Presently, the CNG stations in these areas are catered by LCVs, commercial vehicles having cascades, so which is not a very optimum supply model for CNG stations. So, once we commission these steel lines, we will see a lot of growth in new areas like Kanpur, Muzaffarnagar, then in Rajasthan, Ajmer and Haryana. So we plan that we will have one million cubic meter growth from these areas in next financial year, that is, by March 24 end, that is the estimates that we have at our end.
The CNG price differential to diesel has nearly halved. Is there a slowdown in car conversion as well owing to the same and what is the current conversion rate?Depends on the operator of the geographical area. So, for IGL we have not increased our prices to that extent. We have maintained our prices at the approximate level of Rs 79 in Delhi for last four-five months. Now, if the prices are moderate, the conversion rates would continue. Our conversion rate in the month of January has actually increased. From 14,000 we have clocked 16,000 vehicle conversion in the month of January for our geographical areas.
And what part of your CNG volumes are sold to buses and how much to three wheelers and which are more likely to be converted to EV according to you by regulatory intervention?20% of our sale is to buses and to other autos, etc. Now some part of that sale may be compromised because of EV buses. The buses are big CNG customer and in order to manage this risk that we are facing, we are planning to get into a bigger way in EV also and second thing is that if we keep our price moderate, it will be slightly difficult for the decision makers to convert to EVs because the cost factor is always there in the EVs. But that risk actually pertains to Delhi which has the possibility of converting to EV. The other areas that we are operating in, they may actually take more than five years to convert buses into EVs that is our call.
Five years from now what would be the core business of IGL? Will it be a gas company which also is using their outlets to give other additional services like EV charging or you will remain a gas distribution company at heart?We will be participating in EV business also, but the experts all around the world are talking about energy trilemma which is affordability of energy, sustainability of energy and energy security. Now if energy security is not there, it will be a problem. Affordability is also very important. Now, if you look at the way things are panning out, most advanced countries would reduce their gas and oil consumption in coming 10-15 years by maybe 50% also. But countries like India their the impact would not be so much. In fact the Indian gas consumption is likely to peak in the year 2037 to 2040. So, we would continue to grow from here to 2040 and if the gas consumption in the country continues to grow, IGL would continue to have larger part of their business from the gas business and EV will be the second business that I see in five years from now.
Will you be able to incubate the EV business because that involves setting up of infrastructure, it involves setting up of charging stations, infrastructure has to be invested first and the annuity starts later. Can you do it on the existing balance sheet, with the existing cash flows?We are a debt-free company and we do not see any problem in that. Moreover, the EV business has come up with its own model, people are actually offering that annuity, they set up the charging facility and they try and get some part, some share or some percentage of revenue that comes from the charging business. That model is also very prevalent, we have come across that. For IGL, we are presently debt-free company, we do not foresee any such problems.
