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Roadmap for Adaptationon Low Sulphur Fuel

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  • Final Draft

    1

    A ROADMAP FOR REDUCING BLACK

    CARBON FROM HEAVY DUTY DIESEL

    VEHICLES AND ENGINES IN BANGLADESH

    FINAL DRAFT

    Dhaka, March 2015

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    Contents

    page no.

    Contents 02

    List of Abbreviation 03

    Executive Summary 04

    1. Introduction 05

    1.1 Rationale for low-sulfur diesel 06

    1.2 Purpose of the Roadmap 07

    1.3 Methodology for the development of the roadmap 08

    2. Technical Aspects of Diesel Combustion and Emission 12

    3. Emission Control Technologies for Diesel Engines 13

    4. Effects of Fuel Quality on Diesel Emissions 14

    5. Diesel Emissions: Bangladesh Scenario 15

    6. Cost of Low Sulfur Diesel 20

    7. Implications of Introducing Low-Sulfur Diesel (LSD) 20

    8. Policy Framework: Roadmap Actions and Milestones 21

    8.1 Overcoming economic barriers and creating incentives for LSD

    deployment 21

    8.2 Addressing non-economic barriers 21

    9. Final Draft of the proposed road map 22

    10. Milestones for introducing LSD 30

    11. Conclusions 33

    12. Future Plans 35

    Appendix-A: Summary of meetings with focus groups and stakeholders 36

    Appendix-B: First draft of the proposed road map 49

    Appendix-C: Documents Provided by Stakeholders 53

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    LIST OF ABBREVIATIONS

    BADC Bangladesh Agricultural

    Development Corporation

    ECD Emission Control Devices

    BPC Bangladesh Petroleum

    Corporation

    ERL Eastern Refinery Ltd

    BR Bangladesh Railway GOB Government of Bangladesh

    BRTC Bangladesh Road Transport

    Corporation

    HC Hydro-Carbon

    BSTI Bangladesh Standards and

    Testing Institute

    HSD High Speed Diesel

    BRTA Bangladesh Road Transport

    Authority

    HSFO High Sulfur Fuel Oil

    BIWTA Bangladesh Inland Water

    Transport Authority

    KPC Kuwait Petroleum

    Corporation

    BIWTC Bangladesh Inland Water

    Transport Corporation

    LSD Low Sulfur Diesel

    BUET Bangladesh University of

    Engineering and Technology

    NOx Nitrogen Oxides

    CAA Clean Air Asia PDB Power Development Board

    CO Carbon Monoxide PM Particulate Matter

    CNG Compressed Natural Gas SOx Sulfur Oxides

    DPF Diesel Particulate Filter WHO World Health Organization

    DOE Department of Environment

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    EXECUTIVE SUMMARY

    As a developing country, in Bangladesh, the use of motorized vehicles has been increasing at

    a faster rate which leads to environmental pollution especially in highly populated

    metropolitan areas. One of the most hazardous of these pollutions is the particulate matter.

    High sulfur content in diesel is partly responsible for particulate matter which is a major

    pollutant from diesel vehicles. More importantly, the emissions from diesel engines make the

    emission control devices like diesel oxidation catalyst, diesel particulate filter (DPF), etc.,

    inactive when the engine runs with high sulfur diesel.

    The Government of Bangladesh (GOB) has taken many initiatives to reduce pollution. In

    Bangladesh, Department of Environment (DOE) in collaboration with Clean Air Asia (CAA)

    has initiated a project titled Roadmap for Reducing Black Carbon from Heavy Duty Diesel

    Vehicles and Engines in Bangladesh to achieve a pollution free environment within a certain

    period of time. Department of Mechanical Engineering, Bangladesh University of

    Engineering and Technology (BUET) provided the technical consultation to DOE for this

    roadmap project.

    The proposed roadmap has taken into consideration the views and feedbacks from all relevant

    stakeholders through a series of meetings and discussions. This roadmap incorporated

    milestones of lowering the sulfur content on imported diesel fuel from the current level of

    2500ppm to a stricter level of 500ppm by 2016. Eventually, it is targeted to be as low as

    350ppm by 2020 and 50ppm by 2023. The consultation team recognizes the technical,

    economic and socio-political implications of pursuing stricter standards. It is also suggested

    that proper co-ordination of activities like - standardization of measurement of sulfur content

    in diesel, up-gradation of vehicle emission standard for low sulfur diesel and effective control

    of fuel adulteration is essential to achieve the full benefit of using low sulfur diesel. The

    process should be accompanied by a public awareness program to create a better

    understanding regarding the use of low sulfur diesel among the end users. The report

    suggested a strategy for Eastern Refinery Ltd (ERL), the only major local producer of fuel in

    the country, to be able to cope up with such reduction on sulfur level in their diesel product.

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    1. INTRODUCTION

    Environmental pollutions including air pollution have been increasing day by day in

    Bangladesh. The use of motorized vehicles is increasing at a faster rate which leads to

    environment pollution especially in highly populated metropolitan areas. One of the most

    hazardous of these pollutions is the particulate matter or PM. High sulfur content in diesel is

    partly responsible for particulate matter which is a major pollutant from diesel vehicles.

    These emissions from diesel engines make the emission control devices like catalytic

    converter, diesel particulate filter (DPF), etc., inactive when the engine runs with high sulfur

    diesel.

    A pollution free environment is the dream of all and the Government of Bangladesh (GOB)

    has taken many initiatives to reduce pollution. In Bangladesh, Department of Environment

    (DOE) in collaboration with Clean Air Asia (CAA) has initiated a project titled Roadmap

    for Reducing Black Carbon from Heavy Duty Diesel Vehicles and Engines in Bangladesh to

    achieve a pollution free environment within a certain period of time. Department of

    Mechanical Engineering on behalf of the Bureau of Research, Testing and Consultation of

    Bangladesh University of Engineering and Technology (BUET) has become the technical

    consultant to DOE for this roadmap project. In this regard, a team of experts consisting of 5

    members from the Department of Mechanical Engineering has been working on with an

    ultimate goal of proposing a roadmap.

    The specific objectives that are being fulfilled by this Consultation team are as follows:

    i) Department of Environment will arrange discussion meetings among the stakeholders

    and the Consultant will gather the feedback for the proposed roadmap from these

    stakeholders. The responsibility to invite the participants from government, private

    sectors and civil societies to join the stakeholder groups lies with the DOE.

    The stakeholders will express their views on the existing fuel / vehicle emission

    standards in Bangladesh and sort out the barrier for implementing that. The possible

    barrier for the proposed roadmap will also be highlighted and way out to solve /

    overcome the barrier will be discussed. The shortcomings of different

    implementing/enforcing authorities will also be considered and the remedy will be

    proposed.

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    ii) The technical aspects for using high sulfur content diesel in vehicles and engines will

    be highlighted by the Consultant to all the stakeholders so that they can contribute to

    develop a roadmap for Low Sulfur Diesel (LSD).

    iii) The upcoming roadmap will be proposed by the Consultation group and will be

    reviewed / modified in the stakeholders forum discussion meeting.

    iv) The Consultation team will also provide technical assistance for the up-gradation of

    Eastern Refinery Ltd (ERL).

    1.1 Rationale for Low-Sulfur Diesel

    Pollutants are formed in diesel engines, which are very harmful for both environment and

    human health. The major pollutants that are produced during the diesel combustion are

    Particulate Matter (PM), Nitrogen Oxides (NOx), Unburnt Hydro-Carbon (HC), Sulfur

    Oxides (SOx) and Carbon Monoxide (CO). Particulate matters from diesel engines consist of

    primarily carbon particles, the remainders are hydrocarbon compounds (some of which are

    bound to soot), and a few are sulfates in the form of aerosols. The adverse effects of pollution

    from diesel engines are well known. SO2 is the principal and most ubiquitous urban air

    pollutant which is a highly irritating gas, and at levels as low as 0.3 to 1.0 ppm it can be

    identified by either smell or taste. The sulfate particulate matter (PM) is very much harmful

    for human body especially for small children.

    During breathing, small particles of diesel exhaust are drawn into the lungs. The microscopic

    particles in diesel exhaust are less than one-fifth the thickness of a human hair and are small

    enough to penetrate deep into the lungs, where they contribute to a range of health problems.

    Headache, cancer, asthma, cardiovascular diseases, chronic obstructive pulmonary diseases,

    diabetes and many other diseases might be caused from diesel pollutants. In 2012, the World

    Health Organization (WHO) declared that diesel pollutants are carcinogenic. These pollutants

    can also reduce visibility in the environment by creating smog. It may also be responsible for

    acid rain.

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    To reduce pollutant emissions from diesel engines, a number of methods are available. Two

    of the most important ones are to use emission control devices (ECD) and to use good quality

    fuel. These two, however, are interlinked in such a way that one requires the use of the other.

    Diesel emission control devices, such as, catalytic converters, DPF, etc. become inactive

    when they come in contact with oxides of sulfur. Catalysts and other elements inside the

    devices are covered by SOx thus losing its capability to convert the harmful gases to more

    benign ones. In addition, sulfur compounds in the exhaust envelope PM making it larger

    which ultimately clog the DPF.

