India LPG Supply Crisis Exposes Cooking Fuel Vulnerability Amid Gulf Tensions

India's 332.1 million active domestic LPG connections have been placed under severe supply stress by disruption in the Strait of Hormuz triggered by the US-Israel military action on Iran, prompting calls to scale biogas as a domestically produced, renewable and LPG-compatible cooking fuel alternative. India imported 20,667 TMT of LPG worth Rs 1.06 lakh crore in FY2024-25, representing 53 per cent of total petroleum import expenditure.

Commercial establishments including restaurants have faced the most immediate operational impact from the LPG supply shortage, paring menus and scaling down or temporarily shutting operations. Piped Natural Gas expansion and electric cooking are being promoted as alternatives, but PNG relies heavily on imported LNG with Gulf countries supplying over half of India's LNG requirements, and 74 per cent of India's total power generation is coal-based, making mass electric cooking transition carbonintensive and potentially conflicting with India's pledge to cut 47 per cent of emissions intensity by 2035.

Biogas produced from organic waste through anaerobic digestion is chemically similar to LPG, cooks at comparable speeds and can be generated from India's abundant agricultural residue, livestock waste and municipal solid waste. India generates approximately 170,000 tonnes of municipal solid waste daily, with biodegradable organic matter accounting for 51 per cent. The Compressed Biogas production potential from domestic organic waste alone is estimated at 62 MMT annually, against current output that is less than 1 per cent of this figure. In FY25, 9.7 million PMUY beneficiaries did not purchase a single LPG refill, indicating a persistent affordability gap that biogas could address.

Successful community biogas models are operating in Punjab villages, at city government facilities in Pune and Indore and at institutional campuses. Hyderabad's Bowenpally Vegetable Market generates 500 units of electricity and 30 kg of biofuel daily from market waste. The author calls for an integrated expansion strategy combining community financing linked to self-help groups, carbon credit market participation under Article 6.4 of the Paris Agreement and reallocation of a portion of the LPG subsidy bill (Rs 15,479 crore in FY24-25) toward one-time biogas infrastructure investment, which does not require recurring annual subsidy unlike LPG.

Key figure — Rs 1.06 lakh crore — India's LPG import cost in FY2024-25