IMPORTANCE OF CNG IN TRANSPORT SECTOR

S.M.ABBAS ZAIDI,
Research Analyst
, PAGE
Jan 11 - 17, 2010

In an effort to reduce dependency on other fuels as well as to improve the environment, the use of CNG in vehicles is being encouraged.

Due to price difference between petrol and CNG, vehicles are still being converted to CNG and approximately two million vehicles are using CNG.

The numbers of CNG stations are increasing with an increase in the conversion rate and there are about 3000 established CNG stations in the country presently with an investment of Rs.70 billion. Pakistan at present is the largest CNG user country.

In addition, the government's policy of de-dieselization is actively pursued with the provincial governments, who are implementing this policy to achieve import substitution.

For instance, the diesel operated intra-city urban public transport will be phased out in Karachi, Hyderabad, Lahore Faisalabad, Peshawar, Quetta and Islamabad/Rawalpindi.

TECHNOLOGY

CNG can easily be used in otto-cycle gasoline and modified diesel cycle engines. Lean-burn otto-cycle engines can achieve higher thermal efficiencies when compared with stoichiometric otto-cycle engines at the expense of higher NOx and hydrocarbon emissions.

WORLDWIDE AVERAGE CNG GROWTH RATE FOR THE PAST FIVE YEARS

Global 30.6%
Asian Industry 49%
Pakistan's Industry 57% (fastest in the World)
Compressed Natural Gas (CNG) (Jan 2010)
Sale price Rs. 503.64 per MMBTU

Electronically-controlled stoichiometric engines offer the lowest emissions across the board and the highest possible power output, especially when combined with EGR, turbo charging and inter-cooling, and three way catalytic converters.

The octane rating of CNG is far greater than petrol and if handled correctly it can produce same or more power output from an engine provided the compressed natural gas is compressed properly and accurate amounts of BTU figures attained.

CNG cylinders can be made of steel, aluminum, or plastic. Lightweight composite (fiber-wrapped plastic) cylinders are especially beneficial for vehicular use because they offer significant weight reductions when compared with earlier generation steel and aluminum cylinders, which lead to lower fuel consumption.

CNG may be refueled from low-pressure or high-pressure systems. The difference lies in the cost of the station versus the refueling time. There are also some implementations to refuel out of a residential gas line during the night, but this is forbidden in some countries.

BENEFITS OF CNG INDUSTRY

There is no doubt that Pakistan's CNG industry is one of the fastest growing industry in the world, therefore it will help to phase out diesel buses, wagons and mini- buses in urban areas for better economy and environment.

Diesel oil is a deficit product for Pakistan. The share of CNG is 15%, gasoline 14% and diesel 71% in road transport sector.

During 2007-08 Pakistan imported 4.5 million tones of diesel oil at a cost of about US $ 3.86 billion. Government has planned to bring 8000 CNG buses on the roads and earmarked US$ 64 million under this project.

In Pakistan the majority of private vehicles have converted to CNG because of cheaper price as compared to petrol. Only luxury cars and official vehicles now run on petrol. Recently, new CNG buses have been introduced by CDGK. Almost all car manufacturers in Pakistan now produce company fitted CNG kit versions.

However, recent hikes in CNG prices have downplayed the ambitious ventures of some of the stakeholders in this sector. It is expected that price of the CNG and kits will come down as competition among manufacturers grows.

Landi Renzo Pakistan is also exporting CNG kits to various countries including China, Brazil, and Italy. Most of the vehicles have dual fuel options in the country.

CURRENT CNG CRISIS

The government has recently decided to raise the price of CNG from Rs 48.54 per kilogramme with an increase of 20 percent to Rs 53-58 per Kg. The price difference between CNG and petrol has become nominal as the price of petrol is Rs 66 per litre at the moment.

CNG PRICES IN PAKISTAN (RS. PER KG)

PROVINCE AUG-2009 JAN-2010
NWFP, Balochistan & Photohar region 49.73 55.30
Sindh & Punjab 48.54 53.63

Sui Northern Gas Pipelines (SNGPL) had earlier requested the Oil and Gas Regulatory Authority (OGRA) to increase gas tariffs by 20 percent for all its users and after increase from January 01, 2010 CNG is now available between Rs 53-58 per Kg.

CNG consumers will soon realise that the kits in their vehicles are a dead investment, as the price of this fuel is getting equal to almost petrol prices.

CONCLUSION

The government saves billions of rupees annually on petroleum due to the usage of CNG. With the increased prices there will be a decline in CNG usage. The government would also be depriving the society of green fuel. CNG emits less pollution as compared to petrol.

Consumers have expressed displeasure over the increase of CNG prices, and exhort the government to decrease prices immediately. The CNG consumers have invested significant money on CNG kits, and if the government does not decrease gas prices these kits would become useless or the CNG-fitted vehicles they bought would be no more economically suitable to them.