CITY GAS PROJECTS: HIGH POTENTIAL FOR GROWTH

April 14, 2010 11:26 am

CITY GAS PROJECTS: HIGH POTENTIAL FOR GROWTH
 
“It is beyond contention that city gas projects implementation will play a significant role in the growth of the economy. The next decade will be the decade of city gas distribution in India.” An OEM Update report.
 
There has been growing concern about the availability of primary commercial energy to meet the country’s growth imperatives. The Indian economy which is growing at 7.5 percent, with projections for further growth is projected to become the second largest by the year 2050.The projected growth will require a corresponding increase in the source of energy as well as in supply infrastructure. Under these circumstances, adequate reliable energy supply at economic prices for optimal and inclusive growth of the country is a prime concern.
 
GAS: A CLEAN ENERGY SOURCE
It is in this context that the role of natural gas as a potent source of clean and efficient energy becomes important. With promising gas discoveries made in the various parts of the country and ongoing exploration activities, natural gas is poised to play an important role in development of the economy. Gas is emerging as an important policy element in achieving equitable, balanced and sustainable economic growth through widening its user base among industry boundaries.
 
Specifically, city gas projects offer a way to improve the availability of lifeline energy to the masses through household distribution of Piped Natural Gas (PNG) to the households and Compressed Natural Gas (CNG) to the transport sector. PNG for city gas distribution provides an avenue to spread the gains of a new a liberalized economic policy to the common man by meeting the most essential requirement of the domestic sector. CNG is equally important for furthering this objective as it is linked to improving the health and quality of life of the masses by providing clean and pollution free environment. Further, city gas distribution projects will help in achieving an equitable distribution of modern energy services as well as in improving the living standards of the people through eco-friendly and efficient energy.   
 
ENVIRONMENTAL CONCERNS
The use of natural gas as a fuel has been in vogue for quite some time in India but it was limited to industrial applications. The main thrust for realization of the city gas projects in the initial stage was due to environmental concerns. The rapid growth in urbanization and increasing vehicular emission in India during last 10-15 years has resulted in a drastic rise in environmental pollution. This has been a major cause of concern in important cities. From a study of the ambient air quality monitored in the late 1990’s it was found that the contribution of vehicles to the ambient air pollution was as high as 65 percent. This was also taken cognizance of by the judiciary at various levels.
 
GAIL’S INITIATIVES
Meanwhile the central public sector gas distributor Gas Authority of India Ltd (GAIL) took several initiatives to introduce PNG to the households and CNG to the transport sector to address the rising pollution levels. Pilot projects were launched in two metros of Delhi and Mumbai in early 1990 leading to start commercial operation of city gas projects in two cities through joint venture mode. Thus GAIL successfully established natural gas as an eco-friendly economical and safe alternative to gasoline and LPG in the transport sector. The results of these ventures are quite feasible through the improvement in air quality in these cities. As such the PSU has played a role model for introduction of CGD projects in the country.   
 
With the gain of experience and expertise GAIL has replicated the projects in other cities where gas is available along with pipeline connectivity. Going ahead with its plan, the company has so far implemented city gas projects in 13 cities independently or through the joint venture route and has formed eight joint ventures for this purpose. Further, with a planned network expansion of more than 12,000 km of high pressure trunk pipelines by 2011-12, GAIL expects as many as 200 cities to be on city gas distribution map of India in due course connecting cities and towns falling in the catchments areas of  its gas pipelines. These cities will span over 15 states and cover a population of about 160 million. Similarly large number of vehicles including public transport will run on CNG.
 
Economics: On an energy-equivalent basis, natural gas costs considerably less than LPG, gasoline and diesel. It is a clean burning fuel that reduces vehicle maintenance. An added advantage is that unlike liquid fuels, gas cannot be adulterated or siphoned off from a vehicle, a major source of concern with petrol or diesel. However, some fiscal incentives may be required for inducing switchovers and conversions.
 
Emissions: Exhaust emissions from CNG vehicles are much lower than that of petrol or diesel. For instance the CNG emission of carbon monoxide are approximately 70 percent lower, non methane organic gas emissions are 89 percent lower and other oxides of nitrogen emissions are 87 percent lower. In addition, CNG vehicles emit significantly lower amount of green house gases than petrol vehicles.
 
Safety: Vehicles which run on clean burning natural gas are safe as vehicles operating on traditional fuels. Being lighter than air, CNG unlike gasoline, dissipates into the atmosphere in the event of an accident. CNG fuel systems are sealed which prevent any spills or evaporative losses. Also natural gas is not toxic or corrosive and will not contaminate ground water.
 
HIGH POTENTIAL

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