    At present, the upper limit of sulfur content in diesel fuel in Bangladesh is 2500 ppm (0.25%

    v/v). However, many stakeholders claim that the actual level at the end-users is much higher.

    As a result, recently imported vehicles which are fitted with ECD face a number of technical

    problems running with high-speed diesel (HSD). In most such cases, the ECD are removed

    from the vehicle thus contributing to pollutant emissions like the older generation vehicles.

    The main impact of using low sulfur diesel is on the emission reduction capability of the

    post-engine emission control devices like catalytic converter, diesel particulate filter (DPF),

    etc., which are incorporated in the exhaust system of modern diesel engines.

    1.2 Purpose of the Roadmap

    Diesel engine vehicles running in and around Dhaka city contribute to pollutant emissions

    into the atmosphere. So reducing sulfur content from the current 2500 ppm down to 500 or

    even to 50 ppm will indeed have a considerable effect on the air quality of the Dhaka city. In

    this case, some locality in the immediate vicinity of the vehicles (roadside gatherings /

    inhabitants) will have some immediate benefits out of this. In the long run, the entire city air

    will get the benefits from the reduced sulfur content in diesel engines and vehicles.

    Moreover, from technical point of view, 2-3 years down the road, most of the diesel engines

    and vehicles will have ECD and demand low sulfur diesel for their proactive operation. In

    that case, if we do not take necessary steps now to gradually reduce the sulfur content of

    diesel, then the new diesel vehicles will face major challenges running on roads. To avoid

    such situation, reduction in sulfur content in diesel is necessary.

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    With a view to reducing high sulfur content in diesel, a roadmap with relevant guidelines

    have been proposed here by considering the views expressed and data collected from

    different stakeholders during focus group meetings (FGMs) and keeping in mind the socio-

    economic condition of the country.

    1.3 Methodology for the development of the Roadmap

    In order to formulate a draft roadmap for developing low sulfur diesel and clean vehicle

    emissions policies in Bangladesh, the following activities have been carried out by the

    Consultant (BUET):

    (a) Organization of bi-monthly stakeholder meetings in Bangladesh to provide forum for

    stakeholder consultation. DOE invited participants from the government, private

    sectors and civil societies to join the national stakeholders meetings. The stakeholder

    groups were invited so as to:

    i. Discuss and package the benefits of low sulfur diesel and clean vehicle

    emissions for Bangladesh.

    ii. Conduct a thorough review of existing national regulations, emission

    standards, barriers for implementing the previous roadmap for clean fuels and

    vehicles, incentives that might promote low sulfur fuel and clean vehicle

    emissions in Bangladesh, assist funding for setting up desulfurization unit in

    Eastern Refinery Limited.

    iii. In addition to the national stakeholders meetings, the Consultants had 5 (five)

    Focus group discussion (FGD) meetings that are listed in Table 1.

    (b) In the stakeholders meetings, the participants were given a set of questions relevant to

    their interests. The Consultants recorded their comments during these meetings. The

    summary of these meetings are reported in Appendix-A.

    (c) Evaluation of the benefits of low sulfur fuel and clean vehicle emissions standards for

    Bangladesh.

    (d) Review of the existing Bangladesh national regulations and incentives that would

    promote low sulfur fuel and cleaner vehicle emissions in Bangladesh e.g., on

    emission, inspection of fuels and vehicles, catalytic converters, taxation regimes etc.

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    Table 1: Stakeholders Participating in the Focus Group Discussion Meetings (FGDs):

    Activities/Meeting Time / Date Participants

    All Stakeholders Meeting-1 May 28, 2013 All Stakeholders

    All Stakeholders Meeting-2 July 29, 2013 All Stakeholders

    Focus Group Meeting-1

    (in Chittagong)

    August 04,

    2013

    ERL, BPC and all other oil distribution

    companies of the country.

    Focus Group Meeting -2 October 23,

    2013

    End-user stakeholders , i.e., Vehicle Owners

    Association, Vehicle Traders Association ,

    Vehicle Importers Association, etc.

    Focus Group Meeting -3 January 15,

    2014

    BRTA, BSTI, DOE, Traffic Authority,

    Dhaka Development Authority, etc.

    Focus Group Meeting -4 February 25,

    2014

    Fuel Pump Owners' Association, DOE,

    Generator Importers' Association, Private

    Sector Power Plant Companies, etc.

    Mid-Term Report

    Presentation

    09 April, 2014

    DoE, Clean Air Asia (CAA), Vehicle

    Importer Association, Communication

    Ministry, BSTI, Ministry of Energy and

    Mineral Resources, Science Laboratory and

    Bus-Truck Owner Association.

    Focus Group Meeting-5 25 June, 2014

    DoE, BADC, BSTI, BRTC, ERL,

    Communication Ministry, Ministry of

    Energy and Mineral Resources.

    2nd National Stakeholder

    Meeting

    29 October,

    2014

    DoE, BADC, BSTI, ERL, Ministry of

    Energy and Mineral Resources, Truck

    Owners' Association and Petrol Pump

    Owners' Association

    3rd (Final) National

    Stakeholder Meeting

    14 January

    2015

    DoE, Clean Air Asia, BRTA, BSTI, BPC,

    ERL, Ministry of Energy and Mineral

    Resources, Ministry of Industries,

    Bangladesh Railway, BCSIR , Vehicle

    Importers' Association.

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    Analysis of Feedback from FGDs and Stakeholders Meetings:

    From the deliberations with the stakeholders, the consultant team (BUET) was informed

    that of the total demand of diesel in the country, about 15% is produced by the ERL

    which is about 0.4 million tons per year and the rest 85% is imported from abroad. From

    the trend analysis of the given data the same was found to be true.

    The ppm content of sulfur in diesel produced by the ERL is around 5000 ppm and the

    ppm content of the imported diesel is around 2000 ppm. Thus when these two are

    blended, the resultant blend is around 2500 ppm. Since the ERL's diesel contains very

    high sulfur content, so even importing diesel with zero ppm sulfur cannot produce a

    blend of less than 500 ppm sulfur if the ERL production (15%) and import (85%)

    percentage remains the same. So blending is impractical in case of the necessity of

    reducing the sulfur content below a certain level. Table-2 summarizes the situation.

    It was also revealed that ERL proposed a capacity expansion of further 3.0 million tons of

    crude oil in addition to the existing 1.5 million tons. That would increase the production

    of diesel up to 1.2 million tons. Keeping in mind that the demand for diesel has been

    increasing at the rate of about 0.1 million tons per year especially in the transport sector,

    by the time that the project is materialized, the share of ERL in the diesel market will be

    somewhere between 30 and 40 percent. ERL also proposed a 1.4 million ton

    desulfurization unit which will be able to produce 350 ppm sulfur diesel. This level does

    not seem to be a prudent one. Such a plant should have an economic life of at least 25

    years. It is quite likely that within about 10 to 15 years time, most of the other countries

    will set the sulfur content at 10 ppm at most (developed countries have already set the

    standard at 10 ppm and advancing towards 0 ppm in the very near future). Therefore,

    ERL should revise their proposal to set the sulfur level to 0 ppm or 10 ppm at most for

    their proposed desulfurization plant.

    The additional costs that will be incurred in case of import of 500 ppm sulfur diesel

    instead of 2000 ppm sulfur diesel is substantially low. Considering the huge benefits that

    will be gained in the form of clean atmosphere, reduced health cost, increased vehicle life

    and others, this additional cost seems quite reasonable.

    So instead of distributing it to the transportation sector, all the diesel produced by the

    ERL should be channeled to limited sectors such as remote power plants, marine vehicles,

    industries, etc. which are far from the cities. For the transport sector, 100% directly

    imported diesel of the required amount (500/350/50 ppm) sulfur content according to the

    proposed roadmap should be distributed.

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    Some of the nations such as China and India setup a split standard for their metros (with

    lower allowable ppm level) and other regions (with higher allowable ppm level). From

    the discussion with the stakeholders, it was revealed that two separate standards are not

    feasible for a small country like Bangladesh. There are cross-country travels and logistic

    and administrative shortcomings related to the marketing, distribution, and storage of

    fuels of two different standards.

    On the other hand, from the deliberations with the stakeholders, it was observed that all

    these efforts for reducing sulfur in fuel will not be fruitful unless we can control

    adulteration of diesel fuel. Such adulterations were reported to have been taking place at

    various stages such as during lighterage from marine vessels, at the storage depot, tank

    lorries and at various distribution channels. In such cases, post-engine emission control

    devices cannot be operated effectively and people will be deprived of clean air despite

    buying expensive vehicles as well as fuels. So, some definitive measures must be taken to

    control these adulteration processes. Continuous monitoring of the various processes and

    channels by the concerned authorities, law enforcements through exemplary punishments,

    introduction of anti-adulteration technical measures, and measurement of fuel properties

    to indicate the extent of adulteration are the few steps that can be implemented to control

    adulteration.

    It was felt mandatory to set a standard methodology to measure sulfur content and other

    fuel properties so that no controversy arises from the measurement process. At present,

    there is a lack of coordination between the concerned parties like ERL, BSTI, and DoE,

    regarding such methodologies. Experiences and technologies from the neighboring and/or

    developed countries can be adopted to set up such measuring and monitoring

    stations/authorities.

