Who will benefit from the increase in subsidies for the conversion of cars from gasoline to gas

The state will subsidize almost half of the costs of individuals and businesses for the transfer of vehicles from gasoline to methane. The corresponding decree was signed by Prime Minister Mikhail Mishustin, the government’s press service reported on August 18.

The amount of the subsidy will increase in 2022 from the current 24% to 48% of the total cost of vehicle conversion (V). Corresponding changes were made to one of the appendices to the state program “Energy Development”. The annex defines the rules for granting citizens, as well as small and medium-sized businesses, subsidies for the conversion of cars, public transport and municipal equipment.

“The decision taken will stimulate the transition of transport from gasoline to methane and support the demand for this type of fuel from business and citizens,” the government said in a release.

On average, about 30,000 units of automotive equipment are converted to methane in Russia annually, of which about half are supported by the state, a representative of the Ministry of Energy said. “This is the fastest growing fuel market, over the past 3 years, the consumption of methane in the form of motor fuel has grown by 25%, reaching 1.37 billion cubic meters. m at the end of 2021,” he said.

The state program “Energy Development” adopted in the spring of 2020 with a total budget of 19.3 billion rubles. provides for an increase in the consumption of natural gas as a motor fuel by the end of 2024 to 2.7 billion cubic meters. m. According to Deputy Director of the National Energy Security Fund Alexei Grivach, for Gazprom, against the backdrop of declining gas exports to the EU, “the issue of developing the domestic market is of particular importance.”

The program also provides for the development of the relevant infrastructure: about 1,300 gas filling stations are to be built in Russia within 5 years. The total number of gas-powered vehicles should increase from 155,000 units in mid-2020 (at the time of the adoption of the program) to 200,000 units by the end of 2024.

Today in Russia, liquefied hydrocarbon gas (propane-butane) or compressed gas (methane) is used as a natural gas motor fuel (GMF). The government decree refers to the subsidization of methane transport. Various state support measures for the transition to GMT have been operating in Russia since 2013. In 2020, the subsidy for the installation of gas-balloon equipment was increased from 30% to 60% of the cost of work. Besides, “Gazprom natural gas engine fuel (a subsidiary of Gazprom) provided compensation for another 30% of the costs as part of its own program.

On average, the transfer of a car from gasoline to GMT cost from 90,000 rubles. for cars up to 300,000 rubles. – for trucks. Thus, taking into account the federal subsidy, compensation for the conversion of vehicles to methane reached 90% (Vedomosti wrote about this on January 21, 2021). But at the beginning of 2021, the subsidy from the state budget dropped again to 30%. The decrease to 24% occurred as a result of an increase in the cost of equipment, a source familiar with the discussion of the document explained to Vedomosti.

As part of the program, subsidies of 700 million rubles are included in the budget. annually. The government release does not specify whether additional funds will be allocated under the program, or whether it is a redistribution of money in favor of 2022 from 2023 and 2024. The government and the Ministry of Energy did not answer this question of Vedomosti.

Deputy Director General of the National Energy Institute Alexander Frolov suggested that due to the current economic situation in the country against the backdrop of sanctions, the amount of subsidy allocated to the program was simply not chosen. “As a result, there were surpluses in the budget, which are included in the new size of the subsidy,” he argues. The same situation, according to Frolov, developed in the coronavirus 2020.

According to Vygon Consulting, in 2021 the total consumption of methane as a motor fuel in Russia increased by 20% by 2020 to 1.325 billion cubic meters. “The actual figure was very close to the target set by the government for 2021 – 1.36 billion cubic meters. m, even despite the widespread decline in demand for motor fuels due to the pandemic,” said Ivan Timonin, a consultant at Vygon Consulting.

Sergei Burgazliev, an independent auto industry expert, told Vedomosti that an increase in the size of the subsidy for the conversion of vehicles from gasoline to methane is “certainly the right decision.” Switching to methane, he says, promises long-term benefits for the car owner: “Today, gas costs 21 rubles. for 1 cu. m, which corresponds to approximately 0.9 liters of gasoline. That is, taking into account the cost of installing CNG equipment at a distance from Moscow to Novosibirsk, you can save about 25-30% on the total cost of transporting 1 kg of cargo per year.”

The emphasis on supporting the re-equipment is now extremely important, agrees the executive director of the National Gas Vehicle Association (NGMA) Vasily Zinin. According to Timonin, at the current level of prices for motor fuels, a two-fold increase in the size of the subsidy for re-equipment will reduce the payback period for LPG equipment for a passenger car from 36,000 km to 24,000 km.

According to the NGMA, now 677 automobile gas compressor stations (CNG stations) are operating in the Russian Federation, about 60 more are planned to be commissioned by the end of the year.Gazprom gas motor fuel” told Vedomosti that the company now owns 323 gas filling facilities in Russia, by the end of the year the company plans to increase their number by 30 units, in the next three years – to open 149 new CNG filling stations. “According to the results of 2021, as part of marketing programs, 17,000 vehicles were converted from gasoline to methane,” the source said. According to the company’s estimates, by the end of 2022, more than 30,000 vehicles will be converted to natural gas in Russia.

The sale of gas motor fuel is also carried out by “Rosneft“. To date, its network of gas stations and modules at gas stations consists of 16 facilities in the Voronezh, Saratov and Ulyanovsk regions, the Stavropol Territory, Ingushetia and Udmurtia, the company reported. As part of the implementation of the gas filling infrastructure development program “Rosneft» plans to launch up to 200 gas filling facilities by 2028. The company also has a special Ecopolis program for legal entities to convert cars to use compressed natural gas as a motor fuel.

To ensure the sustainable development of the market, according to Zinin, it is necessary to achieve an increase of at least 100,000 methane cars annually, but now the pace of switching to methane is 3-4 times lower. He added that “simplification of the conversion registration procedure” is equally important. “So far, the authorities have not coped with this task,” he said.

Burgazliev agrees with this. According to him, the development of gas-powered vehicles is hindered by complex bureaucratic procedures for obtaining and receiving subsidies and the lack of a single digital information system that concentrates all information on methane vehicles – from data on their number and intensity of use to the savings that conversions can bring for the owner. The price of a gasoline filling station, according to him, on average, is about 25-35 million rubles, and CNG stations – 80-220 million rubles.

At the same time, Zinin recalled that from 2022, the GMT market development subprogram covers all regions of the Russian Federation, which should help increase the sale of methane as a motor fuel to at least 10 billion cubic meters. m by 2035