Delhi government apprehends a further rise in price of CNG
3 Jan 2014 6:39 AM IST
The city government on Thursday told the Delhi High Court that it apprehended rise in price of CNG due to reduction in allocation, following new guidelines by Ministry of Petroleum and Natural Gas, even as the Centre said that any shortfall will be met by import of the fuel.
The price of CNG or compressed natural gas in the national capital was hiked last week by a steep Rs 4.50 per kg, the second increase in rates in three months.
The guidelines, which may cause reduction in supply of CNG to Delhi, were issued by the Ministry in pursuance of a Gujarat High Court order that Ahmedabad should also get the fuel for domestic and vehicular usage at the same rate applicable to Delhi and Mumbai to enforce the right of equality.
The supply of CNG is not affected in Delhi as the shortfall in domestic supply is being offset by import of CNG, the counsel for the Ministry said.
Justice Manmohan granted a week’s time to the Centre to file its response to a petition filed by Delhi Contract Bus Association seeking that ‘the allocation and supply of domestic gas to the city of Delhi and National Capital Region through respondent 2 (Indraprastha Gas Ltd) be not reduced.’
However, Delhi government expressed apprehension that the Petroleum Ministry guidelines will have an adverse impact on commercial vehicle operators and any reduction in CNG allocation to Delhi would lead to fillip in prices of CNG and essential commodities.
The counsel for city government, in a written submission, said as an effect of redistribution, the domestic gas allocation for Delhi NCR would reduce resulting in more consumption of imported gas and will result in substantial price increase. It would adversely affect the transport sector in Delhi, the Delhi government said.
The plea said the ‘guidelines for allocation/supply of domestic natural gas’ to City Gas Distribution (CGD) entities for CNG (transport) and PNG (domestic) were ‘arbitrary, illegal, unconstitutional’ and contrary to a 2002 apex court order.
The Gujarat HC had directed the Ministry to maintain uniformity in allotment of natural gas and provide the fuel to Ahmedabad at the same rate it is supplied to Delhi and Mumbai.
According to subsequent guidelines issued on 14 November, 2013, the Centre decided to redistribute 5.75 MMSCMD (which is the present share of domestic gas in the entire consumption of gas for transport and domestic sector) among all entities/ cities.
The Delhi government also said that following the apex court directions of 2001 to switch city fleet to CNG, it took steps to procure CNG and all bus operators and private vehicle owners took steps to procure vehicles pre-fitted with CNG system or get it fitted at a substantial cost.
It said that because of all these combined efforts, NCT of Delhi has the biggest number of CNG using vehicles totalling to 513936 including 6,9907 cars; 17,722 buses; 77,110 private three-wheelers and others.
‘It is a hard fact that there would be an increase in the CNG prices as a result of the reduction of allocation of domestic gas in accordance with the guidelines of November 14, 2013 issued by the Ministry which will have an adverse impact on the commercial vehicle operators who got converted their vehicles to CNG by investing additional money on it.
‘Any reduction in allocation of CNG to Delhi would not only increase the prices of CNG alone but it would have further impact on rising of prices of essential commodities as well as discourage the use of CNG,’ the Delhi government counsel told the court.
The association, in its petition, also contended that GAIL had written to Indraprastha Gas Ltd that supply of domestic natural gas to it would reduce from 2.344 MMSCMD to 2.228 MMSCMD which amounts to five per cent reduction or 116,000 standard cubic meters per day. The court has now fixed the matter for hearing on 18 February.
The price of CNG or compressed natural gas in the national capital was hiked last week by a steep Rs 4.50 per kg, the second increase in rates in three months.
The guidelines, which may cause reduction in supply of CNG to Delhi, were issued by the Ministry in pursuance of a Gujarat High Court order that Ahmedabad should also get the fuel for domestic and vehicular usage at the same rate applicable to Delhi and Mumbai to enforce the right of equality.
The supply of CNG is not affected in Delhi as the shortfall in domestic supply is being offset by import of CNG, the counsel for the Ministry said.
Justice Manmohan granted a week’s time to the Centre to file its response to a petition filed by Delhi Contract Bus Association seeking that ‘the allocation and supply of domestic gas to the city of Delhi and National Capital Region through respondent 2 (Indraprastha Gas Ltd) be not reduced.’
However, Delhi government expressed apprehension that the Petroleum Ministry guidelines will have an adverse impact on commercial vehicle operators and any reduction in CNG allocation to Delhi would lead to fillip in prices of CNG and essential commodities.
The counsel for city government, in a written submission, said as an effect of redistribution, the domestic gas allocation for Delhi NCR would reduce resulting in more consumption of imported gas and will result in substantial price increase. It would adversely affect the transport sector in Delhi, the Delhi government said.
The plea said the ‘guidelines for allocation/supply of domestic natural gas’ to City Gas Distribution (CGD) entities for CNG (transport) and PNG (domestic) were ‘arbitrary, illegal, unconstitutional’ and contrary to a 2002 apex court order.
The Gujarat HC had directed the Ministry to maintain uniformity in allotment of natural gas and provide the fuel to Ahmedabad at the same rate it is supplied to Delhi and Mumbai.
According to subsequent guidelines issued on 14 November, 2013, the Centre decided to redistribute 5.75 MMSCMD (which is the present share of domestic gas in the entire consumption of gas for transport and domestic sector) among all entities/ cities.
The Delhi government also said that following the apex court directions of 2001 to switch city fleet to CNG, it took steps to procure CNG and all bus operators and private vehicle owners took steps to procure vehicles pre-fitted with CNG system or get it fitted at a substantial cost.
It said that because of all these combined efforts, NCT of Delhi has the biggest number of CNG using vehicles totalling to 513936 including 6,9907 cars; 17,722 buses; 77,110 private three-wheelers and others.
‘It is a hard fact that there would be an increase in the CNG prices as a result of the reduction of allocation of domestic gas in accordance with the guidelines of November 14, 2013 issued by the Ministry which will have an adverse impact on the commercial vehicle operators who got converted their vehicles to CNG by investing additional money on it.
‘Any reduction in allocation of CNG to Delhi would not only increase the prices of CNG alone but it would have further impact on rising of prices of essential commodities as well as discourage the use of CNG,’ the Delhi government counsel told the court.
The association, in its petition, also contended that GAIL had written to Indraprastha Gas Ltd that supply of domestic natural gas to it would reduce from 2.344 MMSCMD to 2.228 MMSCMD which amounts to five per cent reduction or 116,000 standard cubic meters per day. The court has now fixed the matter for hearing on 18 February.
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