Green bus operators worry about possible gas price spike

A plan of Ho Chi Minh City to treble the number of buses running on compressed natural gas (CNG) by the end of 2017 might be in jeopardy as the CNG price has increased this year and is forecast to edge up further in the coming years.

According to the Ho Chi Minh City People’s Committee, the city has 256 CNG buses plying some of the fare-subsidized routes. There are four CNG pumping stations operated by PetroVietnam Southern Gas Joint Stock Company (PV Gas South) and the CNG price is 40% lower than that of diesel oil.

green bus operators worry about possible gas price spike hinh 0

A demonstration of a CNG bus being refilled in HCM City. The rising CNG price might jeopardize a plan of HCM City to treble the number of buses running on compressed natural gas (CNG) by the end of 2017

These green buses have helped reduce environmental pollution. Therefore, the city is propping up investment in environmentally friendly buses as it looks to have 841 CNG buses operating on 39 routes by the end of this year.

But the plan might not materialize as a report of the Ho Chi Minh City  Department of Transport said PV Gas South has revised up its CNG price this year and now it is equivalent to 66% of the DO price. 

The CNG price rise is projected to continue.

Worse still, PetroVietnam Gas Corporation (PV Gas) has asked PV Gas South to suspend construction of new CNG pumping stations in the city.

“These factors will make inroads into the city’s clean bus development plan,” said the city government in a document sent on April 13 to Vietnam Oil and Gas Group (PVN). 

The city requested PVN to speed up construction on nine new CNG stations and expansion on the four existing stations.

The city also asked PVN to keep the CNG price at 60% of the DO level to ensure those eco-buses can operate efficiently.

The city suggested PVN plan a CNG supply system for public transit to help reduce environmental pollution and spur sustainable development of the public transit sector.

Transport experts said CNG buses use 30% less fuel than those running on diesel oil. However, the cost of a CNG bus is more than VND1 billion (about US$44,050) higher than that of a diesel vehicle.

Sai Gon Times

Related news

Most Popular Video