CLEAN CNG IN TRANSPORTATION IN BANGKOK

Transcription

1 CLEAN CNG IN TRANSPORTATION IN BANGKOK Sriwan Eamrungroj 1 INTRODUCTION Natural gas is widely looked upon as an attractive alternative to traditional fossil fuel types due its superior environmental properties. The fuel offers significant reductions in carbon monoxide, nitrogen-oxide, particulate matter and non-methane hydrocarbon emissions. This attribute is becoming more and more valuable as these air-borne pollutants have reached critical levels in many urban centres around the world. In Thailand, there is an additional factor, which is helping to drive the development and promotion of alternative fuel systems in the transportation sector. The present sharp devaluation of the Thai Baht together with the crude oil price crisis have negatively exerted impact on vehicle owners and commuters due to significant increase in the price of traditional automotive fuels such as gasoline and diesel which are derived from imported crude oil. With its own indigenous reserves of natural gas, there is now a considerable price difference between natural gas and traditional fuels in Thailand. Therefore, natural gas use can generate sizeable operating savings for end-users and, with widespread use, can help Thailand conserve precious foreign currency reserves. Technological improvements are also advancing the introduction of natural gas in the automotive sector. While natural gas vehicles (NGVs) have been around for some time, the relevant technology has only recently reached the stage where wide-scale conversion of traditional gas and diesel combustion engines is economical. With this technology now readily available, many countries have begun the process of introducing NGVs into the market. Worldwide there are now over one million vehicles fuelled by natural gas. 2 THAILAND PRIMARY ENERGY SUPPLY AND CONSUMPTION Figure 2.1 Thailand Primary Energy Supply and Consumption Thailand Primary Energy Supply Unit:KBD % 4 % % 92% 5 % 12% 17% 66% Hydro Lignite/C oal Natural Gas 3 % O i l 14% 24% 59% Source :Econom ic Division,PTT H ead Office Year Thailand Primary Energy Consumption By Economic Sectors Unit :KBD Transportation Year Source : Department of Energy Development and Promotion Residential Manufacturing /Con s tru ction/m ining In the early days, the energy sector was dominated by imported oil. After the oil crisis in the early 198s, Natural gas was; therefore, produced in commercial quantities. The use of natural gas has been accelerated with the extensive installation of natural gas pipeline network throughout the country to gradually replace oil. In terms of consumption, the energy consumption has been continuously increased although the country has experienced economic crisis. At the beginning, the energy was mainly consumed in residential sector. However, the consumption in transportation and manufacturing sectors has rapidly increased. Agriculture 1

2 Today, the primary energy is mainly consumed in transportation sector accounting for 41%. Most of this energy consumption is in the form of petroleum products, comprising diesel 54%, gasoline 27%, jet fuel 14%, fuel oil 4%, and LPG 1%. Moreover, a small volume of natural gas is also consumed. The second and third largest consumption are found in manufacturing and residential sectors which account for 34% and 21%, respectively, mainly in the form of electricity or power. Natural gas is the main energy source, which is around 5-6% of power generation in Thailand. 3 THAILAND PRIMARY ENERGY CONSUMPTION PROJECTION Figure 3.1 Thailand Primary Energy Consumption Projections Thailand Primary Energy Consumption Projection Unit : KBD 2 15 Hydro Lignite/Coal 1 3 % 3 % Natural Gas 6 % 5 15% 16% 2% Oil 26% 29% 24% 56% 53% 5% Year Source : Economic Division, PTT Head Office In 2, we could see an aggregate total demand for energy of about 1 MBD oil equivalent of which around 56% is oil generated. Natural gas accounts for about 26% of total demand. In the next 5 years, it is expected that natural gas demand will enlarge replacing oil. This is reflected from the economical benefit of natural gas in power generation especially in IPP sector and as a clean fuel in industry sector. In the long term, we also expect to see continuing lower percentage of oil as source of energy. However, share of natural gas shall be maintained at around 24-26%. Obviously, coal will play more roles in long term. This is expected to be inline with the national energy policy to diversify the energy supply uniformly among all sources. 4 THAILAND PETROLEUM PRODUCTS CONSUMPTIONS BY ECONOMIC SECTORS Figure 4.1 Thailand Petroleum Products Consumption by Economic Sectors Thailand Petroleum Products Consumption Unit : KBD % 4 1% 3 6 % 2 13% 1 64% Residential Agriculture Electricity Manufacturing/Construction/ 6 % Mining 6 % 5 % 7 % 16% 11% 14% Transportation 14% 59% 62% Source : Department of energy Development and Promotion Year As crude oil is still the main energy supply source to the country, in 1999, the petroleum products consumption was around 638 KBD. In term of supply, more than 95% of supply for petroleum products of the country came from the imported crude oil from foreign countries that was worth 17, million Baht per year. The main consumption was found in the transportation sector which 2