    Effect of emission from HSFO-run power plants and coal-based brick-fields situated in

    and around Dhaka city may have a significant role on the resulting sulfur content in the

    air. However, the team does not have enough data to quantitatively assess their

    contribution of sulfur pollution in the air of Dhaka city. If their sulfur pollution is at a

    significant level this may outweigh the benefits of using low sulfur diesel in vehicles.

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    2. TECHNICAL ASPECTS OF DIESEL COMBUSTION AND EMISSION

    The particles from diesel engines consist of hydrocarbon particles, the remainders are

    hydrocarbon compounds (some of which are bound to soot), and a few are sulfates in the

    form of aerosols. The creation of soot is largely determined by the local temperature (800

    1400 K) and the oxygen concentration, and occurs in two phases. The reactions in the

    primary formation phase occur almost exclusively from radical chain mechanisms in the core

    of the fuel jet behind the jet tips O, H, and OH radicals are formed. Cyclic and polycyclic

    aromatic hydrocarbons (PAH) form by polymerization and cyclization. Uncombusted and

    partially combusted hydrocarbons, especially aldehydes can bond to the secondary particles

    due to their large specific surface. As combustion proceeds, the secondary formation phase is

    soot reoxidation that is governed by the dwell time and oxygen concentration. The diameter

    of the particles varies between 1 and 1000 nm. For homogeneous mixtures, soot is found in

    the exhaust emissions when the mixture is very rich (50% of theoretical air); at more than

    60% air under optimum conditions, there is no demonstrable soot formation. Important

    unrestricted components in untreated exhaust from diesel engines are cyanide, ammonia

    (NH3), sulfur dioxide (SO2), and sulfates. Specifically, hydrocarbons, methane, ethane,

    ethene, ethine, benzene, and toluene are of particular interest.

    The adverse effects of pollution from diesel engines are well known. SO2 is the principal and

    most ubiquitous urban air pollutant which is a highly irritating gas, and at levels as low as 0.3

    to 1.0 ppm it can be identified by either smell or taste. Because of its marked solubility in

    water, it is almost 100 percent absorbed in the upper airways in human beings. Even a mild

    exposure (6 to 12 ppm) can cause serious respiratory and related troubles. Similar

    phenomenon can result from chronic irritation by other pollutants such as NO2 and O3. An

    intense exposure to SO2 may lead to laryngeal spasm or pulmonary edema, both of which

    conditions could be fatal. Sulfate ions in different substances vary widely in their irritant

    potency. The sulfate ion itself is not an irritant. The most potent agent is sulfuric acid

    (H2SO4), followed by ferric sulfate, zinc sulfate, and ammonium sulfate.

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    3. EMISSION CONTROL TECHNOLOGIES FOR DIESEL ENGINES

    Pollution from diesel engines can be controlled in different ways; some are performed before

    the combustion of diesel and some after the diesel combustion. The devices which are

    employed before combustion is called pre-ignition devices and devices that are used after the

    combustion is called post-ignition devices.

    Pre-ignition devices: Hot air-intake system and improved fuel metering electronic

    governor.

    In-Engine systems: (i) Direct and indirect fuel injection, injection retardation (ii) Valve

    design - Vtech, 16 Valve, DOHC (iii) EGR: Exhaust Gas Recirculation and (iv) Stratified

    charge combustion, lean burn

    Post-ignition devices:

    (i) Diesel Particulate Filter (DPF): Diesel particulate filters (DPF) reduce diesel PM

    emissions through filtration. This technology is very efficient in controlling diesel PM

    emissions, and has been demonstrated to reduce diesel PM by over 90 percent.

    (ii) Diesel Oxidation Catalyst (DOC): Diesel oxidation catalyst (DOC) reduces the emissions

    of particulate matter (PM), carbon monoxide (CO) and gaseous reactive organic gas

    (ROG) from diesel engines by catalytic oxidation.

    (iii) Continuously Regenerative Trap (CRT): The CRT system utilizes a ceramic wall-flow

    filter to trap particulates. The trapped particulate matter is continuously oxidized by

    nitrogen dioxide generated in an oxidation catalyst which is placed upstream of the filter.

    The CRT requires ultra low sulfur fuel and a certain minimum NOx/PM ratio for proper

    operation.

    (iv) Selective Catalytic Reduction (SCR): Selective Catalytic Reduction (SCR) is an

    advanced active emissions control technology system that injects a liquid-reductant agent

    through a special catalyst into the exhaust stream of a diesel engine. The reductant source

    is usually automotive-grade urea, otherwise known as Diesel Exhaust Fluid (DEF). The

    DEF sets off a chemical reaction that converts nitrogen oxides into nitrogen, water and

    tiny amounts of carbon dioxide (CO2), natural components of the air we breathe, which is

    then expelled through the vehicle tailpipe.

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    4. EFFECTS OF FUEL QUALITY ON DIESEL EMISSIONS

    The minimum requirements for diesel fuel are primarily concern density, ignition quality

    (cetane number), boiling curve, resistance to cold, and sulfur content. Petroleum naturally

    contains sulfur depending on where it comes from. The sulfur is chemically bound, and more

    than 95% is converted into gaseous sulfur dioxide upon combustion the remainder largely

    passes into the particle mass of the exhaust that contains sulfurous acids and sulfates leading

    to corrosion and exhaust pollution. In addition to the soot in diesel exhaust that is suspected

    of being carcinogenic, there are also polycyclic aromatic hydrocarbons (PAH). Local rich

    conditions during combustion lead (via the intermediate steps of acetyls and polycyclic

    hydrocarbons) to the formation of graphite-like soot particles. By means of coagulation and

    agglomeration processes, soot particles approximately 100 to 300 nm in diameter (median)

    arise from these approximately 110 nm (1 nm = 10-9 m) primary particles. Since the large

    surface area (up to 200 m2/g) of these particles make them strongly adsorbent, a large share

    (greater than 50% by weight) of hydrocarbons, sulfates, water, and lubricating oil

    components can be demonstrated in diesel soot in addition to carbon. One known method for

    reducing the total emission levels of particulate matter (TPM) from diesel engines is to use

    low-sulfur (0.05 percent by weight, equivalent to 500 ppm) diesel fuel. The stringency of

    legal restrictions on fuel sulfur has rapidly been tightened in recent years and continues to

    tighten still (although, from one country to another, there may be field issues for some time).

    The main reason for enforcing the use of low-sulfur diesel is that sulfur causes havoc in

    emission control systems.

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    7%4%

    33%55%

    1%

    Sector-wise Consumption of HSD during 2012-13

    1

    2

    3

    4

    5

    Power

    Agriculture

    Domestic and others

    IndustryCommunication

    5. DIESEL EMISSIONS: BANGLADESH SCENARIO

    Bangladesh is an oil-importing country. The only refinery in the country is the Eastern

    Refinery Limited (ERL) located in Chittagong. It has a capacity to handle 1.5 million tons of

    crude oil per year. The major petroleum products are high-speed diesel (HSD) and high-

    sulfur fuel oil (HSFO), constituting more than three-fourths of their production. The sulfur

    content in HSD and HSFO are 0.5% (5000 ppm) and 3.5% (35,000 ppm) respectively.

    However, the volume of HSD produced in ERL is relatively small and can meet only about

    15 percent of the total national diesel demand of the country. In order to meet this

    requirement, the controlling agency of ERL, Bangladesh Petroleum Corporation (BPC)

    imports the remaining 85 percent through ERL from different countries. A FGM with BPC

    and ERL revealed that the finished product, viz., HSD is important from Kuwait Petroleum

    Corporation (KPC) which has a sulphur content of about 2000 ppm. HSD imported from

    other sources have sulfur content of 2500 ppm. The current practice of ERL is to blend the

    imported HSD from KPC with their own product to deliver HSD for country-wide

    consumption with sulfur content of 2500 ppm.

    The current emission regulations regarding diesel vehicles allow import of vehicles

    complying EURO2 standard (for Dhaka and Chittagong) and EURO1 standard (for the rest of

    the country) and the free acceleration smoke density limit is 40 HSU (k = 1.2 m-1) for

    naturally aspirated and 61 HSU (k = 2.2 m-1) for turbo-charged diesel engines.

    The data related to the production, consumption and import are gathered from various sources

    and are presented in the following figures and tables.

    Fig. 1: Sector-wise consumption of HSD in Bangladesh (2012-13)

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    0

    200000

    400000

    600000

    800000

    1000000

    1200000

    1400000

    1600000

    1800000

    2008-09 2009-10 2010-11 2011-12 2012-13

    Co

    ns

    um

    pti

    on

    (M

    T)

    Years

    Sector-wise Consumption of HSD during Last 05 Years

    Power Industry Agriculture Communication Domestic and Others

    0

    200000

    400000

    600000

    800000

    1000000

    1200000

    2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13

    Sale

    s in

    MT

    Years

    Actual Sales of Fuel Oil Handling System (FOHS) during Last 10 Years

    Fig. 2: Consumption (sector-wise) of HSD (last 5 years)

    Fig. 3: Actual sales of High Sulfur Fuel Oil (last 10 years)

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    0

    500000

    1000000

    1500000

    2000000

    2500000

    3000000

    3500000

    2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13

    Sale

    s in

    MT

    Years

    Actual Sales of High Speed Diesel (HSD) during Last 10 Years

    0

    500000

    1000000

    1500000

    2000000

    2500000

    3000000

    3500000

    1 1. 5 2 2. 5 3 3. 5 4 4. 5 5

    MT

    Year

    HSD Production by ERL, Consumption and Import

    Production by ERL

    Total Consumption

    Import

    2008-09 2009-10 2010-11 2011-12 2012-13

    89.3% of consumption

    85.6%

    88.4% 88.5%

    87.1%

    Fig. 4: Actual Sales of High Speed Diesel (HSD) (last 10 years)

    Fig. 5: HSD production and import by ERL (total consumption)

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    A hypothetical analysis was done with the resulting sulfur content in diesel if the imported

    diesel is blended with that produced by ERL, as shown in Table 2.

