EghtesadOnline: Retrofitting vehicles, especially vans, with compressed natural gas can substantially cut fuel costs, head of the CNG Department of state-run National Iranian Oil Products Distribution Company said.
“A van uses at least 750 liters of gasoline per month that costs 19 million rials ($64). CNG (750 cubic meters/month) costs 3.8 million rials ($12) and helps save $52,” Mohammad Hossein Baqeri was quoted as saying by IRNA.
Each cubic meter of CNG is sold for 5,000 rials (1.6 cents) and a liter of subsidized gasoline costs 15,000 rials (5 cents) and non-subsidized fuel 30,000 rials (10 cents).
As per a 2019 directive of the National Iranian Oil Products Distribution Company to sell gasoline at two rates, non-hybrid vans are entitled to 250 liters of subsidized fuel a month.
According to the official, there are 2.4 million vans of which 1.3 million are non-hybrid.
CNG is almost five times cheaper than unsubsidized gasoline. Common sense and economic wisdom demand a collective shift to the cost-effective fuel, the NIOPDC official said. There are 200 conversion centers that can retrofit 20,000 vehicles to CNG per day.
Referring domestic production of hybrid cars, he said up until the recent past automakers manufactured half a million hybrid CNG engines a year “but now that has declined to 40,000”.
Baqeri said of the total 19 million vehicles in Iran, five million plus have hybrid CNG engines accounting for 20% of overall CNG consumption.
Iran has the capacity to produce 40 million cubic meters of CNG per day.
CNG consumption shot up by 10 million cubic meters a day in August and September compared to March and February.
Use of the fuel plunged to 10 mcm/d in March and February due to closedown measures to control the coronavirus pandemic. Sales of the cheap and environmentally-friendly alternative fuel doubled in August and September reaching the same volume before the plague struck.
CNG consumption is growing and is projected to exceed 24 mcm/d by the end of November as more vehicles are being retrofitted, Baqeri said. Globally Iran is 5th in CNG consumption. There are 2,000 CNG stations in the country.
Unlike gasoline, eco-friendly CNG minimizes harmful carbon deposits when combusted. This helps engines run more efficiently and increases the life of spark plugs. Iran has extensive natural gas resources and an efficient network of pipelines.
Motorists averse to the conversion say CNG tanks are heavy and take considerable storage space leaving little room in the trunk of small sedans like Pride.