Investing in Compressed Natural Gas (CNG) has proven to be a highly profitable venture, with the Africa CNG and LPG Vehicle Market experiencing remarkable growth.
Currently valued at USD 1.28 billion (as of 2024), the market is projected to reach USD 1.9 billion by 2029, with a Compound Annual Growth Rate (CAGR) of 6.78% during the forecast period (2024-2029), according to Mordor Intelligence.
Although the adoption of CNG and LPG vehicles in Africa is still in its early stages, some African nations are pioneering the adoption of CNG as a strategy to transition away from fossil fuels.
The market size differs across the continent, with certain regions witnessing more rapid growth due to favorable regulatory environments and infrastructure development, setting the stage for a promising future
According to data from Mordor Intelligence and Ventures Africa, the following countries have implemented policies to support the seamless adoption of CNG in their regions;
- Egypt has emerged as a leader in the region in the manufacturing, distribution, and servicing of CNG and LPG vehicles. Egypt’s government is investing in CNG infrastructure, aiming to convert 2,600 vehicles/month, with incentives and financing options to boost adoption
- The Nigerian government has set a target of converting one million vehicles to CNG by 2025, starting with 11,500 CNG buses and 55,000 conversion kits. The government has also set in motion, plans to set up 50 EV charging stations by 2025 in major cities like Lagos, Abuja, and Port Harcourt.
- Morocco has an ambitious energy strategy which aims to achieve 52% of its energy mix from renewable sources by 2030. The Moroccan government has initiated plans to convert 10,000 taxis to CNG by 2025 through government grants and private partnerships.
- South Africa, a leader in electric vehicle adoption, is also witnessing a significant increase in CNG usage, particularly in public transportation. Notably, Johannesburg’s Metrobus fleet has incorporated over 150 CNG-powered buses, aligning with the country’s goals to minimize carbon emissions and reduce fuel expenses.
- The Kenyan government has set up initiatives to convert public service vehicles to CNG, tackling urban air pollution. The government has also launched pilot projects to convert public service vehicles (PSVs) to CNG, aiming to reduce urban air pollution.
- The government of Tanzania is constructing a CNG mother station valued at about Sh 14 billion. This central station will supply gas to various smaller stations across the country, particularly in areas lacking access to gas.
Government support and policy initiatives are key drivers of the African CNG vehicle market, offering financial incentives and regulatory frameworks to boost adoption across the continent.
