CNG Refueling - The Story of Natural Gas in Australia.
Compressed Natural Gas (CNG) is again presenting as a logical and long overdue transport fuel solution in Australia. The Industry is ready to utilise the extensive gas distribution infrastructure in place and there is a considerable resource of gas yet to be managed.
The Industry has not been well supported by government though several state transport agencies are well placed to expand existing fleets, beyond the buses currently running smoothly on natural gas. CNG as a reliable and clean transport fuel does not require more study, the world is already embracing natural gas vehicles on both an economic and environmental basis. CNG Station gas pricing at or below 50% of current petroleum would make sense now for the economy, sustainable transport and cleaner air in city streets.
Will pricing alone bring Australia into the modern age of transport or should the government show leadership and dirtection to ensure that such progress is so? CNG and other emerging ‘alternative fuels need only to be seen as one part of the overall transport solution . There is no quick fix and the media fixation with view points to cut petrol excise suggests the country is distracted temporarily from basic economic and energy management. All interests in the fuel lobby need to be openly identified and considered in managing any thing resembling a sustainable approach to the consumption of energy. Transport demand and supply can be managed to plan for a better outcome than we are currently experiencing. Old fashioned policy measures: excise and exemptions is as one can determine and shape the transport fuel mix, pricing and the quality of the transport system we envisage.
Look at most Australian cities and you will find various forms of transport chaos. Sole occupant cars driving manically to no place in particular fast, queues of people stranded at stations while the auto-mobile move past. Large masse RUVs guzzling safely through the streets in convoy…looking out for the next petrol station maybe? Public transport often working well and at other times overcrowded or running late. Trains, planes, buses and automobiles roaming randomly and competing for a safe on the streets…stress, pollution, out of equilibrium with most people and their lives. Something better can surely be envisaged which at the same time is a sustainable investment in our cities? Less traffic at the right time and sensible options starting from walking to riding or to just considering the impact of the next trip.
The petrol car and diesel truck have been long term allies of big oil and gas and governments and excise revenue go hand in hand…freedom to govern without excess external influence throwing the transport fuel strategy debate into boardrooms instead of public office which should always be the domain of long term public policy related to national resources and desired outcomes. This is the context in which the ‘alternative fuel’ situation can be properly assessed. Irrespective of the emerging path of transport fuel alternatives the current day reality of supply and demand and desired social objectives needs to steer the desirable fuel mix.
Martin Ferguson highlighted this in relation to the vast reserves of North West shelf natural gas. LNG tankers are contracted to deliver the vast majority of this offshore to China, North Korea and North America. Whats missing in this equation? Transport fuel security is whats missing. Australia has a vast natural gas distribution network of representing a massive investment and head start in providing CNG refueling stations along the entire eastern seaborde from Adelaide to Brisbane. While this was made policy and funded under the National Heritage Grant funds post the first sale of Telstra, the Australian Greenhouse Office (AGO) did not deliver, leaving the industry baffled and shaking its head.
Economic sense and necessity has seen several successful CNG Stations establish in Australian capital cities (buses) and depots running private fleets. Australian engineering experience abounds with all forms of natural gas and LPG is currently viable and can share a changing market space with CNG. Access for skill gap training for revised standards and materials would assist LPG Conversion locations enabling CNG service and conversions.. Out of the factory OEMs exist (Honda/Toyota/Mercedes…) in both the passenger, commercial and heavy vehicle markets…government direction and support is long overdue in making production line NGVs a common site on our roads.
8 Steps or less to Recovery - A fresh addition to the transport fuel mix.
1/ Acknowledge the policy perversity that currently exists courtesy of kowtowing to the petroleum/motor vehicle lobbies. Richard Dennis of the Australia Institute came up with a cost estimate of $9 billion per year - thats right…policy costs accruing as a result of taxes and incentives supporting the motor vehicle industry. So there is no shortage of spare change for any government pursuing a strategic transport agenda, its more than self funding.
2/ Legislate where required to ensure that privatised transport sectors are mandated to follow a course of action which is in alignment with a clean and green agenda.
