WORLD BANK TECHNICAL PAPER NO. 41 0 for public discussion 2\one 1Q Successful Conversion tO Unleaded G(asoline in Thailand .,. 'I~~' RECENT WORLD BANK TECHNICAL PAPERS No. 336 Francis, with Akinwumi, Ngwu, Nkom, Odihi, Clomajeye, Okunmadewa, and Shehu, State, Community, and Local Development in Nigeria No. 337 Kerf and Smith, Privatizing Africa's Infrastructure: Promise and Change No. 338 Young, Measuring Economic Benefitsfor Water Investments and Policies No. 339 Andrews and Rashid, The Financing of Pension Systems in Central and Eastern Europe: An Overview of Major Trends and Their Determinants, 1990-1993 No. 340 Rutkowski, Changes in the Wage Structure during Economic Transition in Central and Eastern Europe No. 341 Goldstein, Preker, Adeyi, and Chellaraj, Trends in Health Status, Services, and Finance: The Transition in Central and Eastern Europe, Volume I No. 342 Webster and Fidler, editors, Le secteur informel et les institutions de microfinancement en Afrique de l'Ouest No. 343 Kottelat and Whitten, Freshwater Biodiversity in Asia, with Special Reference to Fish No. 344 Klugman and Schieber with Heleniak and Hon, A Survey of Health Reform in Central Asia No. 345 Industry and Mining Division, Industry and Energy Department, A Mining Strategyfor Latin America and the Caribbean No. 346 Psacharopoulos and Nguyen, The Role of Government and the Private Sector in Fighting Poverty No. 347 Stock and de Veen, Expanding Labor-based Methodsfor Road Works in Africa No. 348 Goldstein, Preker, Adeyi, and Chellaraj, Trends in Health Status, Services, and Finance: The Transition in Central and Eastern Europe, Volume II, Statistical Annex No. 349 Cummings, Dinar, and Olson, New Evaluation Proceduresfor a New Generation of Water-Related Projects No. 350 Buscaglia and Dakolias, Judicial Reform in Latin American Courts: The Experience in Argentina and Ecuador No. 351 Psacharopoulos, Morley, Fiszbein, Lee, and Wood, Poverty and Income Distribution in Latin America: The Story of the 1980s No. 352 Allison and Ringold, Labor Markets in Transition in Central and Eastern Europe, 1989-1995 No. 353 Ingco, Mitchell, and McCalla, Global Food Supply Prospects, A Background Paper Preparedfor the World Food Summit, Rome, November 1996 No. 354 Subranmanian, Jagannathan, and Meinzen-Dick, User Organizationsfor Sustainable Water Services No. 355 Lambert, Srivastava, and Vietmeyer, Medicinal Plants: Rescuing a Global Heritage No. 356 Aryeetey, Hettige, Nissanke, and Steel, Financial Market Fragmentation and Reforms in Sub-Saharan Africa No. 357 Adamolekun, de Lusignan, and Atomate, editors, Civil Service Reform in Francophone Africa: Proceedings of a Workshop Abidjan, January 23-26, 1996 No. 358 Ayres, Busia, Dinar, Hirji, Lintner, McCalla, and Robelus, Integrated Lake and Reservoir Management: World Bank Approach and Experience No. 360 Salman, The Legal Frameworkfor Water Users' Associations: A Comparative Study No. 361 Laporte and Ringold, Trends in Education Access and Financing during the Transition in Central and Eastern Europe. No. 362 Foley, Floor, Madon, Lawali, Montagne, and Tounao, The Niger Household Energy Project: Promoting Rural Fuelwood Markets anzd Village Management of Natural Woodlands No. 364 Josling, Agricultural Trade Policies in the Andean Group: Issues and Options No. 365 Pratt, Le Gall, and de Haan, Investing in Pastoralism: Sustainable Natural Resource Use in Arid Africa and the Middle East No. 366 Carvalho and White, Combining the Quantitative and Qualitative Approaches to Poverty Measurement and Analvsis: The Practice and the Potential No. 367 Colletta and Reinhold, Review of Early Childhlood Policy and Programs in Sub-Saharan Africa No. 368 Pohl, Anderson, Claessens, and Djankov, Frivatization and Restructuring in Central and Eastern Europe: Evi- dence and Policy Options No. 369 Costa-Pierce, From Farmers to Fishers: Developing Reservoir Aquaculturefor People Displaced by Dams (List continues on the inside back cover) WORLD BANK TECHNICAL PAPER NO. 410 Successful Conversion to Unleaded Gasoline in Thailand Philip Sayeg Tlm WorldBank Wasinton, D.C. Copyright i 1998 The Intemational Bank for Reconstruction and Development/THE WORLD BANK 1818 H Street, N.W. Washington, D.C. 20433, U.S.A. All rights reserved Manufactured in the United States of America First printing June 1998 Technical Papers are published to communicate the results of the Bank's work to the development community with the least possible delay. The typescript of this paper therefore has not been prepared in accordance with the pro- cedures appropriate to formal printed texts, and the World Bank accepts no responsibility for errors. Some sources cited in this paper may be informal documents that are not readily available. The findings, interpretations, and conclusion,s expressed in this paper are entirely those of the author(s) and should not be attributed in any manner to the World Bank, to its affiliated organizations, or to members of its Board of Executive Directors or the countries they represent. The World Bank does not guarantee the accuracy of the data in- cluded in this publication and accepts no responsibility for any consequence of their use. The boundaries, colors, de- nominations, and other information shown on any map in this volume do not imply on the part of the World Bank Group any judgment on the legal status of any territory or the endorsement or acceptance of such boundaries. The material in this publication is copyrighted. Requests for permission to reproduce portions of it should be sent to the Office of the Publisher at the address shown in the copyright notice above. The World Bank encourages dissem- ination of its work and will normally give permission promptly and, when the reproduction is for noncommercial purposes, without asking a fee. Permission to copy portions for classroom use is granted through the Copyright Clearance Center, Inc., Suite 910, 222 Rosewood Drive, Danvers, Massachusetts 01923, U.S.A. ISSN: 0253-7494 Cover photo by Surachart Toemlaphyingyong, Bangkok, Thailand. Philip Sayeg is the managing director of Policy Appraisal Services Pty Ltd in South Bisbane, Queensland, Australia. Library of Congress Cataloging-in-Publication Data Sayeg, Philip. Successful conversion to unleaded gasoline in Thailand / Philip Sayeg. p. cm. - (World Bank technical paper; no. 410) Includes bibliographical references. ISBN 0-8213-4239-8 1. Gasoline-Thailand-Anti-knock and anti-knock mixtures. 2. Tetraethyllead. I. Title. II. Series. TP355.S22 1998 363.738'74-dc2l 98-23529 CIP CONTENTS ABWSTRDACT .......................... ix ACKNOWLEDGMENTS ...............................................Xi SELECTED WORLD BANK TITLES ON AIR QUALITY .............................................. xii ABBREVIATIONS, ACRONYMS, AND DATA NOTES ..x ... ...................... Xiii GLOSSARY ...XV EXECUTIVE SUMMARYA............... I CHAPTER 1: INTRODUCTION ... .................... 3 NOTES ...3 CHAPTER 2: BACKGROUND.......... 5 INTRODUCTION ......................5 NATIONAL ENERGY BALANCE AND TRANSPORTATION ENERGY USE ................................8 THAILAND'S ENERGY POLICY TO 1991 .9 VEHICLE PRODUCTION, IMPORTS, AND SALES .10 GASOLINE FUELS USED .11 BANGKOK'S AIR QUALITY AND IMPACTS .11 NOTES .15 CHAPTER 3: DEVELOPING A STRATEGY TO PHASE OUT LEADED GASOLINE ........... 17 GETTING STARTED .17 STRATEGY FORMULATION .19 SUITABILITY OF OLDER VEHICLES WITH SOFT VALVE SEATS TO USE UNLEADED GASOLINE .22 INDUSTRY RESPONSE AND OTHER ISSUES .22 REFINERY MODIFICATIONS .23 ROLE OF THE WORLD BANK .24 NOTES .25 CHAPTER 4: IMPLEMENTATION. ......................... 27 INTRODUCTION ...27 iii Successful Conversion to Unleaded Gasoline in Thailand iv KEY INITIATIVES ..................... , 27 Pricing ........................ . 27 Catalytic Converters ........................ , 29 Unleaded Gasoline Distribution ........................ 30 Marketing and Public Relations Issues .31 Other Initiatives to Assist Implementation .31 Initial Concerns, Monitoring, and S'upplementary Studies .31 STRENGTHENED ENVIRONMENTAL REG1ULATIONS. 31 MARKET PENETRATION OF UNLEADED GASOLINE, 1991-95 .34 THHE BENZENE MYTH .38 ACCELERATED PHASE-OUT OF LEADED REGULAR AND PREMIUM GASOLINES .39 OBSERV:ED REDUCTION IN AMBIENT LEAD THROUGH LATE 1996 .41 NOTES.. 41 CHAPTER 5: CONCLUSION AND LESSONS LEARNED. . ........ 43 NOTES.44 BIBLIOGRAPHY ....................................................45 APPENDIX A: NEPO's LIST OF MAKES AND MODELS OF GASOLINE-POWERED VEHICLES THAT CAN USE UNLEADED GASOLINE ............................................... 49 APPENDIX B: THAILAND'S SPECIFICATIONS FOR AUTOMOTIVE GASOLINE ..............53 APPENDIX C: DATA ON UNLEADED GASOLINE SALES ....... APPENDIX D: UNLEADED GASOLINE PRODUCTION AND IMPORTATION, 1990-95 ....57 FIGURES Figure 2.1: National Energy Policy Council and Related Agencies. 9 Figure 3.1: Agencies Responsiblejfor the Environment since 1991 .18 Figuirre 4.1: Unleaded Percentage of Premium Gasoline Consumption (1991-95) ... 35 Figure 4.2: Unleaded Percentage of Regular Gasoline Consumption (1993-95) .36 Figure 4.3: Unleaded Percentage of Total Gasoline Consumption (1993-95) . 37 Figure 4.4: Roadside Air Lead Level (1990-96) .42 Figure C1: Consumption of Premium Gasoline (1991-95) .55 Figure C.2: Consumption of Regular Gasoline (1993-95) .56 TABLES Table 2.1: Organization Chart of the Royal Thai Government-Land Transportation' in Bangkok .........6 Table 2.2: Number of Vehicles Registered By Type (1984, 1990, and 1995). 7 Table 2.3: Consumption of Selected Petroleum Products (1986-90) (Units: million liters) .8 Table 2.4: Thailand's Official Refinery Capacity (1990 and 1994) (Units: barrels per v day) .................................................................. 8 Table 2.5: Comparison of Ambient Air Quality Standards, 1991 (micrograms per cubic meter) .................................................................. 13 Table 2.6: Bangkok: Morbidity and Mortality Associated with Lead (Estimated Impact of 20 Percent Reduction in Ambient Concentrations) ............................... 14 Table 2.7: Measured Daily Lead Concentrations at Nine Curbside Monitoring Sites in Bangkok (1990) .................................................................. 14 Table 3.1: Significant Changes in Fuel Quality Specifications through May 1991.. 21 Table 4.1: Bangkok's Price Index of Selected Petroleum Products (1986-93) ......... 28 Table 4.2: Average Prices of Imported Petroleum Products, Thailand (1986-93) .... 28 Table 4.3: Excise/Municipal Taxes on Thailand Ex-refinery Prices of Fuels (Baht/ liter) .................................................................. 29 Table 4.4: Taxes on Imported Fuels (Baht/liter) ......................................................... 29 Table 4.5: Retail Prices of Petroleum Products (Late 1991 Prices: Baht/liter) ......... 30 Table 4.6: Significant Changes in Fuel Quality Specifications Made in 1992 .......... 32 Table 4.7: Relative Emission Reduction through Stages ................... ......................... 33 Table 4.8: Composite Timeline of Fuel and Engine Improvement Plans .......... ........ 34 Table 4.9: Measured Daily Lead Concentrations at Eight Curbside Monitoring Sites in Bangkok (1990-96) .................................................................. 40 Table A.1: NEPO's List of Gasoline Powered Vehicles that can use Unleaded Gasoline .................................................................. 49 Table B.1: Specifications ForAutomotive Gasoline ........................... ........................ 53 Table D.: Thailand Gasoline Net Production and Imports, 1990-1991 (Units: million liters) .................................................................. 57 Table D.2: Thailand Premium Gasoline Production and Imports (1990-95) (Units: million liters) .................................................................. 58 Table D.3: Thailand Regular Gasoline Production and Imports (1990-95) (Units: million liters) .................................................................. 58 TEXTBOX Textbox 4.1: The Benzene Myth ............................. ..................................... 38 FoREwoRD Airborne lead is known to be a serious threat to This World Bank report describes the suc- human and ecosystem health with no "safe" low- cessful experience of Thailand for the benefit level. One of the biggest source of atmospheric of decisionmakers and technical specialists in lead is exhaust from motor vehicles using leaded Asian and other countries where leaded gaso- gasolines. In Asia where motor vehicle popula- line still holds a significant share of the mar- tion is expanding at rates as high as 23 percent ket. We are hoping that this will help them make per year, exposure to lead is an undeniable con- informed decisions regarding introduction of cern. The World Bank has called for elimina- low and unleaded gasoline and the eventual tion of lead in gasoline throughout the world. elimination of lead from gasoline. Eliminating lead from gasoline would also Within a five-year period (1991-95) the Gov- allow use of catalytic converters, which would ermnent of Thailand developed and imple- further reduce vehicular emissions. However, mented a series of policy initiatives that effec- the constraints that would have to be over- tively eliminated leaded gasoline, at net costs of come-the existing motor vehicle pool, the ex- less than US$0.02 per liter. Because of the un- isting gasoline distribution network, the popu- leaded gasoline, the ambient levels of lead have lar and institutional perceptions of how urgent been reduced by a factor of 10 already. This this matter is-may appear daunting to some report describes the strategies and methods the of the decisionmakers in developing countries. government used to achieve this outcome. Kristalina Georgieva Jeffrey Gutman Manager Manager Environment Sectoral Management Unit Transport Sectoral Management Unit East Asia and Pacific Region East Asia and Pacific Region vii ABSTRACT The world recognizes that airborne lead is a se- especially education about the dangers of air- rious danger to human and ecosystem health, borne lead; setting a lower at-pump price for and that eliminating lead in gasoline is a criti- leaded gasoline; helping the oil companies es- cal step. However, the policy and administra- tablish a system to distribute unleaded gaso- tive hurdles to be overcome may appear to be line throughout the country; and conducting insurmountable. The Government of Thailand, monitoring and follow-up studies, and adjust- within a five-year period (1991-95) introduced ing environmental regulations as necessary to a series of initiatives that resulted in the elimi- support these policies. By 1995 leaded gaso- nation of leaded gasoline and reduction of am- line was effectively eliminated in Thailand, at bient lead by a factor of 10. The report de- a net cost of US$0.02 per liter of gasoline. scribes the strategies the government