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India’s LPG crisis, worsened by Gulf tensions and import dependence, has exposed the fragility of its cooking fuel system.
With over 332 million LPG connections and restaurants hit hard, alternatives like PNG and electric cooking carry their own risks.
Biogas, produced from abundant organic waste, offers a domestic, clean, LPG-like solution that strengthens energy security and cuts emissions.
For an energy-dependent country like India, the US-Israel war on Iran and the blocked Strait of Hormuz has been a massive blow, especially for LPG, the reserve for which would last less than two days unlike 74-90 days for crude.
Disrupted LPG supply in India is not an abstract policy problem but a tangible operational crisis for kitchens and eateries in India. With 332.1 million active domestic LPG connections, out of which 104.29 million are Pradhan Mantri Ujjwala Yojana connections, Indian kitchens rely heavily on LPG.
High prices aside, the foremost concern became the scramble to even lay one’s hands on the cylinder. The worst hit are the commercial consumers — the restaurants and eateries, who have had to either pare down their menus, or scale down or temporarily shut down operations, staring at massive losses.
Among the various fixes being floated, expanding Piped Natural Gas (PNG) coverage and electric cooking have garnered the most spotlight. Nudged by the Centre, states are targeting 3 million household PNG connections.
But long-term dependence on these sources is not without its own loopholes. Half of India’s natural gas demand is fulfilled through imports in the form of Liquefied Natural Gas (LNG), the Gulf countries supplying over half of those imports. That again puts us in a precarious situation. Parallely, 74 per cent of India’s total power generation is fuelled by coal. A push for electric cooking is only going to increase our carbon emissions dramatically, especially at a time when India has pledged to cut 47 per cent of emissions intensity by 2035.
A sustainable and long-term solution should aim at building a domestically anchored energy ecosystem capable of managing and tiding over such potentially recurring shocks with grace. This is where the humble biogas has a bigger character to play than the background dance it is being assigned at the moment.
Biogas, produced from organic waste through anaerobic digestion, is a domestic, renewable and clean alternative to natural gas. It is as efficient as LPG, with cooking time nearly identical. Touted as a “waste to wealth” technology, it emerges as a viable and practical energy solution due to a couple of factors. First, favourable conditions. Our strong agricultural base and a large livestock population offer a wealth of raw materials in the form of agriculture residue like paddy straw and animal waste like cow dung, making a serious case for expansion of biogas. Second, and more importantly, it has direct linkages to other pressing challenges that India is currently grappling with.
Solid waste management is a problem of mountainous proportions. As per CPCB’s report, India generates approximately 170,000 tonnes of municipal solid waste daily, with biodegradable organic matter accounting for some 51 per cent, the majority of which ends up in landfills and becomes a source of methane emissions, groundwater contamination and land-use pressure. This organic waste can power Indian kitchens.
Operationalising waste segregation at source and seamless transportation to the treatment plant can ensure uninterrupted supply of clean cooking fuel, both for domestic and commercial stoves, while simultaneously preventing waste dumping in landfills.
The CBG production potential from domestic organic waste alone is estimated at 62 MMT annually, against current output that is less than 1 per cent of that figure. This can be augmented by multiple waste streams like food waste from commercial establishments, animal waste, and industrial waste like bagasse. These decentralised bioenergy units have huge untapped potential.
It makes much economic sense as well. India imported 20,667 TMT of LPG worth Rs 1.06 lakh crore in 2024-25, alone forming 53 per cent of import expenditure on all petroleum products combined. This comes on the back of PMUY, which provides free LPG connections and heavily subsidised cylinders to poor and rural households, driving the demand. Subsequently, the subsidy bill for LPG has ballooned up. Total LPG subsidy bill amounted to Rs 15,479 crore in financial year 2024-25 and Rs 15,120 crore in FY 2025-26.
Even during the COVID-19 lockdown, the government had to intervene through emergency free-refill schemes and logistics prioritisation in order to maintain access to cooking fuel. The subsidy bill for FY 2020-21 reached a mammoth Rs 35,195 crore. In addition, the government from time-to-time compensates oil marketing companies (IOCL, BPCL, HPCL) for losses incurred from selling domestic LPG below cost. Biogas expansion has the potential to mitigate this huge fiscal burden on the exchequer.
Even in the absence of a force majeure, LPG dependence is structurally fragile. There is high non-compliance by PMUY beneficiaries. Large numbers either refill cylinders infrequently or skip them altogether. In FY25, 9.7 million beneficiaries did not buy even a single refill. This reveals a major gap between provisioning of LPG connections and their actual usage.
