The Presidential Compressed Natural Gas Initiative and Electric Vehicles (PCNGI and EV) has entered a strategic partnership with Moniepoint Microfinance Bank Limited (Moniepoint MFB), Nigerian Consumer Credit Corporation (CreditCorp), National Credit Guarantee Company Limited (NCGC) to expand credit access for Compressed Natural Gas (CNG) vehicle conversions.
This move aims to bridge the financing gap for motorists, effectively accelerating the national transition to cleaner, more affordable energy by lowering the upfront capital barrier for vehicle owners.
Speaking during the flag-off ceremony in Abuja on Wednesday, Ismaeel Ahmed, Chief Executive Officer of PCNGI and EEVsaid that the partnership is aimed at addressing the prohibitive cost of conversion kits and installation, which for him is the primary barrier to adoption.
Ahmed explained that the program will address this not only by subsidizing these expenses but by ensuring that these components are supplied at cost, effectively eliminating the profit margin to incentivize mass transition.
He also explained that the CNG powered vehicles saves cost for owners, by reducing the amount spent on maintenance and petrol prices.
He said, ‘Now what we are doing here is to say, okay, what is the barrier for you to switch? It’s cost of the conversion kit and the installation, right? So we are reducing that. We are making that, not only reducing it in terms of price. We are not selling it at a profit.
‘These people are guaranteeing it so that you can pay in the next six months or several months or six weeks or whatever it is that you agree with the financial institution like MoneyPoint that you’ll be able to pay. Someone will tell you that, you know what, we don’t want the debt on our head. We want to pay this in one month.
‘So instead of taking N50,000 every month to my house, I’ll take N10,000 and I’ll pay N40,000 just to make sure that I’m out of this in one month. Someone will say, I want to take the opportunity to pay it in six months. That convenience is there. So this is what this is about.
‘So for a keke and a pep rider, for example, who buys, say, N40,000 worth of PMS a week in seven days, and then every week he has to maintain that keke for N10,000, change the plugs, put black oil, remove black oil. With CNG, he will do that only once a month. So that N10,000 Naira will cumulate into N40,000 a month, N10,000 per week goes down now to N10,000 per month. So he’s saving, N30,000 on maintenance, that’s number one. Number two, he’s having a reduced price from N1,300 worth of PMS to, N 400 worth of gas.’
Speaking further, Ahmed said that the program will be sustained on three matrix including: availability, affordability and acceptability.
Ahmed also said that the government is incentivizing the Electric Vehicles market, through provision of charging stations all across the country. He also hinted on the possible adoption of technology that enables petrol powered vehicles to be converted to electric vehicles.
‘And then the president has graciously approved the reduction to zero for import duty for electric vehicles. So, you know, it’s just to incentivize the market and be able to, we’re trying to get into a conversation with REA, NNPC Retail, to be able to set up charging stations in their filling stations and gas stations in their filling stations, and REA to provide us the solar for power to be able to charge these electric vehicles and keep them charged.
‘But there’s a new technology coming that I heard have the ability to switch from PMS to electric vehicle. I haven’t seen that happen yet, but they are talking about it. We are talking with several partners,’ he added.
In his remarks, Uzoma Nwagba, managing director, Nigerian Consumer Credit Corporation (CREDICORP) said that the program is an initiative of the President Tinubu-led administration to provide succour to Nigerians after the removal of fuel subsidy.
He said that with the reforms of the government yielding macroeconomic gains, the partnership is aimed to drive the gains of the reforms to Nigerians at the grassroots.
Nwagba noted that the challenge of affordability, stating that the price of converting a vehicle was quite on the high side, ‘ which is why all these partners have now come together to say, we are here to provide consumer credit, enable the financial institutions to give consumer credit, for people to afford things that radically improve their lives. Energy costs and energy reduction is something that will radically improve your life.
‘Now, people have said that you see how the macro environment is growing and the business environment is benefiting richly from all the reforms of the two major reforms that have happened, but the question has always remained, what about the people at the bottom? And you see the CNG initiative as well as the consumer credit initiative are two initiatives that are specifically targeted at the bottom.
‘Now, even before the war in the Middle East started and energy prices started going up, there’s always been a need to figure out a reduction in the cost of energy for our people. And so, the CNG program has been driving that in that regard, seeking to drive down the cost of energy for our people. But now, with 100,000 kits and even several 100,000 more kits available and coming, the question is how do we make it easier for Nigerians to afford those CNG combustion kits.
‘In other words, if you already have a petrol vehicle, how do we make it easier for you to convert your petrol vehicle to CNG? Knowing that once you convert your petrol vehicle to CNG, the cost of fueling that car comes down by about 75 percent. That means if I spend N40,000 per week on my vehicle, or now N80,000 per week on my vehicle, I would now be spending N20,000 per week. So, that cost saving is significant,’ he said.
For Tobi Amirah, the lead of Business lending at Moniepoint, the partnership aligns with the company’s mandate of powering dreams by providing critical finacing. ‘One of the things we are focused on is doing things that impact our customers and Nigerians as whole and our data showed that transportation cost is one of the key problems for Businesses and individuals, hence the need for us as partners to solve this problem. ‘