Australia’s recently formed national NGV association, NGV Australia, is ready for action following a strategic workshop of key industry members in Melbourne earlier this week. Industry stakeholders represented included heavy, medium and light duty commercial vehicle and engine OEMs, gas suppliers, LNG fuel suppliers, CNG refueling equipment suppliers, converters, and component suppliers. NGV Australia Chairman, Tony Middleton, said the half day workshop facilitated by IANGV Executive Director Brett Jarman, helped the association determine current priorities and actions required to help increase momentum in the Australian market. “Evaluating current industry barriers in a strategic manner proved valuable and we ended the day with some very specific time based actions and commitments from members to make them happen.”
Though the Australian NGV market is currently small in terms of vehicle numbers (less than 3,500 on the road), the industry has targeted high fuel users with considerable success. With technology barriers now all but removed and the performance of the vehicles now well proven, the main remaining impediment to growth currently is longer than ideal ‘payback’ times for fleet operators seeking to use NGVs. OEMs and LNG fuel suppliers present at the workshop said interest was high amongst fleet operators, who were only waiting for the right mix of fuel price differentials between diesel and natural gas and conversion costs before making significant commitments to natural gas.
Infrastructure turnaround
Despite the current marginal business conditions, significant commitments totalling more than $AU100 million have already been made by LNG suppliers (BOC, Blue Energy, EVOL) to establishing networks of fuelling stations in various parts of the country. CNG refuelling stations have also begun to spring up again, with one opening in Canberra late last year and more recently in Victoria, and more expected in the coming months.
Mood upbeat
Jarman, who first became involved in the NGV industry via an earlier Australian association (ANGVC) said the mood of the Australian industry was much more buoyant today. “Ten years ago, NGVs were a great idea whose time hadn’t quite yet come. OEMs and fleet operators were for the most part reluctant participants and the technology wasn’t quite ripe. Nowadays the technology is proven as outstanding, the OEMs are eager to see more of it on the road, and fleet operators are keen to have the vehicles in their fleet as soon as possible. It’s a total turnaround and it was satisfying to see some of that enthusiasm directed towards focussed outcomes at the workshop.”
Fleet operator enthusiasm has seen the formation of NGV fleet user groups and, in Tasmania, the formation of an LNG fuel supply company wholly owned by local fleet operators. Some of the country’s largest fleet operators have indicated intentions to make sizable commitments ‘as soon as conditions are right’ either through sustained higher oil prices or the introduction of programs to reduce the costs of fleet conversion.
Energy Security on Australian Agenda
Also noted at the workshop was a shift in political focus towards energy security in Australia. A recent Energy In Australia 2010 publication includes a statement from Federal Resources, Energy and Tourism Minister, Martin Ferguson, “Against a strengthening global economic backdrop and increasing demand for energy exports, Australia must continue to address the issue of domestic energy security.” Australia currently imports around 74% of refinery feedstock with this figure rising annually. With vast reserves of local natural gas (more than 100 years based on current overall demand) political figures are now questioning the wisdom of relying on imported oil when a home grown, cleaner and cheaper alternative is available.
Workshop outcomes
Key outcomes of the workshop and a Board Meeting held immediately prior included:
- Commitments to submit a proposal, requested by current Government Ministers, outlining industry recommendations for a renewed conversion or tax credit program designed to lower price differentials borne by fleet operators for natural gas vehicles. A commitment to develop an NGV Industry Road Map, with a workshop dedicated to this purpose to be held in early September.
- Acceptance of an invitation to join the regional Asia-Pacific NGV Association (ANGVA) for networking and information sharing purposes.
- Establishment of a team to review incoming fuel excise arrangements due to come in force in Australia in July 2011 and examine their possible impact on the uptake of natural gas vehicles.
- A specific timetable for the completion of the association’s website and provision of other information resources.
More information on NGV Australia can be obtained from Tony Middleton.
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