This is primarily due to high refill costs, despite subsidies, which creates a recurring burden on low-income groups and they readily fall back on unclean fuel sources like solid biomass. As per NSO 2022-23 data, around 32 per cent of the population, majority of which are in rural areas, still relies on solid biomass as their primary cooking fuel. This is exacerbated during times of crisis, like the present one, when the cylinders become unaffordable.
Besides, solid biomass cooking fuel is the dominant contributor to household air pollution which constitutes the second leading risk factor for mortality in India and also makes up 13 per cent of our greenhouse gas emissions. This becomes an impediment towards SDG 7. However, solid biomass that these families depend on can feed the biodigester instead of the chulha directly, providing them clean fuel. This will also eliminate the need to purchase costly LPG refills and lead to substantial savings.
But on a practical note, installing household level biodigesters is not always possible, especially in urban areas. Community level plants are a better option with regards to both installation cost and spatial considerations, creating a hyperlocal model.
In a matter of a few days since the present crisis, numerous such successful examples have surfaced on social media, few of them being Punjab’s village level plants like in Lambra Kangri and Bahadarpur, the city government established plants in Pune and Indore, and institutional level plants like in several temples and educational campuses. Hyderabad’s Bowenpally Vegetable Market generates 500 units of electricity, which powers the mandi’s stalls and streetlights, and 30 kg of biofuel every day from the waste collected, which is supplied to the nearby kitchen facilities.
These facilities are utilising community municipal waste to power stoves and setting emulation-worthy templates, capable of supporting both commercial and domestic cooking ecosystems. Beyond providing a renewable source of household energy, biogas plants also yield digestate, a nutrient-rich byproduct that can be used as biofertiliser, thereby opening up a stream of further income and even reducing dependence on chemical fertilisers.
Yet the story of biogas in India is not one of inefficiency or infeasibility, but of under-adoption, despite its obvious benefits. The first major government initiative to promote household biogas plants came in 1981 with the launch of the National Project on Biogas Development by the Ministry of Non-Conventional Energy Sources. Four decades hence, less than one per cent of households in India use biogas for cooking. The government has several interventions that promote biogas like the Galvanizing Organic Bio-Agro Resources Dhan (GOBARdhan) scheme and the National Bio Energy Programme (NBP).
The SATAT scheme enables the injection of CBG into City Gas Distribution pipelines, creating assured market linkages for producers while strengthening domestic gas availability; marketing assistance is available for biofertiliser; and plant-size based installation subsidies reduce the capital barrier.
Further, the inclusion of CBG in the list of activities eligible to generate internationally traded carbon credits under the Article 6.4 mechanism of the Paris Agreement opens up an additional climate-finance pathway. Collectively, these measures are indicative of a policy direction to incorporate biogas deeper into the clean energy transition agenda in India, but their scale of deployment remains modest relative to the opportunity and the uptake stands nowhere close to that for LPG.
The resistance to adoption comes from a mix of monetary, behavioural and awareness gaps–higher upfront costs, habituation to a particular fuel, scepticism about fuel efficiency, and lack of operation and maintenance know-how. These are policy-design barriers that can be countered at the local level by specific financing assistance, demonstration projects and institutional facilitation.
Addressing these barriers does not require reinventing the wheel; the models already exist. Piecemeal pilot interventions must give way to an integrated expansion strategy. Self-help groups-linked community financing models must be supported to help mobilise affordable capital for decentralised plants while strengthening local ownership.
A systematic leveraging of carbon credit markets will improve project viability, especially for waste-to-energy based biomethanation systems. To further enhance affordability, it is prudent to consider reallocating a small portion of the current LPG subsidy towards biogas infrastructure, since biogas requires largely one-time investment support unlike LPG subsidies that must be paid out year after year. Corporate social responsibility funding can also impart stimulus to early-stage installations and demonstration projects; such partnerships in Uttarakhand have brought down adoption costs by up to 50 per cent.
The lessons from the current disruption are therefore clear. The LPG crunch brought to fore the fragility and vulnerability embedded in India’s energy supply chain and security. A country aiming to become “Aatmanirbhar” cannot afford to pursue a business-as-usual approach, especially when the issue is linked to food security.
This is an opportunity to rethink how India powers its kitchens and to push for biogas as an indigenously generated affordable, reliable and sustainable alternative at a massive scale. Biogas offers a pathway that simultaneously addresses energy security, waste management, livelihoods generation, income augmentation and climate commitments within a single decentralised framework.
Muskaan Jain is a postgraduate student pursuing public policy at the Tata Institute of Social Sciences, Hyderabad. Views expressed are the author’s own and don’t necessarily reflect those of Down To Earth.