3/ Manage Fuel Excise strategy in a way which promotes stated policy measures and apply subsidies, rebates and mandates to stimulate the onset on new technology and changed buyer behaviour to drive the success of all introduced measures. The CNG transport sector does not necessarily require government funding if the government provides favourable policy settings. Public station CNG currently sits well under 50 percent of current fuel prices and does not present air quality issues which exist with LPG (mix of propane and butane - streamed from natural gas as well as a by-product of petroleum refining process) . Likewise with diesel and petrol fuels long appreciated and reliable but in short supply and more polluting. Excise management is one of the special keys to implementing CNG Refueling or any other strategic energy direction initiative. An interesting read on transport modelling and the impact of policy measures including excise is the Gain Report (Canada). Point the taxes and subsidies in the right direction and the market will take care of itself and the long long awaited transformation will occur painlessly. When fuel prices are not making front page news the strategy will be showing signs of success.
4/ Introduce a National Transport Strategy based on the nature of the Australian Transport Task…that is, apply assistance and re-build infrastructure to support the most efficient transport modes and fuels and apply taxes and penalties to modes and fuels that are not consistent with a national strategy. Re-instatement of train transport lines (the most efficient) will over time correct the current imbalance in freight road vehicles. The additional road toll witnessed in recent decades in relation to road freight vehicles could arguably be attributed to the decline of the rail transport systems. The bullet would have to bitten in relation to price discounting situation that led to the perversity mentioned above. That is, tax corrections to prevent hoards of people flying between cities on the basis of $50 or $60 dollar fares…not only are the nature of most of these trips questionable but the shifting of modes which results is certainly not moving Australia ahead in the so called ‘Greenhouse Challenge’.
5/ Apply Policy Support and Incentives where its needed most and will be most cost effective. While road haulage use may be currently skewed on account of reduced rail freight, this situation will not rectify overnight. Heavy road vehicles and buses represent a cost effective and sensible path for diesel substitution and health benefits from reduced air and noise pollution can be factored in as well.
6/ Learn from developments abroad. Public CNG refueling stations provide the incentive and means for smaller private fleets to become part of the conversion. Private stations or ‘depot’ stations may well be the perogative of companies which can justify them but public access stations enable the NGV sector to grow. Be realistic and also scientific about the costs of providing infrastructure and refueling. The 7.30 report mentioned Phil CNG home refueler but look at the costs and benefits of this in terms of energy in the totality of that equation. A home refueler may well be ahead of the bowser on price but consider the electricity consumption in energy provision . There may well be benefits of home refueling but if they slow the onset of public refueling stations the question of driving energy efficiency across the sectors needs to be considered.
7/ Be realistic about the costs and benefits of providing vehicle ‘conversion’ assistance or providing clear paths for the import of factory ready OEM vehicles. There is room for both but nothing succeeds like success and there is nothing more frustrating than poor conversions or a poor conversion program. One risk of government sponsored conversion programs is the inflationary effect on something which no longer has a real market price…keep the conversion profitable and competitive but not artificially inflated. In summary, look at how subsidies have worked effectively and benchmark the reasonable cost of a conversion and equipment to prevent such outcomes re-occuring if conversions are assisted with government subsidies.
8/ Leadership and Vision. Federal, State and Local Governments can use their purchasing power and purchasing criteria to provide early support for CNG setup and NGVs. Government fleets can dedicate to CNG vehicles where applicable: buses, light commercials and garbage trucks…
There are directions which can be followed by consumers, business and government which will promote clear and clever strategy in whatever area of transport they relate: whatever mechanisms available (at the stroke of a pen) to spending, investing and tax fairly in the interests of the transport users which is pretty much every individual in the country. Health and environmental concerns addressed cost effectively while at the same time delivering a common sense economic model for the management of our national energy resource. Its been a good story all over the world and although no single pathway is perfect or permanent it makes sense today is available and affordable.
Natural Gas Background:
The big picture of gas and oil is well covered in Research Paper no. 25 2007–08 Australia’s natural gas: issues and trends Science, Technology, Environment and Resources Section, 1 April 2008, Mike Roarty. Quote from conclusion :
The use of natural gas is less polluting than the use of coal and oil. A major benefit is that natural gas is some 65 to 70 per cent less greenhouse gas intensive than either brown or black coal. Another decided advantage of gas is that it contains far fewer particulates and other elemental contaminants than either coal or oil. As a consequence natural gas can be used as an alternative fuel for transportation in the form of either compressed natural gas or liquefied natural gas especially in heavy transport such as public buses or road freight carriers that can use centralised refueling points.
