Diesel more efficient than petrol : Report
The government may be subsidising diesel to appease electorate, but there is also a brighter side of this appeasement policy. Diesel is stated to be an efficient fuel.
By Sushmi Dey, ET Bureau |
The interim report of the review committee on auto fuel policy, submitted to the petroleum secretary R S Pandey recently, interestingly, favours use of diesel over petrol.
This at a time when public sector oil marketing companies ��� IndianOil (IOC), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) ��� are incurring huge under-recoveries due to rising demand of diesel and also given that diesel is highly subsidised for political reasons. According to reports, diesel consumption in the country has risen by 17-20%, mainly by power producers and industrial users as it is cheaper than other fuels.
However, the panel, headed by ministry of petroleum & natural gas��� scientific advisory committee chairman and former CMD of HPCL MB Lal, is in favour of encouraging diesel engine technology on the ground that it is more fuel-efficient and emits less green house gases (GHG) compared to petrol.
���Diesel engine technology is more fuel-efficient and emits less GHG compared to engines operating on gasoline, CNG or LPG. Other emissions from Euro-IV technology diesel engines are also comparable with CNG engines,��� the
committee said in the report.
The interim report may come as a shock to the public sector oil marketing companies which are bleeding due to rising consumption of subsidised diesel. In fact, the recommendations come at a time when the oil ministry is considering to reign in rising consumption of diesel by imposing higher duties on diesel-run vehicles.
���Diesel alone accounts for more than 50% of the total under recoveries suffered by public sector oil marketing com-panies on retail sale of petroleum products���petrol, diesel, kerosene and LPG���at controlled price. The revenue loss on diesel is expected to go up during 2008-09,��� an expert said.
Considering the country���s energy consumption scenario, the ministry has been arguing that it has to study alternatives that were available and take steps to ensure that India���s progress was not constrained by energy availability.
Domestic consumption of diesel, which is mainly used as a transportation fuel, is estimated to be growing at a rate close to 17-20%, said an expert. The report is expected to further increase the use of diesel by qualifying diesel engine technology as more fuel efficient and cleaner than petrol and CNG.
The report has also identified diesel generator sets as a major source of contribution for fine particles in the atmosphere.
According to the report, more investments are required to bring down the traffic congestion vehicle waiting period
on roads. This in turn is expected to help in reducing fuel consumption as well as emissions. Fuel economy reduces by around 50% when vehicle speed reduces from 40-45 km per hour to 10-15 km per hour. According to the report, tax relief may also be linked with fuel economy of the vehicle and higher incentives may be considered for hybrid vehicles.
���Hybrid vehicles being more fuel-efficient and emitting fewer pollutants compared to petrol and diesel vehicles, must be promoted by giving financial incentives including duty reduction etc.,��� the report said.
For cities that are highly polluted, the report recommended use of gaseous fuels in public transports. ���In highly
polluted cities where pollution from automobiles is a major portion of the total pollution load, gaseous fuels may be promoted particularly in public transport vehicles like buses and three-wheelers etc.,��� the report said.
It also said, in specific for cities like Faridabad, Ghaziabad, Noida and Gurgaon (which have grown in the proximity of major metros), that such cities should immediately implement a gas distribution infrastructure and switch all three wheelers and local buses and taxis to CNG or LPG.
In order to ensure adequate supply and filling points for CNG in such cities, the report suggested that the government should accord priority to gas allocation for the transport sector and take suitable steps which will result in expansion of the distribution system and filing points in cities where it has already been introduced.
This at a time when public sector oil marketing companies ��� IndianOil (IOC), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) ��� are incurring huge under-recoveries due to rising demand of diesel and also given that diesel is highly subsidised for political reasons. According to reports, diesel consumption in the country has risen by 17-20%, mainly by power producers and industrial users as it is cheaper than other fuels.
However, the panel, headed by ministry of petroleum & natural gas��� scientific advisory committee chairman and former CMD of HPCL MB Lal, is in favour of encouraging diesel engine technology on the ground that it is more fuel-efficient and emits less green house gases (GHG) compared to petrol.
���Diesel engine technology is more fuel-efficient and emits less GHG compared to engines operating on gasoline, CNG or LPG. Other emissions from Euro-IV technology diesel engines are also comparable with CNG engines,��� the
committee said in the report.
