National Refining and Distribution Company electrifies Tehran’s engines

According to Energy Press, while air pollution is one of the most serious crises in the Tehran metropolis, a new memorandum of understanding is on the verge of being finalized that could be a milestone in reducing urban pollutants and gasoline consumption.
The National Iranian Oil Refining and Distribution Company, in its role as the grand coordinator, is set to sign a memorandum of understanding to modernize Tehran’s motorcycle courier fleet in cooperation with the Ministry of Transportation, banks, municipalities, and online transportation platforms.
In this plan, about 400,000 worn-out gasoline motorcycles, mostly owned by urban couriers and more than 90 percent of which lack environmental standards, will be retired and replaced with electric motorcycles; a step that will both reduce air pollution and play a role in managing fuel consumption.
A project based on multi-institutional partnership
The foundation of this plan is based on cooperation between government, municipal, and industrial institutions. The Ministry of Oil, backed by the Economic Council’s resolution of Bahman 1403, is tasked with modernizing 460,000 vehicles in the city’s fleet. A large part of this goal is related to Tehran’s motorcyclists. In the meantime, the National Refining and Distribution Company is not only the executive arm of the Ministry of Oil, but also, as the project’s overall leader, is responsible for coordinating the project’s various players.
Other institutions involved include the Ministry of Industry, Mines and Trade (SMT), banks, online taxi platforms, and municipalities.
Each of these institutions is responsible for a specific area: from providing charging infrastructure to scrapping motorcycles, financing, facilitating urban transportation, and delivering new motorcycles.
Financing from gasoline savings
One of the most innovative parts of this project is its financing model. According to Note 7 of the 1402 Budget Law, the Ministry of Oil is authorized to spend the income from reducing gasoline consumption on implementing energy efficiency projects. This means that instead of being directly subsidized, the gasoline that is no longer consumed becomes a source of finance for the purchase of electric motors.
It is estimated that by eliminating each worn-out motor, about $750 in foreign exchange savings will be achieved annually in gasoline consumption. If the plan is fully implemented, these savings could reach $300 million per year.