employed, Lx ACKNOWLEDGMENTS In undertaking to document Thailand's success- to them also. Dr. Supat Wangwongwatana, Di- ful efforts to eliminate leaded gasoline discus- rector ofthe Air Quality and Noise Management sions were undertaken with various experts in Division of the Pollution Control Department, Thailand,andawiderangeofsourceswerecon- deserves special mention. Dr. Tiengchai sulted.Itisverymuchduetothesepeople'sassis- Chongpeerapien, President of BERA Consult- tance that the content ofthis report could be col- ants, was most helpful and made time available lated and made available to a broader audience. at short notice to discuss the topic at some length. The Secretary General of the National En- The World Bank's Bangkok staff, especially ergy Policy Office, Thailand, Dr. Piyasvasti Manida Unkulvasapul and Sriprae Somsri, as- Amranand, played a key role in the design and sisted by providing access to their data files, implementation of the program, particularly in giving advice, and making administrative ar- discussions and negotiations with the oil com- rangements. Stephen Dice and Thomas Walton panies and Thai agencies. Dr. Piyasvasti re- of the World Bank's Resident Staff In Indone- ceived the International Institute for Energy sia (RSI) provided overall guidance. Colleagues Conservation Award, in part, for this initiative. from country and sector units, most notably For this report he made time available to review Edward Dotson, Masami Kojima, and Magda an early draft and kindly allowed us to inter- Lovei, reviewed the text and provided valuable view his staff, in particular Ms. Napasiri Sirisali input. In the World Bank Asia Regions Envi- who generously provided data, documentation ronmental Sectoral Management Units, Jitendra and other relevant information which made the Shah, Jean Aden, and Sheldon Lippman pro- preparation of this report much easier. Many vided management support and quality assur- other persons in a wide range of government ance, while Julia Lutz copyedited the text and agencies were contacted and thanks are extended prepared the layout. xi SELECTED WORLD BANK TITLES ON AIR QUALITY Air Pollutionfrom Motor Vehicles: Standards Urban Air Quality Management Strategy in and Technologies for Controlling Em,is- Asia: Jakarta Report. ]Edited by Jitendra J. sions. Asif Faiz, Christopher W. Weaver, Shah and Tanvi Nagpal. Technical paper and Michael Walsh. no. 379. Air Qualihy Management Considerations in Urban Air Quality Management Strategy in Developing Countries. Lakdasa Wijetilleke Asia: Metro Manila Report. Edited by and Suhashini A. R. Karunaratne. Jitendra J. Shah and Tanvi Nagpal. Techni- Clean Fuels for Asia: Technical Options for cal paper no. 380. Moving toward Unleaded Gasoline and Urban Air Quality Management Strategy in Low-Sulfur Diesel. Michael Walsh and Asia: Greater Mumbai Report. Edited by Jitendra J. Shah. Technical paper no. 3 77. Jitendra J. Shah and Tanvi Nagpal. Techni- Taxing Bads by Taxing Goods: Pollution con- cal paper no. 381. trol with Presumptive Charges. Gunnar S. Urban Air Quality Management Strategy in Eskeland and Shantayanan Devarajan. Di- Asia: Guidebook. Edited by Jitendra J. rections in Development Series. Shah, Tanvi Nagpal, and Carter J. Brandon. Urban Air Quality Management Strategy in Vehicular Air Pollution: Experiences from Asia: Kathmandu Valley Report. Edited Seven Latin American Urban Centers. Bekir by Jitendra J. Shah and Tanvi Nagpal. Tech- Onursal and Surhid P. Gautam. Technical nical paper no. 378. paper no. 373. xii ABBREVIATIONS, ACRONYMS, AND DATA NOTES ADB Asian Development Bank HSD high-speed diesel ATC Area Traffic Control System IEAT Industrial Estate Authority of Thailand APCU Action Plans Coordinating Unit IQ intelligent quotient BERTS Bangkok Elevated Road and Trans- IIEC International Institute for Energy port System Conservation BMA Bangkok Metropolitan Administration IRP integrated resource planning BMR Bangkok Metropolitan Region I&M inspection and maintenance BMTA Bangkok Metropolitan Transit Au- JICA Japan International Cooperation thority Agency BOI Board of Investment ktoe kiloton oil equivalent BOT build-operate-transfer LPG liquified petroleum gas (propane) BTS Bangkok Transit System LTD Land Transport Department BTSC Bangkok Transit System Corporation MEA Metropolitan Electricity Administration CNG compressed natural gas ,tg microgram CRO Commercial RegistrationDepartment mg milligram CO carbon monoxide MOC Ministry of Commerce COHb carboxyhemoglobin MOI Ministry of Industry DEA Department of Energy Affairs MOPH Ministry of Public Health DEDP Department of Energy Development MOSTE Ministry of Science, Technology and and Promotion Environment DIW Department of Mineral Resources MRTA Metropolitan Rapid Transit Authority DMR Department of Pollution Control MRTS Mass Rapid Transit Authority EGAT Electricity Generating Authority of MTBE methyl tertiary-butyl ether Thailand mtoe million tons of oil equivalent EIA Environmental Impact Assessment NAAQS NationalAmbientAir Quality Standards ETA Expressway and Rapid Transit Au- NEB National Environment Board thority of Thailand NEPC National Energy Policy Council FPO Fiscal Policy Office NEPO National Energy Policy Office GDP gross domestic product NEQA National Environmental Quality Act GEMS Global Environmental Monitoring NESDB National Economic and Social De- System velopment Board GOT Government of Thailand NGO non-governmental organization HC hydrocarbon NO2 nitrogen dioxide xiii SUCCESSPUL CONvRSION TO UNLEADED GASOLiNE mib TH.IAND XiV NOx nitrogen oxide SPM suspended particulate matter OCMRT Office of the Commission for the SPURT Seventh Plan Urban and Regional Management of Road Traffic Transport OECD Organisation for Economic Coopera- SRT State Railways of Thailand tion and Development TA technical assistance OEPP Office of Environmental Policy and TDRI ThailandDevelopmentResearchlstitute Planning TISI Thailand Industrial Standards Institute ONEB Office of the National Environment toe ton oil equivalent Board ULG unleaded gasoline PCB polychlorinated biphenyls USAID United States Agency for Interna- PCD Pollution Control Departmenit tional Development PEA Provincial Electricity Authority USEPA United States 'Environmental Protec- PMIO particulatemattersmallertban lOmnicmns tion Agency PTT Petroleum Authority of Thailand PWD Public Works Department Note: Except where indicated, "dollars" re- RON research octane number fers to 1996 U.S. dollars. RTG Royal Thai Government Except where indicated, all tables, SO2 sulfur dioxide figures, and boxes were originated by So, sulfur oxide the report's authors. GLOSSARY Aromatics: A group of cyclically structured tion systems, or automotive exhaust systems. hydrocarbons of which benzene is the par- High-speed diesel: Also referred to as diesel ent. They are called aromatics because many oil, fuels suitable for use in diesel and other of their derivatives have sweet aromas. compression ignition engines. These hydrocarbons are of relatively high Research octane number (RON): The measure specific gravity and possess good solvent of gasoline's anti-knock value. The higher properties. Certain aromatics have valuable the RON, the higher the gasoline's anti- anti-knock (octane) characteristics. Typical knock quality. aromatics are benzene, toluene, and xylene. Valve seat recession: Excessive wear between Benzene: Apure aromatic hydrocarbon of char- exhaust valves and their seats, found par- acteristic odor occurring in significant pro- ticularly in older model cars with soft valve portions in certain Far Eastern crude oils. seats made of soft metals. Valve seat reces- Catalyst: A substance that affects the rate of a sion is only likely to occur when engines reaction without being consumed itself. with soft cast-iron valve seats are driven for Catalytic converter: A device built into the ex- long periods at very high speeds. Lead in haust system of an automobile containing a gasoline acts as a lubricant between exhaust catalyst generally made up of finely divided valves and their seats. Soft valve seats can platinum, rhodium, and palladium, which be replaced with hardened inserts to prevent converts carbons monoxide (CO) to carbon recurrence of recession, or other anti-knock dioxide (CO2); unburned hydrocarbons to additives can be added to unleaded gasoline. CO2 and water (H20); and nitrogen oxides Volatile organic compounds: Reactive hydro- (NO,) to nitrogen dioxide (NO2), nitrogen carbons emitted by fossil-fueled motor ve- (N2) and oxygen (02). hicles, evaporation of solvents and gasoline, Emission standards: Legal limits or standards chemical manufacturing, petroleum refin- ontherate ofemissionofpollutants from spe- ing, and, to a lesser degree, from waste dis- cific sources, through smokestacks, ventila- posal sites and wastewater treatment plants. xv EXECUTIVE SUMMARY Airborne lead is known to be a serious threat to would get the same performance or better. human health and ecosystems, with no "safe" Lower at-pump ULG prices dissuaded motor- level. One of the biggest sources of atmospheric ists from purchasing leaded gasoline. Oil com- lead is exhaust from motor vehicles using panies were guided in establishing a distribu- leaded gasoline. Lead has traditionally been tion system for unleaded gasoline throughout used in gasoline since the early 1 920s, as it is Thailand, including up-to-date storage tanks, the cheapest means of increasing octane level. pumps, and nozzles. A realistic and safe speci- Increasing community awareness of air pol- fication for ULG (including a maximum ben- lution and the activities of various organiza- zene level) attainable by local refineries using tions, studies, and conferences on this issue and their available crude was designed. the related health impacts, led in 1991 to a de- ULG was introduced as part ofa broader strat- cision by the Government of Thailand to intro- egy to reduce vehicular emissions. At the same duce unleaded gasoline (ULG). By 1995 Thai- time as ULG was introduced, the quality of die- land had successfully eliminated lead in gaso- sel fuiels and lubricants were improved to re- line. This achievement was the result of a duce particulate and other emissions, which had collaborative approach involving key stake- also been identified as a pressing problem. The holders and decisionmakers, including govern- Government of Thailand set about establish- ment agencies, representatives of oil compa- ing more stringent ambient air quality standards nies, and automobile manufacturers. and new emission standards for motor vehicles, Following analysis of possible problems to in concert with improved vehicle maintenance be addressed, a basic policy for the introduc- and inspection. Of particular importance was tion of ULG was formulated. ULG went on sale the requirement for new vehicles to be fitted concurrently with a media campaign highlight- with a catalytic converter. The reduced emis- ing the health and environmental hazards at- sions strategy also included strengthening traf- tributable to leaded gasoline. Lead content in fic management measures designed to raise ve- leaded gasoline was also reduced with a target hicle speeds and implementing measures to re- date set for its complete phase-out. While duce kilometers driven per vehicle. leaded gasoline remained on the market it was As a result of this program, airborne lead reformulated to reduce other harmful emissions has dramatically declined, from 1.55 micro- (carbon monoxide, benzene, polynuclear aro- grams per cubic meter in 1991 to 0.1 micro- matic hydrocarbons). Drivers were assured that grams per cubic meter in 1996. Net costs at- most vehicles introduced before unleaded gaso- tributable to introducing the capability to re- line could safely use unleaded gasoline, and fine ULG were estimated to be less than I Successful Conversion to Unleaded Gasoline in Thailand 2 US$0.02 per liter (Thai B0.5). The slightly in- outweighthe cost. Success is dependent on gov- creased production cost of ULG is offset by ermmental institutions taking vigorous leader- reduced rnaintenance costs, and by potential ship and managing all steps of the process in- health benefits which have been estimated at cluding setting target dates for implementing US$0.12 per liter for a 20 percent reduction in key actions, using price and fiscal incentives airborne lead in Bangkok. The benefits from to favor ULG, and assuring continual monitor- the 93 pe:rcent reduction actually obtained in ing and follow-up evaluation. Consultation and ambient lead levels are commensurately greater. consensus building is essential to the success Major elements of the ULG implementation of the changeover. These activities should be program in Thailand are applicable in other de- supported with high quality consumer research, veloping countries with similar objectives. Lead public education, and training, and adequate phase-out is cost-effective, and the beneflts far resources to study technical issues as they arise. CHAPTER 1: INTRODUCTION Thailand's ambitious program to eliminate lead Metropolitan Bangkok, the capital of Thai- in gasoline, one component of a larger strategy land, is home to approximately nine million to reduce motor vehicle emissions, was com- people. Its air quality is very poor and contin- pleted in early January 1996, after only four ues to deteriorate. The World Bank (1994) es- and a half years, and one year ahead of sched- timated that a 20 percent reduction in lead in ule. That same month the United States con- Bangkok's air (as was achieved during 1989-90 cluded its 25-year phase-out of leaded gasoline. by general reductions in gasoline lead content) Speaking of the United States' achievement, would save approximately 850 lives, as well as U.S. Environmental Protection Agency Admin- significantly reducing hypertension, losses of istrator Carol M. Browner cited the elimina- children's IQ points, and heart disease.' These tion of lead in U.S. gasoline as "...one of the savings are conservatively estimated at an an- great environmental achievements of all time."' nual value of US$460 million, or US$58 per The same can be said of Thailand's achieve- capita in 1996 prices.6 The benefits of an even ment and that of the several other countries (in- greater reduction of atmospheric lead would be cluding Austria, Bolivia, Brazil, Canada, Co- expected to be even more significant. lombia, Costa Rica, Honduras, Japan, Nicara- The purpose of this report is to document gua, and Sweden) which have already howThailandintroducedunleadedgasolineand eliminated lead in gasoline.2 Because there are phased out all leaded gasoline. considerable benefits attributable to reducing lead content in motor vehicle fuels, the World Bank has helped the governments of Bulgaria, NOTES China, India, Mexico, the Philippines, and Thai- land to develop tax, price, and market liberal- 1. USEPA 1996. ization policies to phase out leaded gasoline.3 2. University of Wisconsin 1996; World Bank Lead is known to be harmful to human health, 1996. but commonly has been used in gasoline since 3 World Bank 1996. the early 1920s as it is the cheapest means of 4. USEPA 1996; Chevron 1990; Shell 1990. increasing gasoline octane levels. However, 5. World Bank 1994. these requirements can now be met by unleaded 6. Costs are expressed either as 1996 U.S. dollars gasoline (ULG) which has additional signifi- or Thai baht (B). The U.S. dollar was worth ap- cant health benefits to the population at large.4 proximately Thai B25 during this period. 