Recent National Media:
The transcript from the ABC’s 7.30 Report ‘Natural Gas - The Fuel of the Future’ sums up the situation with regard Australia’s transport fuel situation. Ollie Clark of the Natural Gas Vehicle Association comments on the current state of affairs:
The thing that strikes me as being rather quaint, to put it mildly, is that we pay anywhere from about $8 billion to $25 billion to import the oil and we get a paltry $4 billion for the gas that we sell to overseas countries. It seems odd to me, especially given gas is a superior fuel for many, many purposes including the use in motor vehicles.
LNG plant faces impact test (The Australian July 5, 2008)
LNG cryogenically supercooled for liquification and then shipped in tankers running on crude oil. It will be interesting to see if these proposals go forward and how the energy waste in production and delivery would be assessed in terms of carbon offset credit.
Gas price under pressure from exports - The Australian July 1, 2008
Orbital secures $2.8m in govt funding
CNG Avenues to explore in Australia:
Policy and Economics
Natural Gas in Australia : Issues and Trends (From the parliamentary library)
Australia’s future oil supply and alternative transport fuels - (Interim report - 7 Sept 2006)
Australian Natural Gas - How Much Do We Have And How Long Will It Last ?
Chevron eyes natural gas reserves in Australia
Senate enquiry and response to CNG - 2004
Sustainable Transport Coalition of Western Australia - broad scope policy for sustainable mobility
Greenlivingpedia for a sustainable future - green cars
53 cents per litre (equivalent) for CNG at Fyshwick, ACT, refueling station
Natural Gas - the future of fuel ? (The Oil Drum)
CNG/LPG conversions set to grow 175% by 2012
Wikipedia references (CNG - Compressed Natural Gas)
TEC Action for Air Review 2004 -integrate air quality goals and urban transport planning
Oil man Pickens seeks “army” to back energy plan
Natural gas vehicle (NGV) options and opportunities - Australia:
Holden plans production of CNG sedans
Ford can run with CNG Falcons in Australia
Why no Honda Civic GX natural gas vehicle for Australia…
2008 Volkswagen Passat TSI EcoFuel Natural Gas Concept Review
Opel Zafira CNG and Opel Combo models - 5.2/4.9 kg CNG per 100 kilometers
Natural gas Sprinter on the way (April 2008)
Natural Gas Falcon Production Started in 1997…and could begin again
GasTech engine and equipment (Australia) technology to run Kenworth truck on CNG
Advanced Fuel Technology - Australian truck and car CNG Conversions
Garbage collection by truck ideally suited to CNGNew bus assembly plant to supply local, int’l markets
Natural Gas Vehicle Owner Community - exchange ideas and get your community going on gas
Australian CNG Industry Development Resources:
Australian Gas Association - Certification Services
Service CNG fuel systems - National Training Information Service
Victorian Automotive Alternative Fuels Registration Board (AAFRB)
Guide to Available Natural Gas Vehicles (NGV) and Engines
AEC’s greener, gas-fuelled strategy - 4 July 2008
Gas Research - gaseous fuels equipment and research
CNG-NGV Asia Pacific Forum - 2008 -NGVA Roundtable Session Best Practices, Challenges…..
Natural gas vehicle (NGV) options and opportunities - International:
Cost savings and environmental bonus for Australia Post and others?
International Association of Natural Gas Vehicles (IANGV)
CNG Stations and Prices for the US, Canada and Europe
Malaysian CNG car maker Proton set to drive in to India
Pakistan NGV Industry thrives - Government policy free’s up import regulations
Phill site - commonly available CNG vehicles in Europe and US
Buses and other vehicles in use in Asia
Alternative Fuels Refueling locator - what we anticipate in the near future in Australia
Note: The author has been promoting sustainable transport in Australia and is the agent for GNC Galileo (CNG Refueling Solutions).
By 2010 in UK is expected to have 100.000 CNG cars and to not mention the millions of CNG cars in South America. So we are not either a “Banana Republic” By the way in 1969 I was driving in Milan my Renault 12 powered by CNG.