    Table 2: Sulfur ppm after blending of imported and ERL produced HSD

    Sulfur ppm in ERL produced

    HSD (ERL production is about

    15% of country demand)

    Sulfur ppm in imported HSD (import is

    about 85% of country demand)

    Sulfur ppm

    after

    blending

    5000 2000 (from KPC) [at present] 2450

    5000 2500 (from other source) [at present] 2875

    5000 500 [in future] 1175

    5000 50 [in future] 793

    5000 0 [assumption] 750

    Table 2 clearly indicates that at present, ERL can deliver HSD with 2450 ppm sulfur

    after blending (which is less than 2500 ppm, the country standard) only from the imported

    HSD of KPC (which has about 2000 ppm of sulfur). In case of import from other sources

    (2500 ppm), after blending, it does not meet the present standard. It also indicates that

    importing HSD with 0 ppm sulfur and after blending with 5000 ppm of ERL produced HSD,

    the value of sulfur ppm below 750 cannot be achieved.

    Therefore, if the road map is set for 500 ppm in the near future, the blending of imported

    HSD with that produced by ERL will not be compatible with the roadmap. In such cases,

    HSD produced by ERL can have restricted uses in power plants in remote areas, marine

    transports, or country-side irrigation, while the imported low sulfur diesel (LSD) can be used

    in urban transports and other uses. In order to increase their share in the HSD market, ERL

    proposed for a second Crude Processing Unit with an installed capacity of 3.0 million tons

    per year along with a desulfurization plant (350 ppm) of a capacity of 1.4 million tons. That

    means that had the proposed plant come into existence, ERL will be able to produce about 1.9

    million tons of HSD against the present demand of around 3.0 million tons.

    However, it is highly likely that by the time the proposed project is completed, the demand

    for HSD will increase to about 3.7 million tons. That is, the country will need to import more

    than half the total demand.

  • Final Draft

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    In the discussion meetings, many stakeholders voiced their concern about the adulteration of

    fuel (including diesel) in different stages of handling (from port up to the end user i.e., the

    vehicle users). They believe that there is a widespread adulteration of fuels and they finally

    recommended that all the concerned authorities should be accountable. They emphasized that

    without proper control of adulteration at field level, all the efforts for reducing pollution by

    improvement of fuel quality may prove fruitless.

    Sulfur (from HSD) Scenario in Bangladesh and around Dhaka City

    In the whole country:

    Sulfur content in HSD in Bangladesh is about 2500 ppm. The total consumption of HSD in

    2012-13 year in Bangladesh in power, industry, communication, domestic and other sectors is

    29,64,604 MT which produced 7,412 MT of sulfur or sulfur compounds in Bangladesh from

    HSD.

    In and around Dhaka City:

    In 2012-13, the consumption of HSD in Bangladesh in the whole communication sector was

    16,21,675 MT.

    Considering 90% of the diesel vehicles was used in 4 major cities (Dhaka, Chittagong,

    Khulna and Rajshahi) and 50 % of which can be assumed to be running in Dhaka region only.

    Again assuming 40% of the diesel vehicles of Dhaka region were used in and around Dhaka

    city at a time, they produced sulfur amounting to about 730 MT in 2012-13 in and around

    Dhaka city.

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    6. COST OF LOW SULFUR DIESEL

    Cost of diesel fuel includes among others, the price of crude oil, costs of refining,

    distribution, marketing and taxes. In the US market, the price of crude oil and refining

    constitute about 70% of the total cost. The pump price of ultra-low sulfur diesel (ULSD)) (0-

    15 ppm sulfur) is about US$ 1 per litre (*Source: www.eia.gov) over the last four years or so.

    It is interesting to note that the cost of producing diesel is generally higher than that of

    gasoline.

    In Bangladesh, until recently the cost of diesel production was higher than the pump price.

    But, the Government of Bangladesh, since inception, had been subsidizing the price of diesel

    to facilitate the various economic sectors, especially, the farmers and in general, the

    population. While the price of fuel in many developed countries are driven by market forces,

    that in Bangladesh and some other countries are fixed by the Government.

    The authors are unaware about any detailed study on the cost of LSD in Bangladesh market.

    Verbal communications in one of the FGDs, it was revealed that the pump price of diesel

    may go up by about Tk. 4 to Tk. 5 per liter. This may increase the cost associated with diesel

    import in the order of taka 1500 crore per year. Thus, before commenting on the price of

    ULSD, a proper study on the production and marketing costs needs to be accomplished.

    7. IMPLICATIONS OF INTRODUCING LOW-SULFUR DIESEL (LSD)

    The implications of introducing LSD in Bangladesh are many. A few of the important ones

    are namely, technical, economic, and political. Technical advantages and disadvantages of

    introducing LSD in Bangladesh with larger population of older vehicles in the diesel-driven

    fleet have already been discussed in sufficient details in earlier sections. Economic

    implications are wide ranging. From the past experiences, one can easily conclude that there

    is a direct correlation of prices of essentials and other commodities and services with the

    price of fuel. If the latter increases, all other prices go up almost immediately before the

    market stabilizes.

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    Political implications are tied up with the economic ones. Any increase in the price of fuels

    causes an uproar in political arena. However, if adequate and effective measures are taken by

    the various functionaries of the Government to make people aware of the bad effects of high-

    sulfur diesel on human health and environment as well as the benefits of using LSD are

    highlighted, the dissenting voices would not be too vocal.

    8. POLICY FRAMEWORK: ROADMAP ACTIONS AND MILESTONES

    8.1 Overcoming Economic Barriers and Creating Incentives for LSD Deployment

    As discussed in the previous section, the immediate effect of rise in fuel prices is that the

    transport costs of all forms go up. This in effect put an adverse effect on the economy as a

    whole. Two propositions can be thought of in this regard. Firstly, the Government, for the

    sake of betterment of the environment, can continue giving subsidies for the first three years

    which would be decreased gradually over this period. This would help ease the burden on the

    people. Secondly, the Government can take up an aggressive public awareness program to

    drum up the good effects of using LSD in regard to health and environment for the period

    from now up to the deployment of LSD; i.e., in the period put forward in the proposed

    roadmap. Then the stakeholders can prepare themselves for the increase in LSD price well in

    advance.

    Other incentives like reduced taxation for using LSD and importing of LSD vehicles,

    imposing higher tax and duties for higher emission vehicles, etc., may also be implemented.

    8.2 Addressing Non-Economic Barriers

    Non-economic constraints are generally more difficult to handle than economic barriers. The

    leaders of the country have to be proactive to motivate people in such a manner so that the

    majority may feel that the introduction of LSD is necessary. A similar model of replacing

    two-stroke three-wheelers in Dhaka and Chittagong with less polluting CNG driven three-

    wheelers may be put to use.

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    9. FINAL DRAFT OF THE PROPOSED ROADMAP

    The first draft of the proposed roadmap was placed in a meeting with all the major

    stakeholders, for their feedback. The draft had two options in the proposed roadmap,

    which were discussed in detail (as included in Appendix-B). From the discussions with

    stakeholders a number of interesting features and new findings were revealed

    The process of importing low sulfur diesel would require some lead time for

    acquiring diesel purchase from international suppliers. Refineries which typically

    supply diesel to Bangladesh are having their up-gradations to produce low sulfur

    diesel as well. Ministry of Energy and Mineral Resources, BPC and ERL are the

    major stakeholders in this process.

    The standardization of the procedure for measurement of sulfur content in diesel is

    not completed yet in Bangladesh. The process also needed further acceptable

    coordination among relevant government agencies. DoE, BSTI, ERL and BPC are

    the major stakeholders in this process.

    The modernization and establishment of desulphurization plant in ERL will require

    a minimum lead time of three years before it could come into operation. Such

    process may start in 2015 and currently targeted for achieving 350 ppm level. 350

    ppm appears to be a low level of requirement based on the fact that 50 ppm diesel

    will be standard within the life time of such renovations of ERL. Provision of

    further improvement of low sulfur diesel must be included in the renovation plan of

    ERL. Ministry of Energy and Mineral Resources, Ministry of Finance and ERL are

    the major stakeholders in this process.

    The production of diesel from ERL could not be stopped as it also produces HSFO,

    octane, petrol, kerosene and a number of other products which are used as raw

    materials in different industries. Possible internal markets where ERL diesel could

    be separately channeled without blending with imported diesel were explored. At

    first agriculture, power generation, inland water transport and railway have been

    considered. Feedback from concerned stakeholders revealed a number of

    limitations in this regard.

