On the event’s second day, the conference “Finance, Investment, Research and Promotion for NGV Use in Fleets and for the Establishment of New Refuelling Stations” took place at Sandton Convention Center, with Carel Snyman, Green Transport, SANEDI, as moderator. Speakers included Thembisile Salman, Senior Project Manager of Chemicals & Allied Industries at IDC (Industrial Development Corporation), and Thulebona Nxumalo, Executive Manager of Piped Gas Regulation at National Energy Regulator of South Africa (NERSA).
With his presentation “Financing Green Transport,” Salman gave an overview of funding provided by IDC through the last years (R102 billion). “Funding will be structured in a way that will suit the business’ needs most appropriately,” he said and gave as example the investment in CNG Holdings, helping support the development of NGV industry and introduction of biogas and CNG-powered taxis and buses.
However, according to Salman, the industry should consider establishing an association to address some of these challenges: lack of policy and regulatory framework for the use of natural gas and biogas, and imposing road fuel taxes on gas as well as incentives for biofuels. He said that IDC has financed several pilot projects to demonstrate benefit for South Africa so as to assist development of regulatory framework, and that is currently supporting a process with various government departments to facilitate this growth.
Regarding the financing of CNG stations, he stated that there are three different kind of ownerships: fleet or end-user ownership, local distribution company and third-party ownership. Moreover, conversion kits can be financed through gas sales over a prescribed payback period depending on km travelled; through soft loans from development institutions or government that attract no interest or less than prevailing market rates to fleets that convert to operate on alternative fuel; and through government grants.
The other speaker was Thulebona Nxumalo, who presented “Regulations and Requirements for Licensing of CNG/Biogas as a Vehicle Fuel.” Concerning licensed infrastructure, Nxumalo mentioned the regulated pipeline network for transmission and distribution (owned by Sasol Gas); CNG infrastructure including fueling stations (owned by Novo Energy and NGV Gas) and mobile storage facilities (owned by Novo Energy and Virtual Gas Network).
He also stated that currently regulatory framework entails construction of gas infrastructure; operation of gas facilities; trading in gas; and conversion of existing facilities into gas transmission, distribution or storage facilities. However, it does not entail the licensing of manufacturers of CNG cylinders; licenses for testing laboratories; licenses for CNG equipment installers and service providers; licenses for filling stations not issued by NERSA; licenses for sale of CNG equipment; and licensing of CNG vehicle manufacturers.
“As a result, it is necessary to amend the current regulations to include specific provisions regarding the use of CNG in vehicles and the development of industry standards for CNG/biogas in SA,” he added.