Australia we are already late.
The UK I understand is also on the verge of converting its London Cabs to CNG, making them not only stylish and practical but more greenhouse friendly as well. Gastech engines, an Australian NGV innovator providing the conversion technology. Italian engineering has been at the forefront of NGV engineering as the Argentinians will certainly testify…I wonder if that Renault is still chugging along on CNG through the streets of Milan
Good thoughts Nigel. I’ve written to Chris Bowen about the issue of alternative fuels in Australia as I believe its fundamentally a matter of competition. While the government and ACCC regularly investigate the price discrepancies between competing petrol retailers they have yet to look into the reasons that there is not also competition between fuels. Clearly consumers are locked in to buying petrol by the way their cars are built and locked into buying such cars by the lack of alternative fuel outlets. There’s a cartel operating here.
I recently read comment from the head of Saudi Aramco, which were encouraging of the spread of coal to liquid and gas to liquid technology (some members of cabinet are also keen on this retrograde fuel especially Martin Ferguson). There’s no contradiction here - coal to liquids would help maintain the fuel monopoly by encouraging consumers to not adapt their fuel tanks to work with genuine alternatives. The environmental cost and precious resources wasted in going down this route are alarming.
I encourage others to write to our politicians on these issues .
The matter of competition is an interesting aspect to the story which deserves attention. On the one hand the pro government regulators will say that top level policy will manage supply and demand and then aside from some money here and there the market will sort out the pricing. The aspect of free market that will cause rebalancing the fuel mix clearly as the alternatives are both more ‘economic’ in the effiecency sense of the word, and most people expect the government to manage the long term picture beyond the next budget.
It is a paradigm shift to gas and its a balancing of the terms of trade to reduce reliance on imported oil. There is actually benefits for government, business and consumers in using energy and transport fuel efficiently.
Its probably one of the bigger tests of the Rudd government to grab the bull by the horn and take responsibility for transport reform, its clearly a local state and federal issue but on this there is enormous advantage in direction coming from the top.
There is myriad opportunities in improving the way we manage and use our coal, oil and natural gas. With so much deregulation of the market place to supposedly drive competition the traditional levers of government have been either ignored or mis-used and its time to get a strategy that delivers us to the right place.
..as well as its more environmentally unfriendly cousin, coal to liquids, or CTL) and compressed natural gas (CNG). The view that CNG is a way to reduce our consumption of foreign oil is quite a common one,
What are the tax’s on cng for cars?
…effectively tax free until 1 July 2011 when fuel tax will be applied. The rates will increase annually until the final rates are reached on 1 July 2015 as shown in the following table…this is not the policy of the current government but is the situation in place at the moment and was not reviewed in the past budget.
The current tables have been included in a previous post:
http://news.rosettamoon.com/?p=142
The situation as it is is not a CNG show stopper at all, but the arrangement legislated under the last government is not reflecting well on the economic and environmental benefits of CNG - confirmed by CSIRO in several reports, Tom Beers, Barney Foran et al. The Industry is not averse to excise but what is desirable is a chart which reflects favour on a fuel mix which is good for Australia…if you look at the chart applications of excise are less LPG, ethanol, and bio-fuels…this is a macro-economic budgetary outlook that could easily be changed and would direct investors more quickly (and wisely)…this type of government reform is not making the papers…but it should…so thats a good question and I hope this answers it for you.
Nigel
what would stop a small independent from retail cng
Nothing! Check out Fueltown in Melbourne and I will do my homework on other such sites. The smarts of CNG/NGV in Australia, Gastech Engines and Advanced Fuels Technology are doing conversions so its a matter of having an initial customer base and to work from there…a smart operator would find local councils or industry looking at CNG trucks (like boral concrete sydney) or local garbage collection and make sure the site is accessible for larger vehicles as well as the public…regular fills by a few trucks is good volume to start and will soon have tongues wagging in the locality…these ‘return to base’ opportunities can work well at the stage where we have a limited refueling network. I will work on a CNG station list for access points to make this easier.
The other consideration is the gas inlet pressure at the site..the higher the inlet pressure the higher the refueling potential of the CNG Refueling equipment…the Nanobox shown is capable of handling a wide range of inlet pressures and is low investment for the scenario you describe.