    (i). Irrigation in agriculture uses sufficient amount (33%, i. e., more than a million

    ton per year) of diesel and the existing engines can use diesel with higher

  • Final Draft

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    sulfur content, but there is no separate distribution channel for such diesel.

    Farmers use the same diesel as transportation and receive some financial subsidies

    from the government. The demand for diesel varies seasonally and introducing a

    cheaper diesel could also increase the possibility of widespread fuel adulteration.

    This did not appear to be a prospective sector.

    (ii). Power plants using diesel fuel could be a viable option of using ERL diesel.

    Diesel used in this sector is about 7% of the national demand which is more than

    0.22 million tons per year. However, most of the diesel power plants are owned by

    private sectors and they already have their agreement of fuel import/supply in

    practice, in which case they may not be interested of changing. This appears to be

    a good prospective sector.

    (iii). Railway uses small amount of diesel only, reaching about 31,000 tons per year.

    With is own distribution network, this appears to be a good prospective sector.

    (iv). Inland water transports use a significant part of diesel used in transportation

    sector. A large portion of water transport is owned by private vessel owners who

    purchase diesel from the same market as road transportation. The portion of diesel

    used by vessels owned by government agencies like BIWTC, BIWTA etc.

    amounts to a small fraction of only about 13,000 tons per year. This appears to be

    a prospective sector.

    Table 3 shows a possible list of restricted clients which may be selected for marketing the

    diesel produced by ERL. (Estimations are based on the trend of the last 5 years.)

    Table 3: Proposed list of consumers for diesel produced by ERL

    ERL diesel production

    tons per year Restricted clients

    Clients expected demand tons per year

    350,000 400,000

    Diesel Power Plants 2,50,000 300,000

    Bangladesh Railway 30,000 40,000

    Inland water Transport (Govt

    Sector) 15,000 20,000

    Inland water Transport /

    Industry

    (Private Sectors, around ERL)

    50,000

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    The control of fuel adulteration is essential for getting the real environmental benefit

    of using low sulfur diesel and modern diesel engines fitted with post-ignition emission

    control devices, both of which involve additional costs. Mixing of fluids like

    condensates, used hydrocarbon chemicals and water were reported to adulterate diesel

    fuel. Presence of such materials would significantly affect engine emissions and

    outweigh the benefit of using low sulfur diesel. These practices have been going on

    for a long period of time and involve a number of levels in the distribution channel in

    Bangladesh. Taking sufficient measures for the monitoring, implementing law

    enforcements and ensuring good coordination of relevant government agencies are

    essential to control this problem. Ministry of Energy and Mineral Resources, Ministry

    of Home Affairs, BPC and ERL are the major stakeholders in this process.

    The emission regulation for diesel vehicles and engines should be updated in

    conjunction with the availability of low sulfur fuel. As fuel below 500 ppm level

    becomes available in the local market, importing new vehicles and engines only with

    diesel emission control technologies must be made mandatory. It may take few years

    for the changeover of the fleet to better technology, but since old engines can run on

    low sulfur diesel there is no need to maintain a separate supply line for existing

    vehicles and engines. In metropolitan cities, the use of CNG in public transport sector

    may continue and in case of new diesel vehicles, use of low sulfur diesel and vehicles

    fitted with post-ignition emission control devices must be made mandatory. DoE,

    Ministry of Commerce and BRTA are the major stakeholders in this process.

    The feedback from stakeholders and analyses of the information reveal that a number of

    activities need to be synchronized to achieve a realistic and fruitful roadmap for sulfur

    reduction in diesel fuel. Solving the problems associated with the high sulfur diesel

    currently produced at ERL needs a multiple strategy plan to be implemented. Reducing

    sulfur in diesel will definitely involve more cost, but this needs to be weighed against

    health benefits and longer engine life. A gradual change is more pragmatic based on the

    socio-economic and technical scenario of Bangladesh, but the whole process can not wait

    indefinitely for preparation of all the components. Based on the features stated above, the

    proposed roadmap for developing low sulfur diesel fuel and clean vehicle emissions

    policies in Bangladesh is framed as follows:

  • Final Draft

    25

    Up to year 2015

    Up to year 2015, the policy of importing diesel with 2500 ppm or less sulfur content

    may continue. Meanwhile, the diesel produced by ERL will continue to be blended

    with the imported one to keep the sulfur content within the current 2500 ppm level.

    During this period details of three policies should be finalized in parallel. These

    include -

    (i) Standardization of sulfur content measurement of diesel fuel

    (ii) Up gradation of emission control regulations for diesel vehicles/engines

    (iii) Implementation of preventative measures against fuel adulteration

    Preparative measures shall be taken to import diesel with 500 ppm sulfur content from

    the year 2016.

    ERL should also plan and start its modernization process to provide diesel with lower

    sulfur content.

    Policy regulations for marketing of ERL diesel to restricted customers like diesel

    power plants, railway and inland water transport can be included in this range.

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    PROPOSED ROADMAP FOR SULFUR REDUCTION IN DIESEL FUEL

    *revision recommended **revision mandatory

    Sulfur Content

    (PPM)

    [All over Bangladesh]

    Timeline (Years)

    2014 2015 2016* 2017 2018 2019** 2020 2021 2022** 2023 2024 2025*

    2500 2500 500 500 500 500 350 350 350 50 50 50

    Standardization of Sulfur Content

    of Diesel X X

    Regulation regarding

    Emission Control in Vehicles

    X X

    Control of Fuel Adulteration

    X X

    Monitoring of Fuel

    Adulteration X X X X X X X X X X X X

    Awareness Program for

    using LSD X X X X X X X X

    Imported Diesel

    (PPM)

    2500 or

    less

    2500 or

    less

    500 or

    less

    500 or

    less

    500 or

    less

    500 or

    less

    350 or

    less

    350 or

    less

    350 or

    less

    50 or

    less

    50 or

    less

    50 or less

    ERL Diesel

    (PPM)

    5000 or

    less

    5000 or

    less

    5000 or

    less

    5000 or

    less

    5000 or

    less

    5000 or

    less

    350 or

    less

    350 or

    less

    350 or

    less

    50 or

    less

    50 or

    less

    50 or less

    Blending of Import and ERL

    Diesel X X X X X X X X

    Restricted Marketing of ERL

    Diesel X X X X

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    From the year 2016 till 2019

    From the year 2016, import of diesel with 500 ppm or less sulfur content will only be

    allowed. The imported fuel will go through the distribution network without blending.

    ERL will start its renovation/expansion program for producing diesel with lower

    sulfur content. At present, this is planned to take about three years, reaching a sulfur

    content of 350 ppm.

    Blending of diesel produced by ERL with the imported fuel will not be allowed

    during this period. ERL will market its production of high sulfur diesel to restricted

    customers only, which may include diesel run power plants, railway and inland

    water vessels etc.

    All the new diesel vehicles will be mandatory to satisfy the emission regulations,

    which generally would require post-engine emission control devices like DPF and

    DOC, catalytic converters, etc.

    Old vehicles and engines will continue to operate using diesel with sulfur content of

    500 ppm.

    From the year 2020 till 2022

    From the year 2020, import of diesel with 350 ppm or less sulfur content will only be

    allowed. This is restricted due to the current plan of ERL to produce 350 ppm diesel.

    In case the ERL diesel has lower ppm, the sulfur content of imported fuel can also be

    reduced accordingly.

    Since the sulfur content of both imported and ERL diesel are of the same order they

    could be used separately or after blending.

    ERL will continue to improve its process facilities in order to produce diesel with

    sulfur content of 50 ppm or less.

    For all new diesel vehicles it will be mandatory to satisfy the emission regulations,

    which generally would require post-engine emission control devices like DPF,

    catalytic converter, and DOC. The proportion of the newer vehicles and engines is

    expected to increase significantly in the whole fleet.

    From the year 2023 till 2025

    From the year 2023, import of diesel with 50 ppm or less sulfur content will only be

    allowed.

    Since the sulfur content of both imported and ERL diesel will be of the same order,

    they could be used separately or after blending.

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    If we superimpose the proposed roadmap in the following figure from the Clean Air Asia

    (CAA), "Current and Proposed Sulfur levels in Diesel in Asia, EU and USA", it can be

    observed that most developed nations such as the EU, Japan and the USA, have already setup

    and implemented a sulfur level of 10 to 15 ppm back in 2007-2008. Most other nations are

    implementing a sulfur level of 50 ppm including our Asian neighbors, such as, India, China

    and Sri Lanka. China and India setup a split standard for their metros (with lower ppm) and

    other regions (with higher ppm). So, it can be concluded that reduction in sulfur is a necessity

    for us to remain compatible with the global community. But the roadmap to that reduction

    could be in line with our techno-economic feasibility. For example, right now a reduction of

    sulfur level to 50 ppm or 10 ppm would be a very drastic measure for Bangladesh. Also the

    split standards are not recommended for a small country like Bangladesh with small

    jurisdiction, cross-country traffic movement and complicated administration.

