Compressed natural gas and the cost of living

DAR ES SALAAM: ASK any driver in Dar es Salaam about the price of fuel and you will hear the same sigh. Petrol and diesel are eating into pockets that were already thin.

A taxi driver summed it up well when he told me, “If I make about 100,000/- in a day, nearly 40,000/- goes back to the pump.” Then he smiled when asked about Compressed Natural Gas (CNG). “With gas, I only spend 20,000/-. I take more home.

It feels lighter.” That one story captures the heart of the debate. Can CNG really ease the cost of living in Tanzania? The numbers suggest it can. Studies show that switching from petrol to CNG cuts fuel costs by as much as 79 per cent. For many drivers, the money spent converting a car pays itself back in a few months. Even for heavy trucks that mix diesel and CNG, costs per kilometre fall sharply.

The math is clear. Less spent on fuel means more left in people’s wallets. The growth has been fast. In 2023, only about 3,100 vehicles in the country were running on CNG. By 2024, that number had more than doubled to 7,000. By the end of this year, it is expected to reach 15,000. New filling stations are being built too.

There were only five in 2024. Now there are nine, with seven more planned in the coming year. For a country that has often moved slowly in energy transitions, this pace is striking. Tanzania has the resources to back this shift. Beneath our soil lie an estimated 57.5 trillion cubic feet of natural gas. It is more than enough to supply homes, industries and transport for decades to come.

More importantly, it gives the country a way to step away from the global oil rollercoaster. Africa as a whole spent over 250tri/- on petroleum imports in 2023.

ALSO READ: Digital loans surge 80 per cent with mobile convenience

For Tanzania, every litre of imported petrol is not just costly but also vulnerable to global shocks and currency swings. If CNG can replace even a fraction of that, the savings ripple across the entire economy. Still, the picture is not all rosy.

For many Tanzanians, CNG remains out of reach. Outside Dar es Salaam, filling stations are scarce. Even in the city, long queues sometimes snake around stations, a sign of demand outpacing supply. The cost of conversion is another hurdle. Installing a CNG kit costs roughly 2.0m/-.

For a taxi driver who already struggles to pay rent and school fees, that is a steep mountain to climb. The longterm savings are real, but the upfront cost blocks many from joining in. The government is aware of this tension. In its 2024/25 budget, Parliament approved 1.8tri/- for the Ministry of Energy, part of which is aimed at expanding CNG infrastructure.

Regulations for opening new stations have been eased and Tanzania Petroleum Development Corporation (TPDC) has promised more outlets in Dar es Salaam and Coast.

These are important steps, but the bigger question is whether support can go further. Should there be subsidies for conversion kits? Should there be targeted financing so that drivers can spread the cost over time?

These are the kinds of policies that would decide whether CNG remains a fuel for a few or a solution for the many.

For now, the benefits are clearest among those who spend the most time on the road. Taxi drivers, daladala operators and logistics companies see margins restored almost overnight. Their reduced operating costs may eventually trickle down into lower fares and cheaper goods, but that link is not automatic.

Until CNG access spreads wider, many ordinary Tanzanians may still feel the squeeze of petrol prices in their daily lives. The verdict is simple. CNG does ease the burden, but only for those who can afford the leap and have access to a station.

It has the power to cut fuel costs by half, to free households from the constant fear of price hikes and to shield the economy from import dependence. But for it to truly change the cost of living, Tanzania must do more than celebrate early adopters.

It must build the infrastructure, ease the upfront costs and create confidence that this is not just a passing trend. CNG is not a silver bullet, but it is a start. For every driver who spends 20,000/- instead of 40,000/- on fuel, the difference is not abstract. It is school fees paid on time. It is food on the table.

It is a sigh of relief at the end of a long day. If that relief can spread from thousands to millions, then yes, CNG can genuinely ease the burden of living in Tanzania.