3 CHAPTER 2: BACKGROUND INTRODUCTION torious for its severe traffic congestion. Peak period traffic speeds over much of the area are This chapter ofthe report describes relevant fac- less than 10 kilometers per hour. tors to the introduction of unleaded gasoline in The road network is characterized by very Thailand in May 1991. Like many other Asian wide primary roads and small local side streets countries, Thailand experienced exceptional (or soi) that run off of them. There are few me- economic growth during 1986-96. Real gross dium-width distributor roads connecting the pri- domestic product (GDP) grew at about 8 per- mary roads. The primary roads, which are ex- cent per year, which suggests that economic ac- tremely congested, thus carry local, medium, tivity increased by more than 100 percent dur- and long distance traffic. The first urban ex- ing that time. About 50 percent of this economic pressway, the First Stage Expressway opened activity was generated in the Bangkok Metro- in 1981. Since that time, a great many major politan Region (BMR), home to about 15 per- road and expressway projects have been com- cent of Thailand's population of 60 million pleted or are planned. people. Per capita incomes in Bangkok are The rail network serving Bangkok is not ex- some 250 percent greater than the national av- tensive. It is primarily comprised of an at-grade erage, and this disparity has increased in re- railway with double tracks on most alignments. cent years.' The railway system serves freight and inter- The BMR is centered on the City of city, inter-regional, and urban passengertraffic. Bangkok, the nation's capital, but also includes Water transport services are provided on the five neighboring provinces (see map inside the Chao Phraya River and two major canals. back cover). Mass rapid transit has been recommended Bangkok has grown rapidly from a small as a component of a suitable transportation sys- compact city located on the eastern bank of the tem for many years, but the first such facilities Chao Praya River to a large sprawling urban have only recently begun to be constructed. area covering over 2,000 square kilometers. Many agencies are responsible for the vari- Growth was originally to the north and the east. ous aspects oftransportation in Bangkok; these Since the early 1 970s there has been an exten- agencies generally do not coordinate their ac- sive program of bridge and road building, which tivities very well. Table 2.1 lists the current in- has accelerated urban development to the west. stitutions overseeing the planning, provision, Development is following the major road cor- and operation of land transport in Thailand. ridors, and the neighboring provinces within the Thailand's national motor vehicle fleet in BMR are rapidly suburbanizing. Bangkok is no- 1995 was about 14 million, having grown by S Successful Conversion to Unleaded Gasoline in T'hailand 6 Table 2.1: Organization Chart of the Royal Thai Government-Land Transportation in Bangkok LPrime Minister and Council of Ministers MINISTRY Independent Public Office of the Ministry of Transport Ministry of the Agencies Prime Minister and Communications Interior AGENCY BMA OCMRT DLT, DOH PWD, DT&CP, Police STATE ENTERPRISE - MRTA SRT, BMTA ETA Transport Function Roads BMA DOH PWD Urban Expressways ETA Mass Rapid Transit BMA (BTS) MRTA (Initial SRT (Hopewell) ETA System) Ordinary Bus BMTA Road Traffic Control Police Urban Transport OCMRT Management BMA: Bangkok Metropolitan Administration OCMRT: Office of the Commission for the Management of Road Traffic DLT/ LTD: Department of Land Transport DOH: Department of Highways PWD: Public Works Department DT&CP: Department of Town and Country Planning Police: Royal Thai Police Department MRTA: Metropolitan Rapid Transport Authority SRT: State Railways of Thailand BMTA: Bangkok Mass Transport Authority ETA: Expressway & Rapid Transport Authority of Thailand * BMA reports to Minister of the Interior on certain functions. The Minister, Cabinet or Prime Minister may direct that certain policies are adopted. Source: SAPROF (OECF, 1996). an annual rate of 14.0 percent over the previ- bus registrations. Pickup trucks-almost all die- ous decade, as shown in table 2.2.2 Bangkok sel-powered-are widely used as personal ve- accounts for about 22 percent of the nation's hicles, particularly in urban areas. They are registered motor vehicles, including 68 percent taxed at a lower rate than cars, and after modi- of the private car fleet, but only 15 percent of fications to the body to provide a similar level motorcycle and 20 percent each of truck and of comfort to a car, they are still significantly 7 Chapter 2: Background Table 2.2: Number of Vehicles Registered By Type (1984, 1990, and 1995) Type 1984 1990 1995 Bangkok Whole Country Bangkok Whole Country Bangkok Whole Country Private Cars 392,359 506,144 598,233 777,345 940,573 1,383,613 (29.0 percent) (9.8 percent) Micro Bus 124,056 175,915 300,938 445,093 321,496 529,562 (9.9 percent) (3.8 percent) Pickup and 65,495 397,954 268,598 925,936 402,680 1,921,722 Van (12.4 percent) (13.6 percent) Taxi 13,493 16,827 13,493 16,827 49,404 52,117 (1.5 percent) (0.4 percent) Tuk-Tuk 7,406 19,614 7,406 19,614 7,406 46,329 (0.2 percent) (0.3 percent) Motorcycle 435,516 1,911,220 728,679 4,778,220 1,373,072 9,314,840 (42.4 percent) (66.1 percent) Bus 15,985 55,699 20,923 71,680 24,364 87,783 (0.8 percent) (0.6 percent) Truck 42,102 200,612 67,987 330,540 91,427 499,330 (2.8 percent) (3.5 percent) Other* 33,401 68,994 39,567 226,829 30,659 262,423 (0.9 percent) (1.9 percent) Total 1,129,813 3,352,979 2,045,814 7,592,085 3,241,081 14,097,719 (100.0 percent) (100.0 percent) Note: Other includes vehicles such as tractors. Tuk-tuks refer to a three-wheeled two-stroke engine minitaxi. Source: Land Transport Department. cheaper than cars. was estimated that 44.5 percent of all house- During 1984-90 the national motor vehicle holds have no motor vehicles (i.e. car or mo- fleet doubled at a growth rate of 14.6 percent torcycle). About 45 percent of all person trips per year. Much of this growth was due to mo- are made by private cars and motorcycles. torcycles. The total Bangkok vehicle fleet (in- The increased motorization and vehicle use cluding motorcycles) increased atarate of 10.4 exacerbated Bangkok's existing severe traffic percent per year-418 vehicles per day were congestion. Bangkok's already bad air quality added in this period. Private car registrations rapidly worsened and began to draw attention in Bangkok increased at a rate of 7.3 percent from the public, politicians, and the media. This per year in this same period. Growth continued concern about air pollution and other environ- at only a slightly lower pace during 1990-95. mental problems was to a large extent due to In 1990-91 automobile registrations per the emergence of a well-informed middle class capita in Bangkok were 65 cars per 1,000 in Bangkok, concerned with quality-of-life is- people. Despite the very high growth rates in sues for their families and others. vehicles in Bangkok in recent years, in 1995 it Successful C'onversion to Unleaded Gasoline in Thailand 8 NATIONAL ENERGY BALANCE AND for 40 percent of all road transport energy con- TRANSPORTATION ENERGY USE sumption, diesel accounted for 55 percent, and liquified petroleum gas (LPG, or propane) ac- In 1990 estimated primary commercial energy counted for 5 percent. In 1997 cars and motor- demand in Thailand was 29,750 thousand tons cycles consumed 94 percent of all gasoline in of oil equivalent, of which 62 percent was im- Bangkok, while pickups, tiucks, and buses con- ported almost entirely as crude oil and oil prod- sumed nearly all of the diesel fuel. ucts.3 In 1990 the demand for petroleum prod- In Thailand in 1990 there were four oil refin- ucts increased by almost 20 percent over 1989, eries, with a total refining capacity of 222,000 due to high demand and small domestic supply. barrels per day (although production was actu- Import dernands increased by over 50 percent. ally 260,000 barrels, 17 percent higher than the Table 2.3 shows that in 1990 consumption official capacity, to meet the intense market of gasoline (regular and premium) and high- demand). These refineries and their capacities speed diesel (HSD) in total grew by 13.9 per- are shown in table 2.4. At the time, the indus- cent per year, a rate similar to that of vehicle try was heavily regulated by the government. registrations during the same period. Gasoline, A new refinery was scheduled to begin opera- which is normally used by cars and motor- tions in the mid-1990s, andL expansion plans for cycles, represented only 27 percent of the itotal the existing plants were being negotiated. Table 2.3: Consumption of Selected Petroleum Products (1986-90) (Units: million liters) Type, of Product 1986 1990 Annual Growth Rate ( percent) Premium Gasoline 932.8 1,749.8 (13.1 percent) 17.0 percent Regular Gasoline 1,336.2 1,936.4 (14.5 percent) 9.7 percent High Speed Diesel (HSD) 5,669.0 9,693.5 (72.5 percent) 14.4 percent Total 7,938.0 13,379.7 (100 percent) 13.9 percent Source: Pocket Thailand Petroleum Report, 1995 (Alpha Research Company Ltd, 1995a). Table 2.4: Thailand 's Official Refineiy of these fuels, with over 73 percent represented Capacity (1990 and 19f4c) (Units: by HSD which is used by trucks, buses, and barrels per day) pickups. Diesel fuel was the primary automo- r nels 1990d199 bilefuel. Refinery 1990 1994 bil ful.Bang Chak 68,000 120,000 In 1991 it was estimated that transportation Esso 69,680 160,000 represented nearly 60 percent of Thailand's to- Fang (Chiang Mai) 1,100 1,700 tal petroleum product consumption. Based on Thai Oil 83,500 183,500 Total 222,280 465,200 Thailand's National Energy Policy Office 1991 Source: Pocket Thailand Petroleum Report, 1997 estimates, within Bangkok gasoline accounted (Alpha Research Company Ltd, 1997). 9 Chapter 2: Background By 1994 these four oil refineries in Thailand land (GOT) to develop policies for the energy had a combined refining capacity of 465,000 sector, which are coordinated today through the barrels per day (109 percent more than in 1991). National Energy Policy Council (see figure 2.1). Ninety-one percent of this increase in refinery The Sixth Economic and Social Develop- capacity was added in 1992.5 In the mid-1990s ment Plan (1987-91) described energy pricing three proposed new policy in terms of energy demand management; refineries were at an advanced state of plan- ning or implementa- Figure 2.1: National Energy Policy Council and Related tion, and by 2000 they Agencies are expected to in- A: Agencies Related to Energy crease refinery capac- ity to over 700,000 bar- rels per day. Most of the new refinery ca- pacity that has been PMOfice Industry Science Finance implemented or will Ministry Technology Ministry come online during Ministry 1991-2000 is aimed at *NEPO increasing the capacity E *Petroleum Dept. to refine diesel fuel. .PTT Sixty percent of Thailand's diesel fuel is currently imported Defense Commerce Interior from Singapore. Ministry Ministry Ministry Defnse | RDnW Dep Tae Dep E THAILAND'S ENERGY POLICY TO 1991 B: The National Energy Policy Council The oil crises of the 1970s and early 1980s a ational nergy Policy Council affected the Thai economy adversely by creating trade and bal- Petroleum Policy Electricity Energy Energy Committee Polic Conservation Consevation ance of payment defi- Committee and Altemative Promotion cits, high inflation l Energy Fund Commitee rates, and energy shortages.6 This led the Govemment of Thai- National Energy Policy Office Successful Conversion to Unleaded Gasoline in Thailand 10 the key element was that energy prices paid by August 1990, as oil prices soared from US$18 the end users should reflect the real cost to the per barrel to a temporary high of US$30. economy. ]Revenues from oil products were an In August 1991 GOT deregulated the prices important source of government revenue.7 of all products except LPG, and the oil fund However, pricing oil products was a politically was modified.8 In the mid- 1990s ex-refinery sensitive issue. The government controlled the prices are set by the private sector, which are prices of all oil products because these were in turn tied to the world market through peri- regarded as vital to the population's livelihood. odic price adjustments based on the Singapore Locally-refined petroleum products were sub- spot market price. An import duty is levied to ject to controls on retail and ex-refinery priuces. protect domestic refiners. Excise, municipal, and business taxes were col- The Seventh Economic and Social Devel- lected at different rates for different types of opment Plan (1992-96) guidelines for energy product. In addition, after 1974 there was a policy were similar, but thie Seventh Plan em- component known as the "oil fund," equLiva- phasized economic pricing, an expanded role lent to a variable tax or subsidy allowing the for the private sector, and a commitment to governmernt to stabilize the ex-refinery price "[P]reserve the environment and prevent the without changing other components and the impact of production and consumption from retail price. This component was a positive levy reaching communities."9 when the government raised retail prices or oil import prices fell, and it was reduced when oil import prices increased. VEHICLE PRODUCTION, IMPORTS, AND SALES In the early 1980s all oil products except gasoline were subsidized by government Domestic motor vehicle production in Thailand through compensation paid out of the oil fund. primarily is assembling completely knocked- After 1983, subsidies for kerosene, diesel, and down kits. In 1990 total domestic productionwas fuel oil began to be reduced, but at the end of 210,000 vehicles, of which 30 percent were pri- the 1980s diesel fuel, fuel oil, kerosene, and vatecarsandtherestcommercialvehicles.About LPG were still heavily subsidized. These dis- 700,000 motorcycles were produced as well In tortions led to inefficient use of transportation orderto encourage heavy investmentin automo- fuel, product imbalance, and fiscal deficits. bile manufacturing plants, GOT protected local In 1988 when world oil prices fell dramati- industry. Importswerestrictlycontrolledbysev- cally, the 'government adjusted the inter-fuel eral means (duties, restrictions