The Union Cabinet has approved GOBARdhan, the National Circular Bioenergy Scheme, with a total financial outlay of Rs 23,731 crore to scale up domestic Compressed Biogas (CBG) production. The scheme, administered by the Ministry of Petroleum and Natural Gas, will run from FY 2026-27 through FY 2035-36, aiming to expand domestic CBG production nearly ten-fold by processing agricultural residue, cattle dung, press mud, and municipal organic waste into clean fuel and organic manure.
To achieve this scale, the government says that GOBARdhan will integrate six core operational pillars directly into its national execution framework. Under the assured offtake component, City Gas Distribution entities must comply with a notified blending trajectory of 3% in FY 2026-27, rising to 4% in FY 2027-28 and 5% from FY 2028-29 onward across CNG and domestic PNG segments, creating a predictable market demand signal. Revenue certainty is further reinforced by a government-backed pricing framework establishing an administered price of Rs 2,110 per Metric Million British Thermal Unit (MMBTU) with a minimum ten-year horizon.
CBG Capital Assistance: Up to Rs 2 Crore Per Ton/Day for Greenfield Plants
Eligible greenfield projects will receive capital assistance of up to Rs 2 crore per ton per day of installed capacity—extending to feedstock aggregation and organic manure processing assets—alongside support for brownfield expansions. Distribution bottlenecks are addressed through targeted funding for cluster-based and standalone pipeline connections linking CBG facilities to main trunk lines and city gas networks.