The 1,000-km pipeline will feed industries at Belgaum, Dharwad, Gadag, Bellary, Davanagere, Chitradurga, Tumkuyr, Ramanagaram and Bengaluru who have till now been using costlier and polluting liquid fuels like naphtha and diesel as feedstock.
"With gas coming in, the devil of pollution will disappear from the City of Gardens," Oil Minister M Veerappa Moily said after inaugurating the pipeline.
Gas will help the state power generation utility save Rs 800 crore annually by reducing cost, improving efficiency and drastically cutting down pollution caused by using liquid fuels.
The pipeline, he said, will be extended to Mangalore this year and further to Kochi in Kerala by end of next year.
Gas in its liquid form, or liquefied natural gas (LNG), imported at the just commissioned Dabhol terminal in Maharasthra would fire industries in Karnataka. GAIL commenced supply of gas through the line to its first customer Toyota Kirloskar Auto Parts Pvt Ltd.
The Dabhol-Bengaluru pipeline has a capacity to carry 16 million standard cubic meters of gas per day, he said, adding 73-km of line have been laid in Bengaluru city that would help in beginning CNG supplies to automobiles as well as piped cooking gas to households.
"We will work to give GAIL the licence for operating city gas in Bengaluru and may be in two months, we will see the first CNG station in the city," he said.
GAIL also signed an agreement to supply 0.6 million tonnes of LNG to Karnataka Power Corp Ltd's proposed 1,400 MW Bidadi power plant.
KPCL Managing Director M R Kamble said the first phase of 750 MW would now be built in next two to two-and-half years at an estimated cost of Rs 2,800 crore. 170 acres of land for the project has already been acquired and all clearances obtained.
Also, there is possibility of the 350 MW Yelahanka power plant switching over from diesel to gas to save cost, he said. Together with 1,400 MW Bidadi power plants, Bengaluru would have 1,750 MW of generation capacity against a demand of 1,500 MW.
GAIL Chairman and Managing Director B C Tripathi said the company had imported two shiploads of LNG at Dabhol and a third would be imported in next week to 10 days.
The firm is planning a massive expansion of its 10,000 km of pipeline network with 3,000 km of lines under execution and another 2,000 km on drawing board, which would take up the transmission capacity to 350-400 million standard cubic meters per day.
Gas, he said, would help power generation utilities save Rs 700 to 800 crore in fuel cost.