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  1. Ujjwala LPG cylinder scheme: Narendra Modi government set to take this big step to fund refills

Ujjwala LPG cylinder scheme: Narendra Modi government set to take this big step to fund refills

Given how several households that want to benefit from the Pradhan Mantri Ujjwala Yojana (PMUY) may not have the means to refill liquefied petroleum gas (LPG) cylinders, the ministry of petroleum and natural gas is roping in microfinance institutions to offer them funding solutions.

By: | Updated: December 16, 2017 4:21 AM
Pradhan Mantri Ujjwala Yojana, PMUY, LPG cylinders, petroleum and natural gas Given how several households that want to benefit from the Pradhan Mantri Ujjwala Yojana (PMUY) may not have the means to refill liquefied petroleum gas (LPG) cylinders, the ministry of petroleum and natural gas is roping in microfinance institutions to offer them funding solutions. (Image: IE)

Given how several households that want to benefit from the Pradhan Mantri Ujjwala Yojana (PMUY) may not have the means to refill liquefied petroleum gas (LPG) cylinders, the ministry of petroleum and natural gas is roping in microfinance institutions to offer them funding solutions.  “It’s difficult for a poor person, who earns daily wages, to save Rs 600 a month. However, it’s easier for her to save Rs 20 a day so microfinance groups are being consulted for a solution by which these households will have Rs 600 at the end of the month,” a government official said, asking not to be named.  The flagship PMUY was launched in May 2016 with an aim to provide LPG connections to 5 crore women belonging to the below-the-poverty-line category in three years. Till date, around 3.2 crore connections across 712 districts in the country have been released by the three national oil marketing companies.

“The ministry has sought suggestions and for instance in Uttar Pradesh, MicroSave is working on it and is confident it can come up with a product for regular savings for LPG refilling,” added the official. As reported by FE earlier, the average rate of LPG cylinder refills by PMUY beneficiaries stands at an annual 3.7 per connection issued compared with the national average of around 7.5 refills annually for 2016-17. While states such as Gujarat, Bihar and Uttarakhand are among the top with an average of more than four cylinder refills a year, Madhya Pradesh and Chhattisgarh have witnessed less than three refills a year per connection.  In the first year of the scheme — May 1, 2016 to April 30, 2017 — almost 80% of the PMUY consumers have come back for second refill while around 45% have refilled cylinders at least three times, data analysed by the petroleum ministry show. In fact, some consumers have an even higher refilling rate of six to seven times within a year.

A survey by the Petroleum Planning and Analysis Cell (PPAC), an arm of the petroleum ministry, showed 86% of the respondents found the high initial cost for the deposit and the price of gas stove a barrier; the high recurring cost of the cylinder was a barrier for 83% of the respondents. Information was collected from 1.03 lakh households without LPG connections across 120 districts in 13 states. Other barriers included access to free cowdung cakes and biomass.

“There is a huge geographical variation both interstate and intrastate in terms of refilling data, so there is no pattern. The variations are also seasonal and, for instance, in winter refill rates were high,” said the government official quoted above. The petroleum ministry has also initiated Pradhan Mantri LPG Panchayat which sensitises consumers to the socio-economic benefits, apart from health benefits, of using clean fuel for cooking.

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