3 was approximately 398 KBD or 62% of the total consumption. More than 8% of petroleum products consumption was in form of diesel and gasoline. With respect to the petroleum products consumption in the transportation sector by regions, more than 3% of the total petroleum products consumed were in Bangkok and Metropolitan areas. The diesel consumption in Bangkok and Metropolitan areas was around 24% while gasoline consumption was approximately 43% of the total consumption. 5 NATURAL GAS UTILIZATION IN THAILAND Figure 5.1 Natural Gas Utilization in Thailand Natural Gas Utilization in Thailand Unit : MMSCFD 2 15 GSP 1 Industry 5 % 14% 16% Power % 6 % 2% 1% 8% 64% Year Unit : MMSCFD Thailand Natural Gas Demand Forecast Transportation GSP 2 Industry 15 % 1 % 2 % 1 16% 17% 15% 5 2% 18% Power 2% 64% 64% 62% Year Source : Business Planning Department, PTT Gas Source : Business Planning Department, PTT Gas Power generation is the major user of natural gas, which represents around 6% portion of total natural gas supply. The recent economic crisis has resulted in the revision of the power consumption forecast and natural gas demand. The average growth rate for the next 1 years of natural gas demand in this sector is expected to be 5% p.a. with the based year demand of 1.1 BCFD in The forecast is based on the preliminary national power generator from Electricity Generating Authority of Thailand (EGAT), i.e., Power Development Plan in 1999 (PDP 99-1). In the industrial sector, it is expected that the average growth rate in this sector will be 5% p.a. for the next 1 years. In transportation sector, natural gas is consumed in a small amount by 82 conditioned public buses of Bangkok Mass Transit Authority (BMTA). When combining the natural gas consumption from gas separation plants and petrochemical, the natural gas utilization is shown in figure 5.1. From the base year of 1999, the natural gas demand will increase from the level of 1.7 BCFD to 3.2 BCFD by 211, which represents an average total growth rate of 5% p.a. 6 THAILAND NATURAL GAS RESERVES Natural gas is one of the most abundant fossil fuel. Although different estimates are put forward with regard to the ratio of natural gas to crude reserves, this factor is constantly increasing globally. On daily average, Thailand produced more petroleum in 1999 than in the previous year. Natural gas production increased by 9%. This was mainly due to a result of more exploration and delineation activities in the Gulf of Thailand. In addition, imported gas from Myanmar, Yadana and Yetagun fields, would be the major source of supply. Therefore, as of December 1999, the country s total natural gas reserves (proved+probable+possible) were around 39 trillion cubic feet (TCF). At the consumption rate of 2, MMSCFD, these reserves translate into production ratio of 53 years. 7 AIR POLLUTION IN THAILAND The pollution in Thailand is mainly caused by the emission from industry factories and vehicles. Geographically, the most deteriorating air quality is in Bangkok and metropolitan areas. The air pollution problems are relentlessly escalating. Although the emission control measures applicable to stationary pollution sources such as factories have marked considerable progress and although efforts to control exhaust gas emission have also advanced for automobiles the fact remains that the environmental standards especially particulate matter (PM) are not being met in most roads in Bangkok. While, in part, this can be caused by the increase in the total number of automobiles on Bangkok roads, the most important factor is the increase in diesel vehicles. 3

