President Bola Ahmed Tinubu and state governors have agreed to introduce measures aimed at reducing transportation costs across Nigeria from October 1, 2026, with the use of cheaper Compressed Natural Gas (CNG) and electric vehicles expected to drive the initiative.
Tinubu announced the agreement after meeting with members of the Nigeria Governors’ Forum on Thursday, saying the governors had independently committed to taking steps to reduce transportation costs in their respective states.
The Federal Government will support the initiative through the Presidential CNG Initiative, which is designed to expand access to cheaper and cleaner alternative fuels for transportation.
According to the government, more than 120,000 vehicles have already been converted to CNG nationwide, while over 100,000 additional conversion kits are being prepared for deployment.
The government is also expanding CNG conversion centres and refuelling infrastructure across the country to support the growing number of gas-powered vehicles.
Over 1,000 CNG Stations Planned
Through the Midstream and Downstream Gas Infrastructure Fund, the Federal Government is financing more than 100 gas infrastructure projects, including 15 CNG mother stations and 86 daughter stations.
Tinubu commissioned four of the projects in May, including a 15-station CNG refuelling network in Lagos and a facility in Abuja capable of serving up to 1,000 cars and tricycles and 50 trucks and buses daily.
The President has also directed the rollout of an additional 500 CNG refuelling stations nationwide, bringing the total number of stations planned under the programme to 1,000.
Government officials say CNG-powered vehicles can use between 60 and 80 per cent less fuel than petrol-powered vehicles, potentially reducing the operating costs of commercial transport operators.
The Federal Government hopes the savings will translate into lower transport fares for Nigerians from October 1.
“From October 1, our goal is that Nigerians begin to partake in those savings through lower transport fares,” Tinubu said.
“We have agreed that cheaper fuel should result in cheaper fares.”
Joint Committee to Drive Implementation
Tinubu said intra-state transportation was particularly important because it was the area where Nigerians experienced transportation costs most directly and where state governments had significant control.
To ensure the measures are implemented, the Federal and state governments have agreed to establish a joint committeethat will begin work immediately.
The Nigeria Governors’ Forum also backed the National Affordable CNG Transit Programme, which seeks to reduce transportation costs and cushion the impact of the removal of fuel subsidies.
Under the programme, state governments are expected to support CNG vehicle conversions and infrastructure development, while transport operators would commit to passing the savings on to passengers through reduced fares.
Lower Transport Costs Could Reduce Food Prices
A governor from Bayelsa State said reducing transportation costs could have a wider impact on the economy.
According to him, lower transport expenses would reduce the cost of moving goods from one location to another, allowing traders to pass some of the savings on to consumers.
This could eventually contribute to lower prices for essential commodities, including food, while improving the purchasing power of households.
The Federal Government and state governments are expected to begin implementing the agreed measures ahead of the October 1 target date.