Indraprastha Gas Limited (IGL), one of the key and biggest city gas distribution (CGD) network operators, has expanded tremendously in terms of its customer base and asset development since it took over Delhi’s gas distribution operations from GAIL (India) Limited in 1999. Over the years, the operator has consistently recorded a high growth rate of 13 per cent per annum owing to its dominant position (market exclusivity) in the National Capital Region (NCR). Further, in line with the government’s aim of moving towards a gas-based economy, IGL has made aggressive expansion plans for augmenting the gas pipeline network in its existing geographic areas (GAs) besides expanding its business presence in the four new GAs won under the ninth and tenth bidding rounds. At a recent India Infrastructure conference, E.S. Ranganathan, managing director, IGL, talked about the company’s existing CGD network, new technologies and information technology (IT) systems deployed for improving efficiency in operations, and future network expansion plans…
Existing footprint
So far, IGL has rolled out more than 1.1 million domestic, over 22,500 commercial and 1,900 industrial piped natural gas (PNG) connections. Further, its compressed natural gas (CNG) infrastructure has expanded from 448 stations in 2017-18 to 507 stations in 2018-19. By the end of 2019-20, the operator is expected to increase its PNG connections to 1.4 million besides increasing CNG stations to 570.
Further, there has been rapid expansion in the pipeline network. High pressure steel pipelines have doubled from 658 inch-km in March 2014 to 1,209 inch-km as of December 2019, across the NCR. Another 13,723 km of medium density polyethylene pipelines have been laid. With the expanded distribution network, IGL has become one of the largest PNG and CNG retailers in the country, accounting for about 25 million metric standard cubic metres per day (mmscmd) of gas consumption. During 2018-19, about 5.9 mmscmd of gas was sold, and this is expected to increase to 6.5 mmscmd with increasing gas demand from new GAs.
Expansions under ninth and tenth rounds
IGL has won one GA (Meerut, Muzaffarnagar and Shamali) in the ninth round, and three GAs – Ajmer, Pali and Rajsamand in Rajasthan, Kaithal in Haryana, and Kanpur, Fatehpur and Hamirpur in Uttar Pradesh – in the tenth round. Work under both the rounds commenced in August 2019. These GAs have a combined minimum works prog-ramme commitment of installing more than 300 CNG stations, 1.3 million PNG connections and 5,679 inch-km of steel pipelines over a period of eight years.
Driving efficiency
For a big CGD operator like IGL, fostering efficiency in complex business operations is essential to remain profitable. To achieve this, digital and advanced technologies have been leveraged extensively. For instance, remote monitoring and analysis of sectionalising valves is done on a real-time basis through a control and command centre. Vehicle tracking systems have also been installed on all patrolling vehicles for remote monitoring. To minimise billing issues, automatic meter readers have been deployed for industrial, commercial and domestic users besides providing the facility of prepaid billing. To overcome leakages in pipelines, geographic information system-based mapping of the entire pipeline network is currently being undertaken.
Apart from this, several IT solutions have also been adopted to provide value-added services and improve customer experience. Cashless payments through credit cards, mobile wallets like Paytm and Unified Payments Interface, prepaid cards, payment reminders through mobile messaging, online invoice availability are some of the initiatives. Further, customer relationship management software and a dashboard populating analytical reports on business operations have been introduced to enhance efficiency and transparency in operations. To drive business efficiencies, integrated CNG compressing and dispensing units have been installed for effective utilisation of limited land. Setting up dual-purpose dispensing stations (for buses and other vehicles) and a remote price change facility in CNG dispensers is another key step taken by the CGD operator.
Conclusion
The addition of new areas of operation and aggressive expansion in existing GAs will enable IGL to continue increasing its market presence in the CGD segment. That said, expanding business operations will bring along added complexities that will need to be effectively managed. Currently, the company has a gas tie-up with GAIL for a large portion of its current requirement. However, there is a need to improve gas availability and expand pipeline connectivity in the new GAs to ensure smooth operations and high demand pickup. Equally important is the need to ensure timely implementation of the upcoming liquefied natural gas terminals to expand the share of industrial customers in the consumer mix.