Abstract

Economic analysis of the use of compressed natural gas (CNG) for powering automobiles was presented. The data for costs of constructing and running CNG-powered vehicles were obtained for the study. Economic analysis of running the CNG-powered vehicles was performed. The initial costs of project and operating costs amounted to N3.71million and N1.31million for CNG respectively. The net revenue for CNG is N2.55 million. Figures were used to determine the pay-out of the project which is 1.45 years. The Net Present Value (NPV) and other parameters that make up the project economics were estimated for CNG. The NPV for CNG at an expected rate of return of 10% is N15.7 million. The summary of the result of the calculations of all the parameters examined for CNG was also presented. From the whole analysis done it is easily seen that using CNG for powering vehicles is economically viable.

Highlights

  • IntroductionNatural gas is a hydrocarbon, which means it is made up of compounds of hydrogen and carbon

  • Natural gas is one of the cleanest, safest, and most useful forms of energy in our day-to-day lives.Natural gas is a hydrocarbon, which means it is made up of compounds of hydrogen and carbon

  • 2.3 EVALUATION OF THE ECONOMIC VIABILITY OF USING compressed natural gas (CNG)-POWERED VEHICLES The economic flow chart for running vehicles with CNG consists of the various costs at different stages: costs of putting the extra parts of the CNG-powered vehicle together, which are summed up to get the total capital cost as shown in Fig 3.2 below

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Summary

Introduction

Natural gas is a hydrocarbon, which means it is made up of compounds of hydrogen and carbon. The simplest hydrocarbon is methane; it contains one carbon atom and four hydrogen atoms. Natural gas can be found by itself or in association with oil. Oil, sulphur, carbon dioxide, nitrogen, and other impurities may be mixed with the gas when it comes out of the ground. These impurities are removed before the natural gas is delivered to our homes and businesses. Energy yielded by natural gas can be measured in a variety of ways, and the most common is the Gigajoule (GJ), which is one billion joules, the metric measure for heat or energy [1]

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