4 In 1999, there are 2 million vehicles in Thailand, approximately 19% of them were diesel vehicles, and 11% were gasoline vehicles. Diesel vehicle exhaust gases are believed to be the main source of No x and PM emissions while gasoline vehicle exhaust gas is the main source of CO and SO 2. From the statistics of Pollution Control Department, main pollution quantities released from fuelconsumption motor vehicles by type of vehicles and in Bangkok and Metropolitan areas are illustrated in the figures below. Figure 7.1 Main pollution quantities released from fuel-consumption motor vehicles provinces by type of vehicles Pollution Quantities in Thailand (Ton/Year) Type of Vehicle Nox SO2 Co PM HC Gasoline 34,133 4,52 4,25 4, , , ,886 42,12 Light Duty 65,836 62,272 1,868 1,768 34,821 32,936 6,366 6,22 15,739 14,887 Vehicle Heavy Duty Vehicle 163,73 144,6 3,69 2,699 68,331 6,11 1,663 9,38 17,671 15,544 Motorcycle 976 1, ,38 137,313 2,871 3,51 163,677 2,119 Total 264, ,533 9,973 1, , ,998 2,62 19, , ,67 Figure 7.2 Main pollution quantities released from fuel-consumption motor vehicles in Bangkok and Metropolitan Province Pollution Quantities (Ton/Year) Nox So2 CO PM HC Bangkok 164,737 17,914 6,897 7, ,32 286,428 13,273 13, ,86 23,276 Metropolitanprovices 77,572 53,785 2,46 2,74 77,584 75,835 5,63 3,986 45,963 5,596 Total 242,39 224,699 9,33 9, ,94 362,263 18,876 17, ,49 253,872 8 INTRODUCTION OF NGV IN THAILAND The Natural Gas Vehicle (NGV) has been introduced to Thailand since 1983 with the financial support from New Zealand Government in converting 5 public buses of BMTA to be dual-fuel mode together with providing 6 sets of conversion kits and cylinders. In 1986, Kasetsart University, a state university, converted additional 25 public buses of BMTA. Afterwards, in 1991, the Thai Government granted fund for purchasing 82 new NGV dedicated public buses (44 Man, 38 Mercedes Benz) to BMTA which have been in service in Bangkok and Metropolitan since The first NGV refueling station was also constructed and operated by Petroleum Authority of Thailand (PTT) at BMTA bus depot at Rangsit in October There are presently 82 NGV buses operated in Bangkok which the natural gas consumption of around.6 MMSCFD. With this as a start, the Thai authorities are now anxious to see wider use of NGVs in Bangkok and throughout the country. However, as the NGV market grows, it is critical that a safe, efficient and modern natural gas service station network shall be developed to serve every potential target markets consequence to promote the sustainable expansion of NGV use in the Thai transportation sector. 9 PTT S NGV EXPANSION PLAN The Petroleum Authority of Thailand (PTT), in its capacity as the country s national oil and gas enterprise, has been assigned by the Thai Government for the task of promoting sustainable NGV business in Thailand. 4

5 There are several drivers for NGV business in Thailand. These include the followings;! Pollution problem, which major source, is from transportation sector (around 61% of total petroleum products consumption).! Price gap between natural gas and gasoline and diesel is very significant (NGV is priced at 7% of diesel price and 5% of gasoline price).! Conversion kit and cylinder technologies are more proven and available.! Petroleum Authority of Thailand (PTT) s infrastructure facilities (natural gas pipeline system) are already in place.! Government fully supports the more natural gas utilization in transportation as an alternative fuel in order to reduce dependence on imported traditional fuels. With the above driving forces, PTT; therefore, has set the strategic NGV expansion plan, which focuses on the following aspects; 1) Development of Infrastructure (both natural gas pipeline network and NGV refueling station) 2) Supporting NGVs vehicles expansion 3) Pricing Strategy Development of Infrastructure One of the key successful factors for NGV development is the sophisticated infrastructure in relation to natural gas pipeline network in Bangkok, and NGV refueling stations. PTT; thus, has planned to expand its natural gas pipeline around Bangkok Metropolis so as to create gas pipeline system in the perimeter of Bangkok Metropolis and its suburbs to promote the utilization of natural gas in power, industry, and transportation sectors. This project is called Bangkok Gas Ring Project. The NGV refueling stations would also be constructed along existing and future natural gas pipeline simultaneously. - Bangkok Gas Ring Project The new section of natural gas pipeline will be as followed; Route 1 Southern Bangkok Power Plant (Sumrong District) Sai Noi District and Bang Yai District North Bangkok Power Plant: 24-inch gas pipeline will be laid starting from EGAT s Southern Bangkok Power Plant and going under the Chao Praya River and paralleling to Electricity Generating Authority of Thailand (EGAT) s power transmission line through Ratburana District, Bangkhunthian District, covering Outer Ring Road, and then to Nongkhaem District, and finally connecting with Ratchaburi Wangnoi Gas Pipeline at Sai Noi District, Nonthaburi Province and 1 inches natural gas will be laid starting from Bang Yai District to North Bangkok Power Plant, for a total distance of 75 km. Route 2 Rangsit District Pakkred District: 1-inch gas pipeline will be laid starting from Rangsit District paralleling to EGAT s power transmission line and Prapa Canal until reaching Bangkadi Industrial Park for a total length of 5 km. - Expansion of NGV Refueling Stations PTT has planned to expand the number of NGV refueling stations from its existing one NGV refueling station at Rangsit to 3 stations by 24/25, whereby the stations will be located along the existing gas pipeline routes, the new gas pipeline routes, and additionally in some of PTT s existing petrol stations (the number of PTT petrol stations in Thailand is 1,5 stations, 212 of which are located in BKK Metropolitan areas). (The Bangkok Gas Ring pipeline network and NGV stations is illustrated in appendix 1.) Supporting NGVs vehicles Expansion PTT has been using its efforts to intensively promote the expansion of natural gas engine to use natural gas as an alternative fuel in transportation sector in forms of dedicated NGVs, bi-fuel vehicles, and diesel dual fuel vehicles. The advantages and disadvantages of each type of NGVs are summarized below. - Dedicated NGVs Advantages: - Best emission - Highest reliability/derivability Disadvantages: - High cost - High fuel consumption - Bi-fuel NGVs 5

