Stakeholders: Using LPG as Vehicle Fuel Could Save Africa $3bn Annually

Stakeholders: Using LPG as Vehicle Fuel Could Save Africa $3bn Annually

Emmanuel Addeh in Abuja

The adoption of Liquefied Petroleum Gas (LPG) as a source of fuel for vehicles could save Africa a whopping sum of $3 billion, experts who gathered at the 15th anniversary of the African Refiners and Distributions Association (ARDA) annual ARDA Week conference, have agreed.

Speaking on the “Role of LPG in Africa’s Energy Transition,” at the event, Executive Director, Sahara Group, Temitope Shonubi, said converting just 30 per cent of Africa’s vehicles to run on LPG could result in $3 billion annual fuel cost savings and huge carbon emission reductions.

Shonubi also noted that the indirect cost savings from its impact on health and infrastructure could exceed $15 billion yearly if LPG is fully harnessed on the continent.

He further disclosed that only six African nations have combined LPG storage capacity greater than 50,000 Metric Tons (MTs), stressing that such lack of large-scale infrastructure would lead to uneconomic cargo sizes thereby resulting in increased landing LPG costs.

Stating that Africa consumes only 4 per cent of global LPG demand, Shonubi noted that affordability, purchasing power, limited infrastructure, safety concerns as well as cost of cheaper alternatives have accounted for low LPG penetration on the continent.

In order to grow Africa’s LPG consumption, he stated that strategies and policies must be implemented to promote investments in storage and distribution infrastructure and encouragement of financing schemes to make LPG more affordable.

He added that target environmental impact rewards programmes for switching to LPG, enforcement of safe practices and education of the public to counter negative perceptions of LPG use could also be encouraged to aid penetration.

The industry expert stressed that the total cost of continued use of biomass, charcoal and other pollutants as cooking fuels rather than cleaner alternatives like LPG could lead to premature deaths.
Executive Secretary of ARDA, Anibor Kragha, in his remarks, warned of imminent danger if Africa fails to quickly adopt modern clean energy as over 850 million Africans still depend on solid fuels (biomass) for cooking.

According to him, without strategic efforts towards energy transition, especially replacement of solid cooking fuels like biomass and charcoal with cleaner alternatives like LPG, over 600,000 Africans could die prematurely annually due to household air pollution.

Kragha insisted that there should be no going back on the implementation of an actionable roadmap that will effectively transition Africa’s current primary energy mix towards more sustainable, lower-carbon footprint.

On his part, Chairman, Global LPG Partnership, Kimball Chen, who also spoke at the event, said functional LPG policies, regulations, standards and market models were being widely implemented across Africa.

Chen said global development institutions and multilateral banks continue to hold back on scaling up support for LPG because it is still considered a fossil fuel.

To achieve a quantum leap, he stressed that a combination of private sector investment in the LPG sector and support from global development institutions and multilateral banks for green Bio-LPG projects would be needed.

According to him, capital markets and major private sector companies are moving forward on an initial wave of Bio-LPG production projects as it is produced from natural sources such as agricultural residue and municipal waste while having the same clean energy benefits as traditional LPG.

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