On October 1, 2026, the Union Ministry of Petroleum and Natural Gas launched the GOBARdhan scheme, the Unified GOBARdhan Portal and the GOBARdhan Handbook. The launch marks a shift in the government’s approach to compressed biogas (CBG), bringing producers, farmers, state governments, city gas distribution (CGD) entities and financial institutions under one framework.
India’s import dependence remains significant. In 2024-25, natural gas consumption was around 71,000 million standard cubic metres, with about half imported at a cost of around $14.9 billion. CBG can reduce this dependence while putting agricultural residues, animal dung, and municipal and industrial organic waste to productive use.
GOBARdhan is less of a financial support programme more of an attempt to build an ecosystem on the ground, one that helps farmers move from being an “anna data” to “urja data”.
Earlier CBG policy was fragmented: land, feedstock, approvals, finance, technology, purification, off-take and network access sat with different agencies. GOBARdhan responds with central support, state-level implementation and a unified digital platform.
The portal is the single interface for registering plants and accessing support, and registration is mandatory. Producers must install SCADA, online gas chromatographs and automatic shut-off systems, so that quality and production data feed the portal. Support is also production-linked: the final 50 per cent of capital assistance is released in full only when the plant operates at 75 per cent of its capacity, pro-rata between 50 and 75 per cent, and not at all below 50 per cent.
The administered CBG price (ACP) is Rs 2,110 per MMBtu, to remain in place until 31 March 2036, alongside digital facilitation of firm off-take agreements with CGD entities.
Capital assistance is Rs 1.25 crore per tonne per day (TPD) of capacity, plus up to Rs 0.75 crore per TPD for feedstock aggregation and manure machinery, capped at Rs 30 crore per project. Brownfield expansions get half the rate, and special category states get an extra 20 per cent.
The most significant feature of the new approach is the recognition that the ecosystem around a plant is built locally. The Centre provides the framework, price, offtake mechanism and funding, but land, feedstock, farmer mobilisation and approvals decide whether a plant becomes operational and stays viable. At the launch, states were described as the “karmabhoomi” of GOBARdhan.
The CBG Ecosystem Challenge Fund has an outlay of Rs 500 crore for FY 2026-27 to FY 2030-31. Its District CBG Challenge Programme gives annual awards of Rs 5 crore each to the top three district administrations and Rs 2 crore each to the next seven. Districts are scored equally (20 per cent each) on five parameters:
a single window for district-level approvals;
average turnaround time for those approvals;
tehsil-wise feedstock mapping;
use of organic manure from CBG plants by district departments and others;
information and awareness activities.
This aligns with CSE’s finding that constraints were common across states: weak policy implementation, unreliable feedstock supply, high capital costs, inadequate market integration and imported technology.
The most consequential change is that offtake is now a contract with consequences for both the producer and the CGD entity. Firm offtake runs through a tripartite agreement between the producer, the CGD entity and GAIL as Synchro Operator, with take-or-pay and supply-or-pay obligations:
Year 1 is a stabilisation year. Neither side owes a financial disincentive, though nominations must still be filed.
From Year 2, the CGD entity must take at least 90 per cent of the Annual Nominated Quantity. A shortfall attracts a disincentive of the APM base price plus the Price Adjustment Factor per MMBtu.
From Year 2, the producer must supply at least 50 per cent of the Annual Contract Quantity. A shortfall attracts 10 per cent of the prevailing ACP per MMBtu (about Rs 211), payable to the offtaker.
Nominations are filed fortnightly, 30 days ahead; volumes above the daily contract quantity are treated as reasonable-endeavour volumes.
CSE’s studies of Punjab, Haryana, Gujarat and Uttar Pradesh identified three operational issues: feedstock security, CBG off-take, and management of FOM/LFOM, the fermented and liquid fermented organic manure by-products of CBG production.
Its national blueprint rested on four pillars:
Realistic goal-setting with emphasis on operational efficiency
State-led policy support aligned with national targets
Reliable feedstock supply chains supported by infrastructure and long-term contracts
Indigenous technology development to reduce capital costs
CSE argued that registered projects should not be the measure of success, and proposed at least 1,000 operational waste-based CBG plants by 2030, with average capacity utilisation above 75 per cent. The question is how far GOBARdhan addresses these recommendations.
Feedstock is perhaps the most fundamental constraint. Residues are seasonal, quality varies, and collection, transport and storage are fragmented, which depresses plant utilisation. CSE recommended long-term supply agreements with price escalation, collection and storage procedures, and biomass banks near CBG clusters, along with aggregation machinery, balers and decentralised storage for paddy straw.
What GOBARdhan addresses: The scheme makes states responsible for the ecosystem around plants, including waste, farmers and supply chains, since feedstock cannot be solved by the developer alone. Capital assistance for aggregation machinery and district feedstock mapping also help.
What remains: There is no detailed framework yet for long-term feedstock contracts, standard pricing, aggregation centres, storage norms or district feedstock planning. These must be built by states, and GOBARdhan’s success will depend on whether they create actual feedstock supply chains.
Off-take has been a major concern: plants faced delays in gas lifting and relied on costly cascade transport without pipeline connections. CSE recommended expanding CGD networks around clusters, state support for pipelines, interim gas corridors, stronger CGD oversight and blending targets.
What GOBARDHAN addresses:
The CBG obligation of 3, 4 and 5 per cent gives CGD entities a mandatory blending target, and the portal maps plants to the areas where they can sell.
The tripartite agreement and its penalty clauses put an enforceable cost on non-compliance by either side, and an allocation cut for a CGD entity that fails to sign gives escalation teeth.
