors like cost of the refill, availability of cheaper biofuel and long waiting time come into play. The cost of the refill is Rs. 518 which is simply not economically feasible for this population. A survey conducted by Petroleum Planning and Analysis Cell shows that the amount of money spent on cooking fuel (biomass) varies from State to State depending on its availability, but it’s averaged at Rs. 358. In States like Uttar Pradesh, the average is as low as Rs. 285. The difference in both fuel (LPG and biomass) price clearly indicates the lack of sustainable use of LPG. Even with the optional loan facility provided by Oil Marketing Companies, these individuals might land themselves in a debt trap, thereby defaulting on their payments. Other barriers include lack of distributors in the region, satisfaction from current fuel use, tedious process of getting the connection and lack of awareness.

The CAG report mentions a lack of adherence to safety norms, naming certain unsafe LPG practices like placing the stove below the level of the cylinder or using non-standard hose pipes. This shows the lack of information among LPG users and the ineptitude of installers which can be extremely hazardous.

While working on increasing the coverage and accessibility of the LPG connections, there is now a simultaneous attempt to increase the switch to PNG cooking fuel. To achieve this objective, the Urja Ganga Gas Project was launched in October 2016 in Varanasi to develop a series of pipelines under the aegis of the Gas Authority of India (GAIL). Once built, the total length of the pipeline will be 2,655 kilometres which will be distributed through extensions in the first and the second phases of the scheme. It initiates the underground laying of gas pipelines which will provide eco-friendly cooking gas to households across thousands of kilometres in 5 States (Uttar Pradesh, Bihar, Jharkhand, West Bengal & Odisha) in the eastern region of the country.

The Project will encourage development of clean fuel dependent industries in the eastern region of the country, with supply of clean energy to fertiliser, power and steel plants. Another major beneficiary of this project will be around 20 lakh families from the eastern part of India, alongwith 40 districts and 2600 villages in the region. This is a major step towards fulfilling the basic requirements of people by providing gas supply at their houses. Moreover, the scheme will also make it possible for vehicles to switch to CNG which will help reduce the pollution and is also a step towards helping and boosting clean energy based infrastructure in cities.

So far, India’s gas grid connection connects the western, northern and south eastern markets of the country leaving the eastern region behind. Through this scheme, the government is trying to include the eastern region in the economic development of the country. Successful implementation of the scheme will improve the living standard of the people in the eastern region while also reducing the pollution levels of the region by promotion of CNG vehicles. The scheme additionally aims to revive the four large fertilizer units at Gorakhpur, Barauni, Ranchi and Sindri which will help to industrialize at least 20 cities by laying out the gas grid connections.

Even though for both schemes, the common mission is to increase the use of clean modern fuel, they have several underlying aspects that may hinder the end goal. Expecting a shift to PNG from people who are already in the process of shifting to LPG will be particularly chaotic. Data reveals that LPG usage has not been completely established, especially in States that are the target beneficiaries of the Urja Ganga Project. According to Petroleum Planning and Analysis Cell, the second-largest connections made under PMUY have been from the east (2.3 crores), even more than the North (2.1 crores). But on the contrary, it also reveals that cylinder refills have gone down in these States (except for Jharkhand). While the government has been successful at reaching out to the BPL population in this region and installing a connection, a sustainable use of modern cooking fuel has not been generated. 

Apart from this, one must also understand the relative infeasibility of installing PNG connections in rural India, where the majority of the BPL population lies. Rural villages, being relatively smaller in comparison to urban areas, it is not economically viable to bear the cost of laying out a pipeline. Rural populations are also more likely to choose biomass fuel over PNG/LPG because of its affordability. Also at this hour there are a lot of hurdles and challenges in front of the authorities which is delaying the Urja Ganga project.

Policy Suggestions

For now, the authorities should focus on strengthening the use of LPG where it is gravely lacking while introducing PNG to those who are in a place to shift from LPG (primarily urban areas).

  1. The government can work towards reducing the fuel price for PMUY beneficiaries. It is seen to be a significant barrier in adopting a sustainable modern cooking fuel. By making LPG more affordable, the poor will not turn towards alternative fuel options that may be cheaper but hazardous.
  2. One way to make refills cheaper would be to exclude middle class or high income groups from receiving subsidies. Even after the launch of the ‘Give up LPG subsidy’ campaign, only 4% of the users opted out of the subsidy. By mandatorily excluding users with annual income of Rs. 5 lakh or more, a financial capacity can be built to shift this subsidy for PMUY beneficiaries.
  3. Furthermore, the government can introduce cleaner and efficient ways to use biomass with the help of technology. Installation of biogenerators can generate biogas that is a clean and sustainable fuel. A biogenerator only requires cow dung and kitchen wastewater. This indigenous form of procuring fuel can be affordable and easily adopted in rural India.
  4. The government should also work on setting up more LPG bottling plants and distributors. By decreasing the distance between the end user and the supplier, the per unit cost of providing LPG can be reduced and delivery can be on time. The number of bottling plants in India is 191, with the least being in North East and Eastern India. The CAG report shows that 57% of LPG distributors had to cater to PMUY beneficiaries living up to 92 km away. Covering such a long distance can lead to either delay or non-delivery of cylinders. This can also have a result on the price of LPG cylinders in various cities. These rates tend to differ by a few rupees from city to city due to transportation costs and local taxes. For example, in April, 2020 the prices in some cities in Eastern states like Assam, Manipur, Mizoram, Bihar etc had been above Rs. 850. However, LPG prices in cities like Mumbai, Delhi and Kolkata were below Rs. 800. It is argued that increasing the number of bottling points can help decrease the price fluctuation.
  5. While PNG can be provided to the BPL population in urban areas under this regime, supply in rural areas should be a long term plan. The government should focus on establishing the sustainable use of LPG connection in these areas. Moreover, after PNG connections have been secured in urban areas (including BPL population), the LPG connections of these regions can be shifted to less prosperous regions under the Ujjwala Yojana.
  6. The government should launch informational programs to raise awareness among PMUY beneficiaries about the advantages of LPG on their health and environment, safety norms for LPG use and the hazardous consequences of biomass fuel. 

Urja Ganga Project is a great initiative taken by the Government and the Gas Authority of India (GAIL) towards the domestic and industrial development of the Eastern region of the country. But it is crucial to understand that until the time majority of our population has gained access with a sustainable use of LPG, it would not be ideal to ask them to shift to PNG. It would lead to poorly planned policy outcomes. Therefore, both the schemes should be implemented in a well-balanced manner while addressing their flaws to make every citizen switch to clean cooking fuel.