Electric vehicles are gaining supremacy as the low-carbon transportation of choice in China [Gas in Transition]
Natural gas vehicles are being squeezed out, due to a lack of political support and diminishing economic benefits compared to other fuels. [Gas in Transition, Volume 2, Issue 1]by: Shi Weijun
China’s natural gas vehicles (NGVs) – once touted as a future driver of domestic gas demand – are being sidelined from the conversation about how to decarbonise transport by more popular electric vehicles (EVs), which prove more cost-competitive and have snatched political momentum from NGVs. China has the world’s largest fleet of gas-powered passenger vehicles, with 7.32 million on the road in 2020, but market development has slowed significantly since 2014. Lack of political support and diminishing economic benefits compared to other fuels have blocked consumer adoption and limited infrastructure expansion. Passenger electric vehicle adoption continued to accelerate while NGVs lost ground. Passenger NGVs grew at a compound annual growth rate (CAGR) of 5% in the three years between 2017 and 2019, a fraction of the 76% CAGR enjoyed by EVs. In 2020, China’s compressed natural gas (CNG) vehicle fleet shrank for the first time in its 32-year history, by 100,000 vehicles to 6.62 million, according to an oil industry newspaper affiliated with PetroChina. ..