- In the wake of Nigeria’s decision to remove fuel subsidies, the federal government introduced Compressed Natural Gas (CNG) as an alternative to petrol, aiming to alleviate the economic strain on citizens.
- Despite allocating substantial funds to promote CNG adoption, uptake among motorists has been sluggish, facing significant resistance.
In 2023, President Bola Tinubu announced the removal of these subsidies, citing economic constraints and the need for fiscal responsibility. The immediate consequence was a sharp increase in petrol prices, leading to a surge in transportation costs and widespread public discontent.
In response, the government turned to Nigeria’s abundant natural gas reserves, launching the Presidential Compressed Natural Gas Initiative (PCNGI) in August 2023.
The initiative aimed to convert 150,000 vehicles to CNG by the end of the year and one million by 2027, positioning CNG as a cheaper and cleaner alternative to petrol. To support this transition, the government allocated N100 billion to provide CNG vehicles and infrastructure development.
The PCNGI was designed to create a sustainable energy framework, reducing reliance on imported petrol and cushioning the economic impact on citizens.
The government rolled out multiple batches of funding, including subsidies for vehicle conversion kits and investments in building a network of CNG refueling stations. Despite these measures, the adoption rate has been lower than anticipated, with many motorists hesitant to make the switch.
Challenges facing CNG adoption
Despite these efforts, the adoption of CNG has been slower than anticipated. Several factors contribute to this hesitancy among motorists.
One of the issues is the high conversion costs. Converting a petrol vehicle to CNG requires significant investment. For instance, converting a vehicle with a 1.6-litre engine costs between N300,000 and N400,000, while tricycles with 4-stroke engines require N100,000 to N200,000. Lorries and vans can incur conversion costs up to N1.8 million.
In an interview with Yusuf Ibrahim, a keke (tricycle) driver, expressed frustration over the high costs associated with converting his vehicle to run on CNG.
“The government is asking us to switch, but they haven’t provided enough support to make it affordable,” he said.
“The conversion alone costs nearly N200,000, which is more than what I earn in several months. Even if I managed to convert my tricycle, there are hardly any CNG stations around Ogba.
“It’s not practical for me to drive all the way to another area just to refuel,” he lamented.
Yusuf also voiced concerns about the potential downtime during the conversion process, which would mean losing income for several days.
A significant challenge is the limited CNG infrastructure, with refueling stations available in only 13 out of Nigeria’s 36 states. This scarcity presents a major hurdle for motorists, as the ease of refueling is essential for adoption.
Safety concerns are another major issue. Incidents at unauthorized conversion centers have sparked fears, such as the explosion of a CNG-converted vehicle at a filling station in Benin City, Edo State, which caused injuries. These incidents have amplified worries about the safety of CNG vehicles.
Moreover, a lack of awareness and widespread misinformation have contributed to the slow uptake of CNG. Many motorists remain unaware of its benefits or hold misconceptions about its effectiveness and safety, leading to hesitation in adopting this alternative fuel.
Government initiatives and financial support
To tackle these challenges, the government has launched several funding initiatives.
Foremost among them is the N100 billion Energy Transition Fund, dedicated to facilitating the provision of CNG vehicles. This initiative aims to alleviate the financial burden on motorists and promote the adoption of CNG.
Additionally, another N100 billion has been allocated to a consumer credit fund designed to bolster the manufacturing sector. This fund seeks to make goods and services, including vehicle conversions, more accessible to Nigerians through consumer credit options.
Despite these financial commitments, disbursement and implementation have faced scrutiny. Concerns have been raised about the transparency and efficiency of fund allocation, with reports suggesting that the PCNGI has not made significant progress even after the disbursement of N100 billion.
Voices from the Road: Drivers and Passengers Speak Out
For Michael Adebanjo, an Uber driver in Lagos, the situation is slightly different but equally challenging.
“I’ve considered converting to CNG because petrol prices are killing my profits. But I have concerns about the warranty on my vehicle.
“If I make modifications, will it still be covered? Plus, I’ve heard stories about safety issues with CNG systems not installed properly. I can’t afford to risk my car, which is my primary source of income,” Adebanjo said.
Michael also pointed out that the lack of adequate refueling infrastructure means he’d have to plan his trips around the availability of CNG stations, which is not feasible given the nature of his work.
Chidi Okafor, a bus driver who operates on the busy routes of Surulere, echoed similar sentiments.
“Switching to CNG sounds like a good idea for saving money in the long run, but where do I get the money to convert my bus?” he asked.
“The government talks about funding, but I haven’t seen any of it. And even if I did, the places to refuel are few and far between. It’s just not convenient.”
Chidi also mentioned the lack of clear information on how to access government support for conversion, making the entire process seem more daunting.
Passengers, who are directly impacted by the choices of drivers, also have varied opinions on the shift to CNG.
Temitope Ayeni, a daily commuter from Lagos Island to the mainland, expressed cautious optimism.
“If CNG adoption can lead to lower fares, then it’s a good thing. But my concern is how soon this will happen. Drivers are already charging more because of the fuel price hike,” she said.
“If they switch to CNG and it’s not readily available or affordable for them, I doubt we’ll see any real benefits.”
Temitope also raised concerns about the reliability of CNG as an alternative fuel, citing instances where drivers have refused to use it due to fears of running out of fuel mid-journey.
Nkechi Adigwe, who works in Victoria Island, shared her safety concerns.
“I’ve read about accidents involving CNG vehicles, especially those converted at unauthorized centers. Safety is my top priority. Until there’s a robust safety standard and more awareness about how CNG works, I’d rather stick to what I know, even if it costs more,” she explained.
Nkechi also pointed out that the government needs to do more in terms of educating the public about the benefits and safety measures of CNG, to build trust and confidence.
Adewale Johnson, a university student commuting daily to Yaba, views CNG adoption as a potential game-changer for students like him.
“Transport costs are a huge part of my expenses. If CNG could make it cheaper, I’m all for it. But the problem is, most drivers don’t have the means to switch. Until the government makes it easier and more accessible, it feels like just another promise that won’t be fulfilled,” he said.
What the experts are saying
Michael Oluwatosin, an energy researcher and investor, believes in the long-term economic and environmental benefits of CNG.
“Nigeria stands at a crucial crossroads. By leveraging our vast natural gas reserves, we can significantly reduce our dependency on imported petrol, thus conserving foreign exchange and mitigating the fiscal burden of fuel subsidies,” he said.
“For every one million vehicles we convert to CNG, we save approximately $2 billion annually. This is not just a cost-saving measure; it’s a strategic move towards energy security and environmental sustainability.”
Oluwatosin also highlighted the government’s efforts to scale up infrastructure, acknowledging that while the pace may seem slow, the groundwork is being laid for a more comprehensive CNG network.
Adeola Adigun, an energy analyst, offers a more critical view of the current state of CNG adoption.
“The concept of switching to CNG is sound, especially in light of the subsidy removal. However, the execution has been less than ideal. The high conversion costs and sparse refueling infrastructure are significant barriers,” he said
“The government needs to invest not just in the initial conversion process but in building a nationwide network of CNG stations to make this transition viable for all motorists. Without addressing these fundamental issues, we risk having a policy that looks good on paper but fails in practice.”