The Federal Government on Friday moved to significantly lower the cost of fare charged by E-hailing taxis with a 50 percent conversion discount to Compressed Natural Gas, CNG.

The government said it believes that lowering the cost of transportation across the country would translate into a lower cost of living for Nigerians.

Speaking at the launch of the Rideshare CNG conversion incentive programme and my CNG app, the Minister of State Petroleum Resources (Gas), Hon Ekperikpe Ekpo urged rideshare drivers to take advantage of the incentives being offered by the government.

Mr. Ekpo explained that “the rideshare sector is a vital part of our urban transportation system, providing flexible and cost-effective mobility solutions to millions of Nigerians, particularly our youth. However, the rising costs of traditional fuels have posed a significant challenge to both drivers and passengers, often leading to higher fares and reduced access to affordable transportation.

“The CNG Conversion Incentive Program, in conjunction with the My CNG App, is a bold response to these challenges. By offering a 50% discount for rideshare drivers upon sign-up and scheduling through the My CNG App, we are not only making CNG a more viable option but also easing the financial burden on drivers. This will translate to more affordable transportation options for the users”, he added.

He pointed out that by choosing CNG, rideshare drivers would not only be saving costs but also contributing to the larger goal of national development.

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Earlier, the Programme Director/CEO, Presidential Compressed Natural Gas Initiative, PCNGI, Engr Michael Oluwagbemi highlighted the significance of the e-hailing taxi service in the economy, disclosing that in 2020, the sector generated $290 million in revenues with seven million people using the service.

Oluwagbemi said: “Indeed, we know that transportation is responsible for about 14% to 15% of an average family’s spending. It contributes about 1.5% to the overall economy, with an average of 5.1% growth on a year-to-year basis”.

He pointed out that in Nigeria the vehicle-to-population ratio is about 60 vehicles to 1,000 people “with 41.1% of the about 12 million vehicles in Nigeria are privately owned, with vehicle ownership concentrated in our urban areas.

“This means that the real opportunity for moving people around in an environment where there is no vehicle ownership is this ride-share technology that has become available across the land in the last 10 years. The global ride-hailing market is valued at about $130 billion as of 2020, and is anticipated to reach a value of $230 billion by 2026, registering about 8.75% growth between 2021 and 2026.