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    Proposed Roadmap of Bangladesh Presented with the Existing Roadmaps of Other Countries

    [Source: CAI-Asia. 2010. Current and Proposed Sulfur levels in Diesel in Asia, EU and USA]

    Notes: a - under consideration/ discussion; uncertain; b = nationwide supply of 50 ppm commenced in 2003 and for 10 ppm in 2005 due to voluntary goals set by the oil industry; c = marketed;

    d = mandatory; e = voluntary standard of 500 ppm, however formal standard remains 2000 ppm, product in the market nationwide varies 500-1000 ppm; f = various fuel quality available;

    g = Beijing, Guangdong, Shanghai

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    10. MILESTONES FOR INTRODUCING LSD

    The following are prominent milestones for the proposed roadmap to make it successful.

    Table below shows the major stakeholders associated with milestone events in Bangladesh

    with the suggested "Lead Organization" shown in Bold letters.

    Table 4: Milestones for introducing LSD in Bangladesh

    Event

    Sequence Milestones

    Stakeholder / Agency

    Associated

    Recommended

    Time Line for

    Implementation

    1 Finalization of roadmap for low

    sulfur diesel DoE 2014-15

    2a

    Standardization of sulfur content

    measurement in diesel as per the

    proposed roadmap

    BSTI, ERL, BPC, DoE 2015

    2b

    Up-gradation of relevant

    standards (Fuel, Vehicle

    Emission)

    BSTI, ERL, BPC, DoE 2015

    2c Up gradation of regulation of

    emission from diesel vehicles

    DoE, BRTA,

    Ministry of Commerce,

    Vehicle Importers/

    Vehicle Assembles

    2015

    2d Control of fuel adulteration BPC, ERL, Home

    Ministry, Police 2015

    3a Economic analysis of using LSD

    DoE, Ministry of Power,

    Energy & Mineral

    Resources, BPC,

    Ministry of Finance

    Ministry of

    Communication, BRTA

    2015

    3b

    Arrangement of a pilot project to

    run Bangladeshi vehicle fleet with

    LSD

    DoE, ERL, BRTA 2015

    3c

    Arrangements for import of diesel

    with 500 ppm or less sulfur

    content

    Ministry of Power,

    Energy & Mineral

    Resources, BPC,

    Ministry of Finance

    2015

    3d Awareness program for the end

    users regarding use of LSD DoE, ERL, BRTA 2015-2022

    3e Planning for restricted marketing

    of ERL diesel from 2016

    ERL, Ministry of

    Power, Energy &

    Mineral Resources,

    BPC, PDB, BR,

    BIWTC, BIWTA, Local

    Industry

    2015

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    Event

    Sequence Milestones

    Stakeholder / Agency

    Associated

    Recommended

    Time Line for

    Implementation

    4**

    ERL up gradation / renovation for

    producing sulfur content of diesel

    to 350 ppm or less

    ERL, Ministry of

    Finance, BPC, Donor

    Agencies

    2015-2018

    5 Monitoring of fuel adulteration

    control measures

    BPC, ERL, Home

    Ministry, Police 2016-2025

    6a Import of diesel with 500 ppm or

    less sulfur content

    Ministry of Power,

    Energy & Mineral

    Resources, BPC,

    Ministry of Finance

    2016

    6b Marketing of ERL diesel to

    restricted customers

    ERL, Ministry of

    Power, Energy &

    Mineral Resources,

    BPC, PDB, BR,

    BIWTC, BIWTA, Local

    Industry

    2016-2019

    7a

    Up-gradation of relevant

    standards (Fuel, Vehicle

    Emission)

    BSTI, ERL, BPC, DoE 2019

    7b

    Arrangements for import of diesel

    with sulfur content of 350 ppm or

    less

    Ministry of Power,

    Energy & Mineral

    Resources, BPC,

    Ministry of Finance

    2019

    7c

    Production of diesel from ERL

    with sulfur content of 350 ppm or

    less

    ERL, BPC 2019

    7d Review of Road map for 350 ppm

    LSD DoE, All Stakeholders 2019

    8 Import of diesel with 350 ppm or

    less sulfur content

    Ministry of Power,

    Energy & Mineral

    Resources, BPC,

    Ministry of Finance

    2020

    9**

    ERL up gradation / renovation for

    improving sulfur content of diesel

    to 50 ppm or less

    ERL, Ministry of

    Finance, BPC, Donor

    Agencies

    2020-2022

    10a Review of Road map for 50 ppm

    LSD DoE, All Stakeholders 2022

    10b

    Up-gradation of relevant

    standards (Fuel, Vehicle

    Emission)

    BSTI, ERL, BPC, DoE 2022

    10c

    Arrangements for import of diesel

    with sulfur content of 50 ppm or

    less

    Ministry of Power,

    Energy & Mineral

    Resources, BPC,

    Ministry of Finance

    2022

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    Event

    Sequence Milestones

    Stakeholder / Agency

    Associated

    Recommended

    Time Line for

    Implementation

    10d

    Production of diesel from ERL

    with sulfur content of 50 ppm or

    less

    ERL, BPC 2022

    11 Import of diesel with 50 ppm or

    less sulfur content

    Ministry of Power,

    Energy & Mineral

    Resources, BPC,

    Ministry of Finance

    2023

    12

    Review of Road map for LSD

    with less than 50 ppm sulfur

    content

    DoE, All Stakeholders 2025

    ** currently the sulfur content is planned to be reduced to 350 ppm, in case it is reduced to

    50 ppm event 4 and 9 can be blended together.

    *** Lead Organizations shown in Bold letters

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    11. CONCLUSIONS

    All the stakeholders generally agreed that it is necessary to reduce the sulfur

    content of diesel fuel. The consultant team (BUET) is of the opinion that

    proposing drastic reduction in the sulfur content in diesel from the existing

    2500 ppm down to 50 ppm seems unrealistic given the socio-economic,

    technological and political situations in Bangladesh. So it suggests a rather

    pragmatic approach of going down the road in phases as it seems more

    feasible for implementation.

    Since more than 85% of HSD consumed in Bangladesh at present is imported

    as the final product, BPC can start importing diesel with lower sulfur content.

    However, 15% diesel comes as one of the products from processing crude oil

    by ERL. Being a refinery established decades ago, ERL produces diesel with

    higher sulfur content, but the associated products like HSFO, octane,

    kerosene and petro-chemicals are essential fuels and raw materials for other

    sectors. Currently, ERL diesel is being blended with imported one resulting in

    a sulfur content of 2500 ppm which is the existing standard in Bangladesh.

    Based on the socio-economic condition of Bangladesh as well as the global

    and regional trends a roadmap for use of LSD in Bangladesh has been

    proposed. Input and feedbacks from a wide range of stakeholders have been

    sorted in a number of occasions, through seminars, focus group discussions,

    field-visits and data collection.

    The approach of gradual change from a HSD to LSD is considered to be more

    pragmatic and realistically achievable in the socio-economic context of

    Bangladesh. The road to use LSD is divided in three successive phases after

    preliminary preparation work. This preparation phase in 2015 must include

    activities involving - standardization of measurement procedure for sulfur

    content in diesel fuel, up-gradation of emission control regulations for diesel

    vehicles / engines, and introduction of prevention control measures against

    fuel adulteration. Implementation of these three milestones is essential for

    getting the real benefit of using LSD fuel for a better environment.

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    Reduction of sulfur content to 500 ppm is proposed from 2016. After the

    proposed renovation of ERL facilities this is suggested to be reduced to 350

    ppm from 2020. From 2023, the whole system should be ready for using LSD

    of 50 ppm. Important milestones with concerned timelines have been detailed

    in the proposed roadmap. Intermediate review of the proposed roadmap is

    essential which is proposed in 2019 and 2022. This would allow to

    accommodate changes in national or global scenario along the timeline of the

    roadmap.

    The activities associated with the roadmap involve a wide range of

    government and private bodies. A good co-ordination between associated

    agencies will be essential. Keeping all such relevant stakeholders onboard is

    essential for successful implementation of the proposed roadmap.

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    12. FUTURE PLANS

    The consultant team (BUET) proposes the roadmap up to the year 2025 including

    recommendations for the revisions of the roadmap at a convenient time interval of

    three/four years. However, in 2019 and then in 2022, the roadmap must be revised to

    adapt to the then prevailing socio-economic, environmental, technological, political

    and health situations of the country as well as the global trends.

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    APPENDIX-A

    (SUMMARY OF MEETINGS WITH FOCUS GROUPS AND STAKEHOLDERS)

    Total six meetings were conducted from May 2013 to February 2014 at Dhaka and

    Chittagong with all the stakeholders and some specific focus groups. The Focus Groups (FG)

    consists of department of environment, vehicle business groups, government enforcement

    authorities, Oil companies, Oil distributors and Oil refinery. In different meetings,

    representatives from different organizations were present and the consultant representative

    (BUET) initiated the discussion with a long time multimedia presentation. The participants

    were given some specific questions relevant to their business / duties / research etc., the

    discussions were most of the time continued on the basis of the questions and their

    corresponding answers. In this appendix, the highlighted portion of the conducted meetings is

    summarized.

