Clean-diesel beats compressed natural gas on cost, paticulate emissions impact: India

Diesel Fuel News, Dec 23, 2002 by Jack Peckham

Converting the Mumbai, India, transport sector to cleaner vehicles and cleaner liquid fuels -- including ultra-low sulfur diesel (ULSD)--easily beats compressed natural gas (CNG) on cost and delivers equivalent reductions in "toxic" particulate emissions, according to India's Tata Energy Research Institute (TERI).

The initial TERI study earlier this year showed that ULSD would be substantially cheaper on a rupees-per-liter basis than CNG, no matter whether the ULSD is imported, nor whether the CNG comes from Indian domestic or imported sources.

What's more, a catalyst-equipped ULSD bus would be about one-third less cost than a CNG bus on a rupees per kilometer basis, the study showed.

A more detailed, policy-oriented follow-up study that TERI's developing for Asia Development Bank will help define the air pollution problems in Mumbai (Bombay) and likely future trends.

This study will include input from consumer groups and look at the impact of CNG pricing on India's relatively huge population of low-income people.

This cost factor is especially critical in a country with so many poor people, and a growing need for "clean" electric power.

Yet CNG promoters have been demanding subsidized CNG pricing and preferential gas supplies, even to the detriment of electric power producers, as shown by India Supreme Court orders confirming a CNG bus monopoly for Delhi and extension to other polluted cities.

TERI's new study for Mumbai aims to estimate potential demand for CNG and ULSD road fuels between now and 2010, and identify potential supply sources. It's also analyzing the resulting ambient emissions load of carbon monoxide (CO), hydrocarbons (HC), nitrogen oxides (NOx) and particulate matter (PM) with alternative scenarios based upon increasing market penetration of CNG and ULSD.

The TERI study assumes that neither CNG nor ULSD are suitable for the large fleets of two-wheeled vehicles, and that CNG isn't viable for pre-Euro II buses nor trucks.

It assumes ULSD and PM filters are feasible for all Euro-II (or later) diesel light trucks and buses (a more inclusive group of vehicles than it had assumed last year), while ULSD and a diesel oxidation catalyst (DOC) are seen feasible for all pre-Euro II vehicles and Euro II heavy trucks.

The study also assumes CNG usage gradually will increase in new cars, taxis, buses and autos, although another Supreme Court order compelled the abrupt conversion of some 15,000 taxis to CNG or LP-Gas, which earlier provoked a taxi drivers strike and yet more transport problems for commuters.

The Supreme Court also ordered that CNG users get steep gas price discounts and supply priority over industrial/electric generators. Yet India suffers from frequent electric blackouts already; prioritizing CNG supplies for vehicles would only aggravate this problem.

Trying to find ways to avoid a similar transportation and energy fiasco in Mumbai, TERI's study shows that a clean-diesel alternative (offered along with CNG, rather than a CNG monopoly) could dramatically reduce PM emissions, even on older buses, at far lower cost to consumers.

The CNG option would result in somewhat lower total NOx emissions, compared to a ULSD/PM filter bus fleet, the initial TERI analysis shows.

But the PM abatement cost with ULSD and PM filter would be only U.S.$3,123 per ton, versus $39,473 per ton with CNG - making ULSD ten times more cost-effective, the initial TERI analysis shows.

What's more, "creation of additional infrastructure for CNG [refueling] is difficult because of space constraints" in the city of Mumbai, the TERI analysis indicated.

Meantime, "carefully controlled demonstration projects in the region with both ULSD and CNG would be very helpful" to verify emissions data and cost impacts, TERI's study outline for ADB says.

Cost of ULSD supply


   Crude Price, $/bbl                   25

1  FOB Price HSD $/bbl               27.86

2  Premium LSD over HSD $/bbl         0.40

3  Premium ULSD over LSD, $/bbl       3.51

4  Freight Cost to Mumbai port
 $/bbl                                1.40

5  CIF Price ULSD $/bbl (1 2 3 4)    33.20
5  CIF Price Rs/km                 9914.43

6  Terminal Charges Rs/km           175.00

7  RPO Charge Rs/km                  83.96

8  Dealers Commission Rs/km         277.00

9  Cost of supplying ULSD at         10.45
   Retail outlet Rs/km
10 Cost of supplying ULSD at         11.50
   Retail outlet Rskm

Summary of costs


Duabi Crude Price, $/bbl  Unit         22     25     28

ULSD                      Rs/litre   9.44  10.45  11.46

CNG thru import ex Dahej  Rs/kg     15.23  15.95  16.67

CNG thru indigenous       Rs/kg     13.04  13.98  14.91

ULSD bus                  Rs/km      2.32   2.57   2.82

CNG bus (Import)          Rs/km      3.59   3.76   3.93

CNG bus (Domestic)        Rs/km      3.62   3.88   4.14

The views presented here do not necessarily reflect the views or
position of ADB, or its Board of Directors or the Governments they
represent. ADB does not guarantee the accuracy of the data included in
this file and accepts no responsibility for consequences arising from
their use. The term "country" does not imply any judgment by ADB as to
the legal or other status of any territorial entity.