LNG v LPG

I thought the programme last night said that natural gas was much more economical than distillate for the State Transit buses. They claimed that the reason they purchased new buses that run on distillate was that AGL is not able to supply enough gas without an extra pipeline being built. AGL was not prepared to spend the money and was trying to get State Transit to pay for the construction of the pipeline, which they wouldn't agree to do.

Cheers Frank.

In considering economics of a solution, you have to include the cost of everything - including upgrading pipes and the LNG liquefaction units - and these AREN'T cheap.

You can easily make LNG appear cheaper if you say "my car uses xx litres of LNG per 100 km and AGL sell natural gas at xx per litre". To use it in a car, you have to look at the cost of LIQUEFIED natural gas.

State Transit has to consider the total cost of LNG liquefaction - because they have to fund hem.

If you were to buy LNG by the litre from a servo - they would have to add the cost of LNG liquefaction and gas main upgrade to the cost per litre.

Yes, Australia has lots of LNG and we SHOULD use it, but it will only happen if it's more economical for the end user. The one major user in NSW has voted with their wallet.

Hi Mike,

I believe that the State Transit buses use compressed natural gas rather than LNG, though this doesn't change your valid point that LNG would be needed if someone was to be able to do a quick fill up at a service station. Is this is actually necessary?

The guy on the program with the old tray top also uses CNG. He said that he plugs his car in to his compressor and fills up over night. The eight hour fill gives him a 200 km range and if he exceeds that he needs to switch over to petrol. The cost of the compressor is around $3,000 and running his car on CNG costs him around one fifth of the cost of running on petrol.

Two hundred kilometers per day would satisfy most people's needs and natural gas is currently piped to most metropolitan houses. With a cost per kilometer of one fifth that of petrol, wouldn't that make the CNG compressors a more sensible product for the government to subsidise than LPG conversions for vehicles?

While it is correct to consider the total cost of the different solutions, there are many ways to represent just what constitutes the total cost. The State Transit Authority keeps a bus for 12 years. This means that buses being bought now will be effected by the 19 cents per cubic meter tax that is being applied to CNG in 2011. There is also the consideration of the 19 cents per litre rebate that the government has introduced for commercial distillate use. Without these imposts that have been imposed by government, the economic case for CNG would still be ahead of distillate. This is why State Transit could previously justify the use of CNG but can not do so in future.

If one considers the economic benefits to the state that derive from the lower pollution emissions from the use of CNG over distillate then CNG also gains economically. A bus running on diesel, even one complying with the Euro3 standard, produces 17 times the particulate matter produced by a bus running on CNG. What's the health cost to the community of the pollution from buses? Who knows? Shouldn't it be factored in somehow?

Using CNG just seems like a good idea; it's less polluting and we have a huge amount in Oz. Why sell it to the Chinese when we can use it ourselves and get rid of our dependence on foreign oil? If we were to run our metropolitan commuter cars and buses on CNG our own petroleum reserves could be left for the applications that require it.

Well that's what I think. I think.

Cheers Frank.

"Using CNG just seems like a good idea; it's less polluting and we have a huge amount in Oz. Why sell it to the Chinese when we can use it ourselves and get rid of our dependence on foreign oil? If we were to run our metropolitan commuter cars and buses on CNG our own petroleum reserves could be left for the applications that require it. "

Frank - I agree with you 100%

I'd expect that for home use, like the builder with that ute had on the show, would need a liquefication compressor running off his home gas supply. This unit would have to meet all sorts of stringent safety regs, and I'd say would not be cheap.

I note that it took about 8 hours to fill a tank which gave 200km range. Guess this range would be fine for a lot of people doing city work.

Now how is the Govt going to tax this LNG when they bring in the LPG tax in a few years. Just slap on a tax for all home gas?
Gerry