The Infrastructure Is Not Enough for Widespread Switching to Gas Fuel

11 january 2018 | Rossiyskaya Gazeta

Gasoline and diesel fuel account for almost all fuel (99%) consumed by road vehicles in Russia. This figure remains unchanged for several decades, but the government has been actively promoting the shift of commercial and public transport to gas in recent years. The Analytical Center estimated that re-equipping of gasoline taxi cars will pay off in less than six months and it will be possible to curb the growth of ticket prices in the conditions of lower gas cost.

Alexander Amiragyan
Alexander Amiragyan
Department for Fuel and Energy Sector

"Currently in Russia, liquefied hydrocarbon gases (LHG) and compressed natural gas (CNG) are 2-3 fold cheaper than gasoline and diesel fuel with comparable mileage per fuel unit," state the experts in their monthly energy bulletin. According to their estimates, due to this the payback period of commercial car re-equipping to gas usage is just 3.4-4.5 months (the equipment cost is around RUB 30,000 for LHG and RUB 60,000 for CNG). In case of a city taxi, the payback period is slightly higher - up to 5 months subject to the annual car mileage of 70,000 kilometers. However, there are several disadvantages: less space in the car after installing balloons, less mileage per one fueling, and some limitations of operation in cold season (for LHG), explained Mr. Alexander Amiragyan, Expert of the Analytical Center.

Such high efficiency of gas fuel vehicles is a strong incentive to switch the public transport and light commercial vehicles (used for regular cargo carriages) to gas. In part, this has already happened: in some regions, people and business switched to gas fuel, mainly, LHG, due to availability of developed fueling infrastructure, according to the bulletin. At the same time, paradoxically that the key factor constraining the widespread switch to gas fuel is a low density of gas fueling stations or their lack in a number of other regions, said Mr. Alexander Amiragyan.

However, the switch, for example, of fixed-route taxi-buses to CNG may significantly reduce fuel costs being one of their main cost items. "In this case, we can expect lower ticket prices, especially in regions that have mainly gasoline-based fixed-route taxi-buses now," says the expert. At the same time, there is a risk that due to a significant increase in LHG and CNG consumption their prices will grow faster than gasoline and diesel fuel prices that may gradually reduce their key competitive advantage.

According to the experts' calculations, theoretically switching to electric engine taxis may become the most favorable scenario subject to affordable prices, but it is still very unprofitable and inconvenient from economic point of view despite faster development of the charging infrastructure. For example, there are no affordable models of electric vehicles in the Russian market, state the experts. However, subject to the current prices for internal combustion engine vehicles and probable savings on fuel, we can calculate the payback period of an electric vehicle purchase compared to a gasoline analog.

Source: Rossiyskaya Gazeta