According to Paris (France)-based International Energy Agency (IEA)’s report titled “India Gas Market Report: Outlook to 2030”, India’s natural gas consumption is expected to increase by nearly 60% to 103 billion cubic meters (bcm) annually by 2030. This growth will be mainly driven by robust growth in city gas distribution, industrial demand and power generation.
- While, Liquefied Natural Gas (LNG) imports are projected to more than double between 2023 and 2030, to 65 bcm annually, driven by steady demand growth and a much slower increase in domestic production.
- The key findings of the report were released during the India Energy Week (IEW) celebration held in New Delhi, Delhi.
Note: India aims to increase the share of gas in its energy mix from a slightly over 6% to 15% by 2030.
Key Findings:
i.As per the report, targeted strategies and policy interventions could push India’stotal gas consumption beyond the projected trajectory to around 120 bcm annually by 2030.
- The report has outlined certain targeted strategies like: promoting higher utilization of gas-based power plants, faster adoption of LNG in heavy-duty transport, and further boosting expansion of city gas infrastructure.
ii.The report projected that City Gas Distribution (CGD) will lead to the growth in consumption through 2030, driven by rapid expansion in Compressed Natural Gas (CNG) infrastructure and competitive pricing against liquid fuels.
- Also, heavy industry and manufacturing sectors like: iron and steel production are projected to add around 15 bcm of demand during this period, while gas use in oil refining is expected to increase by more than 4 bcm as more refineries are connected to the network.
iii.The report revealed that India’s natural gas demand increased by more than 10% in both 2023 and 2024, which indicates an inflection point. While, total consumption in 2023 was marginally higher than 2011 levels.
- This growth is driven by 3 main factors: rapid infrastructure expansion, recovering domestic production, and an expected easing of global gas market conditions.
iv.Since 2019, the number of CNG stations and residential gas connections in India, has increased by nearly 4 times and more than two times, respectively. It has also expanded its natural gas transmission pipeline by 40%.
- The report has projected that CNG stations and residential gas connections in India are likely to double again, while the gas transmission grid is expected to expand by another 50%.
v.India’s domestic gas production, which met 50% of demand in 2023, is estimated to grow gradually, reaching just less than 38 bcm by 2030, or around 8% above 2023 levels.
vi.As per the report, India’s LNG imports increased by 70% between 2013 and 2023, and reached 36 bcm in 2024, matching the previous record set in 2020 and consolidating India’s position as the world’s 4th largest LNG importer.
- However, the report cautioned that the gap between contracted LNG supply and estimated LNG demand is expected to widen, particularly after 2028. This will leave India more exposed to the volatility of the spot LNG market unless additional LNG contracts are secured in coming years.
vii.The report projected that India’s Compressed Biogas (CBG) production is expected to reach 0.8 bcm annually by 2030. It has also estimated that India’s CBG potential will be around 87 bcm annually.
- The report highlighted certain challenges that may hinder the consistent availability and commercial viability of CBG production: availability of land, limited offtake, seasonal biomass supply and inadequate logistics.
Keyfacts:
i.Japan has the largest LNG import capacity in the world. As of 2024, Japan’s LNG import terminals boasted a combined capacity of nearly 242 million metric tons(MMT) per year.
ii.In 2024, the United States of America(USA) became the largest LNG exporter in the world with 11.9 billion cubic feet per day (Bcf/d).
iii.In 2024, China is the world’s largest importer of LNG with 76.65 million tons(MT).
About International Energy Agency (IEA):
Executive Director (ED)- Dr. Fatih Birol( Turkey)
Headquarter- Paris, France
Member nations- 32 (India joined IEA as association member nation in 2017)
Established- 1974
