The National Iranian Gas Company has restricted compressed natural gas delivery to pumps across the nation, especially in northern provinces namely North Khorasan, Golestan, South Khorasan, Mazandaran and Khorasan Razavi, the head of the CNG Department of state-run National Iranian Oil Products Distribution Company said.
“As long as household gas consumption is above 650 million cubic meters per day, CNG stations all over the country have to be either closed or operate part time,” Mohammad Hossein Baqeri was also quoted as saying by IRNA.
Gas consumption in households has surpassed 700 mcm/d and NIGC has already cut fuel supply to thermal power plants, industries and petrochemical plants, he added.
CNG stations receive fuel via a local utility at a pressure lower than that used for vehicle fueling and the fuel station compresses the gas to a higher pressure for vehicle fueling, so when the pressure is low, compressors will stop functioning automatically.
Baqeri said if the growing trend continues, NIGC will have to curb gas delivery to CNG stations in other provinces.
Close to 30 mcm of CNG are supplied to 2,650 CNG filling stations in Iran per day.
“Supplying gas to households is NIGC’s top priority,” the official said, adding that due to high consumption, gas pressure in northern regions has dropped considerably and NIGC is struggling to supply residential buildings with gas, let alone CNG pumps.
Dismissing rumors about total gas cuts in some counties like Khaf in Khorasan Razavi Province and Tabas in South Khorasan Province, he noted that the temporary cut was because of technical glitches and a massive pressure drop in the national gas grid.
Hybrid CNG Engines
According to Ardeshir Dadras, the head of the Iran CNG Association, the number of vehicles with hybrid CNG engines has surpassed 5 million and if the supply is limited, many car owners could face problem as they will have to fill up their tanks with gasoline that is costlier than CNG.
Gasoline is sold at two rates in Iran. As per the directive issued by NIORDC in 2019, private car owners can only buy 60 liters of subsidized gasoline every month at 15,000 rials (4 cents) a liter and at double the rate for additional purchases (unsubsidized fuel).
One cubic meter of CNG costs 6,000 rials (1.5 cents), which is about three times cheaper than gasoline.
The National Iranian Oil Products Distribution Company, a subsidiary of the National Iranian Oil Company, has announced that of the 19 million vehicles in Iran, over 5 million have hybrid CNG engines, accounting for 20% of overall CNG consumption.
Globally, Iran is the fifth biggest CNG consumer.
The United States, the European Union, Russia and China use 75 mcm, 45 mcm, 40 mcm and 35 mcm of the fuel per day, respectively.
Unlike gasoline, eco-friendly CNG minimizes harmful carbon emission. This helps engines run more efficiently and increases the life of spark plugs.
In the last decade, $2.4 billion were invested to expand CNG use in Iran.
Downward Trend
According to Mohsen Johari, a member of Iran's CNG Association, a large number of CNG-hybrid cars have been sent to the junkyard over the past decade, but they have not been replaced with new automobiles, because of which CNG demand is witnessing a downward trend.
The more gasoline-based vehicles are produced, the more CNG demand will decrease, he added.
As long as automakers continue to manufacture gasoline-powered cars instead of CNG-hybrid vehicles, CNG supply will outstrip demand and this will push the sector to the brink of insolvency.
The official noted that despite all the publicity about the importance of replacing gasoline with CNG, the government is importing gasoline-based vehicles rather than CNG-hybrid vehicles.
Most car factories have almost stopped the production of CNG hybrids, meaning the demand for clean fuel will reduce steadily.
Iran's CNG Association has urged the administration to change its wrong policies regarding CNG. Nonetheless, most officials have so far largely turned a deaf ear to the request.
Johari said the marginal difference in CNG and gasoline prices discourages car owners to opt for CNG.
Under the current deplorable economic situation, the government has no plans to raise gasoline tariffs.