Apart from that the gas utilities can advise other considerations - here are some contacts relevant to CNG Refueling:
ACT: ACTEW/Alinta, Ken Fox, ph: (026) 285 7777, fax: (026) 280 6352.
NSW: AGL Gas Networks, David Goodwin, ph: (02) 9741 7500, fax: (02) 9748 1580.
NT: Agility, Christina Kotsaris, ph: (088) 935 1611.
QLD: Energex, Leyton Richards, ph: (07) 3849 9111, fax: (07) 3349 0300.
SA: APT/Origin, David Vince, ph: (08) 8217 2605, fax: (08) 82172603.
VIC: Energy 21, Iain Buckland, ph: (03) 9652 5524, fax: (03) 9652 5460.
True Energy, Lee Holmes, ph: (03) 9299 2622, fax: (03) 9299 2695.
WA: AlintaGas, Aart ter Kuile, ph: (08) 9470 8530, fax: (08) 9470 8500.
This information may not be accurate, thankyou Brett Jarman for helping with some updating - will provide an updated list as information becomes available or leave a comment or email.
I am convinced it must be a conspiracy! Why else wouldn’t we be developing CNG as an alternative, especially in the transport industry, with all the ‘fear’ being generated by global climate change gurus. Am I being cynical? I simply cannot get my head around why CNG isn’t out there in the media being pushed as the alternative to oil based energy. Am I missing something?
PS I am driving a company Prius, very economical but it is not not the answer. Neither is wind and wave power, and God forbid, carbon trading.
It depends what you define as a conspiracy. The energy industry in Australia has been subject to de-regulation which has moved it out of the sphere of governance. This is an obvious progression from Howard and Keating politics…when ownership of resources shifts out of Australia its no surprise that Australia and Australians will suffer…just like Australian mortgage owners are suffering from de-regulated banking, the Australian transport sector (and economy) is suffering from a de-regulated energy sector. Despite a savage media, Martin Ferguson and the treasurer are introducing reform as recently announced in the freeze on Chinese buyout of our minerals and energy reform..thats a courageous and positive step which needs recognition, as does recently announced reform to the management of the national gas pipeline regulator.
Carbon trading (pollution trading) is laughable yes and so too are the credentials of the author Garnaut, who espouses a green future for Australia while presiding over a Lihir Gold which has deforested an island in Papua New Guinea and is dumping toxins in the seas above Australia!
At the flick of a switch we can be running our cities clean on CNG so the next step is for us to take a look at where our excise regime is pointing and remove those onerous regulations prohibiting free access to readily available CNG vehicles which are proving ever so popular with our neighbors!
does anyone know where to get CNG conversions done in Queensland, Gold Coast or Brisbane, and what the likely cost will be for both the car conversion and the home refueling equipment.
As far as I know the only public CNG station was owned and operated in the past buy energex (I need confirmation) but was closed 2003/4. Brisbane buses of course run major depot stations. Yes, all a bit frustrating (NGV’s, conversions, refueling), but reforms occuring, we certainly need access to NGV asian vehicles and conversions need streamlining and LPG centres the perfect place to start.
Thanks for the story and links. The Fueltown you mention in the comments above is a scam, I phoned the station and they dont have CNG. The company publishing the false information is possibly a scam as well. The website is http://www.oes.net.au/photographs_cng.shtml
Apologies, I was alerted to the OES false advertising some time back, but forgot it was quoted on the site. The Australian CNG Industry in the past has suffered from unscrupulous operators and I should have contacted the station before assuming it was truthful information. The energy industry in general can be said to lack ethics, such companies as these are not healthy in building a credible CNG Industry in Australia.
My name is Daniel Epstein and I operate Conservo, a Sustainable Fuel Station brand in Victoria. I had a trial station in Prahran for 10 months and am planning on opening 3 more over the next 3 months. I plan on having CNG refueling options at these new servos.
I feel I need to point out my CNG refueling will be through OES CNG, the company who is criticized above, and yet the only company I have come across who are putting their money where their mouth is. I know what its like to start something new, and attempt to tap into a new market. I also know what its like to run a business. For those reasons I find the above blog entries inappropriate, as they are flippant throw away comments made from passion not investigation. I know OES CNG have been trying to get a refueling station online in Victoria for over a year, as I have been one of the stations they have pitched their product too.
