CNG prices hiked again: Does green fuel make economic sense vs petrol?

CNG prices were once again hiked in the country with the latest ₹2 per kilo increase taking the rates to ₹73.61 per kilo in Delhi. While petrol prices are also at significantly high levels, there has been no revision in recent weeks which means a litre of the fuel in Delhi is at ₹105.41. While CNG vehicles have long been considered ideal for those with long-distance daily commutes, rising prices of the fuel has cast aspersions on the cost-effectiveness of the fuel even though petrol and diesel are quite expensive too.

CNG is considered an environment-friendly automotive fuel with less emissions than petrol and diesel. With number of re-fueling stations on the rise across the country, wait times are also coming down. Tata Motors recently entered the CNG space in the personal passenger vehicle segment which already has Maruti and Hyundai as strong players. But while options among company-fitted CNG vehicle models may have increased, the price hikes of the fuel do it no good.

Here's a quick look at if you ought to consider a CNG vehicle over a petrol-only model:

We take a Maruti Suzuki Ertiga CNG vs Maruti Suzuki Ertiga petrol-only model for comparative purpose only, along with their respective claimed mileage on CNG as well as petrol. CNG price is taken as ₹73.61 per kg while petrol price is taken as ₹105 per lire in Delhi (prevailing rates on Sunday, May 15).

Maruti claims the Ertiga CNG has a mileage of 26.11 kms per kilo. So for every one kilometer on the move, a driver spends ₹2.81. If a person drives 1,000 kms a month, this is 12,000 kms a year. So money spent per annum on CNG is at ₹33,780.

Now let us take the Ertiga without the CNG option. The Ertiga on petrol has a claimed mileage of 20.51 kms per litre. A driver then spends ₹5.11 for every kilometer driven. At 12,000 kms driven each year, the per annum expenditure on petrol is at ₹61,320.

This means that each year, a person driving an Ertiga with CNG is paying ₹27,600 less than someone driving an Ertiga on petrol only. Assuming the person owns and drives a vehicle for 12 years, he or she spends ₹7.35 lakh on petrol in the entire duration but around ₹4.05 lakh. This is the big difference right here - ₹3.3 lakh - but over a prolonged period of 12 years, mind you and if you do drive around 12,000 kms each year or 1.44 lakh kms over 12 years.

But one obviously has to pay more for a model with company-fitted CNG than the same model minus the kit. Again, for reference purpose only, the Ertiga petrol-only option is at ₹8.35 lakh (ex showroom) for the base LXi variant. But let's take the VXi priced at ₹9.49 lakh (ex showroom). The VXi variant (there's no LXi with CNG) with company-fitted CNG is at ₹10.44 lakh (ex showroom) or approximately ₹1 lakh more. Add around ₹50,000 for maintenance, fitness tests and registration renewals for the CNG model over a period of a decade or little longer.

This basically means the owner of a CNG Ertiga saves around ₹1.80 lakh over a 12-year period when driving the vehicle 12,000 kms each year vis-a-vis someone inside an Ertiga petrol only variant. This ₹1.80 lakh could hold varying significance for individual buyers, may be a lot for many and not so much for others. Would you want to buy a CNG vehicle in the coming times?

Note: The above figures and data are for reference purposes and indicative at best. The intention of the above article is to provide a glimpse into CNG and petrol-only vehicles in terms of buying and running costs.