Wednesday, May 5, 2010

Are we ready for Euro IV?

Preeti Jain

In May 2009, when I landed in Manila to pursue MBA Programme at Asian Institute of Management, it was a place for temporary retirement from my job at Indian Oil Corporation Ltd., where I was working as Researcher on alternate fuels, fuel quality issues and urban air quality; a subject close to my heart. But soon after meeting CAI Asia experts in Manila, I had a chance to understand the issues pertaining to the fuel quality and urban environment in the country. Manila to me is not different from India in terms of political debacle for power, developmental issues and at the same time with its efforts to move towards Euro 4 for cleaner environment. India took a proactive action in leapfrogging for fuel quality in the year 2000 by adopting European emission and fuel regulations and later in October 2003, ‘National Auto Fuel Policy’ was announced with a phased program for introducing Euro 2 - 4 emission and fuel regulations by 2010. Similarly Philippines is also on its path towards leapfrogging to Euro 4 and amidst all this consistent efforts of CAI Asia towards a better environmental for the people in Asia is really commendable.

Among many wandering questions for clean environment efforts in Philippines, I think I am right to ask these questions to the powerful political lobby in this country busy with upcoming elections. Where does the environment stand in the political agenda?

In Philippines, where health problems like asthma, bronchitis, premature deaths related to air pollution are on the rise, it’s the time to think and act now, because as responsible citizens of this democratic country, development should be for the people and not at the cost of people. In the Philippines, the estimated population of about 92 million people has very uneven distribution, majority of which is distributed in its urban centre. Looking at the demography of the country, 4 out of 10 persons reside in Metro Manila and the adjoining regions of Central Luzon and Southern Tagalog. To support this large population for their energy needs, the country is largely dependent on crude and coal import besides its own resources of geothermal, hydro and wind power. In terms of power mix, oil consist of just 8% as compared to coal (25%), geo (18%), hydro (16%) and natural gas (32%) in this country but majority of same is imported.

As far as transport sector is concerned, it’s primarily dependent on fossil fuels with nearly 5.53 million registered vehicles with an average growth rate of 4.55%. In Metro Manila, transport is augmented by three main railway networks LRT (Manila Light Rail Transit System), MRT (Manila Metro Rail Transit System) & PNR Philippine National Railways. Besides road transport, there are busy seaports and aviation traffic consuming a good share of petroleum products. Manila has an advantage of its proximity with the sea where pollutants emitted from motor vehicles is soon converted to secondary aerosol particles thus preventing inhalation of toxic fine particles by people. But still there is matter of concern because ambient levels of pollutants like oxides of sulphur and nitrogen and particulate matter are significantly higher than WHO guideline values. A recent study by Greenbaum and co-workers from the Health Effects Institute USA found that in Asian countries including the Philippines there are high levels of particulate matter>100 μg/m3 and the probability rate of illness and death increase at ~0.5% with every increase of 10 μg/m3 of PM10. To curb this pollution and mounting health problem, the transport sector plays a significant role. However the question is how fuel quality, meeting Euro 4 standards becomes crucial to lower the environmental impact of motor vehicle emissions.

For this we need to understand that a comprehensive pollution control strategy consists of advanced vehicle technology, clean fuels, stringent vehicle I&M Programmes and better transport infrastructure & planning. To achieve better outcome it is important that fuels and vehicles are looked upon as a system and policies are designed in that direction. There is no doubt that substantial cost involved in upgrading technology for fuels and vehicles but if we look at economic terms, the benefits of clean vehicles and fuels will certainly far outweigh the costs. Though if I look from a common man perspective I need to make him understand why fuel quality is so important?

Fuel quality is important as performance of exhaust treatment emissions especially particulate trap or catalytic converter device for gasoline and diesel powered vehicles depend on the sulphur content of fuel. The different parameters of fuels in a way are indicative of their pollution potential; for instance fuel Sulphur is responsible for emission of oxides of nitrogen, carbon & sulphur, hydrocarbons, particulate and toxics both is gasoline and diesel. The efficiency of diesel fuel in the form of Cetane Number indicates better combustion thus lower hydrocarbons and oxides of carbon and nitrogen. Similarly in the case of gasoline parameters such as Reid Vapor Pressure (responsible for emission of oxides of carbon, nitrogen, hydrocarbon etc.), Aromatics and Benzene (cause toxics, particulate and oxides of nitrogen),Oxygenates (responsible for carbon monoxide), olefins (affect reactivity and toxicity) and Distillation cut (affects hydrocarbons and oxides of nitrogen) are important. World over greater emphasis is being given to fuel sulphur as it immediately helps to lower sulphur dioxide (from Existing Vehicles both old and new), particulate matter (diesel powered vehicles), oxides of carbon/ nitrogen and hydrocarbons from vehicles equipped with catalytic devices. The advanced vehicle technologies of Euro 4 standards or higher can work efficiently only with fuel with lower sulphur content as high sulphur cause poisoning of catalytic converter. Further, the attempt of make existing vehicle clean by retrofit technologies will also work more efficiently and effectively with low sulphur fuel.

Looking at the Philippines, the move from Euro I to Euro II has significantly helped to lower emissions but still the vehicle technology is underachiever if being run on low quality fuel. In order to meet desirable air quality and better health for people, it is time to leapfrog to Euro 4 fuels and reap its health benefits. However to ensure that standards for fuels and vehicles are developed simultaneously; government bodies like the Department for Energy for fuel quality, the Department of Transportation and Communications, the Land Transport Office, the Land Transport Franchising Board, the Department of Trade and Industry, the Department of Science and Technology for complementary vehicle technology need to come forward to act now. There is already a move towards Euro 4 with discussions with various stakeholders; however, to meet Euro 4 standards, supply and demand sides aspects of fuel need to be looked into. The supply of fuel is primarily either through import of products or by refining, in such scenario need for compatible refining capacity is of key importance which involves substantial financial cost.

In most of the Asian countries where tax structure in quite complex, there are concerns by refineries for granting incentives for such leapfrog initiatives. At the same time the Oil Industry has another dimension to add that vehicle effects are much greater than fuel effects in reducing emissions where fuel sulphur is a key enabler and certain parameters have marginal impact on emissions and can be better curbed by improving vehicles technology. In a country like the Philippines where the vehicular fleet consists of new generation of two wheelers, bikes, passenger cars, LCVs, HCVs, SUVs and at the same time old generation of two stroke side cars, jeepney, old trucks/ buses, trailers etc., in such circumstances the Oil Industry have concerns that the impact of fuel quality achieved through huge investment may be diluted, thus regulations for improving fuel quality should adapt to local conditions. This concern is important for Policy makers to decide on cost-effective measures while ensuring local supply security. Looking back again from a common man’s perspective who recognize the ultimate effect in terms of better air quality and environment for himself and his family. I am of the view that though there may be an option of focusing on few fuel parameters, but looking at a bigger picture of World Fuel Quality and Vehicle Technology standards Harmonization, benefits that fuel quality improvement and vehicle technology holds, it is the right time to leapfrog towards Euro 4, where the oil and vehicle industry should be given clear guidelines with time frame and scope of specification changes to move forward.