on engine size, price differentials somewhat. Despite the Sixth domestic content regulations) and during Plan's objective to float oil prices, little was 1980-89 only 194,000 motorvehicles (60 percent done until 1988. When world oil prices in- of which were personal cars) were imported.'I creased sharply in 1989, the oil fund surpluses Prices of locally assembled vehicles in- which had built up in the mid-1980s were rap- cluded a duty ranging from about 5 percent for idly depleted, and fell into deficit in early 1990. heavy vehicles to about 20 percent on personal This deficit was further exacerbated due to the cars, with rates in between for motorcycles and effects during and after Iraq invaded Kuwait in pickup trucks. Until July 1991 duties on im- 11 Chapter 2: Background ported cars and car parts were as high as 300 ethanol are widely used. These, blended with percent, but were reduced to 20-60 percent af- gasoline as high as 10 percent by volume raises ter that time. Earlier that same year, the ban on octane levels, with the additional benefit of re- importing completely built-up small-engine ducing carbon monoxide (CO) and hydrocarbon cars was lifted. These moves were intended to QHC) emissions by up to 15 percent. pressure local industry to increase its efficiency. In 1991 both regular and premium fuels had In the latter half of 1991 vehicle retail prices a lead content of 0.4 grams per liter; this was fell by 10 percent, which led to a sharp increase decreased to 0.15 grams per liter in early 1992. in sales of sedan cars. Until mid-1991 import Unleaded premium gasoline was introduced in duties also discriminated substantially against May 1991, and its use has since expanded the introduction of new component technolo- greatly. Regular ULG gasoline was introduced gies for trucks and buses."I These taxes were in May 1993. reduced slightly at that time. BANGKOK'S AIR QUALITY AND IMPACTS GASOLINE FUELS USED A given locality's air quality is determined by Until early 1991 the grades of gasoline avail- the amount of emissions produced by motor able were 83 RON (research octane number) vehicles and other sources, as well as topogra- regular gasoline, and premium 95 RON. About phy and prevailing meteorological conditions. the same time as the introduction of premium Ambient air quality in almost all large cities in unleaded gasoline in 1991, a new 87 RON gaso- Asia today violates World Health Organization line was introduced, which was intended to re- standards, and is linked to major health prob- place 83 RON gasoline by September 1994.12 lems in the exposed population.'3 This situa- Thus there were three grades of leaded gaso- tion prevails in Bangkok. Health impacts vary line available around the time unleaded gaso- depending on the type of pollutant, the length line was introduced. of exposure, and the extent of interaction with Previously lead was the primary octane en- other pollutant types. hancer in Thailand's gasoline and was almost The Radian Corporation's 1994 study esti- entirely responsible for the high lead content in mated the following distribution of emissions Bangkok's air (as can be seen in chapter 3). It for the various vehicle types in 1993: was added as tetra-ethyl lead or tetra-methyl lead, because itisthecheapestmeansofboostingbase * cars and motorcycles are the major sources gasolines' octane. A higher octane rating in- of CO, accounting for 45 percent and 26 creases gasoline's resistance to engine knock- percent, respectively; ing.Intheabsenceoflead, octane levels must be * motorcycles are the dominant HC source, raised by more costly methods, such as improv- accounting for almost two-thirds of the to- ing refining techniques or adding other high-oc- tal, followed by cars (19 percent); tane blending components, such as oxygenates, * more than half of ambient nitrogen oxides of which methyl tertiary-butyl ether (IBE) and (NO.) comes from diesel trucks and buses, Successful Conversion to Unleaded Gasoline in Thailand 12 followed by utility vehicles (light trucks) at ratory system; lead accumulates in the body, 22 percent, and cars at 19 percent; affecting circulatory, reproductive, and other * sulfur emissions come mainly from diesel systems, and lowers children's learning abil- fuel, and are almost equally divided between ity; and particulates irritate the mucous mem- utility vehicles and trucks and buses; branes, is linked to infant deaths, and has the * lead comes exclusively from gasoline con- ability to adhere to carcinogens emitted by sumption, so the major sources are cars (55 motor vehicles.'4 percent), motorcycles (23 percent), and light On a global scale, carbon dioxide is believed trucks (13 percent); and to contribute to global warming, and NOx, * motorcycles dominate organic particulate which causes ecological damage, is linked to emissions, responsible for about 44 percent, motor vehicle emissions. followed by diesel utility vehicles (36 per- Lead is a cumulative, systemic toxin, affect- cent), andldieseltrucks and buses (18 percent). ing blood pressure regulation and the nervous system. Exposure to atmospheric lead is usu- The extent of these emissions depends on ally through the gastrointestinal tract, as a re- the nature of the fuel, the engine, and any ernis- sult of consuming dust containing lead particles. sion control technology employed. Bangkok's This exposure route is most important in young severe traffic congestion greatly increases ernis- children, who tend to crawl and put things in sion rates. A 1994 study undertaken by ithe their mouths."5 Because of Bangkok's mixed Thailand Environment Institute applied the U.S. (and largely unplanned) land use, residential Environmental Protection Agency's Mobile 5 dwellings, offices, shops, restaurants, schools, model to Bangkok to simulate the effect of vari- and hospitals are often located adjacent to ma- ous policies and strategies to reduce motor ve- jor roads. The general population's high expo- hicles emissions. The relationships used in the sure to vehicle emissions is compounded by the model showed that, for example, vehicle emis- practice of roadside eating. Some newborn ba- sion rates of CO and HC generally more than bies in Bangkok were found to have blood lead doubled for all vehicle types when the average levels two to five times higher than levels con- speed was reduced from 16 kilometers per hour sidered acceptable in the United States, and to 8 kilometers per hour. Halving the speed had there are documented cases of school children a lesser effect on NO,. No data on lead emis- with high lead levels displaying lower intelli- sions were provided in this report, which are gence, poorer concentration skills, and more largely a function of the gasoline used, which aggressive behavior.'6 in turn depends on the engine's fuel economy A study estimated that in 1990 lead emitted and the distence traveled, rather than speed. into Bangkok's ambient air measured about 380 Inhaling motor vehicle pollutants can haLve tons, of which gasoline-fueled automobiles con- major adverse health impacts. CO interferes with tributed 360 tons (95 percent), while industry the absorption of oxygen by hemoglobin and contributed the balance of 20 tons (5 percent).7 may impair perception and thinking; NOX in- For lead and particulate matter, the effect of creases susceptibility to viral infections; ozone deposition to the ground and re-entry into the irritates the mucous membranes and the res:pi- atmosphere may have been significant. 13 Chapter 2: Background Table 2.5: Comparison ofAmbient Air Quality Standards, 1991 (micrograms per cubic meter) Thailand United States Pollutant Averaging Time Concentration Averaging Time Concentration TSP 24-hour average 0.330 0.260i' Annual Average 0.100Y 0.075a PM1o 24-hour average 150.0 24-hour average Annual average 50.0 Annual Average CO 1-hour average 50.0 1-hour maxs' 40.0 8-hour average 20.0 8-hour max 10.0 Pb 24-hour average 0.01 quartedy average 0.0015 SO2 24-hour average 0.30 24-hour average 0.0365 Annual Average 0.10Wt Annual average 0.08 NO2 1-hour average 0.32 Annual average 0.10 Ozone 1-hour average# 0.20 1-hour averageW 0.235 a/ TSP was the indicator pollutant for the particulate matter until 1987. bl Geometnc mean. c/ Maximum standards are not to be exceeded more than once per year or, in the case of ozone, more than three times (days) over a four year perod. Notes: TSP measured by gravimetric methods; CO measured by non-dispersive infrared detection; lead measured by wet ashing; SO2 measured by pararosaniline; NO2 measured by gas phase chemiluminescence; ozone measured by chemiluminescence. Source: World Bank (1994). Thailand's 1990 air quality standards are shown The World Bank confirmed these general in table 2.5 and compared to those of the United findings, although the approach used differed- States. Although it is difficult to directly com- the health impacts of a given level of ambient pare the standards, Thailand's standards at the lead pollutant reduction were valued as shown time (a national daily standard of 10 micro- in table 2.6.20 This table shows that a 20 per- grams per cubic meter) were weaker.'8 cent reduction in lead in the atmosphere alone In 1989 the United States Agency for Inter- (which was in fact generally achieved over national Development commissioned a study 1989-90 by reductions in gasoline lead con- ranking Bangkok's environmental problems in tent) was estimated to save some 850 lives, terms of health risks posed. Particulate matter along with significant reductions in hyperten- and lead were ranked as the most problematic, sion, loss in children's IQ points, and signifi- and were estimated to possibly lead to 1,400 cant heart disease events. This saving was esti- and 400 deaths per year, respectively.'9 In ad- mated to have an annual value of dition, lead levels from all sources were esti- US$291-1,470 million, representing some mated to cause several hundred thousand cases US$37-189 per capita in 1989 prices. In 1996 ofhypertension per year, significant impairment prices the range of benefits are estimated as of childrens' intelligence functions, and pos- US$460-2,330 million, which is equivalent to sible, but unproven, effects on unborn fetuses. about US$58-300 per capita. The benefits of Successful Conversion to Unleaded Gasoline in Thailand 14 an even greater reduc- tion of lead in the at- Table 2.6: Bangkok: Morbidity and Mortality Associated with mosphere, which has Lead (Estimated Impact of 20 Percent Reduction in Ambient since been achieved, Concentrations) are expected to be Health Impacts Reduction in number of caseslyear even more significant. Low Mid High In 1990 the Pollu- Reduction in IQ Points in Children 16,000 26,700 37,400 tion Control Depart- Hypertension in Adult Males none given 9,!500 none given ment, then a division Coronary Heart Disease Event in 10 years none given 677 none given of the Office of the (CHD) National Eniviromnment Mortality Reductions N Neonatal Mortality none given 4.27 none given Board, operated eight * Adult Male Mortality (in 12 years) none given 1346 none given permanent air pollut- Source: World Bank (1994). ant monitoring sta- tions in central Bangkok, located Table 2. 7: Measured Daily Lead Concentrations at Nine about 50 meters from Curbside Moniltoring Sites in Bangkok (1990) roads, and nine Station 1990 Station 1990 curbside mLonitors lo- 24 hour average 24 hour average cated three meters (pg/m3) (jgim3) from roads. The Sapankway min: 0.6 Banglampoo min: 0.9 Pahonyothin max: 1.2 max: 1.9 curbside rnonitoring ave: 0.90 _ _ _ ave: 1.3 data are more mean- Silom min: 0.3 Pratunam min: 1.4 ingful for comparisons max: 4.8 Rachaprop max: 2.8 ave: 2.8 __ ave: 1.9 to the standard, since Siphraya min: 0.6 Yaowaraj min: 0.9 they provide ranges max: 3.3 max: 3.2 for daily averages and ave: 2.8 ave: 2.1 Mansr min: 4.9 Laniuang min: 3.2 more accurately repre- Bamrungmuang max: 6.4 max: 4.8 sent how large num- ave: 5.4 ave: 4.0 bers of the population Source: World Bank (1994). are exposed daily. 1990 data from eight sites are shown in table 2.7. of 10 micrograms per cubic meter, they did sig- Concentrations were generally low al the nificantly exceed the U.S. standard of 1.5 mi- eight monitors with an average of 2.0 micro- crograms per cubic meter. Furthermore, lead grams per cubic meter, minimum of 0.3 micro- concentrations had been observed to be grow- grams per cubic meter, and maximum of 6.0 ing in the late 1980s. Recent research indicates micrograms per cubic meter. Although the inea- that there is no "safe" level of ambient lead; sured daily lead concentrations at most these therefore it was imperative that ambient lead sites did not exceed Thailand's daily standard be reduced. 15 Chapter 2: Background NOTES 11. Sayeg et al. 1992; PPK Consultants 1991. 12. 87 RON was planned to replace 83 RON in 1. Alpha Research Company Ltd 1995a. 1993. Subsequently, due to marketing require- 2. Land Transport Department 1996. ments, as a result of which consumers perceived 3. Thailand Development Research Institute 1990. a higher octane rating as more beneficial, many 4. Sayeg et al. 1996. companies introduced 92 RON fuel. 5. Alpha Research Co. Ltd. 1995b. 13. Faiz et al 1990, 1994. 6. Koomsup 1993. 14. Faiz et al 1990; World Resources Institute 1996. 7. AccordingtoKoomsup(1993), in 1987, excise and 15. World Bank 1992. import taxes on oil products represented 13.5% 16. Magistad 1991. of the government's revenue from all sources. 17. Panich 1994. 8. World Bank 1993. 18. World Bank 1994. 9. Tansamrit 1991. 19. U.S. Agency for InternationalDevelopment 1990. 10. Sayeg et al. 1992. 20. World Bank 1994. CHAPTER 3: DEVELOPING A STRATEGY TO PHASE OUT LEADED GASOLINE GETNG STARTED a result of these concerns, the recognition that government institutions needed to be upgraded A number of factors were responsible for the to deal with the environmental challenge; and Government of Thailand's (GOT) landmark de- also various influential organizations, studies cision to introduce unleaded gasoline (ULG) in and conferences focusing on this issue. 