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Cngfuture PDF

Cngfuture PDF

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Published by: hriaum on Apr 29, 2013
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CNG programme in India: The future challenges
--- Anumita Roychowdhury
1. Imperatives of the NGV programme in IndiaImperatives of energy securityEnvironmental imperatives of CNG programmesEmissions gains from CNG vehiclesAir quality gains of the CNG programmeHealth benefits of the CNG programmeClimate benefitsBlack carbon vs methaneCNG: panacea for fuel adulteration2. Policy drivers of CNG programme in India The Auto Fuel PolicyEmerging public policy3. Technology roadmap for CNG vehicles Technology roadmap for CNG busesConcerns over after market conversion Transitional technical glitchesLessons on regulatory approaches for a quality programmeParadigm shift in CNG technologyIndustry develops CNG hybrid busesCNG gate-way to Hydrogen future – hythane4. Fiscal policy to promote natural gasNational fiscal policyCNG pricing in the era of price deregulation
Favourable taxation
Fiscal incentives in statesHarmonization of prices5. Market developmentChallenge of small CNG marketsLink CNG programme with public transport augmentation programmeCoupling of other business models with stand alone transport CNG programmes6. Prospects of clean dieselIt is possible to clean up dieselIndian diesel norms need to leapfrogLocating CNG in the future roadmapFuel neutral approach is possible when diesel cleans up nationally:Future roadmap for CNG and diesel to address PM, NOx and fuel efficiency challengeAnnex 1: Dieselisation of car segmentAnnex 2: Status of CNG transport programme in IndiaReferences
ith a large number of Indian cities embarking on natural gas vehicle programme it is essentialthat the elements of these programmes are well defined for maximum environmental and publichealth gains. It is important that the lessons are drawn from the well established programmes inthe region to chart the future course. The existing programs in Indian cities are of varying scaleand scope and reflect the regional imperatives. Environmental imperatives are much stronger inIndia today, which in conjunction with the energy security concerns are propelling theseprograms. The front runner cities that have already established their first generation CNG programmes likeDelhi and Mumbai along with the new ones are at the throes of planning the second generationexpansion. This will require well thought out policy and criteria to maximize the environmental andpublic health benefits of these programmes and also make them economically effective. Therefore, it is important to consider the criteria on the basis of which the future expansion oCNG infrastructure and transport sector programmes will be planned in India.Currently, it is estimated that the transportation sector uses up less than 2 per cent of the naturalgas in the country. As the natural gas grid further expands and more cities begin to get access tonatural gas, the prospect of its application in the transportation sector also increases. Thecompressed natural gas vehicle (CNG) programme is expected to expand considerably in future.According to the estimates of the Petroleum and Natural Gas Regulatory Board, currently, thereare 7 lakh natural gas vehicles in the country. This is expected to increase to 58 lakh over thenext 10 years. Delhi alone has more than 2 lakh vehicles. Around 30 cities have access to CNGand some of them have implemented the programme of varying scope. It is also expected thatthe pipeline network will increase to 15,000 Km and implementation of city gas distributionnetwork will cover around 150 to 200 cities by 2014. This potential can be further exploited if thenatural gas distribution network is expanded and strengthened. What is driving the Indian CNGprogramme?
Table 1: Gas Authority of India (GAIL) Future Plan: The Road Ahead
Source Gas Authorityof India Ltd: FuturePlan: Road Ahead.
Feasibility studies for additional 20 cities in progress
Commitment for Highways to Greenways
CNG corridors along major highways on anvil
National Roadmap for expanding CNGprogrammeEstimates
Number of Potential Cities* 298Investment Required Rs. 37,170 CroreLikely Gas Requirement 74.34 MMSCMDPotential Households 14,871,385Potential Vehicles 3,708,9652015-20Number of cities in the periphery of 200 km. fromexisting / upcoming pipeline117Estimated Demand 16.3 MMSCMDCapital expenditure Rs. 8,150 crore2021-25Number of cities where there is no existing /proposed pipeline connectivity69Estimated Demand 10.32 MMSCMDCap expenditure Rs. 5,160 crore
 1. Imperatives of the NGV programme in IndiaImperatives of energy security:
India is becoming increasingly dependent on oil imports. Giventhe fact that India imports as much as 75 percent of its crude oil requirement and the petroleumprices have not been fully deregulated, the price shocks have often threatened to destabilize theeconomy. In the recent past the government and the public sector oil companies have had toabsorb as much as 86 per cent of the increased cost of fuel prices due to bullish trends ininternational crude oil prices. Energy demand in the transport sector is already high and isexpected to be particularly high, as vehicle ownership increases. International Energy Agencyhas estimated that by 2030 India will import more than 85per cent of its crude oil – nearly all of it. This will certainly make India even more vulnerable.Diversified fuel basket is expected to strengthen our resilience and reduce our vulnerability tointernational vagaries in crude oil prices. Reducing India's dependence on diesel and petrol canmake the country less vulnerable to oil price spikes.It is estimated that overall local reserves of natural gas in India amount to 27 years of supply atcurrent demand whereas local reserves of crude oil amount to less than 5.5 years. The rate of discovery of natural gas reserves in India also seems to be higher than oil reserve discoveries.Unless India diversifies its energy supply, away from high risk sources such as oil, the country willfind itself crippled if it can't afford fuel. Nearly three-fourths of India’s crude oil imports come fromthe Middle East. The Indian government expects this geographical dependence to rise in light of limited prospects for domestic production.Although India’s natural gas production has consistently increased, demand has alreadyexceeded supply and the country has been a net importer of natural gas since 2004. Natural gaspresently constitutes about 10 percent of the country’s energy basket. India's hydrocarbon visionstatement envisages the share of natural gas to be about 25 percent by 2025.Even though the domestic production of natural gas is also not sufficient to meet the entireindustry, power and transport sector demand, still the future prospects of tapping more domesticreserves provides a viable economic alternative to petroleum fuels and to de-risk the energysector of India. Currently, natural gas shares are roughly 9 percent in our primary commercialenergy mix.Currently, the share of the transport in natural gas usage is miniscule. Natural gas is mostly usedin the industry, especially fertilizer sector and power sector. But the environment and publichealth in cities demand its greater application in the transportation sector where the conventionalfuels are the source of extremely toxic emissions and high human exposure. For futureexpansion, the Government of India will have to lay down clear policy guidelines to enable CNGprogrammes in new cities. For that it is also important to understand how the CNG prgrammeshave benefited so far and their potential benefits in the future.
Box: Natural gas in India: key highlightsNatural gas reserves and production
India has 1,074 BCM of natural gas reserves. This includes 287 BCM of natural gas from on-shore and787 BCM off-shore. In terms of gross production, the figures stand at 32,849 MCM. Of this, 8,763 MCMof natural gas is produced on-shore and 24,086 MCM off-shore. However, the net production of naturalgas during 2008-09 was 31,770 MCM.

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