Economics of CNG Diesel Bus CNG Bus

HSD Retail Selling Price (Rs./ Litre) 38.97

Km/ Ltr or
Mileage
Km/ Kg 3.50 4.20
Fuel Cost Rs./ Km 11.13
Maintenance cost as percent of fuel cost 0.05%
Total O&M Cost of HSD Bus 11.14
Cost of New Vehicle Rs. 1,800,000 4,000,000
Residual value after 8 years of running 15% 15%
Re-sale value Rs. 270,000 600,000
Net Cost (Cost - Residual Value) Rs. 1,530,000 3,400,000
Total Running before re-sale Kms 475,200 475,200
Fixed cost Rs./ Km 3.22 7.15
Extra Fixed cost for CNG Bus " 3.93
Total O&M Cost of HSD Bus " 11.14
Affordable O&M cost of CNG Bus " 7.21
Maintenance cost as percent of fuel cost 0.05%
Affordable O&M cost of CNG Bus Rs./ Km 7.20
Affordable price of CNG Rs./ Kg 30.25
Less VAT 12.5% 3.36
CNG price net of VAT Rs./ Kg 26.89
Less Excise Duty 14.27% 3.36
CNG price net of of Excise Duty Rs./ Kg 23.53
Less Online CNG Compression Charge Rs./ Kg 4.20
CNG Price net of Online CNG Compression Cost Rs./ Kg 19.33
Say Rs./ SCM 14.64
Less CGD Network Tariff Rs./ SCM 3.20
Affordable Gas Price (At city Gate) Rs./ SCM 11.44
Say Rs./ MMBTU 317.78
Affordable Gas Price (At city Gate) $/ MMbtu 7.06
180 Kms/ Day for 330 Days over 8 years

Assuming competitive bidding for CGD

Assuming competitive bidding for CGD

1 USD = Rs.45
 Economics of CNG
R-LNG Domestic Option 1 Option 2 Option 3
Dahej Kochi KG 6 R-LNG Domestic
Dec 2014 Dec 2014 Pooled Kochi KG-6
FOB Price $/ MMBtu 10.08 11.60 4.20 11.60 4.20
Boil-off Gas " 3.00% 0.35 0.35
Ocean Freight " 0.29 0.83 0.83
CIF Price " 10.37 12.78 4.20 12.78 4.20
Customs Duty " 5.15% 0.54 0.64 0.64
Re-gasification charges " 0.68 1.83 1.83
Ex-Terminal Price/ Land-fall point price " 11.59 15.25 4.20 12.18 15.25 4.20
Marketing Margin " 0.19 0.19 0.14 0.19 0.19 0.14
VAT 12.5% for R-LNG/ CST @2% " 12.50% 0.23 1.91 0.08 0.24 1.91 0.08
12.01 17.35 4.42 12.61 17.35 4.42
Pipeline Tariff (Inclusive of service charges) " 10.30% 2.76 1.43 2.54 2.76 1.43 2.54
Delivered Price at City Gate " 14.77 18.78 6.95 15.37 18.78 6.95
NCV to GCV " 6.26 6.26
Say (AT 1 USD=Rs.45) Rs./ MMBTU 664.48 845.14 281.83 691.45 845.14 281.83
Say Rs./ SCM 23.92 30.43 10.15 24.89 30.43 10.15
Add: Network Tariff (&) " 3.00 3.00 3.00 3.00 3.00 3.00
Price of Gas inclusive of Network Tariff (&) " 26.92 33.43 13.15 27.89 33.43 13.15
Rs./ Kg 31.57 40.17 13.40 32.85 40.17 13.40
Add: Online Compression Charge (CC) " 4.00 4.00 4.00 4.00 4.00 4.00
Price of Gas inclusive of Online CC " 35.57 44.17 17.40 36.85 44.17 17.40
Add: Excise Duty " 14.42% 5.13 6.37 2.51 5.31 6.37 2.51
CNG Price inclusive of Excise Duty " 40.70 50.54 19.91 42.16 50.54 19.91
Add: Marketing Margin " 17.29% 5.46 6.95 2.32 5.68 6.95 2.32
CNG Price inclusive of Marketing Margin 46.16 57.49 22.23 47.84 57.49 22.23
VAT on CNG net of VAT on R-LNG 12.5% 4.86 4.41 2.41 5.03 4.41 2.41
RSP of CNG 51.02 61.90 24.64 52.87 61.90 24.64
Mileage per Kg of CNG Kms 4.20 4.20 4.20 4.20 4.20 4.20
CNG Cost per Km Rs./ Km 12.15 14.74 5.87 12.59 14.74 5.87
(A) CNG Fuel & Maintenance Cost per Km " 0.50% 12.21 14.81 5.90 12.65 14.81 5.90
 Retail Selling Price of HSD Rs./ Ltr 38.97 38.97 38.97 38.97 38.97 38.97
Mileage per Litre of HSD Kms 3.50 3.50 3.50 3.50 3.50 3.50
Fuel Cost per Km Rs./ Km 11.13 11.13 11.13 11.13 11.13 11.13
(B) HSD Fuel & Maintenance Cost per Km Rs./ Km 0.50% 11.19 11.19 11.19 11.19 11.19 11.19

(B)-(A) Savings in Fuel & Maintenance cost per Km Rs./ Km (1.02) (3.62) 5.29 (1.46) (3.62) 5.29
Running over useful life (*) Kms 198,000 198,000 198,000 198,000 198,000 198,000
Savings over useful life Rs./ Lakh (2.02) (7.17) 10.47 (2.89) (7.17) 10.47
Cost of New CNG Bus Rs./ Lakh (40) (40) (40) (40) (40) (40)
Less: Capital subsidy under JNNURM 50% 20 20 20 20 20 20
Less: Residual value after 8 years 10% 4 4 4 ### 4 4 4
Net Investment (16) (16) (16)### (16) (16) (16)
Net Loss (18.02) (23.17) (5.53)
### (18.89) (23.17) (5.53)
Assumptions
1 Changes in price of natural gas, VAT/ Exclise duty and price of HSD is a pass-though in CNG price.
2 Passenger tariffs cover the cost of CNG fuel, maintenance and fixed cost of CNG bus.
(&) As a result of competitive bidding
(*) 120 Kms/ day for 330 days for 8 yrs
(**) Assumption of 50% upfront subsidy
 2014 IGL NT CC
Slope 12.60% 14.50% $80.00 Rs./ MMBTU 104.05
MMTPA 7.50 1.44 8.94 Rs./ Kg 6.66
FOB 10.08 11.60 10.32
Freight/ BOG 0.29 1.18 0.43
CD 0.54 0.64 0.56
Re-gaisifcation Charge 0.68 1.83 0.87
12.18

Re-gasification Charges at Dahej 31.76

0.68
Marketing Margins 8.82
0.19
664.4834757868
664.4444444444
27.779264214
27.7777777778

Post-Tax 12.00%
30.00%
0.60%
30.60%
Pre-Tax 17.29%

Rs./ Kg 24.64 RSP 1 BCM 36 TBTU

1 SCM 1.32 Kg 1 SCM 36000 Btu
Rs./ SCM 18.67 1 SCM 0.036 MMBtu
1 SCM= 27.78 MMBtu 27.78 SCM 1 MMBtu
 Rs./ MMBtu 518.52
IRS=1 USD 64.00
$/ MMBtu 8.10

-871% (16) 1.31 1.31 1.31 1.31 1.31 1.31 1.31 1.31