Business Standard

High cost fails to hit LPG use

Customers may continue using 3 cylinders this yr


Pradhan Mantri Ujjwala Yojana (PMUY) beneficiar­ies appear to be shrugging off the high cost of refills and maintainin­g the same level of annual consumptio­n at around three cylinders a year.

According to data compiled by the ministry of petroleum and natural gas, the annualised consumptio­n for this year, based on numbers till September 2021, stands at around 3.7 refills a beneficiar­y.

This is based on extrapolat­ed data for liquefied petroleum gas (LPG) cylinder refills, senior officials told Business Standard. But this data will vary closer to the end of the year, considerin­g fire wood availabili­ty. “Since complete weaning away from firewood or dung for cooking has not happened, PMUY beneficiar­ies tend to stack LPG with other forms of fuel to meet their requiremen­ts. During the rainy season, dry wood availabili­ty becomes an issue and LPG consumptio­n gains,” an oil ministry official said.

PMUY beneficiar­ies had gone in for 3.01-cylinder refills in 2019-20 and three refills in 2018-19. This was when domestic liquefied petroleum gas (LPG) prices were regulated by budgetary subsidies, which varied every month to keep the effective price of a cylinder closer to ~500 apiece.

Currently, domestic LPG cylinders (14.2 kg) are sold at market prices but the government continues to subsidise freight for consumers in some parts of the country. The freight subsidy comes to less than ~30 per cylinder and is used to bring uniformity in cooking gas prices within a state.

According to Indane, the price of a domestic LPG cylinder is now ~884.50 apiece in the National Capital. This is the highest price at which a domestic ‘subsidised’ cylinder has been refilled till date.

On an average, PMUY beneficiar­ies use three (or a little more) cylinders a year. The exception was 2020-21 when the consumptio­n shot up to 4.39 refills after three free refills were given by the Centre under the first Aatmanirbh­ar Bharat package announced in May 2020. “Since we did not see six cylinders being consumed in 202021, it is being assumed that even after three free cylinders, they are not interested in going in for many more refills,” said another oil ministry official.

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