Methane in Nigeria: lower transport costs

The conversation about compressed natural gas (CNG) is not new in Nigeria. For years, governments and private operators have explored its potential. We knew the technology, we owned the gas and understood that it offered a cheaper, cleaner alternative to petrol and diesel.

What was missing was the political will to make methane a serious national priority. This changed with President Bola Ahmed Tinubu.

After gasoline subsidies were abolished in 2023, the president might have viewed rising transportation costs as a problem requiring a temporary solution. Instead, he faced a deeper contradiction: a gas-rich country remained largely dependent on gasoline and diesel to move its people and goods.

The president gave the CNG what it lacked: presidential support, national urgency, and clear political direction.

His proposal was simple. Nigeria needed a cheaper and more sustainable energy option for transport that would make better use of the resources we already have, reduce exposure to oil prices and create real choice.

CNG has therefore become more than just an answer to the removal of subsidies. It has become a national economic proposition.

The Presidential Initiative on Electric and Compressed Natural Gas Vehicles (Pi-CNG and EV) was established to turn this proposition into a functioning market. Our role is not simply to convert vehicles or distribute resources. It’s about building and coordinating an industry based on alternative energy for mobility,

bringing together the infrastructure, vehicles, investors, financiers, engineers, operators and consumers needed to make methane and electric mobility work at scale.

This distinction is important because building an industry requires much more than managing a government program. The gas must reach the vehicles through a network of parent stations, where it is compressed and loaded for distribution, and daughter stations, where it is delivered. Conversion centers require trained technicians, certified kits and cylinders. Vehicles must be available, safety standards enforced and financing made accessible. Investors need to have confidence that customers will come, while customers need to have confidence that fuel will be available.

Other countries, including India, Pakistan and Egypt, have shown that CNG can go beyond pilot projects and reduce transportation costs as vehicles, stations and demand develop together. Nigeria cannot simply copy their models, but their experience demonstrates what is possible once the entire ecosystem is built.

Supply needs demand. Demand needs supply.

This is the space that Pi-CNG & EV occupies: connecting the two.

We stimulate demand so that investments make sense, while working with the market to expand supply so that growing demand can be met. We engage investors to build stations, support the development of conversion capacity, train technicians, partner with vehicle manufacturers and assemblers, introduce financial institutions to the ecosystem, and work with regulators and other government institutions to create the conditions in which the market can grow safely and sustainably.

The government had to provide initial support for conversions, kits, technician training, vehicles and infrastructure. But the goal was never for the government to become the methane industry. The aim was to create one.

That industry is now taking shape. More than 120,000 vehicles have been converted to CNG, with over 400 certified conversion centers and more than 90 CNG refueling stations currently and around 180 in various stages of development across the country. Private capital is building fueling infrastructure. Conversion centers are expanding. Nigerians are acquiring technical skills and livelihoods; 520 in Kano within 3 months and hundreds more across the country. Commercial operators convert because saving makes economic sense. For us, this shift from government-backed adoption to commercial-led adoption is one of the clearest signs that the market we set out to catalyze is starting to stand on its own.

This progress is also reflected in the scale of capital entering the ecosystem. Pi-CNG & EV has helped catalyze approximately $2.5 billion in private sector investment, along with approximately ₦250 billion in public sector financing and commitments, and counting.

Financial institutions are also entering the market. In April, Pi-CNG & EV launched Buy Now, Pay Small with Moniepoint, CREDICORP and other partners, allowing owners of eligible vehicles to convert without paying the full cost upfront.

When an operator converts because the economy works, a bank finances it because it sees a valid customer and an investor builds a station because demand grows, you are building a market.

Methane works. The model is proven: the adoption is real, the savings are real, the industry around it is real. The challenge now is scale, making it work at the scale of Nigeria.

This means addressing the questions Nigerians ask: Where are the stations? Why are there queues? Why is conversion still expensive? If methane costs less, why haven’t rates decreased everywhere?