The interim report may come as a shock to the public sector oil marketing companies which are bleeding due to rising consumption of subsidised diesel. In fact, the recommendations come at a time when the oil ministry is considering to reign in rising consumption of diesel by imposing higher duties on diesel-run vehicles.
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The petroleum ministry is perturbed by the constant rise in consumption of diesel in the country. The ministry has already made it clear that even as the crude prices have been falling, it would not be possible to reduce prices of auto fuel as the oil marketing companies continue their under recoveries.���Diesel alone accounts for more than 50% of the total under recoveries suffered by public sector oil marketing com-panies on retail sale of petroleum products���petrol, diesel, kerosene and LPG���at controlled price. The revenue loss on diesel is expected to go up during 2008-09,��� an expert said.
Considering the country���s energy consumption scenario, the ministry has been arguing that it has to study alternatives that were available and take steps to ensure that India���s progress was not constrained by energy availability.
Domestic consumption of diesel, which is mainly used as a transportation fuel, is estimated to be growing at a rate close to 17-20%, said an expert. The report is expected to further increase the use of diesel by qualifying diesel engine technology as more fuel efficient and cleaner than petrol and CNG.
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The committee, in its recommendations, has also suggested that old vehicles are gross polluters and it is essential to develop and implement a robust system for inspection and maintenance of such vehicles. It has also observed that even in case of new vehicles with state of art technologies, proper maintenance is important for them to continue to operate with design emission values. The report has also identified diesel generator sets as a major source of contribution for fine particles in the atmosphere.
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The committee in its report has observed that major improvements are recorded in respect of sulphur, octane number and benzene limits in petrol. However, there is a progressive improvement in specifications diesel fuel quality. The committee suggested the government to have greater investments in mass public transport and roads. According to the report, more investments are required to bring down the traffic congestion vehicle waiting period
on roads. This in turn is expected to help in reducing fuel consumption as well as emissions. Fuel economy reduces by around 50% when vehicle speed reduces from 40-45 km per hour to 10-15 km per hour. According to the report, tax relief may also be linked with fuel economy of the vehicle and higher incentives may be considered for hybrid vehicles.
���Hybrid vehicles being more fuel-efficient and emitting fewer pollutants compared to petrol and diesel vehicles, must be promoted by giving financial incentives including duty reduction etc.,��� the report said.
For cities that are highly polluted, the report recommended use of gaseous fuels in public transports. ���In highly
polluted cities where pollution from automobiles is a major portion of the total pollution load, gaseous fuels may be promoted particularly in public transport vehicles like buses and three-wheelers etc.,��� the report said.
It also said, in specific for cities like Faridabad, Ghaziabad, Noida and Gurgaon (which have grown in the proximity of major metros), that such cities should immediately implement a gas distribution infrastructure and switch all three wheelers and local buses and taxis to CNG or LPG.
In order to ensure adequate supply and filling points for CNG in such cities, the report suggested that the government should accord priority to gas allocation for the transport sector and take suitable steps which will result in expansion of the distribution system and filing points in cities where it has already been introduced.
The committee in its interim recommendations supported the road map for supply of quality fuels and emission norms provided in the auto fuel policy. The auto fuel policy indicated supply of Euro-IV quality fuels and emissions norms for major cities and Euro-III for rest of the country.
The review committee in its report said that such norms need to be adhered to. The committee also suggested that refineries can be asked to estimate the additional costs for supply of Euro-IV in the entire country and the time required to do so.
In order to encourage refineries to gear up for supply of Euro-IV quality fuel and meet deadlines, the committee recommended that a higher price and return for Euro-IV equivalent fuels be allowed so that refineries complete projects in time. ���Oil companies need to be adequately compensated for the huge investments made by them for upgrading the fuel quality,��� said the committee in its report.
However, in case of railways, the committee said that railways can continue to use Euro-III even after 2010 until their engine technology is upgraded and need for Euro-IV fuel is adequately justified.
Use of biofuels as automotive fuel is also recommended in the interim report of the review committee. Apart from being renewable source of energy, use of biofuels would also result in emission reduction from automobiles.
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