C O M
P R E S S E D N A T U
R A L G A S
The State
stimulus
for NGV conversions in Germany
An
article by late
author Kirill Chirikov
Updated
30 January
2009
In
Germany conversion of vehicles to CNG
motor fuel is regarded as one
of the
most priority directions in ensuring
positive development of the country from both points of view -ecological
and energy
security. It is planned that
natural gas vehicles (NGV ) fleet will
grow up to 1 million
vehicles by 2010 and 6 million by 2020
when one third of all vehicles in Germany
will be CNG fueled
vehicles. The Program of NGV conversions is implemented by joint
efforts of
the Federal
Government, Ministry of Ecology Protection and 5 leading automobile
building
corporations – BMW, Volkswagen, FIAT, Ford and Volvo.
The German
Government
has allocated 22 million EURO since 1994 for NGV conversions and
building Automobile
Gas Refueling Stations.
Considerable financial support is provided by local governments. These
compensate up to 90% ( sometimes
even up to 100%) of
conversions expenditures. German gas companies also provide
technological and
financial help for the conversion programs. There are also financial
stimulus from the German
State
– mainly in taxes and insurance costs.
All
CNG vehicles owners, provided that their
vehicles toxic emissions
did not exceed EURO-3 ( up to 31.12.
2001) and EURO-4 ( from
01.01. 2002), receive a
one time money
compensation equal to 300 Euro and afterward they enjoy a diminished
fuel tax
which, VAT inclusive, since
2002 is as
follows:
- for
petrol - 0.72 Euro
per liter
- for
diesel fuel – 0.51 Euro per
liter
- for
CNG fuel – 0.14 Euro per
gas quantity equal to 1 liter
of petrol
By
law these tax incentives are valid from 2002
up to 2009.
For
mandatory insurance
of CNG vehicles there is a special “ecological
tariff” – only
15%
of the regular insurance cost.
Since
1998 The German Ministry of Finance has
been providing financial subsidies to cover additional expenditure
caused by
NGV conversions. These
cover both conversions as such ( from liquid fuels to gas fuel)
and purchases of
prefabricated new NGVs
from their manufacturers. For
taxi cars up to 30% of the initial price of a new vehicle is covered by
the
subsidy. For private cars the basic subsidy may be as high as 60% of “
additional expenditure”
caused by the conversion. For bi-fueled cars the subsidy may
reach 2500 Euro and for
CNG only cars
– up to 3300 Euro. For
vehicles belonging to Auto schools and hospitals 20% or 4000 Euro is
compensated for
bi-fueled
cars and 5000 Euro for vehicles using as fuel CNG only. For light duty
trucks
the compensation may reach 100% or 5000-6000 Euro.
For
heavy duty vehicles the basic level of compensation is 50% plus subsidies
for additional expenditures
amounting up to 80% or even up to 100%.
However for any type of a
vehicle the total
amount of financial compensation may not exceed 30% of a new gas
fuelled automobile.
In Demonstration Zone of Hanover
if a
vehicle is bought on financial leasing
terms the first
payment is fully
compensated, provided it does not exceed 5000 Euro.
The
expenditure for the innovation works
in building new gas fuelled vehicles
and gas refueling stations is compensated by the State up to 70% of
expenditure
and bank loans taken for such innovations is diminished by 5% as
compared with
a basic bank
interest.
Local
Governments in German “Lands”
also pay their own compensations. For example in Turing 75% of total
expenditures is
compensated for buying gas fuelled buses. In Bavaria this
compensation is very
high
- 90%,
but not more than 40 000 Euro.
German
gas supplying companies belonging to the
German Union of
Gas and Water Suppliers ( in
all there are about 100 such companies) offer two
variants of support to promote
sales of CNG
vehicles:
1) partial
compensation of expenditures
– usually from 1500 to 3000 Euro;
2) free
of charge gas refueling during
two years with total volume of such a free gas fuel from 1000 up to 2900 kilograms
of
CNG ( equal to 1400 – 4000 m3
of gas which in turn is equal to 1400 -4000 liters
of
petrol)
250-500
Euro annually are paid to vehicles
owners who carry on their automobiles
advertisement
stickers such as
“I drive a gas fuelled
car”, “ My car is compressed natural
gas fuelled”,
“CNG Automobile: economic,
safe, clean”.
Industrial and municipal
enterprises and organizations
are entitled to a bank loans at a fixed interest rate – 5,25%
in Western and 5,75% in Eastern
Germany .
These loans are given for buying new gas fuelled vehicles and cover
100% of
their costs.
( Editorial commentary.
In Russia
there is the only incentive for NGV conversions – according
to a Federal
Government Decree of 1994, the price of CNG must not exceed 50% of the price of the equivalent
of
AI-80 petrol. But even this government price regulative Act was
frequently
violated by gas retailers in the end of 2008
in
many places.
Local
governments also have the right to offer
financial incentives to NGV owners but there is no
case of such subsidies
in Russian regions
known to the
Editorial staff. It seems that this legal possibility for local
(regional) incentives
remains on
paper only. As to
the federal level –
there is no federal incentives of any kind except the above mentioned
50% price
limit for CNG. The
Draft Federal Law on
Alternative Fuels has been discussed in the State Duma (
Federal Parliament) for a number of years with no result.
It seems that
the “natural gas
monopoly” lobby is too strong at all decision making levels).
German "OPEL ZAFIRA"
CNG Car