1991.Leadingasolineandrelatedissueshadbeen Since the early 1970s, Thailand has had a on GOT's agenda at various times prior to 1991. basic framework for environmental manage- In 1989, GOT reduced the lead content in ment. Initially concentrating on controlling in- gasoline from a high of 0.45 grams per liter to dustrial discharges, it was extended beyond this 0.4 grams per liter, and proposed to further re- in 1975 with the enactment of the National En- duce the lead content to 0.15 grams per liter by vironmental Quality Act (NEQA). Under this 1992. Other organizations were also promoting act the National Environment Board (NEB) was the use of ULG and cleaner fuels; for example, established as the main environmental policy in 1990 Shell Company (Thailand) organized a body, and the Office of the National Environ- seminar to promote the use of ULG. Other agen- ment Board (ONEB) was established as its sec- cies were also active and influential, including: retariat. As a result of perceived and real inad- equacies, a new NEQA was approved by the * U.S. Agency for International Development cabinet in 1990 and enacted in 1992. (USAID) through a 1990 study of airborne UnderthenewNEQA,NEBwasupgradedto pollutants' health impacts; ministeriallevel, andischairedbythePrimeMin- * International Institute for Energy Conserva- ister.PreviousONEBfunctionswereallocatedto tion (IIEC) which established a Thailand of- threenewDepartmentsundertheMinistryofSci- fice in 1990; and ence, Technology, and Environment (MOSTE), * World Bank which supported GOT's then- which were formerly divisions ofNEB: emerging Action Plan to Reduce Vehicle Emissions and Noise Pollution (under the * Office of Environmental Policy and Planning World Bank's Thailand Third Highway Sec- (OEPP); tor Project). * Pollution Control Department (PCD); and * Department of Environmental Quality Pro- However, more important factors leading to motion (DEQP). the Government's decision were increasing community awareness of environmental issues Figure 3.1 shows the names and general or- in general and air pollution in particular, and as ganization of the agencies responsible for the 17 SUCCESSFUL CoqvvERsIoN TO UNLEADED GASOLiNE IN TH_4LAND 18 Figure 3.1: Agencies Responsible for tke Environment since 1991 Naional Environment Cabinet National Energy Board Policy Council National Energy Policy Office Ministo Ministry of Transport Ministry of Science, Ministry of Ministry of Public Health & Communications Technology & Industry Commerce l Ernvironment Dept of 3~~j Dept. of Land Transport Thai Industrial Dept. of Industrial Standards Institut Works Pollution Office of Enivironmental Dept of Dept. of Commercial Control Policy and Planning Environmental Registration (incl. Fuel Department Quality Promotion Oils Division) environmeint since 1991. cluding the decision to eliminate lead ih gaso- In summary, MOSTE and its line agencies line. While implementing this policy, NEPO are responsible for environmental took on a strong leadership and coordination policymaking, planning, coordination between role. NEPO also sought out and made use of a Government agencies; the Environmental Im- range of technical assistance agreements from pact Assessment process; and standards, moni- the Canadian and other governnents, which toring, and enforcement. Since 1992 PCD es- helped define new fuel specifications and other tablishes eiffluent and emissions standards and relevant matters. undertakes source monitoring and enforcement. The Thailand Developrment Research Insti- The decision to upgrade the National En- tute (TDRI) is a private but government-sup- ergy Policy Office (NEPO) to the status of a ported think tank reporting on economic, so- Department under the Office of the Prime Min- cial, and environmental issues of significance ister was highly significant. NEPO was and is to Thailand. Its annual conference presents the very active in energy policy formulation, in- results of its work, generally centering on a cer- 19 CHAPTER .3: DEVELOPING A STRATEGY To PHASE OUTLEADED GASOLINE tain theme. The 1990 TDRI conference focused jected to decline because the Government had on the environment, under the title "Industrial- already begun to reduce the lead content in gaso- izing Thailand and Its Impact on the Environ- line. It was projected that lead emissions would ment." Seven major research reports were pre- have grown at similar rates, had the first moves pared, covering a range of environmental is- to reduce lead contentin gasoline notbeentaken. sues arising from Thailand's industrialization, This study recommended continuing to reduce urbanization, agricultural practices, mineral lead in gasoline and to completely phase out resource development, and rapid increases in leaded gasoline by the year 2000. energy use due to industry growth and motor- The conference endorsed the recommenda- ization. Princess Sirinthon, who works closely tion to phase out leaded gasoline and to take with the King of Thailand, opened the confer- other steps to improve the environment. ence, and on the final day endorsed the conclu- sions of the research in her presentation to the government decisionmakers attending. STRATEGY FORMULATION A research report entitled "Energy and Envi- ronment Choosing the Right Mix," a collabora- Air pollution from emissions of all types was tive effort between TDRI and the Harvard Insti- known to be a daily problem in Bangkok. The tute for International Development, was pre- various studies summarized above underscored sented during this conference. This report the impacts of continuing the status quo-build- addressedenergyuse andairpollutionissues aris- ing mass transit schemes and additional express- ing from Bangkok's urban traffic and industry. ways alone would not mitigate the impending This study analyzed Bangkok's 1989 transport dramatic increase in emissions. Bangkok needed emissionsandprojectedemissionsin2006under a comprehensive policy approach incorporat- various scenarios, including a base case which ing all relevant factors: fuel quality; alternative assumed transportation infrastructure commit- fuels such as compressed natural gas; upgrad- ted and planned in 1989, and no new energy con- ing vehicular emission standards; improving ve- servation or emissions control policies. Under hicle maintenance and inspection; and traffic this scenario, fuel consumption was projectedto management to raise vehicular speeds.' triple and vehicle speeds not to increase, as the Thailand's decisionmakers accepted this ap- projected infrastructure additions were likely proach and initially concentrated on the ongo- only at best to maintain current congestion lev- ing program to improve fuel quality. Many im- els. The study also calculated thattotal emissions provements which had been proposed gained would increase by 239 percent, or 14 percent per momentum and were being implemented at dif- year over a 17-year period, while vehicle trips ferent rates. were expected to increase by 70 percent Indi- There was a recognition that the pollutant vidual emissionlevelswere expectedto growas problems should be prioritized. Particulate mat- follows: carbon monoxide (CO), hydrocarbons ter (PM) was the most pressing air pollution (HC), and suspended particulate matter (SPM) problem, followed by lead.2 However, the most more than 200 percent; and nitrogen oxides (NO.) dangerous PM is the very fine particles, smaller more than 100 percent. Lead emissions were pro- than 10 microns (PM10), mainly emitted by die- SUCCESSFUL CONVERSION To UNLEADED GASOI.NE IN THAILAND 20 sel-powered vehicles and two-stroke motor- was enacted in January 1991, about one month cycles. PM1,o poses serious health risks because before the February coup. Catalytic converter- it can be inhaled deep into the lungs and, if equipped engines, which can also reduce the mixed with other pollutants, can be highly car- tailpipe emissions of HC, CO, and NOx in en- cinogenic. Improving diesel fuels would reduce gine exhaust, require ULG. Lead not only re- PMIO and sulfur oxides (SO), but might not duces the catalytic converter's efficiency, but greatly reduce ambient PM for two reasons: can destroy it Catalytic converters were required construction-related dust represents about 40 to be fitted to new gasoline-powered cars sold percent of aill PM, and not all PM can be elimi- after 1993; this represented about 70,000 cars per nated. Nevertheless, improving diesel fuel qual- year, or about 9 percent of Bangkok's car fleet, ity directly addressed the PM,, problem and was at the beginning of 1993. known to be very beneficial. In October 1990 In early 1991 the Thai army deposed the in the last days of the Chatichai Administra- elected government headed by Mr. Chatichai tion, earlier proposals to reduce sulfur in diesel and installed a civilian government headed by fuel were realized. Mr. Anand Panyarachun. After the coup, the Similarly, introducing ULG and phasing out Anand administration began a serious effort to leaded gasoline were expected to bring great improve the environment. NEPO, acting as sec- benefits simaply by decimating lead emissions. retariat to the National Energy Policy Council Adding methyl tertiary-butyl ether (MTBE) or (NEPC), had a critical role in developing a strat- other oxygenates can also be used to reduce egy to introduce ULG and phase out leaded emissions. Blending in oxygenates in the range gasoline. A collaborative approach was adopted of 5-15 percent by volume can reduce HC and by targeting stakeholders, identifying CO emissions. "Reformulated" gasolines ofthis decisionmakers, holding discussions, and build- type were introduced in 1993. It was recognized ing a consensus. These include: that reformulating leaded gasoline would pro- duce the greatest benefits. As vehicles using * NEPO; leaded fuel could not use catalytic converters, * Commercial Registration Departmelit; they would produce much greater emissions ihan * Ministry of Industry; the catalytic converter-equipped vehicles using * MOSTE; ULG. A change in gasoline formulation pro- * Finance Ministry; ducing a given percentage reduction in ernis- * Excise Department; sions will thus result in a much greater abso- * PWD; lute reduction (and correspondingly better cost- * LTD; effectiveness) if applied to leaded gasoline.3 * Thai Industrial Standards Institute; Although introducing ULG, phasing out * Petroleum Authority of Thailand; leaded gasoline, and reformulating all gasoline * Bangchak Petroleum; fuels were considered to be the highest priority, * Federation of Thai Indus try (representing the there also was a commitment to introducing cata- automobile manufacturers); lytic converters. A regulation requiring catalytic * other oil companies; ancl converters4 to be installed in gasoline engines * other private sector bodies. 21 CHAPTER 3: DEVELOPING A STRATEGY TO PHASE OUT LEADED GASOLINE At the outset, a fairly detailed idea of what * introduce ULG as a new grade of gasoline; was required was known. However, introduc- * define ULG specifications; ing a full program of fuel quality and other en- * reduce taxes on ULG-an important price vironmental improvement measures was am- incentive to oil companies; bitious. Fortunately, NEPO recognized that suc- * set the end of 1995 as the date by which cessful implementation would require both a leaded regular gasoline was to be completely flexible approach, and as many firm targets as phased out; possible, in order to focus efforts and maintain * make ULG available in the market; momentum. Strong management and active * require new cars to be fitted with catalytic leadership were also essential. NEPO, advis- converters; and ing NEPC, was the prime mover in this work. * upgrade vehicle emission standards. An analysis of the situation prior to the in- troduction of ULG led to the identification of The sale of ULG began in May 1991; at this potential problems: existing gasoline grades time no date had been specified by which leaded provided only for leaded premium (95 RON) premium gasoline was to be phased out.6 The and leaded regular (83 RON); introducing cata- new fuel specifications issued since early 1990, lytic converters would require regulations man- including the new ULG specification, were gen- dating their use and appropriate emission stan- erally aimed at specifying higher-quality fuels dards; and older engines with soft valve seats than had previously been on the market, fea- were feared to be vulnerable to damage. tures of which would reduce pollution (e.g., Based on this analysis, a policy to introduce lower lead content, reduced distillation tem- ULG and phase out leaded gasoline was for- peratures for high-speed diesel fuel). Signifi- mulated. The basic interventions required were cant changes in fuel quality specifications from specified as follows:5 1989 to 1991 are summarized in table 3.1. Table 3.1: Significant Changes in Fuel Quality Specifications through May 1991 Date Event April 20,1989 (Chatchai NEPC ordered immediate reduction of lead content in gasoline from 0.45 to 0.4 grams of Administraton) lead per liter, and set a deadline of September 1993 for further reduction to 0.15 grams of lead per liter. May 25,1990 83 RON regular gasoline to be replaced by 87 RON regular gasoline by September 1993. October 28, 1990 Distillation temperature of high-speed diesel to be reduced from 37000 at T90 to 257°C by September 1, 1993 at which time sulfur content will also be reduced from 1 percent to 0.5 percent by weight. January 11, 1991 NEPC ordered all new gasoline cars to be equipped with catalytic converters by September 1, 1993 and 0.4 grams of lead per liter gasoline to be phased out by September 1, 1992. March 21, 1991 (Anand 1) 0.4 grams of lead per liter gasoline to be phased out by January 1, 1992. Began campaigning for commercial sale of ULG. May 1, 1991 First commercial sale of ULG in Thailand by PTT and Shell. Source: Chongpeerapien (1992). SUCCESSFUL CONVERSION To UNLEADED GASOLiNE IN THALAND 22 SUITABILIT Y OF OLDER VEHICLES WITH SOFT Cars with hardened valve seats can use ULG VALVE SEATS TO USE UNLEADED GASOLINqE all the time. If they normally use high-octane premium gasoline, their ignition timing may Although most vehicles manufactured world- need to be retarded. Cars fitted with catalytic wide since 1980 are able to use ULG without converters must use ULG so as not to destroy engine damage, there was concern that older the device. engines with soft valve seats might be vulner- Radian Corporation concluded in a 1994 able to damage. An engine must be metallurgi- report that reducing lead in gasoline is a win- cally compatible, with suitably hardened ex- win action, as it will extencl spark plug life, in- haust valve seats, to exclusively use ULG. Lead, crease the interval between oil changes, and in addition to boosting gasoline octane rating, extend exhaust system and muffler life. These acted as a valve lubricant and prevented engine findings are confirmed by USEPA (1985). wear. The possibility of exhaust valve seal re- cession in engines operating on ULG was a se- rious concern. INDUSTRY RESPONSE AND OTHER ISSUES NEPO estimated, based on vehicle registra- tion data, that as many as 8 percent of motor Decisionmakers had to be briefed and consen- vehicles might have some difficulty running on sus obtained from the following parties: ULG.7 In fact, as it was common then (and still is now) for drivers to replace many older ve- * State-owned companies-Petroleum Author- hicles' engines with engines imported fromt Ja- ity of Thailand and Bangchak Petroleum; pan or elsewhere, the 8 percent estimate was * Multinational oil companies-including thought to be on the high side. NEPO subse- Esso, Shell, Caltex, Mobil, Q8, and British quently published a document listing all vehicle Petroleum; makes and