CNG growth roadmap for Assam

The Assam cabinet’s decision to slash the value-added tax (VAT) on compressed natural gas (CNG) will make green fuel cheaper in the state. A drop in the CNG price is expected to attract more vehicle owners to adopt it as their personal mobility solution. Easy availability will be a crucial factor in achieving the key objective of reducing vehicular pollution through the use of clean fuel. The CNG is cheaper than petrol, but people would not like to wait in a long line to fill it due to the dearth of adequate filling stations. Time is a crucial factor in productivity, be it in the private sector or in the government sector, and the employer would not give any relaxation to employees to spend a long time filling out CNG. Business owners, too, will compare the loss of time at the CNG filling station to quick filling at the petrol depot before making any investment decisions on CNG vehicles. However, CNG vehicles will be preferred to electric vehicles (EVs) on two counts: the high upfront price and range anxiety in the case of EVs. Due to the dearth of charging stations, range anxiety grips the EV owner and limits the owner’s mobility within the city limits and suburbs that can be covered by a fully charged EV battery. Many CNG vehicles also run on petrol, and this dual fuel system takes away the range anxiety as the driver can run the vehicle on petrol when it runs out of CNG or no CNG station is available in the area. The high price of gasoline makes CNG a better choice as it can bring down the running cost, and due to the cut in the VAT rate in the state, the clean fuel would be much more economical. There is also the option of converting the petrol car to run on CNG, and the conversion cost is in the range of Rs 25,000 to Rs 50,000. A new CNG station is soon going to be opened at Ulubari in the heart of Guwahati City, which is good news for owners of CNG vehicles. However, CNG filling requires the deboarding of passengers for their safety, which makes it a cumbersome process. This explains why the addition of one more CNG station cannot create euphoria among petrol vehicle owners to switch to CNG mode even after a drop in its price on account of the VAT reduction. Only when there are enough stations to reassure vehicle owners of the reduction in wait time can there be some hope for faster CNG adoption. Nevertheless, the country’s priority to decarbonise the transport sector and completely phase out petrol and diesel vehicles will eventually require vehicle owners to make choices about the adoption of EVs or green fuel vehicles. The shift to clean fuel, or EV, is crucial to achieving the country’s carbon emission goals and mitigating the impact of climate change. Extreme weather events aggravating natural disasters like floods, landslides, erosion, and droughts mean the country can least afford to miss the climate action goals. Besides, phasing out petrol and diesel vehicles will also significantly cut down the oil import bill by several lakhs of crores. The amount saved will be available for spending in other sectors like agriculture, healthcare, and education for rapid progress, alleviating the economic condition of people, and strengthening the economy. The development of the infrastructure and technology for alternative fuels is at such a stage that the adoption of clean fuel, or EV, in the transport sector in place of petrol and diesel vehicles continues to be gripped by the chicken-egg dilemma. Initially, the emphasis was laid on building awareness to adopt EVs or vehicles running on alternative clean fuels like CNG. The issues like higher cost, range anxiety remaining unaddressed, and the market sentiment for dependence on petrol and diesel vehicles for a higher degree of flexibility both in terms of upfront cost and availability continue to slow down the growth of EV or alternative fuel vehicles. Lithium reserves discovered in the country and the government’s push to unlock the potential to mine the mineral for indigenous production of lithium-ion batteries have triggered fresh hopes for EV growth. Currently, the country is dependent on the import of EV batteries from China, Japan, and South Korea, due to which the upfront cost of EVs continues to be high. EV penetration is also expected to gain momentum once lithium mining and the production of batteries start. Until that happens, CNG adoption can be pushed towards phasing out petrol vehicles. The state government’s move to make CNG cheaper is a laudable initiative. The state government pushing for adequate CNG filling stations in Guwahati and other places in the state is essential to sustaining interest in CNG vehicles and influencing the investment decisions of individual vehicle owners. The drop in CNG price will certainly make the commercial the commercial running of passenger buses more viable, but there must be adequate filling stations for smooth operation.