Rising demand for fuels drives market growth
Rising demand is a major driver of the City Gas Distribution Market CAGR. To assess the demand situation in the polled areas, we surveyed natural gas demand requirements from various organizations, including industries, household users, commercial clients, and transportation authorities. Ratnagiri District (Maharashtra State), North Goa District (North Goa State), and Dhar District (Madhya Pradesh State) have been identified as the three "Targeted Areas" with the potential for CGD network building. The market is predicted to develop as natural gas consumption rises from automotive, industrial, commercial, and residential end users.
In Rounds 9 and 10, an increasing number of enterprises are being allowed and issued licenses to operate in the CGD industry in various areas around the country, owing to the Government of India's growing number of supportive efforts in the CGD sector. For example, in the ninth and tenth rounds of city gas distribution, Indian Oil Corporation and Adani Gas Limited obtained the most permits to distribute gas in 17 and 15 geographical areas, respectively.
The government also plans to create jobs by transitioning to a gas-based economy, as natural gas is a cheap and environmentally benign fuel. The new and amended laws helped to increase public and private sector engagement in the CGD market. The market is projected to be fueled by increased CNG stations and PNG connections. By the end of the 11th bidding round, nearly 96% of India's population will have access to natural gas.
Moreover, India's city gas distribution market includes both PNG and CNG segments. PNG connections are available to a variety of end users, including household, industrial, and commercial. At the same time, CNG stations, also known as retail outlets, are being erected in various locations to provide people with access to natural gas for transportation purposes. After completing the 11th A bidding cycle in the country in August 2022, the government claimed that it had covered 98% of the population, up from 96% the previous round.
This expansion of the coverage area is projected to boost the number of PNG and CNG connections throughout the country. According to the Petroleum and Natural Gas Regulatory Board (PNGRB), there were approximately 9,302,667 home connections in the country in 2021, 34,854 commercial connections, and 13,215 industry connections. Additionally, the number of CNG stations in the country has expanded. As of 2021, there were 4,433 retail shops in the country. Thus, driving the India City Gas Distribution market revenue.