models that could safely use ULG * Domestic oil companies-Thai Oil, Cosmo, (see appendix A). Susco, MP, and PT; Even in older cars with soft valve seats the * Government-NEPO, Commercial Registra- amount of lead required for valve lubrication is tion Department, Ministry of Industry, Fi- small-only every fourth or fifth tank of gaso- nance Ministry, PWD (petrol station regu- line need contain lead or other lubricant.8 Sub- lations), and LTD (car registrations); and sequent Thai and international experience has * Motor vehicle producers. shown that the worst potential damage is minor and can be adequately resolved by adding ap- There was some resistance to the propriate lubricant additives to the fuel. Chev- government's ambitious environmental initia- ron, a U.S. oil company, has concluded that all tives, especially the proposals to introduce typical U.S. passenger cars and light-duty trucks ULG. It appeared that the costs would fall ini- consuming ULG are safe from valve recession.9 tially on local oil refineries, who opposed the Another study concluded "...that much of the regulations on the grounds that they were too concern about valve seat recession in normal drastic or not needed. One oil refinery asked use has been misdirected and exaggerated."10 the government to produce evidence that emis- 23 CHAPTER 3: DEVELOPING A STRATEGY To PHASE OUT LEADED GASOLINE sions from the various fuel types were already initiatives, including import duty reductions, to at levels harmful to public health." deregulate the car market."3 GOT's approach was that oil refiners should Several companies were initially reluctant voluntarily comply-if they did not want to to expand their provincial gasoline distribution comply, they could withdraw from that networksforfearoflowULGdemandandhigh particular market segment. Most oil refiners distribution costs.'4 agreed to comply, and discussions were held to decide what should be added to replace lead in gasoline to enhance octane. As late as 1992, one REFINERY MODIFICATIONS oil refiner was still arguing to postpone the target dates on technical grounds, claiming it needed In the late 1980s Thailand's main refineries be- more time to adjust its refining configurations longed to Bangchak, Esso, and Thai Oil. These to meet the specified fuel quality requirements. requiredmodernizationtopermitthemorecom- However, these discussions were being held plex operations done in modem conversion re- against a background of rapidly increasing fuel fineries producing better quality fuel. Refinery demand, and substantial refinery expansion and modernization investments necessary to reduce modernization plans were underway. GOT fur- gasolineleadmayalsoimproveproductivity,in- ther smoothed this process by various tax in- crease efficiency, and enhance revenues by per- centives, as described in chapter 4. mittingtheproductionofahighervalueproduct. Representing the local automobile produc- Modem deep conversion refineries can substi- ers, most of which were Japanese in origin, the tute leadata lowercostthanless advanced skim- Federation of Thai Industry worked closely with ming refineries (existing in Thailand in the late NEPO on matters related to fuel quality and 1980s)duetoawiderchoiceoftechnicalalterna- catalytic converters. Some local academics re- tiveincludingalkylation,polymerization,and sisted the introduction of catalytic converters oxygenation-available in modem refineries to on technical and economic grounds. Other increase gasoline octane without lead."5 groups wanted the government to test the ve- Costs depend on the total volume of gaso- hicles under local driving conditions.'2 In ad- line manufactured and the costs of distribution, dition, some parties opposed the introduction but are also influenced by the extent refining of catalytic converters on the issue of cost, as capacities are utilized and spare octane capaci- the majority of buyers were and still are very ties exist; the vehicle fleet's octane require- cost conscious. In 1990 a catalytic converter ments; and the price of octane-enhancing gaso- cost about US$1,200 per unit (which had a use- line additives.'6 ful life of 70,000-100,000 kilometers or four In assessing the net investment cost attribut- to six years under a typical Bangkok driving abletoproducingULG,onlythecostsofacceler- regime), and would have increased the cost of ating these investments should be counted, as a typical small Japanese car, such as a Toyota theyalmostcertainlywouldhavebeenrequired 17 Corolla, by 7 percent. However, by mid-1991 However, eachrefineryisunique, and authorita- car prices had fallen at least 10 percent from tive cost estimates will need to be individually their 1990 levels, as a result of GOT's various prepared for each plant. Very rough estimates SUCCESSFUL CONVERSION TO UNLEADED GASOLINE IN TRAILAND 24 of the net additional refinery costs for produc- Bangchak employed, including some additional ing ULG was assumed to be BO.5, or US$0.02 shut-down time each year for regenerating the per liter."l The World Bank estimated thatatotal catalytic converter and the addition of MTBE investment of US$70 million (1992 prices), or and other additives; these costs amounted to about US$0.015 per liter, was required.'9 less than US$0.018 per liter. Thus, in In 1990-91 Bangchak, the government- Bangchak's case, the total new costs (on an owned but partially privatized refiner operated annual basis) of producing ULG were likely to a refinery which needed modernization to pro- be less than US$0.02 per 'liter, similar to ear- duce ULG and other higher quality petroleum lier estimates presented above and other world products to meet emerging, more stringent, fuel experience.2" It is believed that Thai Oil and specifications. In order to produce ULG, Esso's experiences would have been similar. Bangchak added a catalytic reforming unit At the same time, two niew refineries were (US$4 million in 1991 prices) which increased planned based on work conducted in the late the octane of heavy naphtha, gaining a hight oc- 1980s, predicated on the assumption that higher tane reforimate and an iso-merization unit octane fuels meeting more stringent environmen- (US$15 million in 1991 prices) which increased tal legislation, including ULG, would have to be the octane content of light naphtha without in- produced in the 1990s, and that leaded gasolines creasing the gasoline's aromatic content. There would be phased out arouncl this time. These as- were some initial costs for a separate tank-age sumptions were based on world-wide oil indus- and piping system at the refinery, which was try trends, which preceded Thailand's decision producing both ULG and leaded gasolines. to introduce ULG by at lea[st three years. Star However, Bangchak reports that these costs Refmery,whichopenedin 1996, was one ofthese were very low and would have been eliminated two refineries. Caltex, the majority shareholder once all leaded gasolines were phased out.20 At of Star Refinery,22 is unable to identify a cost 1997 levels of production (near capacity), the attributable to ULG production relative to leaded refinery produced 1,200 million liters per year. gasoline production; this never was an issue.23 Thus, the costs of capital improvements attrib- The major impact on pump prices-that is, utable to ULG production are not more than the price paid by the consumer-is related to US$18 million (1991 prices), allowing for half the official taxes payable, as they are consider- of the costs of the catalytic reformer which was ably higher than the additional costs cited.24 needed to produce leaded gasolines, and an al- lowance for other ancillary costs. On an armu- alized basis, this represents a cost of approDxi- ROLE OF THE WORLD BANK mately US$2.15 million (at a 10 percent real discount rate over 15 years). Expressed on a The GOT program to phase out leaded gaso- per liter basis, this capital component of the cost line and introduce ULG was part of a wider attributable to ULG production is about program of improvements-an action plan- US$0.0018: per liter (1991 prices). designed to reduce emissions from motor ve- There were increased operating and main- hicles.25 During the course of the World Bank's tenance costs encountered with the process Fourth Highway Sector Project, Thailand 25 CHAPTER 3: DEVELOPING A STRATEGY TO PHASE OUT LEADED GASOLINE (1992-97), the World Bank and other agencies 2. USAID 1990. mobilized other funding sources in addition to 3. World Bank 1992. those provided under the loan. A grant provided 4. For new cars with engine capacities larger than by the Dutch Government assisted the IIEC to 1,600 cubic centimeters, catalytic converters fund a comparative study of transport, energy, were required in imports registered after Janu- and the environment in four cities in Asia. The ary 1, 1993 and in domestic models after March cities studied were Bangkok, Thailand; 1993. All new cars with engine capacities less Islamabad, Pakistan; Surabaya, Indonesia; and than 1,600 cubic centimeters were required to Varanasi, India. These case studies were influ- have catalytic converters after September 1993. ential in highlighting issues arising due to un- The law did not specify whether they should be restrained growth of transport demand. In two- or three-way converters. addition, the World Bank mobilized Japanese 5. NEPO n.d. grant funds to finance a wide variety of re- 6. Chongpeerapien 1992. search, including: 7. NEPO 1995. 8. Shell Science and Technology n.d. * major technical assistance to develop emis- 9. Chevron 1990. sion standards for new and existing vehicles 10. Weaver 1996. in Thailand; 11. Chongpeerapien 1992. * work to establish revised national ambient 12. Wangwongwatana (1996) reports that in 1996 air quality standards; PCD tested a sample of forty in-use catalytic * studies to examine the feasibility of commer- converters in private cars; all were found to be cializingLPG andnatural gas-fueledvehicles; functioning properly. However, similar tests of * epidemiological studies of air pollution's ef- catalytic converters in heavily utilized commer- fects on health; and cial vehicles, such as taxis, showed that a sig- * research into appropriate particulate matter nificant number were malfunctioning. (PM,,) abatement strategies. 13. Sayeg et al. 1992. 14. Chongpeerapien 1992. In addition, during this period the World 15. Lovei 1996. Bank undertook two pieces of sector work at 16. Shell 1990; Lovei 1996. the request of NEPO: a study to examine the 17. Lovei 1996. economic impacts of industry and transport on 18. TDRI 1990. pollution and human health26; and a study of 19. World Bank 1994. various fuel options available to meet 20. Sangnimnuan 1997. Thailand's future energy requirements.27 21. Lovei 1996. 22. Star Petroleum Refinery was completed in March 1996. Caltex and the Petroleum Authority of NOTES Thailand hold 64 percent and 36 percent of the shares, respectively, in Star Petroleum Refin- 1. Chongpeerapien 1992; Sayeg et al. 1992; World ing Company Limited. The International Fi- Bank 1994. nance Corporation together with 65 other banks SUCCESSFUL CONVERSION To UNLEADED GASOLINE IN THfAILAND 26 lent money to the project. 25. Sayeg 1997. 23. Martin 1997. 26. World Bank 1994. 24. Shell 1990. 27. World Bank 1993. CHAPTER 4: IMPLEMENTATION INTRODUCTION might be taken as a sign that incentives aimed at the private sector were unrealistic, and the The Government of Thailand (GOT) initiated overall policy might then be injeopardy. In fact, the sale of unleaded gasoline (ULG) alongside in 1991 when ULG was first introduced, most leaded gasoline in May 1991, as mentioned in major private oil companies sold ULG. previous chapters. For Thai policymakers, ULG Overall coordination was carried out by was a vital component of a strategy to increase NEPC, acting onthe advice ofNEPO, whichworked fuel quality across the board and thus address closely with the Pollution Control Department several previously identified high-priority pol- (PCD), the Thailand Industrial Standards Insti- lutants, in addition to lead. A key early step was tute, and other agencies listed earlier. However, the design of an appropriate communication the NEPC recommendations which were ap- campaign. The campaign provided information proved by the Cabinet led to the establishment on pre-ULG motor vehicles that could safely use of various targets to be met by each agency. ULG (i.e., had sufficiently hard valve seats) and on the soft valve seat question; and created awareness ofthe environment and health issues KEY INITIATIVES related to the continued use of leaded gasoline. I The GOT policy was to create a realistic en- Pricing vironment to ensure that most oil companies would find the introduction of ULG (of a cer- Intheperiodpriorto andduringthe introduction tain minimal correct specification) attractive. of ULG (on April 15, 1991), Thailand still con- Furthermore, from the government's perspec- trolled gasoline prices under a semi-regulated tive, at the beginning of the campaign it did not system, prior to full deregulation in 1991-92. matter whether the ULG was locally sourced, Under this system, ex-refinery and import prices or imported from Singapore or elsewhere. of petroleum products were set based on the In order to create the correct policy environ- prices of refined product in Singapore, which ment GOT consulted widely with industry to see was regarded as an efficient regional producer. what issues were critical. The National Energy Table 4.1 shows nominal and estimated real Policy Office (NEPO) knew that it could rely price indices for selected petroleum products on the State-owned PTT/Bangchak Petroleum in Bangkok during 1986-93. The table shows to introduce ULG if all else failed. However, that during this period real prices declined by the government knew that if in the medium- 20 percent (May 1996 real prices are estimated term only the state were to introduce ULG, it to be still 9 percent lower than they were in 27 Successful Conversion to Unleaded Gasoline in Thailand 28 Table 4.1': Bangkok's Price Index of Selected Petroleum Products (1986-93) Year Premium HS Diesel All Items Consumer Real All Items Gasoline Price Index Price Index 1986 82.30 96.58 87.94 100.00 100.00 1987 76.05 94.04 83.46 102.50 92.05 1988 75.73 93.73 83.83 106.40 89.77 1989 72.21 91.04 81.27 112.10 82.95 1990 78.13 100.00 88.03 118.80 84.09 1991 86.15 120.59 100.29 125.60 90.91 1992 79.30 116.86 96.83 130.80 84.09 1993 78.14 117.47 94.52 135.10 79.55 May 1996 (est). 87.40 122.28 105.00 (est) 115.00 (est) 91.30 Note: For premium gasoline, HS Diesel and All Items, base for prce index = 100. For consumer price index and real all items price index, base = 100. Source: Pocket Thailand Petroleum Report, 1995 (Alpha Research Company Ltd, 1995b). 