6 Advantages: - Fuel Flexibility - Low conversion cost Disadvantages: - Optimization tradeoff (between NGV and gasoline) - Carriage of two types of fuel - Dual fuel NGVs Advantages: - Fuel Flexibility - Low conversion cost - Low PM/Smoke Disadvantages: - Carriage of two types of fuel - Other emission levels similar to diesel with high THC PTT had experienced in conducting the installation of conversion kits to 13 diesel engines of public buses and trucks and 12 gasoline engines of PTT s leasing cars to be diesel dual fuel and bifuel, respectively. The age of retrofitted diesel engines is approximately 7-8 years while that of retrofitted gasoline engines is around 5 years. From this pilot project, we can see the significant reduction in PM or smoke while the other emission is not so improved since there are some limitations in fine-tuning vehicles engines to be optimally compatible with the conversion kits. NGV Pricing strategy Currently, natural gas is priced at 7% of diesel price or 5% of gasoline price. However, due to the current oil crisis and the objective to promote the utilization of natural gas in the transportation sector, PTT has announced the new NGV price to be 5% of diesel price. PTT believed that this new price structure would be more attractive to end-users. Figure 9.1 Comparison of NGV price and Diesel, Gasoline, LPG prices Diesel retailed price at October 14, Baht/Litre NGV Price Equivalent to diesel retailed price Equivalent to gasoline retailed price Equivalent to LPG retailed price Remarks: 197 Baht/MMBTU 7.22 Baht/Diesel Litre (Equivalent to 5% of diesel retailed price) 6.57 Baht/Gasoline Litre (Equivalent to 4% of gasoline retailed price) 4.99 Baht/LPG Litre (Equivalent to 87% of LPG retailed price with full (Equivalent to 48% of LPG retailed price without Gasoline retailed price = Baht/Gasoline Litre LPG retailed i With subsidy = 5.77 Baht/LPG Litre Without subsidy) = 1.33 Baht/LPG Litre - Estimation of NGV vehicles Payback Period The figure below demonstrates the estimated incremental cost of NGVs compared with conventional petrol engine and its payback period. NGV pricing policy provides economics and short payback period to vehicles consuming large amount of fuel per day (long distance traveled per day). 6

7 Engine Types Incremental Average Payback Period at Different Crude Oil Prices Investment Distance 2 USD/BBL 25 USD/BBL Baht (Km./Day) 7% Diesel 5% Diesel 7% Diesel 5% Diesel Dedicated NGV ( diesel engine) 1,,-1,5, > 1 Yrs 5-1. Yrs. > 1 Yrs. 5-1 Yrs Yrs. 2-3 Yrs. 3-6 Yrs. 2-3 Yrs. Diesel Dual Fuel Bi -Fuel 4, 35, Remarks NGV s : - Dedicated energy consumption is 3% higher than diesel engine s - Dual Fuel: Energy consumption increases by 1%, Gas to Diesel Ratio = 7 : 3 -Bi Fuel : Energy consumption increases by 1%, Gas to Gasoline Ratio = 8 : 2 - Exchange rate = 4 Baht/ USD - Present oil price structure - NGV price = Yrs. 2-4 Yrs. 3-7 Yrs. 2-3 Yrs. - Taxi 35,-4, Mths. 3-7 Mths. 5-1 Mths. 3-7 Mths Yrs. 4-8 Yrs. 2-5 Yrs. 1 2 Y 1-2 Yrs. 2 Yrs. 1-2 Yrs. - Personal Car 35,-4, Yrs % of diesel retailed price ( equivalent to around 38 % of ) gasoline retailed - NGV price =7 % of diesel retailed price (equivalent to around ) 53 % of gasoline retailed 1 TT S ACTION PLAN With established strategy, PTT has launched action plan in accordance with the Cabinet Resolution on September 5, 2. The action plan will consist of short term and long term plans as followed; Fast track short term plan PTT s fast track short-term plan includes the followings; 1. Expand the utilization of Rangsit refueling NGV station by - converting 1 taxis within November 2 which could substitutes natural gas for gasoline of about 1.8 million liters per year. - purchasing new 7 dedicated NGV/diesel dual fuel buses 2. Expand NGV refueling station for taxi fleet by - providing 1 mobile station within 2 - constructing 1 mother station along PTT s existing natural gas pipeline and 5 daughter stations added on PTT s petrol service stations, expecting to be completed in April 21 - promoting more use of natural gas in taxis by providing conversion kits and cylinders without any charges to 1, taxis operated in Bangkok and metropolitan areas. This promotion could approximately replace gasoline of 18 million liters per year. Long term plan In order to sustain the long term NGV utilization in the transportation sector, PTT has established the target to construct 3 NGV refueling stations along the existing and future natural gas pipeline within year 25/26 in order to serve public buses, trucks, taxis, and passenger cars. The anticipated locations is as followed; - Northern route: Bangkok to Saraburi - Eastern route: Bangkok to Rayong - Western route: Bangkok to Kanchanaburi - Around Bangkok and metropolitan areas This could replace diesel of 11 million liters per year and gasoline of 73 million liters per year. 7

