Where is the gas to implement Gujarat Court order?

The Gujarat High Court’s order regarding natural gas allocation for compulsory usage in all vehicles in the State has been hailed by environmental activists and the State government alike, but the fact still remains that India simply does not have enough gas to cope with higher demand.

In directions issued on a writ petition filed by the Gujarat Rajya Autorickshaw Federation on Wednesday, the Gujarat High Court directed the State government to compel owners of all vehicles registered in the State to start using natural gas — even if it be at higher prices — within a year. In an order on another petition by the Dhrangadhra Prakruti Mandal (DPM), the court directed the Central government to supply Compressed Natural Gas (CNG) to the city of Ahmedabad at the same rate at which it is supplied in Delhi and Mumbai.

Gujarat Energy Minister Saurabh Patel welcomed the order against the Central government’s discriminatory allocation and pricing and estimated that CNG prices in Ahmedabad would come down by about Rs.10 per kg from the present Rs.53 a kg if the order is followed. In Delhi, CNG costs Rs.38-40 per kg and Rs.34-35 per kg in Mumbai.

“This is a very good order, especially if the gas prices are incentivised for public transport as the court directed,” said the Centre for Science and Environment’s Sunita Narain, hoping that the order could replicate the grand push for CNG seen in Delhi after the Supreme Court’s 1998 ruling. “But there is a big problem with implementation because India has run out of gas.”

For 2011-2012, the allocation of natural gas was an ambitious 239 million metric standard cubic metres per day (MMSCMD). However, the actual supply lagged far behind at a mere 154 MMSCMD. The glaring shortage is largely due to the plunging output from Reliance Industries’ KG-D6 gas field. While it was supposed to deliver over 60 MMSCMD, the actual supply from the field has fallen to only a third of the expected amount. With domestic gas production falling short, the fertiliser and power sectors — the biggest users — have already been feeling the pinch and are likely to resist any move to shift additional allocation to city distribution networks for vehicular usage.

“The momentum [for CNG] has been lost because of the disastrous decision to give our only gas field to a monopoly called Reliance,” complained Ms. Narain. “The government of India has to get serious about this.”

If imported gas is used instead, the economics could end up seriously unviable for vehicle users. “There is plenty of gas available in the world market, but it’s over three times the cost of domestic gas,” says Ashok Khurana, director general of the Association of Power Producers, which is already scrambling to cope with the domestic gas shortage. “It would be a tough order. Even if you were to import, it would take 24-36 months for new re-gasification facilities to be set up. The current facilities are already exhausted,” he pointed out.

The original petitioner, DPM vice-president Devjibhai Dhamecha, says it is simply a matter of prioritisation and equality. He asks how much the government values the health and environment costs paid by the people of Gujarat. “We understand that there is a shortage, but there is no reason why vehicle owner in Gujarat should get less of the gas that is available, or pay more for it,” he said.