As petrol prices rise, more Egyptians convert to dual-fuel vehicles

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The number of Egyptians switching to dual-fuel vehicles is accelerating as the government pushes motorists to use cheaper, cleaner and plentiful natural gas.

About 300,000 vehicles, mostly taxis, and minibuses have been converted to dual-fuel systems since the 1990s - a small fraction of the 11 million vehicles licensed in the country.

But authorities are encouraging more drivers to switch by subsidizing vehicle conversions, keeping compressed natural gas (CNG) prices low, and building CNG fueling stations and conversion plants.

Nearly 32,000 vehicles were converted during the financial year from July 2018 to June 2019, two petroleum ministry officials said. The target for this financial year is 50,000 vehicles. That compares with just 6,000 conversions in 2015/16.

Officials say the number of private cars converting is rising. They hope this will soften the blow of petrol price hikes after recent subsidy removals, as well as reducing pollution and cutting the import bill for liquid fuels.

Egyptians have seen steep increases to fuel prices since 2014, with most energy prices brought up to international levels under a three-year, IMF-backed reform plan completed this year.

But gas has remained cheap compared with liquid fuels.

One cubic meter of CNG costs 3.5 Egyptian pounds, roughly the equivalent of one liter of diesel at 6.75 pounds or one liter of 80-octane petrol at 6.5 pounds.

“The ministry of petroleum has maintained an appropriate price so that natural gas always stays at 50% of the 80-octane petrol (price), which encouraged drivers to turn to conversion,” said Abdelfattah Moustafa Farahat, head of Egyptian International Gas Technology GASTEC.

Private cars now make up 30 percent of conversions, Farahat said.

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