A Global Roadmap for Autogas

The role of the government in giving an initial strong impetus to the simultaneous development of Autogas demand and supply infrastructure in collaboration with all stakeholders is vital. Financial incentives are critical, notably those directed at the fuel itself. They can also be directed at vehicles that are able to use Autogas or fuel suppliers to encourage investment in the distribution and refuelling network by offering tax breaks, for example.

Long-term fuel tax measures to ensure that the price of Autogas at the pump is well below that of gasoline and diesel is the single most important policy incentive. In practice, the Autogas price must be no more than 50-60% of that of the other fuels. Those measures can take the form of a lower rate of excise duty (and/or sales tax) or its complete exemption. The lower the rates of duty and tax relative to other fuels, the bigger the financial incentive to switch. Since differences in excise duty show up in prices at the pump, the measure is highly visible, raising public awareness of the potential cost savings from using Autogas. Reducing the tax on Autogas would inevitably lead to a fall in overall tax revenues from transport fuels, albeit small in modest cases. But this could be offset by a modest increase in the rate of tax on gasoline and diesel. In any case, any fall in revenue would be compensated by lower health costs resulting from the improvements in air quality associated with more Autogas use. This measure can be reinforced by incentives for Autogas vehicles, such as a grant or tax credit, to compensate for the higher cost of buying an OEM vehicle or the cost of converting an existing conventional fuel vehicle.

Other measures, including mandates for public and private fleets to switch to alternative fuels and traffic regulations, can also be highly effective in boosting the use of Autogas. Mandates have been the main driver of switching to alternative fuels in the United States. Many countries promote Autogas and other alternative fuels through traffic-control regulations; for example, AFVs may be granted exemptions from city or highway- driving restrictions, such as those imposed during periods of severe pollution. They may also be exempt from on street parking charges and road-pricing schemes. Government can also facilitate the development of coherent standards, in partnership with industry, covering vehicle conversions, refuelling facilities and health and safety aspects of alternative fuel supply and use, in addition to supporting the research, development, demonstration and deployment of alternative-fuel technology. Campaigns in countries focusing on high-profile Autogas vehicles can help create a positive perception. Spain has a fleet of driving- school vehicles running on Autogas to give young drivers the confidence to use the fuel. In the United States there is a large fleet of school buses that run on Autogas that help to promote the safety message.

Technical and safety standards are another important area of responsibility for governments in partnership with LPG suppliers, vehicle converters and OEMs. Fuel providers and end users need to be reassured that the transportation, handling and storage of Autogas pose no safety risks. It is essential for the authorities to lay down and enforce harmonised operating standards for aspects of both Autogas distribution and vehicle equipment, including installation. Poor- quality conversions can undermine engine and emission performance and jeopardise sustainable development of the market. But the drafting and implementation of safety regulations specific to Autogas need to be based on an objective assessment of risk. In certain countries, regulations still limit unnecessarily access and parking of Autogas vehicles, the siting of refuelling stations and the on-site location of dispensers. Studies have shown that many of these restrictions are unjustified.

There is no single model or approach to formulating and implementing a government programme of incentives to promote the development of a sustainable Autogas market. The appropriate strategy for each country depends on specific national circumstances. These include budgetary considerations, which might limit available funds for subsidies, the seriousness of local pollution problems, fuel-supply and cost issues, the stage of development of the Autogas market and the prevailing barriers to fuel switching, including restrictive regulations and the local availability of dedicated vehicles and cost of vehicle conversions.

• Establish a wider and complementary role for all alternative fuels within the transport fuel mix, taking a technology-neutral approach so as to allow all alternatives to compete fairly. This will ensure that the environmental benefits of Autogas are delivered at least cost.
• Recognise officially the status of Autogas as a clean alternative fuel and seek long-term policy stability and consistency across policy areas to provide a long-term commitment to Autogas. This will give confidence to OEMs, fuel suppliers and consumers.
• Establish emission standards on a WTW basis that takes account of emissions along the fuel supply chain, not just at the tailpipe. WTW emissions from Autogas vehicles are generally lower than from vehicles powered by conventional fuels and, in some cases, alternative fuels too. This approach will also be useful to assess EVs on a level playing field, particularly where power generation in the country is based on coal or fuel oil.
• Adopt measures aimed at guiding consumers toward cleaner technology such as Autogas and communicate the benefits of alternative fuels. They may take the form of regular communications, such as websites, newsletters and advertising campaigns, to inform the public and to indicate how to apply for subsidies where available.
• Introduce mandates for government fleets to acquire Autogas vehicles and fuelling systems so that government can take a leadership role in protecting the environment and reducing operating costs.
• Continue to apply a low excise duty on Autogas to reflect its lower environmental impact compared with conventional fuels. As a rule, the tax on Autogas needs to be in the range 50-60% of conventional fuels. If the price of Autogas is too low, it will attract unlicensed operators and illegal activities.
• Introduce or step up grants or tax credits for equipping OEM vehicles with an Autogas system and converting existing vehicles to Autogas. This has the effect of reducing the payback period and drawing attention to the benefits of switching.
• Adopt traffic measures that encourage Autogas and other low emission vehicles. These include exemptions from congestion charges, free parking for alternative fuel vehicles, access to high-occupancy lanes and restrictions on access to town centres during peak pollution periods for polluting vehicles.
• Address pollution from the existing fleet of old, “dirty” cars by encouraging their replacement with new, clean Autogas vehicles or their retrofitting with Autogas fuel systems. Conversion of existing vehicles is often a highly cost-effective means of achieving rapid improvements in air quality.