1986). Thailand's petroleum market was sub- leaded gasoline. By setting the excise tax on stantially deregulated in 1991, hence the fall in ULG at B1.0 per liter (US$0.04) less than that prices during 1991-92. of leaded gasoline, as shown in tables 4.3 and Table 4.2 shows a similar trend for imported 4.4, for locally produced and imported product petroleum products-real prices declined by 20 respectively, GOT absorbed the major share of percentduring 1986-93. Duetothederegulation, the costs at BO.7 per liter. Because 1991 world retailpriceswerecloselylinkedtoimportedprices. oil prices were lower compared to 1990 world Although the costs of producing ULG were oil prices (see table 4.1), the government oil higher than those of producing leaded gasoline, fund was in surplus by B6.65 billion (compared in order to encourage motorists to switch to to 1990 when it had a deficit of B 1.37 billion), ULG, a fundamental measure was to stipulate enabling the government to finance this cost.2 that the retail (pump) price of ULG should. be Also, taxes on diesel fuel were increased by BO.3 per liter (US$0.012) less than that of BO.4 per liter at the commencement of the par- Table 4.2: Average Prices of Imported Petroleum Products, Thailand (1986-93) Year Petroleum Products Petroleum Price Index Consumer Real Product (US$ per barrel) Price Index Price 1986 15.62 100.00 100.00 100.00 1987 17.96 114.98 102.50 112.18 1988 15.32 98.08 106.40 92.18 1989 16.63 106.47 112.10 94.98 1990 21.77 139.37 118.80 117.31 1991 19.58 125.35 125.60 99.80 1992 18.75 120.04 130.80 91.77 1993 16.99 108.77 135.10 80.51 Source: Pocket Thailand Petroleum Report, 1995 (Alpha Research Company Ltd, 1995a). 29 Chapter 4: Implementation Table 4.3: Excise/Municipal Taxes on Thailand Ex-refinery Prices of Fuels (Bahtl liter) Product March 26, May 27, 1991 June 11, September 4, January 1, Ceiling 1991 1991 1991 1992 Unleaded Premium - 2.9290 2.9290 3.1900 2.5850 5.00 Gasoline Premium Gasoline 3.9390 3.9390 3.9390 4.2900 3.3550 5.00 Regular Gasoline 3.9390 3.9390 3.9390 4.2900 3.3550 5.00 HS Diesel (1 percent 2.2220 2.6260 2.6260 2.8600 2.3100 4.00 Sulfur) Notes: May 27, 1991 column represents exciselmunicipal tax differentials set to favor ULG at its introduction. On January 1, 1992, Thailand introduced a Value Added Tax (VAT). VAT at a rate of 7 percent must be added to the above taxes. Source: NEPO (1996). Table 4.4: Taxes on Imported Fuels (Baht/liter) Product May 27, 1991 September 4,1991 January 1, 1992 March 18, 1992 Import Business Import Business Import Business Import Business Duty and Duty and Duty and Duty and Municipal Municipal Municipal Municipal Tax Tax Tax Tax Unleaded Premium 0.0100 2.9290 0.0100 3.1900 0.0100 2.5850 0.0650 2.5850 Gasoline Premium Gasoline 0.0100 3.9390 0.0100 4.2900 0.0100 3,3550 0.0650 3.3550 Regular Gasoline 0.0100 3.9390 0.0100 4,2900 0.0100 3.3550 0.0650 3.3550 HS Diesel (1 0.0100 2.6260 0.0100 2.8600 0.0100 2.3100 0.0650 2.3100 percent Sulfur) Notes: May 27, 1991 column represents excise/municipal tax differentials set to favor ULG at its introduction. On January 1, 1992, Thailand introduced a Value Added Tax (VAT) of 7 percent, to be added to the above taxes. Source: NEPO (1996). tial deregulation of fuel (see table 4.3). fuel prices were reduced only marginally be- These initiatives translated into the pump cause of the taxation treatment. Deregulation prices shown in table 4.5, before and after the itself was not an essential factor in the intro- partial float. The retail price differential be- duction of ULG, but was used to good effect. tween premium ULG and premium (leaded) gasoline is apparent. Prices in 1990 (pre-float) Catalytic Converters were relatively high in the aftermath of the Per- sian Gulf War. By late 1991 (the post-deregu- A major GOT goal was requiring all new gaso- lation period) world oil prices had fallen, re- line-powered cars sold in Thailand during 1993 ducing the prices of all fuels. However, diesel to be equipped with catalytic converters. In or- Successful Conversion to Unleaded Gasoline in Thailand 30 der to achieve this, the Ministry of Com- Table 4.5: Retail Prices of Petroleum Products (Late 1991 merce (MOC) re- Prices: Baht/liter) quired that all new vuired thicallnes poProduct August 1990 September 16,1991 motor vehicles pos- (pre-partial deregulation) (post-deregulation) sess catalytic convert- Premium Gasoline 11.05 9.79 (US$0.39) ers in order to be reg- Premium ULG - 9.48 (US$0.38) istered with the Land Regular Gasoline 10.35 9.12 (US$0.36) Transport Depart- Kerosene 8.72 9.24 (US$0.37) Transport Depart- Diesel 8.40 8.05 (US$0.32) ment. Thus this re- Diesel (low sulfur) 8.40 13.05 (US$0.32) quirement (lid not dis- Source: Bangkok Post, Economic Review, Mid-Year, 1991 as reported in Sayeg criminate against im- (1992). ported vehicles. MOC also forbade the importing of cars which could ment, including additional storage tanks, not use ULG after mid- 1991. MOC established pumps, and nozzles for ULG were required. The the types of catalytic converters that were per- Public Works Department, under the Ministry mitted and vehicular emission standards. of the Interior, was the relevant authority and In orderto preventmisfueling ofvehicles, the was required to act quickly to approve plans Public Wor:ks Department, responsible for gaso- for modifications put forward by the industry. line station facilities, ordered that the gasoline An early target was to assure the availabil- pump nozzle should be to the international stan- ity of ULG in at least 200 outlets in Bangkok dard (smaller than leaded gasoline nozzles),. In by June 1991.3 Concentrating initial efforts in Thailand the Ministry of Industry specified the Bangkok made sense, given that Bangkok's air appropriate gasoline tank inlet size, and ordered pollution issues were most pressing. The tar- that a label with the message "Use Unleaded get of 200 outlets was met by removing 83 RON Gasoline Only" be prominently shown at the in- grade gasoline pumps (which were already be- let. The automobile owner manual also had to ing phased out in favor of standard 87 RON clearly indicate whether the car could use ULG. grade gasoline) in order to free up tanks and make available gasoline pumps for ULG. This Unleaded Gasoline Distribution was an important early initiative, which did not require significant investmnent or require new Importing or locally producing ULG was not approvals. This is an important strategy which enough; it had to be separately distributed, can be adopted in other coumtries: stored, solcl, and otherwise made available. It was important to ensure that ULG would not "In most countries, the introduction of be contaminated by leaded gasoline, which unleaded gasoline may be carried out would have been particularly critical to any without significant changes in the distri- motor vehicles possessing catalytic converters bution infrastructure. The reduced selec- at the time of ULG introduction in mid-1991. tion of leaded gasoline brands, for ex- Modifications to gasoline stations' equip- ample, allows the use of the same num- 31 Chapter 4: Implementation ber of storage tanks andpumps at retail product's environmental-friendliness. At first, stations during the introduction of a new this campaign coupled with the more attractive unleaded gasoline brand "J' pricing was quite successful. As Thailand's oil retail market rapidly ex- Other Initiatives to Assist Implementation panded in the 1990s, the number of service sta- tions grew from 3,475 in 1991 to 5,392 by the Other important measures initiated by the gov- end of 1995, an increase of 55 percent. Thus, emient included exempting MTBE, an impor- there was ample opportunity to install ULG- tant ULG additive, from import tax for the pe- specific tanks, pumps, and other equipment as rnod April-December 1991 aid for by a direct a part of building new service stations. subsidyfromthe OilFund,whichaveragedabout At the end of 1991 just over 80 percent of US$0.016perliter);andincreasingthebudgetsof all nationwide ULG sales were in Bangkok.5 agencies dealing with gasoline quality control. By the ends of 1992 and 1993, the correspond- ing percentages were 79 percent and 70 per- Initial Concerns, Monitoring, and cent, respectively, indicating increased ULG Supplementary Studies distribution to the provinces. NEPO worked continuously and closely From the outset, oil company marketers and with the oil companies to ensure that ULG could NEPO conducted consumer market research to be distributed as soon as possible to all parts of identify how to overcome user resistance to the country. This was especially important be- ULG. As there had been some complaints in cause after 1993 all new motor vehicles were 1991 about poor acceleration in cars using required to have catalytic converters, and thus ULG, NEPO encouraged the oil companies to required ULG. Sustained effort, supported by increase the minimum front end number to pre- laws and regulations, was sufficient to help vent knocking and to raise the octane number spread ULG throughout the country.6 to increase power.' These initiatives are de- scribed further in table 4.6. Marketing and Public Relations Issues PTT subsequently conducted studies on valve seat recession, and found no problems. A vital part of the program to introduce ULG These findings are consistent with international was coordinated marketing and public relations experience as described in chapter 3. by both the government and the private sector. NEPO distributed information on the availabil- ity of ULG and which cars could use ULG (soft STRENGTHENED ENVIRONMENTAL versus hard valve seats). REGULATIONS PTT, the state-owned oil enterprise, was the first company to introduce ULG; they were fol- In March 1992 the Anand administration, act- lowed closely by Shell, and then by other firms. ing on the advice of NEPC and NEPO, an- PTT, Shell, and others developed active pro- nounced even stronger measures to address se- motional campaigns, most featuring the new vere air pollution problems: Successful Conversion to Unleaded Gasoline in Thailand 32 Table 4.6: Signiflcant Changes in Fuel Quality Specifications Made in 1992 Date Event March 6,1992 NEPC moved to make comprehensive improvements of fuel qualifies in Thailand. Target dates were set for the reducton of distillation temperatures, aromatic and benzene content in gasoline. Significant reduction of sulfur in diesel was also planned. May 6, 1992 Target date for catalytic converter installation in new cars moved forward to January 1, 1993 for gasoline cars larger than 1,600cc. July 30,1992 NEPC established 8 year program for fuel quality improvements. Benzene content in gasoline (Anand 2) must be reduced from 5 percent to 3.5 percent by January 1, 1993. AromaUc content to be set at 50 percent maximum by January 1, 1994 and to 35 percent maximum by January 1, 2000. Front-end octane and motor octane numbers were established for gasoline. Regular gasoline to be made ULG by January 1, 1995. Oxygenates are required in gasoline by January 1, 1993. Distillation temperatures of gasoline at T90 to be reduced to 170°C, and to 160°C if ozone problems become severe. Sulfur in HSD to be set at 0.5 percent by weight nationwide by September, 1993. to 0.25 percent by weight by January 1, 1996, and to 0.05 percent by weight by January 1, 2000. September 10, 1992 Cabinet approves NEPC's recommended vehicle emission standards. Source: Chongpeerapien (1992). A comprehensive plan to improve the quality of Controlling carbon monoxide (CO). As the main fuelproducts. NEPO issued new petroleum prod- source of CO was poorly-tuned gasoline engines, uct specifications on August 28, 1992, whtich the first short-term measure was to adopt old came into effect on January 1, 1993. This work European Community standards (ECE R 83 was supported by the Canadian International Approval B), which meant that new gasoline cars Development Agency. These specifications are would have to be equipped with electronic air/ outlined in appendix B, and generally apply to- fuel controls and a three-way catalytic converter. day. The plan included an eight-year schedlule This was proposed to be replaced in 1995 by the to reduce sulfur content in diesel fuel, to re- new emission standards (European Community duce harmful agents like benzene, and to add directive DRT 91/441/EEC or equivalent), which other agents to assist efficient engine running. was expected to almost eliminate CO from new vehicle exhausts. Mandating oxygen in premium The phasing out of all leaded regular gasoline gasoline would also decrease CO emissions. by 1995. Previously there had been no firm cdate by which leaded premium gasoline was to be Controlling hydrocarbons (HC). Using cata- phased out. However, soon December 31, 1996 lytic converters in new automobiles was ex- was set as the date by which all leaded gaso- pected to reduce HC emissions significantly. line was to be banned, a period of five years However, a major source of HC was from two- and eight months after the introduction of UJLG. stroke motorcycles, and therefore GOT pro- In fact, leaded gasoline was eliminated one yiear posed to adopt Taiwan's standard for all new ahead of schedule. motorcycles sold from 1995. 33 Chapter 4: Implementation Controlling particulate matter. This included man health, but both are inexpensive means to various measures, including lowering lead and increase gasoline octane levels. Thailand's thus reducing lead particulates, and changes to then-new specifications for ULG and other the distillation profile, specific gravity, viscos- gasolines, shown in appendix B, specified the ity, and reduction of diesel sulfur content to maximum content of benzene and aromatics. make it lighter and burn more cleanly. Compared to the original United Kingdom, United States, and more recent New Zealand Reducing benzene and other harmful agents. ULG specifications, which did not specify Continued reductions in benzene content, from maximum permitted amounts of these sub- 1992's maximum of 5 percent by volume in stances, Thailand's approach was correct. 