Mandatory switch to PNG for Delhi industries credit positive for CGDs: ICRA

New Delhi, Dec 26 : The Centre’s new directive for industrial units in Delhi to switch over to PNG (piped natural gas) owing to the high levels of pollution is a positive development for city gas distribution (CGD) companies, ICRA said in a note.
Accordingly, the Ministry of Environment, Forests and Climate Change on December 22, identified about 1,644 industrial units spread across 50 industrial areas in Delhi to switch over to PNG owing to the high levels of pollution.
In addition, Delhi Pollution Control Committee (DPCC) was also directed to inspect and identify the industries using unapproved fuels and to take stringent penal action in case of non-compliance.
Besides DPCC, Indraprastha Gas and Delhi government were also asked to work in close coordination with the industrial units so as to target the completion of infrastructure work and switch over to PNG by January 31, 2021.
As per the ICRA note, this directive to compulsorily switch to PNG in the NCR region is a positive development for CGD companies, both from an immediate as well long-term perspective.
“The directive by the ministry would provide a boost to the industrial volumes of incumbent IGL,” said Prashant Vasisht, Vice-President and Co-Head, Corporate Ratings, ICRA.