Venezuela Implements Quota to Increase Production of Natural Gas Powered Cars
Mérida, April 17th 2009 (Venezuelanalysis.com) — Starting this month, 30% of the automobiles manufactured and sold in Venezuela must be equipped with dual natural gas and gasoline powered internal combustion engines, according to the Ministry of Energy and Petroleum.
The measure is the latest step in a national plan to "promote the rational use of liquid fuels on the domestic market" and to reduce pollution, according to the Ministry. The National Assembly passed a resolution in July of 2008 to notify the auto industry of the regulation, which went into effect this month.
The quota for natural gas powered vehicles will increase to 40% in 2010, and 50% in 2011, according to the plan. Toyota, Chevrolet, Volkswagen, Ford, and BMW all produce models that are subject to the regulations.
The state oil company PDVSA has confirmed that nearly 150 gas stations across the country are currently equipped to provide natural gas for the new engines. The company plans to construct as many as 350 more stations to accommodate the half a million natural gas powered cars it hopes to have on the road by the end of this year.
In this initial phase, PDVSA has offered to pay the expense of the conversion, which is approximately $3,000 per vehicle. The company has setup 126 conversion stations in different regions of the country, and signed accords with companies in Argentina and Brazil to import the necessary engine conversion kits.
In 2006, the Energy and Petroleum Ministry asked auto manufacturers to present a production registry of the models that would later be subject to conversion. Most new passenger cars are required to convert, while the conversion of used cars produced since the year 2000 that have been driven fewer than 150,000 miles is optional, according to the daily newspaper El Universal. Buses used for public transportation are temporarily exempt from the regulation.
Venezuela's private automobile industry has cooperated with the plan so far. The national chamber of the automobile industry, CAVENEZ, announced in early April that 4,500 dual engine vehicles are ready to be sold in the next two months. CAVENEZ also urged the government to free up more dollars at the official exchange rate to facilitate the importation of more conversion kits.
"There are still some details to work out in the initial plan, but PDVSA and CAVENEZ have been meeting constantly to resolve the inconveniences and delays," said a CAVENEZ spokesperson during a recent natural gas engine exhibition in Zulia state. "We hope the plan will be 100% consolidated by the end of 2009."