CNG Conversion Scheme Gains Impetus

EghtesadOnline: A nationwide plan for converting 1.4 million gasoline-powered public transport vehicles and private cars to CNG hybrids has gained impetus.

News ID: ۷۵۱۰۶۶

22 September 2020

Close to 200 conversion centers in 25 provinces are each equipped with 150,000 domestically-made kits and tanks, head of CNG department at the state-run National Iranian Oil Products Distribution Company said.

“In the past four months 136,000 vehicles have registered with gcr.niopdc.ir belonging to the NIOPDC, of which 52,000 are public vehicles. The rest are either private-owned cars that have to pay for the conversion or are dilapidated vehicles not eligible for the fuel change,” Mohammad Hossein Baqeri was quoted as saying by ILNA.

The CNG scheme is free for taxis, pickups and commercial vehicles. Of the total 52,000 vehicles, 23,000 cars have been retrofitted and the rest are either being converted or are waiting to do so because the number of authorized centers are limited and demand is high and growing.

In May gcr.niopdc.ir was introduced for specific vehicles registration and converting engines to CNG hybrids.

When the plan ends it will cut gasoline use by 15 million liters per day. Total gasoline consumption in Iran now is nearly 75 million liters a day.

Heavy Polluters

In addition to curbing gasoline and diesel use, the plan is basically to help reduce CO2 emissions from gasoline and diesel-powered engines that are heavy polluters. Comprised mostly of methane gas, CNG produces fewer undesirable gases compared to gasoline and diesel.

Regarding financial issues, the oil official said NIOPDC and Bank Mellat signed an agreement last December to contribute to pool resources to get the retrofitting job done.

As per the contract, the equivalent of $510 million required to convert 1.4 million gasoline-powered vehicles to CNG hybrids comes from Bank Mellat.

According to NIOPDC data, of the 19 million vehicles in Iran, over 5 million do far have hybrid CNG engines.

The NIOPDC said in the last fiscal year that ended in March 2019, daily gasoline consumption was 90 million liters. Gasoline in Iran is costlier than CNG.

One cubic meter of CNG costs 4,600 rials (1.8 cents), about four times cheaper than gasoline. A liter of subsidized gasoline costs 15,000 rials (6 cents) and non-subsidized fuel 30,000 rials (12 cents). Each private car has monthly quota of 60 liters of subsidized gasoline.

“CNG consumption has reached 25 million cubic meters per day and is estimated to increase by 15 mcm/d gradually as more cars are equipped with CNG tanks.”

CNG consumption fell to 10 mcm/d in March and February due to closedowns to control the coronavirus. However, use of the environmentally-friendly fuel registered 100% growth in June and now daily consumption is in the region of 25 mcm.

Globally Iran is 5th in CNG consumption.

There are 2,400 CNG stations in the country, but “NIOPDC has serious problems increasing CNG pumps not only due to expensive land prices but also because of importing equipment”, Baqeri noted.

The US, EU, Russia and China daily use 75 mcm, 45 mcm, 40 mcm and 25 mcm of the fuel, respectively. An estimated 15 million CNG-run vehicles ply the roads in the world, of which 1.5 million are in Europe.

In the last decade more than $2.4 billion was invested to expand CNG use in Iran.