These questions identify the work to be done. In some places, adoption is growing faster than deployment capacity. The queues demonstrate the demand, but cheaper fuel that takes hours to obtain is not sufficiently available. Part of this is a problem with the stations. Part of it is located further upstream, ensuring that the gas reaches the processing and compression points reliably and consistently. Both need to be solved together. Our immediate priority at Pi-CNG & EV is therefore availability: working with private investors and other partners to accelerate mother-and-daughter stations in cities and major transport corridors, together with mobile refueling solutions where appropriate.

Conversion also has a real cost. Kits, cylinders, installation and safety requirements cannot be ignored, and should not be. Certified kits, trained technicians and enforced safety standards are not optional extras. They are what makes public trust in this fuel possible, and that trust is not something we can afford to spend carelessly. This is why we are opening up financing, encouraging competition, building local capacity and supporting greater volumes so that the barrier to entry continues to fall, without giving up the security of getting there.

This is where the president’s tenacity counts. CNG could have been treated as a temporary response to the removal of subsidies. Instead, the President continued to support an ecosystem in which investors, the banks, invest

finance, Nigerian companies assemble vehicles, technicians build careers, and consumers choose alternative energy because it makes economic sense.

Our responsibility is to translate that presidential vision into an ecosystem that functions beyond government. Government must lead through public fleets, mass transit, procurement, standards and sound policy, but the strongest argument is increasingly being made by economists themselves. A commercial driver knows how much he spends on gas. If you convert to methane and see the savings, the case is clear.

Now comes the most important phase: ensuring that Nigerians benefit more quickly and directly.

The President renewed that directive, while governors across the federation committed to working with the federal government, the private sector, transportation operators and other stakeholders to deepen adoption.

That collaboration has already begun. On Thursday, September 10, Pi-CNG and EV brought together state commissioners responsible for transportation, energy and the environment to begin translating this national ambition into coordinated state-level action. The conversation was practical: How do we expand infrastructure, drive adoption, deploy vehicles, and most importantly, ensure that savings from cheaper alternative energy reach the people who use public transportation every day?

This partnership between federal states is fundamental because transport is experienced at a local level. States know their routes, transport operators, urban centers and trade corridors. Pi-CNG and EV can help connect these realities with federal policy, infrastructure development, financing and private investment. This is how national policy becomes local impact.

This alignment is important because transportation happens on the road, not in policy documents.

It is the keke that takes a trader to market, the taxi that takes a worker home, the bus that transports students and the truck that transports food and goods between states.

Our work with states is therefore already moving forward around this reality: more refueling and charging infrastructure, greater conversion capacity and financing, more methane and electric buses, taxis and tricycles, increased local assemblies and the expansion of transport corridors.

But one person must remain at the center of all this: the passenger.

A driver who reduces his fuel bill has benefited. The same goes for an investor building a vital station and a technician making a living. But if the passenger continues to pay the same fare, our job is incomplete.

This is why at Pi-CNG & EV we cannot measure ourselves only with vehicles converted, stations put into service, investments attracted or technicians trained. These are important indicators of an industry under construction, but they are not the final measure of its success.

The passenger is the end.

The real test is whether cheaper energy produces cheaper mobility, whether the savings at the pump reach the Nigerian sitting in the vehicle.

Our three A’s remain Availability, Affordability and Acceptability. They define the work in front of us. We must make alternative energy available enough to be reliable, affordable enough to make economic sense, and accepted enough to become part of Nigeria’s everyday mobility.

But Nigerians can judge us more simply: will they be able to find it? Can they afford it? Can they hear it?

Nigeria has lived for too long with the contradiction of being energy rich while its population struggles with the cost of energy. President Tinubu has given us the opportunity to change this story by putting the political will behind the resources we already have and building an industry around them.

At Pi-CNG & EV, our job is to build the bridge between that vision and the Nigerian way. We are creating choices, catalyzing investments, building capacity, connecting demand with supply and putting Nigerian energy to work for Nigerians.

When a passenger gets on a bus and finds that the ride costs less because it runs on cheaper energy, we will know that the industry we are building has reached the person it was built for.

This is the destination. This is what success looks like.

…Ahmed, ON

Executive Chairman, Pi-CNG and EV