    The first meeting was held on May-28, 2013 at the Department of Environment (DoE),

    Agargoan, Dhaka. The welcome speech mentioning the objectives of the meeting was

    delivered by the Director (Planning), DoE, GOB. A presentation titled Fuel and Vehicle

    Emission Standards: Trends in Asia, was delivered by a representative from Clean Air Asia

    (CAA). She presented the current activities of CAA, goals for Asia up to 2016 regarding

    Better Air Quality (BAQ). A technical consultant (from Dept. of Mechanical Engineering,

    BUET) of this road map project, presented "Reducing Black Carbon from Heavy Diesel

    Vehicles and Engines". He explained the emission formation mechanism from high sulfur

    diesel engines and its remedy. He also asked for the co-operation from all the stake holders

    for proposing a road map to get a diesel pollution free environment. Director General, DOE

    and the Chair in his closing speech emphasized the need for clean air in Bangladesh. He said

    that we need a simultaneous approach to improve fuel quality, control of vehicular emission

    and introduce an efficient traffic management system.

    The second meeting was held on July 29, 2013 at the Department of Environment (DOE),

    Agargoan, Dhaka. The welcome speech mentioning the objectives of the meeting was

    delivered by Director (Planning), DOE, GOB. He gave a brief account of DOEs involvement

    on efforts taken towards lower emission and cleaner fuels. Participants and experts from

    different relevant organizations (BRTA, DOE, representatives from Bus Owner Association,

    representative from vehicle importers) were present on the occasion. Presentations were made

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    by some of the experts, followed by comprehensive discussions and finally a number of

    recommendations were put forward by all the participants.

    The first presentation titled Reducing Black Carbon from Heavy Vehicles & Engines in

    Bangladesh was delivered by Deputy Director (Engg.), Bangladesh Road Transport

    Authority (BRTA), Dhaka. He started his presentation with a brief introduction of BRTA. He

    presented the statistics of type-wise registration of vehicles up to 2009 and vehicles registered

    in 2010, 2011 and 2012 in Bangladesh. According to the statistics of BRTA the total number

    of registered vehicle in Bangladesh up to 2012 was 18,44,335. The number of registered

    vehicle in Dhaka city up to 2012 was 7,25,597. He mentioned that vehicular emission is one

    of major sources of air pollution in Bangladesh.

    Technical consultant from the Department of Mechanical Engineering, Bangladesh

    University of Engineering and Technology (BUET) presented Diesel Engine Emission

    Technical Aspects. At first he presented the basic mechanism, characteristics and

    applications of diesel engines. The combustion mechanism inside the engine cylinder and

    pollution formation was explained in his presentation. He also presented the effect of

    pollutants on health, environment and on engine itself. He presented and discussed the

    existing technology for controlling the pollution from diesel engines. During his presentation

    he emphasized on the quality of fuel for diesel engines and emissions from diesel engines. He

    also discussed about the recent trends in diesel fuel in other countries. He focused on the

    advantages and disadvantages of Low Sulfur Diesel (LSD) and Ultra-low Sulfur diesel

    (ULSD). He informed the meeting that diesel containing high sulfur develops corrosion in the

    cylinder, piston, piston rings and exhaust system. The emissions from diesel engines make

    the emission control devices (like catalytic converter, DPF, etc) inactive when the engine

    runs with high sulfur diesel. He also mentioned that low sulfur content in diesel reduces the

    lubricity of diesel, which can be recovered by using some additive at some cost. His

    conclusion was that the benefits of low sulfur fuels are much greater than the costs. Finally,

    he suggested to take immediate action for the preparation of a road map and its

    implementation for Low Sulfur Diesel (LSD) in Bangladesh.

    A representative from vehicle importers informed that they import brand new diesel vehicles

    which are designed for LSD and equipped with emission control devices (like catalytic

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    converter, DPF, etc.) but due to unavailability of LSD they have to remove the emission

    control devices from the vehicles.

    Finally, the chairman summarized the presentations and emphasized for an emission free

    Bangladesh. He focused on simultaneous approach among- fuel quality, vehicle emission,

    traffic system and co-ordination between the relevant authorities. He thanked all the

    participants and declared the meeting closed.

    The first focus group meeting was held on August 04, 2013 in Chittagong with Bangladesh

    Petroleum Corporation (BPC) and Eastern Refinery Limited (ERL) and all other oil

    distribution companies of the Bangladesh. At the beginning Director (Planning), DoE, GOB

    gave a brief description of the objectives of the project. Director (Marketing) of Bangladesh

    Petroleum Corporation (BPC) presided over the meeting. There are about total thirty

    participants from different disciplines of the above mentioned institution participated in the

    group discussion. The technical consultants of the project from (BUET) informed the

    participants about the advantages of using low sulfur diesel in engines and vehicles. The

    consultation team also requested to BPC and ERL to provide some statistical data /

    documents which will be helpful for preparing the road map of the present project. After a

    two hours fruitful discussion, the chairman of the session assured the participants that BPC

    will do its best to implement the project and to have a pollution free environment. He then

    declared the closing of the discussion session.

    After the focus group meeting, the consultation team members of BUET along with Director

    (Planning), DOE, GOB participated in a field visit to ERL, Chittagong. DGM (planning and

    shipping), ERL assisted the team to understand different process of ERL. The team also

    visited the testing laboratory of ERL. The team members similarly requested to provide some

    statistical data / documents of ERL for assisting the preparation of road map which is the key

    objective of the project. Finally, BPC and ERL provided some useful data and the answers of

    the questionnaires' which were distributed in the meeting.

    The second focus group meeting was held on October 23, 2013 at Department of

    Environment (DOE), Agargaon, Dhaka with presence of Diesel Vehicles Importers'

    Association of Bangladesh and Bus-Truck Owners' Association of Bangladesh. The meeting

    was usually began with a welcome speech delivered by Director (Planning), DOE, GOB

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    mentioning the objectives of the meeting. Technical consultant from the Department of

    Mechanical Engineering, Bangladesh University of Engineering and Technology (BUET)

    provided a multimedia presentation. The consultant discussed very briefly the various

    technical aspects of diesel engines and diesel vehicles with particular emphasis on diesel

    emissions and their severe detrimental effects on environment and eventually to human

    health. He also showed several emission control mechanism that can be employed in diesel

    engines and diesel vehicles to reduce emissions. He put major emphasis on the quality control

    of diesel fuel especially by reducing its sulfur content.

    Representative from vehicle importers informed the meeting that Euro II/III vehicles cannot

    be run without fuel correction. Also fuel statistics are required for newer vehicles import.

    Another participant also informed that vehicles will not be available for running below Euro

    IV standard after March, 2015. Regarding import from China, it was informed that Chinese

    govt. is imposing severe restrictions on producing engines/batteries that cause environmental

    pollution. So no conventional engines will be available after around March, 2015. Some

    participants commented that the protection against the adulteration of lubricating oil and

    diesel fuel is absolutely essential. Lub. oil adulteration is very dangerous for the lifespan of

    the engines and/or vehicles. Finally, Director (Planning), DOE, again reiterated the need for

    Clean air in Bangladesh by controlling the fuel quality with cooperation from all relevant

    sectors. He thanked all the participants and closed the meeting.

    The third Focus Group Consultation Meeting of Reducing Black Carbon from Heavy Duty

    Diesel Vehicles and Engines was held on 15 January 2014 at the Department of

    Environment, Agargaon, Dhaka. The particapants of the meeting were mainly from the

    enforcement authorities of environment of Bangladesh, like BRTA, Traffic Police, DOE,

    BSTI. The Director General, Department of Environment presided over the meeting. The

    welcome speech was delivered by Director (Planning), DOE and PD, Reducing Black Carbon

    from Heavy Duty Vehicles and Fuels. He mentioned that a limit of ppm of sulfur in diesel

    fuel has already been emposed by the Government of Bangladesh before, the ongoing road

    map project hope to propose a new diesel fuel standard to be implimented within certain

    years.

    The technical consultants of the project from BUET an outline of updating the roadmap for

    clean fuels for vehicles and stricter emission standards for Heavy Diesel Vehicle (HDV) and

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    Light Diesel Vehicle (LDV) in Bangladesh. He explained the advantages and disadvantages

    of using high sulfur diesel (HSD) and low sulfur diesel (LSD). He highlighted his discussion

    for the use of high sulfur content diesel, which is very much harmful for the environment.

    The pollutants produced from the combustion of high sulfur content diesel is carsinogenic

    that might cause cancer. This pollutents can also make the emission control devices of

    engines invalid. He also mentioned the disadvantges of using low sulfur diesel like decrease

    of the fuel lubricity, increase of the chance for the formation of organic compound in fuel.

    The representatives from different enforcement authorities participated in a discussion

    session. The representative from the traffic polic mentioned that though LSD is costly, it

    should be used because life is more valuable than anything. The representative from BSTI

    mentioned that they need to increase their capability to maintain / monitor the new standard

    for diesel fuel which will be proposed in the coming road map. The DOEs representative

    highlighted that the sulfur ppm in diesel vary from the supply source (Eastern Refinery

    Limited) to petrol pump i.e. there can be a survey if there is any adulteration during

    transportation / distribution of fuel.

    Finally, Chairman of this discussion meeting, delivered his concluding remarks and declared

    the meeting close. He promised to do everything for a pollution free environment.

