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Surging costs diminish CNG’s attraction as gasoline of alternative

CNG station
Working automobiles on compressed pure gasoline (CNG) in opposition to petrol to chop travelling price has misplaced its attraction as some stakeholders say that the saving has dropped to solely 5 per cent whereas others say it’s virtually zero.

CNG was launched in Pakistan in 1992 with a lot fanfare as an environment-friendly and various gasoline with a main goal to curtail pricey petrol imports. For speedy improvement of this sector, the Musharraf authorities in 2002 introduced large incentives together with responsibility waivers on CNG plant & gear, kits and cylinders. In consequence, buyers arrange CNG stations throughout the nation amid booming demand for the gasoline and was it used to save lots of over 50pc price in distinction to working automobiles on petrol.

Nonetheless, with rising uncertainty over availability of CNG amid extreme gasoline shortages coupled with meteoric hike in its worth, numerous non-public automotive homeowners have shifted to petrol regardless of holding the cylinder and package intact of their automobiles.

“After the newest hike petrol is promoting at Rs123.30 per litre, however CNG nonetheless offers a saving of 5pc,” claims Ghayas Paracha, group chief of the All Pakistan CNG Affiliation (APCNGA).

In Punjab and Islamabad, CNG is being bought at a median worth of Rs121 per litre. Regardless of very low financial savings industrial transport homeowners and 20pc non-public automotive homeowners nonetheless depend on CNG, he added.

Mr Paracha mentioned the inflow of used imported 660cc automobiles with EFI engines and excessive mileage profit has additionally given a serious blow to the demand for CNG as these automobiles can’t be transformed to gasoline.

The federal government allowed import of CNG kits and cylinders final 12 months after sustaining a protracted ban. With the passage of time; new kits have been invented for EFI engines, thus making certain excessive mileage than petrol however customers are nonetheless shy to make use of these new kits, he mentioned.

APCNGA Coordinator for Sindh Zone Samir Najmul Hussain mentioned gone are the times when non-public automotive homeowners used to save lots of 50pc on utilizing CNG in opposition to petrol.

“As we speak, there isn’t a saving. Working the car on CNG and petrol is similar,” he claimed, including that CNG gross sales of 15mmcfd in Sindh as in comparison with pre-Covid gross sales of 70-90mmcfd is sufficient to justify large change over to petrol.

He recalled that saving by CNG was 30pc when the gasoline was out there at Rs123 per kg, however now working a car on gasoline at a worth of Rs165-180 per kg in Sindh doesn’t maintain any attraction for the customers.

Mr Hussain claimed that over 40 CNG retailers have closed in Sindh as a result of low turnover of automobiles making it unattainable for the homeowners to maintain large bills of energy payments, labour salaries and so forth.

He mentioned CNG demand in Punjab is now 30mmcfd which was 170mmcfd in 2014 when native pure gasoline was being utilised. After shifting to RLNG in 2017, the CNG gross sales in Punjab have been estimated at 60mmcfd.

Karachi Transport Itehad (KTI) President Syed Irshad Hussain Bukhari mentioned 95pc non-public huge buses, mini buses and coaches have been working on CNG when the gasoline was out there at Rs123 per kg a couple of months again.

“Now transporters have been shifting to diesel after meteoric rise in gasoline worth,” he mentioned, claiming that 60pc public transport is now on CNG and 40pc on diesel as Rs165-180 per kg for gasoline just isn’t possible for giant automobiles.” Complete huge buses, mini buses and coaches in Karachi are 4,500 roughly. Nonetheless, diesel worth has risen to Rs120 now from Rs110 per litre in January.

Regardless of no permission given by the Sindh authorities, public transport homeowners have raised the fares by a median Rs5 final month to offset the impression of rising diesel and CNG costs.

A lot of rickshaw homeowners mentioned that they’ve stopped utilizing CNG owing to lingering anxiousness over non-availability particularly in winter and even in summer season amid insufferable excessive costs.

Nonetheless, customers are in a limbo. Beforehand rickshaw homeowners used to cost greater fares attributing rising CNG costs. In the previous few months, they’ve discovered one other excuse to cost more cash citing rising petrol costs. In January, petrol was out there at Rs106 as in comparison with Rs123.30 per litre now.

Many of the rickshaw homeowners are seen demanding more money by making certain the passengers of driving rickshaw on petrol as a substitute of gasoline, whereas there are nonetheless various rickshaw homeowners who’re nonetheless utilizing gasoline and demanding greater costs. Regardless of utilizing gasoline or petrol, rickshaw homeowners demand Rs500 for a 12-13 km journey as a substitute of Rs400.

Whether or not CNG saves cash or not, there has all the time been a darkish aspect of utilizing CNG for destroying petrol engines with the passage of time as no CNG engines have ever been developed thus far by any overseas automotive assemblers. The cash saved by the customers on utilizing CNG has lastly gone to waste owing to engine repairing after a niche of two to 4 years relying on in depth working of car on gasoline.

For 800-1,000cc automobiles, the engine remake prices between Rs30,000-50,000 whereas it prices extra on 1,300cc and above automobiles.

Pakistan had seen report petrol gross sales of 0.731m tonnes in Could regardless of early market closures and Eidul Fitr holidays, rising to 0.755m tonnes in June and 0.81m tonnes report excessive gross sales in July. In August, petrol gross sales was 0.733m tonnes. In July-August, petrol gross sales went up by 10pc to 1.549m tonnes as in comparison with similar interval 2020. Diesel gross sales in July-August had swelled by 18pc to 1.390m tonnes.