I believe CNG along with other viable transport fuels can help Australia’s realize its goals of greater fuel security, green house gas reduction targets along with improving our regional economies. I hope Australians can support industry leaders like OES CNG and Conservo in the roll out of Sustainable Transport Fuels in Australia.
Daniel Epstein
www.conservo.com.au
Hi Dan,
I have a pretty free editorial approach and I received some posts and emails after posting the great news ‘first public CNG station in Melbourne’. In fairness to OES and general good taste I emailed back 3 comments which were a bit over the top, and suggested ‘re-phrasing’ to maintain a bit of decorum
It was’nt just the people that rang the station and experienced dissapointment it was also the manager of Fueltown who a friend spoke to was “p****d off” at what was perceived as misleading advertising on the OES website and wasteful of their time.
Swift CNG and an earlier incarnation Clean Air Refueling have worked over the past 8 years to educate and provide guidance to many corporations and government departments that have provided valuable information to us, some of which has been used on this site.
If ‘leading’ means to ‘mis-lead’ the public then I would rather be on the rear guard and proceed slowly and appropriately with substantive and factual information which should bring the industry to fruition here, even though its been languishing in the backwaters compared to many other countries.
I was a regular customer of your Prahran store to buy diesel and found it to be a very well presented operation, especially your brochure information explaining your visions. All the best with the plans for the new locations.
Appreciate your comments,
Nigel
I have had the chance to test drive a prototype that could help make the push to a lot more CNG Cars. This prototype gets 30 km per liter (or 70mpg) and runs soley on natural gas. It even has a over a 640 km (400 miles) range. Check it out: http://www.cng-car.com
Thats a flash looking roadster, I will place my order if they are permitted in Australia…I do notice that Thailand has taken the bull by the horn and introduced a CNG Toyota…now that would have been a lovely substitute for the Hybrid Toyota!!
http://www.ngvglobal.com/en/market-developments/toyota-launches-bi-fuel-cng-e20
-taxi-in-thailand-02158.html
Toyota Motor Thailand Co (TMT) has introduced a compressed natural gas (CNG) powered car under the Limo brand for use as a taxi and due for initial delivery next month. The model is based on the Corolla Altis, using a Euro 3 bi-fuel engine running on CNG or E20 gasohol fuels.
Bangkok Post reports Toyota are projecting initial sales of 200 units per month rising to between 400 and 500 units per month next year. The Limo CNG, which is only available with a 1.6-litre engine, will retail at 724,000 baht, including value added tax and an air-conditioning system, 90,000 baht more than the gasoline-powered Limo. CNG is carried in a 75 water litre capacity cylinder
The new model will be manufactured at Toyota’s Chachoengsao plant and the company is reportedly also considering a CNG fuelled 11 seater Ventury van.
By the way, 724 000 Thai baht = 20 900.432 U.S. dollars, so for well under 30K Australian thats a steal and far smarter than polluting cities with six cylinder muscle cars designed for the race track….1.6 litre fuel efficient taxi - nice work Thailand!
I would like to know where the CNG refueling stations will be located in Melbourne and greater Vic, and also when they will be open.
Kind regards,
Christine
Christine,
Everything is primed for clean city fuels as per the outline above. The technology to make it so is very mature and low investment…in terms of fuel security, clean cities, and the ‘Greenhouse Challenge’ this is an easy win…the challenge is for an energy company or transport company or city shire to bite the bullet and make it happen.
As I did cover in a later post the players will come to the party much faster when the decision making process is not fettered with self interest and to this end I drafted a transport planning framework for commentary. As it happens my correspondences with relevant government departments have not been responded, so in all honesty people need to form their own opinions as to why Australia is not modernising the transport system.
As for Melbourne, of course the North Melbourne depot with its antiquated technology would be an easy location to start…the nanobox technology shown here http://news.rosettamoon.com/?page_id=168 can live easily on an existing petrol filling station or become a compact refueling site in itself.
The issues therefore need to be recognised and acted upon and then of course, as we have seen all over the modern world, the establishment of CNG refueling is quite simple indeed. http://news.rosettamoon.com/?p=193