We Are Geared Up For A Growing CNG Ecosystem: E.S. Ranganathan, MD, Indraprastha Gas
“Availability wise, natural gas will outlast every other fossil fuel, plus if you will see in an economy like India’s where 57 per cent electricity is generated from coal, natural gas seems to be the most benign alternative.”
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In an exclusive interview with BW Businessworld’s Jyotsna Sharma, E.S Ranganathan, Managing Director, Indraprastha Gas (IGL) speaks of the growing CNG ecosystem and natural gas shaping the future of mobility. For the year ended 31 March 2019, the gross turnover of the company was reported as Rs 6,336.7 crore, an increase of 26.9 per cent from the previous year.
Bold climate action could deliver at least $ 26 trillion in economic benefits by 2030. There has to be a global shift to a low- carbon economy, and this has to be across sectors: energy, cities, food and land use, water and industry. Natural gas, it is believed, is simply swapping one fossil fuel with another. Your view on this.
Worldwide, if you look at the primary energy source order in terms of pollution, from production to consumption – coal is on the top of the pyramid followed by liquid fuels. Then comes natural gas and finally renewables like wind, solar etc. If you look at the availability part, natural gas has maximum reserves of the order of more than 100 years. Availability wise, natural gas will outlast every other fossil fuel, plus if you will see in an economy like India’s where 57 per cent electricity is generated from coal, natural gas seems to be the most benign alternative. I personally feel that this will be the bridge for a transition from polluting fuels to the renewables.
What are the key elements of the growth of the CNG ecosystem in India?
Growth of any primary energy source is based on the 3 As – Availability, Accessibility and Affordability. Till sometime back only 20 per cent of the area of the country had access to gas. However, now 53 per cent of the country by area and 70 per cent of the population will have access. The government has come out with priority allocation of domestic gas, which will ensure availability and will also help fulfil its mission of raising the share of natural gas in India’s energy mix to 15 per cent by 2030. For the import of LNG, sufficient new regasification plants are coming up to cater to the new requirement.
What support from the government can be given for expansion?
The government can direct the most polluted cities in the country to move their entire public transport network to CNG. The second thing they can do is that natural gas can be brought under GST as it would help gas companies get the input tax credit.
Tell us about the current IGL CNG and PNG network, the revenue mix and projected growth?
IGL has a massive gas pipeline network of over nearly 14000 kms across its geographical areas of operation. 515 CNG stations have been set up by IGL, which are fueling over 11 lakh CNG run vehicles. Over 12 lakh domestic kitchens are enjoying convenience of PNG being supplied by IGL.
In regards to revenue, 75 percent of our revenue comes from CNG and roughly 8 to 10 percent comes from domestic households, and the rest is from the industrial and commercial sector.
We are planning to add another 70 CNG stations and connect another 3 lakh households with PNG network in one year.
How can natural gas vehicles shape the future of mobility?
Natural Gas vehicles constitute around 2 per cent of the total vehicles in the country. With its zero particulate matter emission and better CO & HC emissions, these offer the best alternative for the reduction in vehicular pollution.
EVs have their own technological challenges like battery disposal, charging time, and cost to name a few. I think, going forward we will see them in hybrid cars (which will be part EV, partly CNG) in a big way. I don’t see the switch happening to an entirely EV ecosystem for at least another 10 years. As far as I am concerned, CNG offers the best option to reduce environmental pollution.
What’s the outlook for the upcoming year and new areas of expansion?
We are the only CGD company that is growing in a double-digit and we expect that it will continue for at least two more years. We currently are operating in 10 GAs in 4 states and are also looking at non-energy projects. We will go for more areas and will be bidding aggressively in new bidding rounds.
Tell us about the use of technology at IGL
Technology brings about customer delight, more efficient operations, optimal cost and better realization of revenue. At IGL, we have embraced technology in a big way. For instance, we have more than 50 payment options available to the customer and I am happy to say that 100 per cent of our PNG customers use the cashless mediums.
Our app – IGL Connect allows self-billing as well. In addition, we also have an option of the customer sending in their meter reading through WhatsApp. Through the Queue management feature in the app, people can see waiting time at all the CNG stations from their home to office in one click. This not only is convenient but also allows them to beat queues at CNG stations.