Comments on Nigerian CNGTrucks Policy

PRES. TINUBU BANS PURCHASE OF PETROL-DEPENDENT VEHICLES

Introduction

African nations have recognized the need to transition to cleaner energy sources to combat climate change and foster sustainable development but at a realistic pace for the continent. Partof this transition involves the use of Compressed Natural Gas (CNG) andLiquefied Natural Gas (LNG), particularly in the transportation sector.

Both CNG and LNG offer significant benefits, including reduced carbon emissions and efficient utilization of natural gas resources. This paper explores the rationale behind these transitions, the challenges and opportunities they present, and the necessary steps for successful implementation.

Rationale for Transitioning to CNG and LNG

1. Reducing Carbon Dioxide (CO2)Emissions

• CO2 from flaring represents around0.6% of anthropogenic greenhouse gas emissions. Flaring also creates local air and noise pollution.

• Three countries, Nigeria, Mexico, and the United States, accounted for most of the decline in global gas flaring in 2022.

• The transportation sector is a significant contributor to CO2 emissions globally, accounting for 17% of emissions, with a higher proportion of 45% within Africa. Transitioning to CNGand LNG can significantly reduce these emissions due to their cleaner combustion compared to traditional gasoline and diesel.
  

1. Utilizing Flared Gas

• In countries like Nigeria, the practice of flaring natural gas is both environmentally damaging and economically wasteful. By capturing and utilizing this gas for CNG and LNG,Nigeria can address local energy demands while mitigating the harmful effects of flaring. This dual benefit aligns with the broader goal of reducing greenhouse gas emissions and promoting sustainable resource utilization.
  

Energy Security and Infrastructure Challenges

Electric Vehicles (EVs) represent an ideal long-term solution for reducing emissions, but Africa faces significant energy security challenges, with over 60% of the population lacking access to electricity.

Given this context, the infrastructure required for EVs, such as widespread charging stations and astable electricity supply, is currently unfeasible. LPG, CNG and LNG offer more immediate and practical solutions, leveraging existing natural gas resources.

Policy Initiatives

The Nigerian government has announced plans to halt the importation of Internal Combustion Engine (ICE) fuel cars, focusing instead on importing CNG powered vehicles. However, this transition will only be feasible, if policies focus on the Three A's: Availability,Accessibility, and Affordability.

Three A's Framework

1. Availability of Gas

• While CNG availability is still limited in Africa, countries such as Tanzania are actively embracing CNG, and the region’s natural gas reserves provide a strong foundation. Nigeria boasts significant natural gas reserves, 208.83 trillion cubic feet of gas, representing 33% of Africa’s total gas reserves in 2022.

• Redirecting flared gas towards CNGand LNG production can ensure a key and steady transport fuel for transportation and domestic use.

1. Accessibility‍

• Developing the necessary infrastructure for CNG and LNG distribution requires significant investment. Here, the private sector involvement such as existing traditional energy marketers, and stakeholders play a major role, in expanding their facilities to includeCNG/LNG refueling stations, storage facilities, auto shops for CNG/LNG conversion.

1. Affordability

• Competitive pricing is essential to encourage widespread adoption of CNG and LNG. Policymakers must avoid imposing excessive levies and employ pricing strategies, that could make these alternatives attractive compared to gasoline and diesel.
  

Challenges and Opportunities

While CNG and LNG present numerous benefits, safety remains a concern, particularly regarding the transport, storage and use of LNG in the transportation sector. African roads are notorious for their poor and deplorable state. Subsequently, it is crucial to ensure stringent safety standards and robust regulatory frameworks and proper road infrastructure to prevent accidents on the roads.

African nations have historically excelled at policy formulation but often struggle with implementation.Effective execution requires a combination of political will, institutional capacity, and continuous stakeholder engagement to ensure transparency and accountability in the implementation processes.

The role of the private sector is indispensable in developing the necessary infrastructure and driving innovation. Policies should create a conducive environment for private investment, offering incentives such as tax breaks, subsidies, and public-private partnerships.

Conclusion

The transition to CNG and LNG offersAfrican nations practical and immediate energy transition solutions enhance energy security and utilize abundant natural gas resources effectively. While challenges exist, particularly in terms of infrastructure development and policy implementation, the potential benefits make this a promising pathway.

By focusing on availability, accessibility, and affordability, and by fostering strong private sector engagement, African nations can achieve a sustainable and impactful energy transition.