8 11 ADVANTAGES AND DISADVANTAGES OF NGVS In the long run, the success of NGV development in Thailand is absolutely dependent on how the advantages of NGVs is optimally maximized and how the disadvantages are minimized to the acceptable level. Advantages of NGVs Better air quality NGV buses have superior emissions to traditional fuels especially diesel. The emission of PM, for instance, of NGV bus is obviously low. Lower NGV price In many countries including Thailand, natural gas is significantly cheaper than diesel. Higher energy security More importantly, for countries lacking domestic oil resources, natural gas is a significant fossil fuel resource; thus, its use gives these countries certain security against shortages and crude oil price variations. Disadvantages of NGVs High price of NGV vehicles and conversion costs NGV vehicles are more expensive to purchase than diesel. Their costs are typically between 3 and 5% more than their diesel engine equivalents. In case of converted buses/ cars, the conversion cost is found to be an obstacle to vehicle owners to switch to NGV since conversion kits and cylinders are to be imported. Heavy weight of cylinder Typically on-board fuel storage capacity will add about 17% to vehicle's carriage weight, depending on type of cylinders. Less traveled distance Typically NGV buses have a range of approximately 2 kilometers compared to 35 kilometers for diesels. Decreased fuel efficiency The fuel efficiency of NGV is not as good as conventional fuel engine especially compared with diesel engine. The fuel efficiency is decreased around 1-15% as compared to gasoline engine and around 15-3% as compared to diesel engine. Limit of refueling stations As refueling infrastructure cost for NGV is high since large compressors and storage volumes are required to ensure an adequate flow and capacity and this could increases capital costs, which significantly affect the NGV refueling station expansion. 12 KEY SUCCESSFUL FACTORS FOR THE SUSTAINABLE DEVELOPMENT OF NGV BUSINESS IN THAILAND In addition to the effort to maximize the advantages and disadvantages of NGVs, the success of sustainable NGV development also depends on the following factors; Governmental support A major factor in the successfully development of NGV business in Thailand is the commitment and vision of the Thai Government in promoting the use of NGV for its positive impact on the environment. The governmental support is needed in terms of - Tax exemption/reduction on the engines and equipment relating to NGV s engine and refueling station. - Providing financial support to both public and private sectors in converting their own fleets or purchasing new NGV vehicles, expanding NGV refueling station, and establishing conversion center. - Revising of current laws/regulations to comfort the NGVs business. - Developing national standards, safety codes, and regulations for NGVs and appliances. - Providing investment privileges to interested investors in NGV refueling station, conversion, CNG storage, and other NGV related businesses. - Setting policies to actively promote the use of NGV especially in state agencies fleets such as public buses and garbage collection trucks. Public perception about NGV 8

9 A positive public perception needs to be created by making people aware of NGV and its significant environmental benefits, significant savings in fuel cost as well as its excellent safety records worldwide. OEM s active participation The participation of car manufactures is essential for successful implementation of the NGV business. Today, no car manufacture has come forward with dedicated NGVs in the Thai market. This could be explained by the fact that the demand for NGV is still very low. However, in the long term, with the government support and policies to catalyze the NGV growth, such manufacturers would come out with NGVs in the market. 13 CONCLUSIONS The transportation sector has a strong impact on the environment. Globally, NGV technology is proved to be its solution. Though the NGV has been introduced in Thailand for years, creating positive public perception of NGV is still a challenge to be met in order to successfully promote such business. More importantly, the cooperation from various relevant organizations is strongly required to greater utilization of natural gas as an alternative fuel in the future. 9