Over the last 15 years, the Government of India has attempted to replicate the success that liquefied petroleum gas (LPG) adoption has seen in urban households, in poorer and rural households. The Grameen Vitrak Yojana, launched in 2009, has helped grow the rural distributor base from 18% to 60% of the total LPG distributor base today. The ambitious Pradhan Mantri Ujjwala Yojana (PMUY) has provided more than 9.5 crore new households with LPG connections since 2016. With near-universal coverage of LPG, this is nothing short of an administrative and operational miracle. However, for the first time, LPG consumption in Indian households saw an absolute reduction in FY23 (minus 0.5% versus FY22) after years of steady growth. The questions are: how long must India consider just subsidising LPG to improve adoption? And what are the other options that it can explore?
The LPG story
In the recent past, the share of Indian households using LPG as the primary cooking fuel had risen to 71% in 2020 from 33% in 2011, according to the India Residential Energy Consumption Survey (IRES) conducted by the Council on Energy, Environment and Water (CEEW). It was a clear indication that Indian households wanted to adopt clean cooking solutions, and policy could overcome ‘preferences’ and financial barriers. However, global events that unfolded since the COVID-19 pandemic and the ensuing loss of livelihoods and income on the one hand and the Russian invasion of Ukraine and the resulting surge and volatility in crude and product prices on the other, have dented even a near-term prospect of universal use of LPG in Indian households.