Pipeline support for CGD connectivity covers 50 per cent of eligible cost, capped at Rs 50 lakh per km for steel and Rs 7.5 lakh per km for MDPE pipelines, up to 75 km.
For trunk pipeline connectivity, GAIL as Cluster Operator builds and owns cluster pipelines once two or more plants, preferably 20 TPD or more, apply against an injection point. Producers who withdraw from an approved cluster without valid reason can be debarred.
What remains: Digital facilitation of an agreement is not physical off-take. The critical issue is whether CGD entities lift contracted quantities consistently and whether pipelines reach CBG clusters. CSE’s calls for stronger CGD oversight and an Organic Fertiliser Off-take Obligation for bio-manure remain important for the next phase.
CBG production generates substantial FOM and LFOM, whose use matters for plant economics and the circular economy. CSE found that poor farmer awareness, weak market linkages, regulatory constraints and inadequate pricing limited uptake. It recommended awareness programmes, demonstration farms, blending targets for organic fertilisers, stronger market linkages and farmer participation in projects.
What GOBARdhan addresses: The ACP includes an incentive for the sale of FOM/LFOM, with sale and beneficial use the producer’s responsibility and non-compliant disposal not permitted. Capital assistance covers FOM machinery such as PROM facilities, compost turners and LFOM tankers, and districts are scored on organic manure use.
What remains: There is no market-creation mechanism for FOM/LFOM comparable to the support for CBG itself. Assured markets, quality standards, farmer demonstrations, procurement and distribution networks are needed. This is critical because plant economics deteriorate when utilisation is low or digestate value is not realised; CSE’s analysis found utilisation to be a primary determinant of viability, and digestate policy a significant influence.
High capital costs are a major barrier. CSE found that imported machinery raises project costs and that many plants operate below 50 per cent capacity utilisation.
What GOBARdhan addresses: Capital assistance and pipeline support are now available through one portal, an improvement over navigating multiple schemes. Capital assistance is released in three tranches: 25 per cent on consent to establish, 25 per cent on first sale and 50 per cent on performance. The final tranche is released in full at a plant load factor of 75 per cent, pro-rata between 50 and 75 per cent, and not at all below 50 per cent, when bank guarantees are encashed. A credit guarantee covers up to 85 per cent of eligible greenfield MSME term loans, up to Rs 20 crore.
However, capital support alone cannot ensure viability. CSE’s analysis shows that even with support, several feedstock-based projects become unviable when utilisation falls sharply.
The performance link rewards plants that actually run, but it raises the stakes: A feedstock or off-take failure that keeps a plant under 50 per cent utilisation can cost it its final tranche and its guarantees. Effectiveness will depend on reliable feedstock, assured off-take, pipeline connectivity and a market for FOM / LFOM.
CSE found heavy dependence on imported equipment and a lack of standard specifications and cost benchmarks. It recommended R&D for feedstock-specific domestic technologies, a CBG technology handbook, benchmark costs and indigenous pilots.
What GOBARdhan addresses: More than the portal alone. Ecosystem Enablement grants of up to 50 per cent of cost, and more in exceptional cases, support domestic equipment, process and yield improvement and by-product value addition, open to developers, research institutions, start-ups and public sector enterprises.
What remains: Standardisation of equipment, technology certification, feedstock-specific designs, benchmark plant costs and indigenous pilots. Without them, high capital costs will keep limiting smaller developers.
CSE recommended state nodal agencies and a single-window clearance, since developers must approach multiple departments, along with state resource centres for handholding, grievance redressal, monitoring and technical assistance.
The portal aligns with this at the scheme interface level, bringing registration, pricing, off-take and support applications together. But it cannot remove regulatory bottlenecks: land conversion, environmental permissions, electricity, water and local approvals must still be synchronised by states, which is where their role becomes critical.
CSE’s assessment showed that the problem was neither a lack of feedstock nor a lack of interest in CBG: India has vast quantities of dung, residues, municipal waste and industrial biomass. The challenge is converting this into reliable, affordable and continuous feedstock supply; viable plants; assured gas markets; and functioning markets for bio-manure.
The scheme addresses several institutional gaps: the unified portal, administered price, enforceable offtake contracts with penalties on both sides, a blending obligation, performance-linked capital assistance, pipeline and credit support, and a role for districts.
But the next stage is harder. The test is whether states and districts can build the ecosystem around the plant: where will feedstock come from, who will aggregate and store it, who bears transport costs, how will farmers participate, who will buy FOM/LFOM, how fast will pipelines arrive, and who will help when a plant struggles to meet its supply obligations? These are implementation questions.
The most important message from the launch may be that states are the “karmabhoomi” of GOBARdhan: the Centre provides the architecture and incentives, but state and district governments will build the physical ecosystem.
CSE’s findings reinforce this. States with clearer policies, single-window mechanisms, feedstock systems and institutional support have progressed, while states with large biomass potential but weak implementation have struggled to turn it into operating plants.
The next generation of state policies should plan the CBG geography of the state: mapping feedstock, identifying land, building aggregation and storage hubs, bringing in farmers and FPOs, connecting plants to gas grids, creating bio-manure markets and building technical capacity. Done well, this addresses residue and waste management, rural employment, clean energy, soil health and farmer incomes together.
The immediate priority is to match the digital ecosystem with a physical ecosystem in India’s villages, farms, dairies, cities and industrial clusters. Success will be measured not by plants registered on the portal but by plants operating reliably at high utilisation, with assured feedstock and off-take, and digestate returning to agricultural soils. That is where the quality of state implementation will be decisive.