Car makers will be required
to install gas converter
In an attempt to boost natural-gas consumption in the gas
rich country, the government is considering introducing a regulation requiring
car makers to install compressed natural gas (CNG) converter kits in all their
vehicles.
The energy and resources, finance, transportation and
industry ministries will make a joint statement regarding the new regulation,
according to Wiratmaja Puja, an expert staff member for the Energy and Mineral
Resources Minister who chairs the acceleration of oil-fuel to CNG conversion
program.
“There will be incentives [for car makers], such as
exemption from the luxury goods tax, so cars with built-in converters can be
sold at competitive prices,” Wiratmaja said on Thursday.
“In the beginning we will prioritize public transportation
and perhaps taxis. We hope that the plan works because there are already many
stations supplying natural gas but [motorists] have not been using them,”
Wiratmaja said.
He added that car producers supported the plan and asked for
a transition period of between 12 to 16 months. The government has been trying
to reduce the gasoline consumption partly by encouraging the people to use
other sources of energy such as CNG.
Indonesia, a former member of the Organization of Petroleum
Exporting Countries (OPEC), has seen growing demand for energy in line with
economic growth. But oil production has been declining due to aging fields,
pushing the country to import a significant amount of oil, making it vulnerable
to volatility in global oil prices.
Last year’s subsidized fuel price hike, implemented due to
high global oil prices, has increased the prices of consumer goods in the
domestic consumption-driven economy, leading to a slowdown in economic growth.
Currently, subsidized fuel prices stand at Rp 6,500 (57 US
cents) per liter for premium or low-octane gasoline and Rp 5,500 for
diesel-fuel, while the price for public transportation vehicles is set at Rp
3,100 per liter. Critics have said that the CNG price should be set higher to attract
business players into the market.
“We, together with business players and the CNG association,
are working to determine a price that is attractive for business players but is
also affordable for consumers,” said Mohammad Hidayat Said, a director at the
Energy and Mineral Resources Ministry’s downstream oil and gas division.
Pertamina vice president of technology Daniel Purba said the
Rp 4,000 level would be attractive for business players.
The plan to convert cars’ oil fuel consumption into gas dated
back to 1988, but the progress has been slow due to poor infrastructure of CNG
stations and concerns over natural gas supply.
As of the end of 2013, there are 30 CNG stations and one
mobile refueling unit (MRU), but most of them are concentrated in the Greater
Jakarta area. The Energy and Mineral Resources Ministry has targeted on
additional 29 gas stations and eight MRUs this year.
The state budget will fund two new gas stations and one MRU
of the total planned additions, while state owned oil and gas giant PT
Pertamina will establish 4 gas stations and 8 ecostations.
Publicly-listed gas distributor PT Perusahaan Gas Negara has
also planned to establish nine gas stations and three MRUs in greater Jakarta
areas. It will also build two gas stations in East Java, one in West Java and
another in Riau.
Source: http://www.thejakartapost.com/news/2014/03/28/car-makers-will-be-required-install-gas-converter.html
Comment
"I think the Government should not raise fuel prices are too
high, because most people cannot afford to buy fuel that is too expensive.
While the economy of Indonesia under the Community average.
So, the Government must look for other alternative fuels
such as waste is processed into fuel. So that we do not depend on oil fuel
depleting every day"
