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Fuel hike accelerates conversion of cars to CNG

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Given the strong increase in the price of the most used fuels in the Peruvian automotive fleet – such as diesel, gasohols and LPGwhose prices rose between S/5 and S/7 per gallon, more than 20,000 users, so far this year, have chosen to convert their cars to vehicular natural gas (CNG), which is a national fuel, abundant and cheap, as its value is regulated by contracts with Camisea.

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According to figures from warmBetween January and May of this year, 22,197 vehicles migrated to CNG only in metropolitan Lima and Callao. The tendency to exceed the conversion record is marked, considering that the best result was obtained in 2014, with 24,243 units. And also seeing that the conversion ratio has not decreased since September of last year: from 1,872 units to April of this year, 5,053 units.

The private firm anticipates that this will be the year in which the vehicle fleet will make the most of the benefits of natural gas, which is extracted from Lot 88 of Camisea and, therefore, has a regulated price, unlike the other fuels subject to to international fluctuations due to its imported nature.

How to access the conversion to CNG?

It is crucial for the standardization of programs such as Ahorro GNV, which is promoted by the Energy Social Inclusion Fund (FISE) and allows financing 100% of the conversion without charges that are detrimental to the economy of citizens in up to nine regions (see infographic).

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To access these conversions, users must enter the FISE website to find the mechanical workshops that have the endorsement of the Ministry of Transport and Communications (TCM). In total, there are 116 affiliated workshops throughout the country.

Each beneficiary has a return period of up to three years once the conversion to CNG is subsidized, although in the case of provinces, they are assigned a discount voucher of S/ 1,000 that is subtracted from the final price.

“The conversion is financed without an initial fee or interest. You just ask to join the program. No need to go to any bank or queue. The financing is for three years and with zero interest”, explained José Saco, deputy manager of mobility at Cálidda.

In this regard, the former Vice Minister of Energy and Mines Luis Espinoza adds that citizens who agree to the conversion to CNG will honor their debt every time they load at a tap. “With each S/10 charge you pay off your debt. You pay it at the tap and that goes to the fund that financed it. The silver is never given in cash but to the people (the workshops) who convert it,” he explained.

The process of converting a vehicle, according to Noel Ñiquen, coordinator of the NGV Savings program of the Ministry of Energy and Mines (mine), the conversion process to CNG takes from one to three days, depending on the complexity of the operation.

Regarding the three years of guarantee that are allowed, Ñiquen told this newspaper that the Minem is thinking of extending the period considering that the conversions carried out at the beginning of 2020 went through more complications than they should have with the stoppage of economic activities generated by the pandemic. .

“Before, the scheme was different with financial entities that gave loans and charged interest to guarantee our return to the program. In 2020 it changed. They were withdrawn and now the FISE gives the credits directly without interest. The first user of 2020 would have to finish paying in 2023, but we are thinking of expanding it. If someone has not finished paying it, the term can be extended, ”he said.

It is worth specifying that there is also the option of paying through a direct deposit in financing installments or in full through a bank window.

70,000 vehicles are expected to be converted

For this year it is expected to convert approximately 70,000 vehicles to CNG through this financing mechanism at the national level.

In that sense, Ñiquen said that so far more than 36,000 light gasoline and LPG vehicles have converted their engines to CNG through FISE.

In detail, according to statistics from the General Directorate of Hydrocarbons of Minem, more than 26,000 vehicles migrated from gasoline to CNG, covering 73% of the total; while there are more than 9,000 cars that switched from LPG to CNG, 27% of the total.

The Lima region is the one that heads the list of total migrations, with 25,000 units of its automotive fleet that now have natural gas.

“Dissemination is lacking. We are going to focus on it from now on because many people are unaware of the program. People are afraid of CNG and there are myths that it will break your engine, the tank will take up space or the brakes will fail. There is a need for greater dissemination by the Government. We are going to promote more conversion workshops in the province”, he noted.

Bonus of S / 2,000 for conversions

The Republic was able to learn that it is still in the hands of the Executive to boost the massification of NGV through the execution of DU 109-2021, which was approved at the end of last year and provides a bonus of S / 2,000 for those citizens who seek to convert your car from LPG – the most used by taxi drivers – to CNG.

In this regard, Ñiquen acknowledged that the legal initiative is under constant review, but “currently it is quite advanced” and the technical details are being refined to prevent waste from modified cars from ending up on a black market.

“They are S/200 million that will interact with the GNV Savings program. The same workshops that currently offer financing will offer this discount voucher to LPG vehicles when this mechanism is activated. We hope that in the coming weeks the discount for LPG to CNG conversions can be activated and announced, ”he told this newspaper.

How much is spent with current fuels?

For every 100 kilometers traveled with a car that uses 95 gasohol, a citizen must spend S/66.96; while with gasohol of 90, S/59.08 and with diesel, S/45.90. In the case of LPG, it requires the user to pay S/33.26.

On the other hand, with CNG, for the same distance only S/15.30 is required, enough to fill 10 cubic meters of the tank. Completing it does not cost more than S / 30, according to data from various specialists, including the former director general of Hydrocarbons Erick García.

For García, the political will of the Government is urgently needed to massify the use of this resource that lies on our soil, not only at the vehicle level –such as DU 109-2021, approved in his administration and which would see the green light in a few weeks– but also in residential, promoting the connection of more points per home to further reduce bills payable.

“VNG is totally simple”

Jesús Cárdenas Becerra is a family man from Lurín who was recently encouraged to modify his car to CNG, considering that the rise in fuel prices was a headache for his economy.

“Each tanking came to cost me S/220 since the fortnight of May, I normally used 95 fuel, but then I had to go down to 90″, he tells La República.

Cárdenas comments that prior to migrating to NGV it demanded a budget of S/5,500, and despite doubts about the heavy spending that figure represents, the company in charge told him that if he did not have the capital there was no problem because the State is giving facilities.

Since then, despite the fear he felt at first because of the myths surrounding CNG, he confesses that “it is really cheap” because the two times he has gone to fill his tank he paid S/10 and S/16.3, respectively. for enough gallons in a section of more than 100 km. “It’s totally simple and recommendable,” he concluded.

Fuels rose to S/2.24

The wholesale prices of the main fuels rebounded after the reincorporation of the selective consumption tax (ISC) on gasohols and 84 and 90 octane gasoline, according to Petroperú.

In the group of fuels that will be taxed again by the ISC, the rise is led by 90-octane gasoline, which rose S/2.2434 (13.71%) and went from S/16.3633 to S/18.6067 in the last week. Meanwhile, the 84-octane one rose S/1.4986 and stands at S/16.4473, and the 90-octane one reached S/23.161 per gallon.

Finally, the price of diesel remains at S/15.93 per gallon; while LPG fell to S/3,422 per kilogram.

Indecopi and Osinergmin supervise that taps deliver the correct amount of fuel for the price paid.

reactions

Noel Ñiquen, NGV Savings Coordinator

“There is fear of CNG and there are myths that it will break your engine or the tank will take up space (…) The Government needs more publicity. We are going to promote more workshops in the province.”

José Saco, deputy manager of Mobility at Cálidda

“The conversion is financed without an initial fee or interest. You just ask to join the program (NGV Savings). No need to go to the bank or queue. The financing is for three years and with zero interest.

Jesus Cárdenas Becerra, father of a family

“Each tanking came to cost S/220 (…) I normally used 95 fuel but I went down to 90 (…) It is totally recommended. Now I tank with S/16.30, which is nothing compared to before.”

Infographic – The Republic

Infographic – The Republic

Infographic – The Republic

Source: Larepublica

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