Pipeline Subsidy for CBG Plants under DPI Scheme for CBG–CGD Pipeline

Scheme Guidelines for Development of Pipeline Infrastructure (DPI) for Injection of CBG into CGD Network – Complete Guide for CBG Plants

Generally we receive many inquiry about Pipeline Subsidy for CBG Plants under DPI Scheme for CBG–CGD Pipeline and about the scheme guidelines for CBG Plants and therefore this is a detail blog for you.

India is rapidly pushing towards clean energy, and Compressed Biogas (CBG) has emerged as one of the most promising green fuels under national programs such as GOBARdhan, SATAT, and MNRE’s Waste-to-Energy initiatives.
To accelerate the use of CBG, the Government of India has launched a dedicated support mechanism:

Scheme Guidelines for Development of Pipeline Infrastructure (DPI) for Injection of CBG in City Gas Distribution (CGD) Network.

This scheme provides financial assistance (FA) to connect CBG plants to nearby CGD networks through pipelines, ensuring full offtake and reducing transportation challenges.

This blog explains the scheme in simple language—objectives, eligibility, financial assistance, application process, timelines, and responsibilities of CBG producers and CGD entities.

1. Purpose of the DPI Scheme

According to the Ministry of Petroleum & Natural Gas (MoPNG) guidelines (June 2024), the DPI scheme aims to:

• Ensure 100% offtake of CBG produced by connecting plants to CGD pipelines.

• Eliminate losses and flaring of CBG due to non-availability of transport.

• Promote cost-effective, environment-friendly pipeline transport instead of cylinders or tankers or CNG cascades.

• Support the development of a robust regional supply network for CBG.

• Reduce carbon emissions by enabling consistent gas movement from plant to consumers.

• Remove financial barriers in laying MDPE/steel pipelines from CBG plant to CGD network.

2. Who Can Apply? (Eligibility Criteria)

Based on the scheme guidelines:

Eligible CBG Plants

A CBG plant can apply if:

1. Installed production capacity ≥ 2 TPD.
2. Plant is registered on GOBARdhan Portal.
3. For preference: capacity > 5 TPD.
4. Plant has a Gas Supply / Gas Transportation Agreement with CGD entity:
5. Minimum 50% take-or-pay arrangement.
6. Under-construction plants must have ≥25% physical progress as per DPR.
7. Design and capacity of pipeline must be mutually agreed between CBG producer and CGD operator.

Eligible Beneficiary

• Primary beneficiary: CGD entity laying the pipeline.

• If CGD cannot lay pipeline: CBG producer may lay it and become the beneficiary.

• OGMCs (Oil & Gas Marketing Companies) are not eligible.

3. Financial Assistance (Subsidy) Under DPI Scheme

Financial support is provided for building a dedicated MDPE or steel pipeline from the CBG plant to the CGD connection point.

3.1 Standard Financial Assistance (SFA)

As per scheme:

3.2 Maximum Financial Assistance

• ₹28.75 crore per project (upper limit).

• FA applies separately for each sector if multiple CBG plants connect to one pipeline network.

4. Milestone-Based Subsidy Release

Financial assistance is released in three stages, based on certified progress:

Milestone 1 – On Approval of Application

• 10% of sanctioned FA (as advance)

• Requires Bank Guarantee valid for 18 months.

Milestone 2 – 50% Construction Completion

• Release 40% of total FA
  OR

• 50% if no advance was taken.

Milestone 3 – Completion & Commissioning

• Balance 50% released after:

  • Commissioning report

  • CA-certified expenditure

  • Verification by PMA

  • Minimum 50% usage of committed gas volume for 3 months.

FA is processed by PMA → Ministry → CNA → Beneficiary’s bank account.

5. Application Process for DPI Scheme

Step 1: Submit Application

Applications must be filed through the designated portal https://dpi.eil.co.in/Default before 31st March 2026 (extended).
Incomplete applications will be rejected within 60 days.

Step 2: DPR & Technical Evaluation

DPI Scheme Last Date

PMA evaluates:

• DPR details

• GSA status

• Plant commissioning status

• Production capacity

• Monetization potential

Step 3: Recommendations

PMA → PAC → PAB (final approval within 2 months).

Step 4: Post-Approval Requirements

Beneficiary must:

• Obtain statutory approvals (PNGRB, local permissions).

• Lay pipeline within 1 year (extension possible with justification).

• Submit commissioning report + CA certificate.

• PMA performs field verification.

Step 5: Release of Subsidy

Once compliance is verified, funds are released to CNA → Beneficiary (within 2 weeks).

6. Responsibilities of the Beneficiary

As per scheme:

• Maintain, operate, and secure the pipeline.

• Use pipeline only for biogas/CBG supply.

• Follow PNGRB regulations on gas quality, pressure, odorization, and safety.

• Ensure exclusivity & transportation tariff compliance.

• In case of non-performance:

  • Warning notice → penalty → recovery of FA.

7. Technical Highlights from Scheme Diagrams

Pipeline Network Illustration: 

This example explains how multiple CBG plants, located at different distances, connect to a Gas Gathering Station (GGS), and then further to the City Gas Distribution (CGD) pipeline network.

Indicative Financial Assistance Calculation for Subsidy for Pipeline under DPI Scheme

Financial Assistance (FA) is calculated based on the distance of each plant from the GGS, with higher support for the first 50 km and a reduced rate for the 50–75 km segment. The illustration below explains how subsidy is computed for each plant in a simple cluster-based connectivity model. If multiple CBG plants connect to a single GGS, FA is not split but is calculated individually based on each plant’s distance.

📌 Example Table: Indicative Financial Assistance Calculation

Total Indicative FA for Cluster = ₹1.125 + ₹1.875 + ₹4.50 = ₹7.50 Cr

8. Why This Scheme Matters for CBG Project Developers

The DPI scheme solves the biggest barrier in CBG monetization:

Guaranteed evacuation of CBG

No more:
✔ Tanker dependency
✔ High logistics cost
✔ Flaring of gas
✔ Uncertain offtake

The scheme offers:

• Pipeline cost subsidy up to 28.75 crore

• Faster commissioning

• Assured revenue via CGD agreements

• Long-term confidence for investors & banks

9. Final Thoughts — Why Every CBG Plant Should Apply Before 31 March 2026

This scheme is a game-changer for India’s CBG ecosystem and Last Date to Submit Application is 31st March 2026 for Pipeline Subsidy for CBG Plants under DPI Scheme for CBG–CGD Pipeline in India.

If your CBG plant is:

• 2 TPD or above,

• Registered on GOBARdhan,

• Interested in CGD supply,

then pipeline connectivity subsidy is the fastest and most profitable way to scale your CBG business.

This scheme is available only for FY 2024-25 and 2025-26—so timely application is critical.

Want to Apply for DPI Subsidy?

As India’s leading expert in CBG project finance & subsidies, Adroit Corporation provides:

• DPR

• Pipeline design support

• Eligibility analysis

• Application filing

End-to-end support till subsidy disbursement.

Book Your Consultation:
 sales@adroitcorporation.in
 7203010101

Rajesh Savaniya