Anyone with B5.5 LPG fitted Passat? Liquid Petroleum Gas.

Hello everyone, just an update, here is an email I received from a reputable dealer:

Hi Oliver,

The cost of conversion will be £1400 supplied and fitted.

We are an importer, distributor and trainer of both Stargas and Aldesa Multipoint sequential injection systems.

We are an LPGA approved installer and are approved by insurance companies.

The London Congestion Charge is being withdrawn as far as we know.

Conversion time is 2-3 days.

You would expect to save 50% on your fuel bill. Therefore if you weekly spend £100 on petrol expect to pay £50 on LPG.

kindest regards

Saleem
www.autolpg.co.uk

Hi Macaddictt,

Well I am not doing much driving at the minute, but my new job will require a longer commute and travel. So I am preparing really. I was thinking about selling it and buying the same year but a 1.9 TDI Passat, but the diesel is 10 pence per litre more expensive than petrol! In the last three years petrol has gone up 40 pence a litre to £1.20 a litre, so another 3 years at the same rate we are talking something like £1.60 or £1.70 per litre! Right now it costs £70.00 to fill the passat with petrol (which is like 140 US Dollars), so in three years time it will be well over £100. The LPG is fairly common in the UK, and it gives you a congestion charge exemption in London (Manchester near me is talking about a new congestion charge), the current price of LPG is .54 per litre. So to fill the passat should be £35.00 as opposed to £70.00. I think it should pay for itself in a couple years. But in another email from the fitter of the LPG, he says that demand is increasing and there is already over a month waiting list, the next fuel rise things will get crazy.

Just a couple of thoughts. You're assumptions were based upon gasoline (petrol) rising at a linear rate over the next few years. Depending on your age, you will remember three prior rapid run-ups of the price of petrol. In ALL cases, the demand peaked, and the price fell back to a more normal price where it held for several years. I think the logic that the price of petrol will continue at the present rate is flawed.

Second, is that you used the recent price increase of petrol to project your future savings, but you never used the same model to project the future price of LPG. I believe if you take the recent increase in LPG prices over the same time as petrol you will find that LPG is actually increasing in price FASTER than petrol.

I am not trying to flame, or shoot down your idea, but just think we all need to not get stampeeded (western slang) by the recent world turmoil and run-up in gasoline (petrol).

You're right Oliver, I have no knowledge of the petrol market in the UK. Here in the colonies, we see a nasty run up in price every summer during the high demand season, when the refineries say they are doing maintainence and can't keep up with the demand, and then prices always ease after the kids go back to school in September.

The three major run ups I was talking about was the "Energy Crisis #1" which was about 1972-73, prices trippled (from $.25 cents a gallon to $.75) in about a year. This caused a world oil recession, inflation and interest rates around 20%. The savings and loan industry collapsed California foreclosures were setting new records and the government kicked in 300 billion in the form of "Resolution Trust" bonds to bail out the ecconomy. Gasoline didn't "fall back" in price, but it held between $.75 and $.80 cents a gallon until 1979 about 6 years. While inflation continued to push the adjusted price down.

The next big "Energy Crisis #2 came in 1979-80 when the price doubled from about $.75 cents a gallon to $1.40 a gallon. This time with Greenspan at the helm of the federal reserve a national ecconomic crisis was averted and after some quick action, oil prices held steady with gasoline being sold at around $1.50 for the next 20 years. (While adjusting for inflation by the winter of 2002 we were paying about $.40 cents per gallon with adjustment).

Since then, we have seen some pretty steady run-ups in the price of gasoline and crude oil. In the summer of 2005 it jumped from $2.20 to $3.20 a gallon but by winter it was back to $2.20. During the summer of 2006 it repeated the action of 2005.

Last year during the summer it jumped up to $3.40 a gallon, but fell back to $3.00 per gallon by winter.

Right now we are in the middle of another serious run-up in price. The mortgage industry is on the brink of collapse and the Government is considering pumping in billions of dollars to bail out another lending industry. History does indeed repeat its self. Even at today's prices adjusted for inflation, you are paying about the equilivent of $1.50 a gallon based on US earning ability.

Now, I know all this crap doesn't help you pay your gas bill tomorrow on your way to work. However I don't think these conditions will last, and I will predict that gas will be back to about $3.00 per gallon by the end of this year. Let's see if I'm right.

Of course all of this is for the US market. You're right, I don't know what's happening to you in the UK, and your conditions could be much better or much worse depending on the politics, government regulations, and other unintended consequences of politicians acting before they think. (We have an abundance of that on this side of the pond and I would love to send some of them on permanent vacation if you could suggest a location).