    The fourth Focus Group Consultation Meeting of Reducing Black Carbon from Heavy Duty

    Diesel Vehicles and Engines was held on 25 February 2014 at the Department of

    Environment, Agargaon, Dhaka. The participants of the meeting were mainly from the

    Diesel-Petrol Pump Owners Association, Generator Importers and Private Sector Power Plant

    Companies. The Director General, Department of Environment presided over the meeting.

    The welcome speech was delivered by the Director (Planning), DOE and PD of Reducing

    Black Carbon from Heavy Duty Vehicles and Fuels. He mentioned that DoE has invited all

    major stakeholders of this environmental issue in a series of Focus Group Discussion

    (FGD) meetings to get their respective views. Only with involvement and coordination

    among the stakeholders an effective roadmap can be proposed.

    The representative from BUET, as a technical consultant of this road map project, presented

    an outline for Reducing Black Carbon from Heavy Duty Vehicles and Fuels. He explained

    health effect of diesel pollution and the objectives of using low sulfur content diesel.

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    Different ways of reducing air pollution due to combustion of diesel and effect of sulfur

    content of fuel on them was highlighted. He also mentioned the advantages and

    disadvantages of using low sulfur diesel (LSD). Finally, he concluded that we should go for

    LSD to cope with the rest of the world

    The representative from petrol pump owners association boldly delivered his long practical

    experience in the meeting. He mainly talked about the adulteration of fuel (including diesel)

    in different stages of handling from port up to the end user (i.e. the vehicle users). He believe

    that there is wide spread adulteration of fuels and finally, he recommended that all the

    concern authorities should be under accountability. He emphasized that without proper

    control of adulteration at field level all the efforts for reducing pollution by improvement of

    fuel quality may prove to be fruitless.

    The representative from diesel generator power plants informed the meeting that the

    generating capacity of liquid-fuel run power plant in and around Dhaka city is about 300 MW

    and near future it may meet 1000 MW. They are using heavy fuel oil (HFO) of certain type

    that meet the specified requirement of fuel set by the engines' manufacturers. Generally the

    sulfur content of HFO is pretty high, but there was no reliable measurement record so far. In

    some cases the foreign donors ask for emission requirement but de-sulfurizing units are still

    very uncommon. The representative from generator importer association informed the

    meeting that still they have no restriction of sulfur content in fuel for running their engines

    used to run the generator for producing electricity. He also informed that in future they might

    undergo the sulfur content restriction for their usable fuels.

    One representative from vehicle importer association was present in the meeting. He briefed

    that for recent models of vehicles, their fuel quality requirement could not be met by the

    available fuel in the market in Bangladesh. Some important parts like fuel pumps, injectors

    and emission control devices become out of order due to low quality fuels. He also informed

    that the latest and high efficient vehicles have high demand but the available fuels in

    Bangladesh do not permit to import those vehicles. Modern diesel emission control devices

    like DPF, DOC or SCR are rarely used in vehicles imported in Bangladesh, although there

    are vehicular emission rules implemented from 2006.

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    At the end of the discussion, Chairman of the meeting, delivered his concluding remarks and

    declared the meeting close. He requested everybody to work together in a coordinated way

    for a pollution free environment.

    The discussion Meeting of Reducing Black Carbon from Heavy Duty Diesel Vehicles and

    Engines at its mid-term stage was held on 09 April 2014 at the Department of Environment,

    Agargaon, Dhaka. The participants of the meeting were mainly from the representative from

    DoE, Clean Air Asia (CAA), Vehicle Importer Association, Communication Ministry, BSTI,

    Ministry of Energy and Mineral Resouces, Science Laboratory and Bus-Truck Owner

    Association. Mr. Md. Raisul Alam Mondal, Director General, Department of Environment

    presided over the meeting. The welcome speech was delivered by Mr. Quazi Sarwar Imtiaz

    Hashmi, Director (Planning), DOE and PD of Reducing Black Carbon from Heavy Duty

    Vehicles and Fuels. He mentioned about the objectives of the present meeting. The time line

    roadmap for sulfur (ppm) reduction in diesel and the recommendation regarding

    improvement of Eastern Refinery Limited (ERL) were the main discussion topic.

    Dr. Nurul Quadir, Joint Secretary (Environment) and Focal Point, Reducing Black Carbon

    from Heavy Vehicles and Fuels discussed about the participation of Bangladesh for reducing

    world environmental pollution. Mr. Md. Yunus Ali, Chief Conservator of Forests,

    Bangladesh Forest Department delivered his speech highlighting that a combined initiative by

    different authorities like BRTA, ERL, Commerce Ministry, Vehicle Importers, Fuel

    Distributors can create a pollution-free Bangladesh. Mr. Rafiqul Islam, Chief Guest and

    Additional Secretary (Environment), Ministry of Environment and Forests delivered his

    speech mentioning that with the cooperation from all, the present initiative can certainly

    produce a fruitful roadmap for reducing the black carbon. He mentioned is our constitutional

    duty to create a pollution free environment.

    Prof. Dr. Maglub Al Nur, Department of Mechnaical Engineering, BUET, technical

    consultant of this road map project, presented the draft roadmap to the forum for discussions

    and recommendations. He highlighted the disadvantages of using high sulfur content diesel.

    He mentioned that in two ways pollution can be controlled; one is by using post ignition

    devices (like catalytic converter, DPM etc.) and the other is by using good quality fuels. He

    presented sulfur level in diesel in different countries. He also informed the production,

    import, consumption and sales data of HSD and HFO by ERL and BPC. He mentioned the

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    blending statistics of ERL and their new proposal for plant development. He presented some

    observations and findings related to HSD and its production, emission and adulteration.

    Finally, he presented the draft proposal for the roadmap for Reducing Black Carbon from

    Heavy Duty Diesel Vehicles and Engines in Bangladesh. He presented two options for the

    sulfur content (ppm) reduction and timeline for the roadmap in the proposed draft and invite

    the participants for the open discussion. Representative from Vehicle Importers informed the

    participants that at the moment the major vehicle manufacturers are producing vehicles

    compatible for only high quality (low sulfur) fuel and due to low quality fuel in Bangladesh

    their sales volume is decreasing. He shared his experience of testing fuel samples at foreign

    laboratories collected from Dhaka showing high level of sulfur.

    A representative from communication ministry informed that due to use of Low Sulfur Diesel

    (LSD), the cost for transportation will be increased and therefore all the relevant departments

    of communication ministry should invite in future meeting. The increase of price should also

    ensure the low sulfur content of the fuel. Representative from BSTI informed the forum that

    ERL needs desulfurization plant for producing LSD. Representative from Energy Ministry

    informed that the cost of diesel per liter will increase if LSD is imported. To do so,

    government needs more subsidy or have to solve the problem for increasing transportation

    cost. Therefore, a rigorous economic analysis has to be performed to propose the roadmap.

    One representative from Science Laboratory mentioned that BSTI should be more active to

    get a standard that is necessary for pollution free environment.

    Two representatives from Clean Air Asia (CAA) were present in the meeting. They were

    informed about the proposed road map and contents of discussion. Mr. Md. Raisul Alam

    Mondal, Chairman of this discussion meeting, delivered his concluding remarks and declared

    the meeting close. He expressed his opinion that to get a healthy environment, we have to

    maintain standard of fuel quality up to the end users.

    The Fifth Focus Group discussion Meeting of Reducing Black Carbon from Heavy Duty

    Diesel Vehicles and Engines was held on 25 June 2014 at the Department of Environment,

    Agargaon, Dhaka. The participants of the meeting were mainly from the representatives of

    DoE, BADC, BSTI, BRTC, ERL, Communication Ministry, Ministry of Energy and Mineral

    Resouces.

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    Mr. Md. Shahjahan, Additional Director General, Department of Environment presided over

    the meeting. The welcome speech was delivered by Mr. Quazi Sarwar Imtiaz Hashmi,

    Director (Planning), DOE and PD of Reducing Black Carbon from Heavy Duty Vehicles

    and Fuels. He mentioned that among the most polluted cities in the world, Bangladesh

    belongs to top few of them. He requested all the participants to finalize the road map for

    making a pollution free Bangladesh.

    Prof. Dr. Md. Mamun, Department of Mechnaical Engineering, BUET and technical

    consultant of this road map project, presented the roadmap (draft) to the forum for

    discussions, recommendations and suggestions for getting it implemented. He discussed the

    disadvantages of using high sulfur content diesel. He presented sulfur level in diesel in

    different countries. He mentioned the blending statistics of ERL and their new proposal for

    plant development. Finally, he presented the draft proposal for the roadmap for Reducing

    Black Carbon from Heavy Duty Diesel Vehicles and Engines in Bangladesh. He described

    two options for the timeline of the roadmap in the proposed draft and invited the participants

    for the open discussion.

    Representative from Department of Electricity proposed that the blending by ERL for diesel

    should be stopped soon; Prof. Ehsan explained that ERL processes crude oil not only for

    producing diesel, a number of other fuels like Petrol/Octane, Kerosene, Jet fuels as well as

    raw materials for a number of petro-chemical industries are also produced in this process.

    Hence it is not practical to stop blending unless a separate market for the diesel produced by

    ERL is found and this process may need some time. It was stated that there may be possibility

    of using ERL diesel in a section of the power generation facilities, but the feasibility needs to

    be explored.

    Representative from BSTI mentioned that they have some meetings for making a standard of


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