President Bola Ahmed Tinubu has said that he is targeting states and local governments to roll out compressed natural gas (CNG) buses as a solution to ease the burdens created by the removal of fuel subsidies in May 2023.
He said this during his live broadcast to the country’s citizens on Monday evening. According to him, his administration is working hard to make sure that Nigerians are relieved from the economic burdens they have across increased transportation costs, due to the high cost of fuel (N617 and upwards).
President Tinubu stated further that the Federal Government is working closely with state and local governments to implement interventions that will cushion the pains of Nigerians across socio-economic brackets.
The Plan
Tinubu said:
- “Part of our programme is to roll out buses across the states and local governments for mass transit at a much more affordable rate. We have made a provision to invest N100 billion between July 2023 and March to acquire 3000 units of 20-seater CNG-fueled buses.
- “These buses will be shared to major transportation companies in the states using the intensity of travel per capita. Participating transport companies will be able to access credit under this facility at 9% per annum with 60 months repayment period.”
The Backstory
During the Muhammadu Buhari administration, the Independent Petroleum Marketers Association of Nigeria (IPMAN) wrote to the Ministry of Finance indicating that the Association had a plan to co-locate CNG dispensing infrastructure at existing 30,000 fuel stations across the country.
According to IPMAN, the availability of an alternative energy source for vehicles would help alleviate the burden created by the removal of fuel subsidy.
Prior to the removal of fuel subsidies in May 2023, the Nigeria Labor Congress (NLC) also put out statements drumming up support for the use of CNG in Nigeria, at a cheaper rate than fuel. Joe Ajaero the NLC President told Arise TV on April 30 that the conversion of vehicles to CNG will not take more than three months.
He said:
- “Internationally, CNG is clean and even cheaper than the price of fuel we are buying today. We have been waiting for the federal government and they initially announced that the Central Bank of Nigeria (CBN) was going to release about N250 million to commence the conversion of the vehicles to CNG and independent marketers all over the country volunteered their filling stations for conversion to CNG.”
During a July 18 interview with Channels Television, Mr. Ajaero said that the CNG agreement, if already in place would have created a cheaper alternative (N100/litre) for poor Nigerians who do not have the luxury of paying for fuel at higher prices.
I am seriously bothered by the thinking of to this policy makers. How can you deploy CNG powered buses when there is no provision for their refilling stations. My expectation in the President’s address is a robust roll out plan for Auto Gas across the country. Once that is in place, people on their own will start converting to the gas powered vehicles.