PRICE ON ...
Whatever happened to CNG- and Lpg-powered vehicles?
Alternative fuels
In Readers’ Writes in New Zealand Classic Car Issue No. 356, Ian Verrall of Waihi asked why the compressed natural gas (CNG) and liquid petroleum gas (LPG) networks were allowed to fail. He wondered if the same thing might happen to electric vehicles (EVS), and suggested I check it out.
Actually, I hadn’t given it a lot of thought before now as I never seriously considered alternative fuels for any of my cars beyond producing a couple of concept drawings for my Zephyr — appropriately enough — ‘convertible’. I have also ruled out electrical power as the 10m extension cord would inevitably pull out as I exited my driveway.
Some of my colleagues did convert their 1960s or 1970s cars to CNG, and many of them had catastrophic results with run bearings and the like. From memory it seemed that, as CNG was a ‘dry’ fuel, the lack of lubrication had a disastrous effect on older car engines. As I recall, it didn’t seem to be an issue with newer vehicles that perhaps had been manufactured with CNG or LPG in mind, or else had working piston rings. Another issue was of course the size of the pressurized tank — a poser for cars with little or no space in the boot for the required-size gas bottle.
An incentive to use alternative fuels was provided by the spiralling price of petrol plus the Robert Muldoon National Government’s offer of interest-free loans for motorists and fleet owners to convert their vehicles to either the CNG or the LPG coming out of the ground in Taranaki, thanks to the Think Big policy. By 1985 some 100,000 CNG conversion kits had been fitted to our fleet of 1.5 million vehicles, and 50,000 vehicles were running on LPG by 1987. Then oil prices started a six-year decline and the growth of alternative fuels shifted into reverse.
SQUEEZED OUT
Now read this bit carefully, as there is an election coming up in September! When the Lange Labour Government came to power in 1984, Muldoon’s subsidies were removed and this, together with the falling oil price, slowly squeezed CNG out of the automotive market. LPG distributors, on the other hand, had built up their domestic heating, barbeque, and industrial markets. That infrastructure stayed viable and today there are 570 refuelling outlets for vehicles. The transport minister of the time, Harry Duynhoven, ran both CNG and LPG conversions in two VW Kombi vans he owned during the 1980s. When he was interviewed back in 2009 he said he doubted that CNG could make a comeback, with a few commercial exceptions.
The LPG sector was putting its faith in widening the Lpg–oil price differential, which equated to unleaded 91 selling for more than $2 per litre while LPG was around $1.26. Throughout the 1990s and up until mid 2002, the price fluctuated by between 61 and 65 cents per litre, kept artificially low by a supply agreement between Maui’s operators and the government. But this era of LPG price regulation lost its oomph as Maui’s production declined. The pricing agreement expired. New Zealand ramped up LPG imports from Saudi Arabia and the benchmark Saudi contract price rose by more than 50 per cent in the year to June 2008. The previous year’s increase had been 27 per cent.
Around December 2008,
New Zealand prices rocketed up with one retailer increasing its retail price by 18 cents per litre. The LPG Association said that there were too many variables to be able to give a price difference between LPG and petrol, given the $3500–$5500 cost to have the LPG conversion fitted. In addition, it was noted that Lpg-powered vehicles did not have the same kilometre-perlitre range as petrol-driven vehicles so the association recommended adding 25 per cent to the price when comparing it with petrol. Still, attempts were made to compare the options and it was suggested at the time motorists would need to hold on to their vehicles for six or seven years to make the conversion economical — a verdict car dealers would not have liked at all!
In 2011, the Automobile Association found CNG supply/use to be virtually comatose, with fewer than a dozen service stations still supplying it. The CNG price isn’t related to international movements but it has risen due to dwindling supplies from the Maui well.
On the LPG front, in 2009 New Zealand was importing roughly 50 per cent of the 180,000 tonnes consumed and further declines from the Maui field would mean more imports. At that time, consideration was being given to stripping LPG from the Taranaki off-shore Pohokura field’s natural gas flow, which could produce 300,000 tonnes of LPG per year. Now, of course, the whole future of the Taranaki / New Zealand oil industry is in the hands of the current coalition government, which has already signalled its distaste for future oil and gas exploration, making us dependent on imports!
CAN YOU STILL BUY A CNG-POWERED CAR?
Not according to a popular vehicle sales website. At the time of writing there were no vehicles listed as being powered by CNG. There were just 15 Lpg-powered cars available, and one of them was only the front half of a Morris Minor that had been converted to a barbeque!
THE MORAL OF THE STORY IS?
The subsidies for EVS are set to be removed in June 2021 and (supposedly) thereafter EV owners will be required to pay road user charges (RUCS) like diesel owners, so, despite the increasing range of some EVS, the payback for buying one will be lengthy. My advice: stick to your petrol-powered classic. Governments have a track record of shafting us motorists!