MLA wants earlier road-digging fee of Rs. 1,957 per metre back

Bengaluru: The issue of road-digging for the installation of Piped Natural Gas (PNG) pipelines — along with the resulting road damage and meagre fees charged for excavation — was raised in the Assembly yesterday.

Chamaraja MLA K. Harishgowda urged the Government to reinstate the earlier road-digging fees, citing severe revenue losses faced by the MCC.

“For the financial well-being of MCC, I urge the Government to restore the old rates for the gas pipeline project supplying natural gas to households. Additionally, the charges fixed for the installation of private underground cables must not be reduced under any circumstances,” Harishgowda stated in the Assembly.

The MLA highlighted that the significant reduction in rates for gas pipeline installation has led to financial setbacks for MCC.

The MLA warned that private companies are now pushing for lower fees on underground cable installations under similar provisions. If this trend continues, developmental projects within MCC limits will be severely impacted.

In 2021, during an MCC Council meeting on Oct. 10, a resolution was passed to fix rates for gas pipeline installations.

As per the decision, road excavation using open trench method required a fee of Rs. 2,250 per metre, while the Horizontal Directional Drilling (HDD) method was set at Rs. 1,000 per metre.

From Rs. 1,857 to Re.1 per metre

As per the Government’s subsequent order, a road-cutting fee of Rs. 1,857 per metre was fixed, along with a Rs. 100 supervision fee. Based on this rate, permission was granted for approximately 45 kilometres of gas pipelines, generating a total revenue of Rs. 9,64,21,500.

However, the Nov. 7, 2023, order titled State Policy on the Development of Urban Gas Distribution Network stressed the need to make gas pipeline installation permissions more affordable.

The new directive proposed that the combined permission and supervision fees be capped at Rs. 1,000 per kilometre. Consequently, the previously fixed fee of Rs. 1,957 per metre was slashed to an astonishing Re. 1 per metre, the MLA pointed out.

This drastic reduction means that the cost per kilometre now stands at just Rs. 1,000, leading to an estimated revenue loss of over Rs. 25.65 crore for the MCC.

Concerns have been raised that the policy overwhelmingly benefits private companies while failing to account for the financial shortfall faced by local bodies and crucial infrastructure they must provide. The abrupt implementation of these revised rates without proper impact assessment has drawn criticism, he said.

With MCC struggling to fund developmental projects, the ongoing pipeline works continue to damage well-maintained roads. Meanwhile, reports suggest that private companies have now urged the Government to similarly lower the rates for underground cable installations, aligning them with the newly reduced gas pipeline charges, he noted.

It was firmly emphasised that the rates for underground cable installation must not be reduced under any circumstances. Additionally, a demand was made by the MLA to reinstate the earlier rate of Rs. 1,957 per metre for gas pipeline projects.

In response, Energy Minister K.J. George assured that the proposal to revise and increase gas pipeline installation charges would be reviewed and appropriate action would be taken.