1992 to 3.5 percent by volume effective Janu- Significantchangesinfuelqualityspecifica- ary 1, 1993, were planned. In addition, GOT tions made in 1992 are summarized in table 4.6. mandated progressive reductions in aromatic At the time, the Thai Industrial Standards content to a maximum of 35 percent by 2000. Institute, which introduced various mandatory However, these standards are more modest than emission standards in March 1992, published those of the United States, where maximum data as shown in table 4.7 to illustrate how allowable benzene levels are about a third of emissions were expected to reduce over time those permitted in Thailand.8 due to new engine emission standards. Benzene and aromatics are harmful to hu- Atthesametime,acompositetimelineofpro- Table 4.7: Relative Emission Reduction through Stages Vehicle Type Stage Standard Reduction of Emissions compared to prior stage's standard (percent) CO HC NOx Gasoline 1 ECE R15-04* 66.0 43.0 2 ECE R83 App.B 60.5 63.7 3 DRT 91/441/EEC 63.2 50.8 Light diesel 1 ECE R83 App.C 86 80.0 2 DRT 91/441/EEC 63.2 50.8 Heavy diesel 1 ECE R49-01 - - - 2 DRT 91/542 App. A/EEC 59.8 54.2 44.4 3 DRT 91/542 App. B/EEC 11.0 12.5 Motorcycles 1 ECE R40-00 (2-stroke) ECE R40-00 (4-stroke) 2 ECE R40-01 (2-stroke) 20.0 20.0 ECE R40-01 (4-stroke) 30.0 40.0 Note: For figures of 1 st stage gasoline and light-duty comparisons, percentage reduction was computed using data on vehicles in uncontrolled conditions. For gasoline and light-duty vehicles, the uncontrolled case emitted 200 grams per kilometer of CO and 12 grams per kilometer of combined HC and NOx. Data for heavy-duty diesel and motorcycles are unavailable. * Not enforced because of the then imminent requirement to have catalytic converters fitted to all new cars in 1993. With catalytic converters this standard was sufficiently easy to meet. Source: Chongpeerapien (1992). Successful Conversion to Unleaded Gasoline in Thailand 34 posedfuelarndengineimprovementplanswasailso gasoline sales. Figures 4. 1,4.2, and 4.3 diagram issued (seetable4.8) indicatingthat anintegrated these and later statistics showing the market approachhadbeenadopted. These improvements penetration of premium and regular ULG, from were not implemented exactly as planned, how- the end of 1991 to the end of 1995. Graphs ever:insomecasestargetdateschanged,or m.ore showing volumes rather than percentages are appropriatestandardswereadoptedbasedonton- included in appendix C. going research and experience. Regular gasoline sales in 1993 were 94 per- cent by volume of the combined sales of pre- mium ULG and premium leaded fuel. An im- MARKET PENETRATION OF UNLEADED provement in air quality was experienced due GASOLINE, 1991-95 to the general reduction of lead in gasoline, in addition to the introduction of ULG. Given that ULG represented 11 percent (May 1991) and in April 1993 (the month before regular ULG 19 percent (December 1991) of all premium was introduced) only 29 percent of premium Table 4.8: Composite Timeline of Fuel and Engine Improvement Plans Fuel Products Year Engine Emissions Type Property to Change Vehicle Type Standard All gasolines Oxidation stability, Existent gum, 1993 Gasoline ECE R83 App. B Distillation profile, Vapor pressure, Benzene, Water Premium gasoline Oxygenated compounds, Additives Motorcycle ECE R40-00 Unleaded gasoline Same as Premium, Dye content Regular gasoline RON High-speed diesel Specific gravity, Kinematic viscosity, Sulfur, Detergent Premium gasoline and ULG MON, Aromatics 1994 Motorcycle ECE R40-01 Regular gasoline MON Light-duty diesel ECE R83 App. Heavy-duty diesel ECE R49-01 Regular gasoline Lead content, Additives 1995 Gasoline DRT 91/441/EE Light-duty diesel DRT 9114411EE Motorcycle CNS 11386 (Taiwan) High-speed diesel Sulfur content 1996 Heavy-duty diesel DRT 91/542 App A/EEC 1997 1998 1999 ULG, Prernium gasoline Aromatics 2000 Heavy-duty diesel DRT 91/542 App B/EEC High-speed diesel Sulfur contents Note: Engine emission standards from 1995 as outlined by cabinet. DRT/ / EEC: Directives of European Economic Community. When approved they take on ECE R label. Source: Chongpeerapien (1992). 35 Chapter 4: Implementation Figure 4. 1: Unleaded Percentage ofrPremiun2 Gasoline Consumption (I1991-95) _-~~~~~~~~~~~~Oct-95 _ _ _ _ _ _ _ _ _ _~~~~Aug-95 _ _ _ _ _ ~~~~ -Jun-95 I _ _ _ _ ~~~ -Apr-95 _ _ _ _ ~~~~ -Feb-95 = = = = = _~~~Dec-94 _ _ _ _ _ -~~~Oct-94 X _ _ _ ~~~ _Aug-94 _ = = = = -~~Jun-94 = = _ = -~~Apr-94 -Feb-94 _ _ _ ~~~ _Dec-93 _ _ _ -~~Oct-93 _ _ _ ~~ _Aug-93 U _ _--Ju~Jn-93 ° _ _ ~~~ -Apr-93 _ _ ~~~ -Feb-93 = _ = _~Dec-92 _ m _ 3-~~~~~~~~oct-92 Unleaded Gasoline| c Aug-92 . _ 3 -~~~~~~Jun-92 _ 3-~~Apr-92 _ __~~Feb-92 _ =_~~Dec-91 l l l _--A~~~~~~~~~~ug941 l l l l _ _ | _-~~~~~~~~~~Apr-91, 100 90 80 70 60 50 4 .b 20. lb d Percent Successful Conversion to Unleaded Gasoline in Thailand 36 Figure 4.2: Unleaded Percentage of Regular Gasoline Consumption (1993-95) _ I - - Oct-95 _I Sep-95 _I Aug-95 Jul-95 - -I ~~~~~~~~~~~~Jun-95 _ = vZ . ~~~~~~~~~~May-95 -Apr-95 Mar-95 1 [7h!-1 Feb-95 ~- [ Jan-95 sE= _ ~~Dec-94 I I I I _ - Nov-94 Oct-94 ___ _8 9 .Hsfs2rl 5 7M i-Sep-94 ____ __ _G__ Aug-94 W_~ _ _Jul-94 Jun-94 Uf __I May-94 = _ = - ~~~~~~~~~~~Apr-94 C =P5iq=; - G Mar-94 Feb-94 Jan-94 Dec-93 Nov-93 Oct-93 Sep-93 I I I i I I T ~~~Aug-93 l | ! E I 1 Jul-93 [Reglar Unleaded Gasol Jun-93 | | | | | | | i | |~~~~~~ Mar-93 { | | | | 1 | | | | ~~~~~Feb-93 8 7 30 20 1 Percentage Unleaded Gasoline 37 Chapter 4: Implementation Figure 4.3: Unleaded Percentage of Total Gasoline Consumption (1993-95) E _ _=E E= z = ~~~~~Oct-95 Sep-95 Aug-95 Jul-95 I_ = :E :E= ~~~Jun-95 May-95 Apr-95 Mar-95 Feb-95 E =E : _ = E= ~~Jan-95 mm m= mm _m =m= Dec-94 eNov94 Oct-94 - -E: = _ =E Sep-94 @= = ~~~~~~ Aug-94 E: _ _ _ = ~~~~~ Jul-94 E: S= == ~~~~Jun-94s 0 May-94 E Apr-94 Mar-94 1=: E: = =E: ~ Feb-94 Is _ _ = Jan-94 Dec-93 Nov-93 Oct-93 [ Unleaded Gasoline Sep-93 L . - = = Aug-93 Jul-93 Jun-93 May-93 Apr-93 Mar-93 4| E Feb-93 __ _ _ . |Jan-93 100 90 80 70 60 50 40 30 20 10 0 Percentage Unleaded Gasoline Successful Con-version to Unleaded Gasoline in Thailand 38 gasoline sales were unleaded indicated that sig- THE BENZENE VYTH nificant reductions in lead could be achieved by also commencing the phase-out of regular In 1993-94 newspaper articles reported that the leaded gasoline. British Transport Commission had recom- Through April 1994 ULG's market share mended to the legislature that ULG should be grew as shown in figures 4.1 to 4.3 and sum- abolished on the grounds that it contains ben- marized as: premium, 40 percent; regular, 96 zene, which, in significant quantities, was re- percent; and all gasoline, 62 percent. ported to increase the risk of leukemia These Regular IJLG market uptake was very rapid, articles were attributed to Octel, the largest pro- as leaded regular was quickly withdrawn. How- ducer of lead additives. In fact in October 1994 ever, by mid- 1994 growth in ULG market pen- the U.K. Royal Commission on Environmental etration was slowing in the premium fuel mar- Pollution recommended that the government act ket (see figure 4.1). This slowing was seen as a to end the sale of unleaded super premium gaso- potential problem, and NEPO initiated research line.9 Actual benzene content was about 1.6 per- to identify the major underlying factors. cent by volume in Thailand, and there was no NEPO commissioned a survey of consumer evidence of increased gasolinLe volatility, so ben- attitudes regarding ULG in April 1994. The study zene was not a serious concern. However, NEPO found an uncertainty and a general lack of moved to counter these allegations with the facts knowledge about the use of ULG. Many drivers on benzene, which are outlined in textbox 4.1. were not sure whether their car could use ULG safely, while Textbox 4.1: The Benzene Myth others resisted change or thought that ULG Gasoline contains various harmful substances, one of whiclh is benzene, a car- was an inferior grade cinogenic hydrocarbon that increases the risk of leukemia. The largest pro- of fuel. Due to a lack ducer of tetra-ethyl lead, Octel, claims that unleaded gasoline should not be used in cars without catalytic converters, since unleaded gasoline contains more of educatio)n, many benzene then leadecd, and in engines without catalytic converters, benzene emis- motor mechanics ad- sions cannot be controlled. vised against using However, there are several weaknesses in this argument. The production of ULG. A major com- unleaded gasoline does not necessarily lead to significant increases in gasoline's benzene content, since it can be controlled by various refining processes. Re- munications program, search has shown that personal activities and pollution sources in homes far using television and outweigh outdoor air's contribution to human benzene exposure. Smokers' other forms of mass exposure, for example, exceeds non-smokers' exposure nearly 10 times. It has media was promptly estimated that more than half of the nationwide exposure to benzene in the initiated to provide ac- United States can be attributed to smoking (Wallace 1989), and only 20 per- initiated to provide ac- cent to traditional sources such as traffic or industrial emissions. Of all benzene curate information on exposure originating from gasoline, leaded or unleaded, a significant share can makes and imodels of be traced to gasoline evaporation in garages, during driving, and while being car which could use pumped. These sources are associated with gasoline used in cars with or with- ULG safely,, and other out catalytic converters. facts about 1LJLG. Source: Lovei (1996). 39 Chapter 4: Implementation All gasolines contain benzene in some pro- oil companies continued their own campaigns. portion. In Thailand, the then new specifications On May 3, 1995, NEPO in conjunction with for all gasoline fuel types, leaded or unleaded, PTT held a major seminar. The objective was to specified the same maximum amount of ben- assesstheviews ofall relevant sectorparticipants, zene-3.5 percent by volume (almost three and to set guidelines for the eventual elimina- times the U.S. benzene standard).10 However, tion of leaded premium gasoline. An important to counter the articles' emphasis on benzene' s outcome was an agreement between all parties possible cancerous effects, GOT restricted the that leaded gasoline would be abolished, and that combination of aromatics and benzene to lev- the target date should be advanced from the end els lower than those prevalent in the Associa- of 1996 to approximately January 1, 1996.12 tion of Southeast Asian Nations and Europe."1 Furthermore, the seminar participants also The actual benzene content of Thai gasolines agreed that there should be two grades of un- averages about 1.6 percent by volume. leaded premium gasoline: unleaded premium (then on the market) suitable to all cars and col- ored green; and a new type, which was to be ACCELERATED PHASE-OUT OF LEADED mixed with anti-valve seat recession additive and REGULAR AND PREMIuM GASOLINES which was to be yellow. At this time the exist- ing premium leaded gasoline had a yellow color, Although the deadline by which leaded regular and unleaded regular gasoline was colored red. gasoline was to be phased out previously had The new type of gasoline was intended to been set as January 1, 1995, on March 22, 1994, be used by cars with soft seat valves or those the Cabinet, acting on the advice of NEPC and whose owners were afraid of using the original NEPO ordered that the deadline for phasing out type of ULG. However, this second type of pre- regular leaded gasolines be advanced to August mium ULG could not be used in cars fitted with 1, 1994. The benefits of this action included the catalytic converters, as the anti-valve seat re- lowering of oil companies' distribution costs. cession additive would destroy the catalytic By April 1995 premium ULG had achieved converter. As a result, a new regulation was a market share of 50 percent. Growth was steady promulgated to set the diameter of the distrib- but slow. During May-June 1995 NEPO inter- uting nozzle for the new type of gasoline as no viewed drivers in the Bangkok Metropolitan less than 24.50 millimeters, or the same size as Region and three major regional centers, to as- the leaded gasoline pump nozzles. sess why drivers chose not to use ULG; and On June 20, 1995, the cabinet resolved to whether they knew if their vehicle could safely abolish the sale of leaded gasoline. MOC, use ULG. NEPO subsequently disseminated NEPO, and other agencies worked out details, leaflets showing which automobile makes and and a ministerial order was issued to take ef- models could use ULG. fect January 1, 1996. The following actions Special attention was paid to motorists whose were taken prior to implementation:'3 cars had hard valve seats; they were urged to try ULG. In addition, good use was made of the e Excise Department taxed the new type of mass media to promote the use of ULG. The premium ULG with anti-valve seat reces- Successful Conversion to Unleaded Gasoline in Thailand 40 sion additive at the same rate as the other should be used with the detergent additive unleaded types of gasoline. already mixed with the gasoline. * Ministry of Commerce specified that the lead contentofthenewgasolinetype shouldbe the PTT, the state-owned oil company, volun- sameastheothers(nothigherthanO.013 grams tarily discontinued sales of leaded gasoline be- per liter) and that the color should be yellow. fore the deadline. All other companies met the * Public Works Department specified that the official deadline. outer diameter of the distribution nozzle for As of early 1997 three types of gasoline are the new type of ULG must be no smaller sold in Thailand: than 24.50 millimeters. * Ministry of Commerce directed that the only * Premium ULG (green, 95 RON minimum ac- permitted anti-valve seat recession additives cording to specifications but usually 97-98 were sodium and potassium, and that these RON in response to consumer preference); Table 4.9: Measured Daily Lead Concentrations at Eight Curbside Monitoring Sites in Bangkok (1990-96) Station 24 hour average (micrograms per cubic meter') 1990 1991 1992 1993 1994 1995 1996 Sapankway min: 0.60 min: 0.70 min: 0.42 min: 0.17 min: 0.22 min: Na min: Na Pahonyothin max: 1.20 max: 1.00 max: 1.38 max: 0.59 max: 0.40 max: Na max: Na ave: 0.90 ave: 0.70 ave: 0.94 ave: 0.35 ave: 0.31 ave: Na ave: Na Silom min: 0.30 min: 0.90 min: 0.35 min: 0.26 min: 0.14 min: 0.11 min: 0.03 max: 4.80 max: 3.00 max: 1.19 max: 0.67 max: 0.38 max: 0.43 max: 0.18 ave: 2.80 ave: 1.90 ave: 0.65 ave: 0.44 ave: 0.25 ave: 0.18 ave: 0.08 ... _ __ _..... _ .... - .._._. ...... _ ..... ". ........... ......... _.... ....... ..___ Siphraya min: 0.60 min: 0.70 min: 0.18 min: Na min: 0.05 min: 0.11 min: 0.04 max: 3.30 max: 1.80 max: 0.94 max: Na max: 0.29 max: 0.32 max: 0.23 _ __ _ _ _ ave: 2.80 ave: 1.70 aye: 0.54 ave: Na ave: 0.22 aye: 0.20 ave: 0. 11 Mansri min: 4.90 min: 0.60 min: 0.24 min: Na min: 0.16 min: Na min: 0.05 Bamrungmuang max: 6.40 max: 3.20 max: 0.57 max: Na max: 0.52 max: Na max: 0.21 ave: 5.40 ave: 1.90 ave: 0.37 ave: Na ave: 0.28 ave: Na ave: 0.09 Banglampoo min: 0.90 min: 0.80 min: Na min: 0.23 min: 0.00 min: 0.06 min: Na max: 1.90 max: 1.60 max: Na max: 0.61 max: 0.41 max: 0.25 max: Na ave: 1.30 ave: 1.20 ave: Na ave: 0.37 ave: 0.19 ave: 0.14 ave: Na Pratunam Rachaprop min: 1.40 min: 0.40 min: 0.33 min: 0.47 min: 0.25 min: 0.34 min: 0.05 max: 2.80 max: 4.20 max: 1.74 max: 1.02 max: 0.73 max: 0.46 max: 0.13 ave: 1.90 ave: 1.80 ave: 0.66 ave: 0.68 ave: 0.43 ave: 0.41 ave: 0.09 Yaowaraj min: 0.90 min: 1.30 min: 0.17 min: 0.35 min: 0.03 min: 0.23 min: 0.06 max: 3.20 max: 4.00 max: 1.53 max: 0.98 max: 0.63 max: 0.45 max: 0.25 ave: 2.10 ave: 2.40 ave: 0.71 ave: 0.61 ave: 0.29 ave: 0.33 ave: 0.10 Lanluang min: 3.20 min: 0.30 min: 0.18 min: 0.18 min: 0.09 min: 0.06 min: 0.03 max: 4.80 max: 1.80 max: 1.09 max: 0.59 max: 0.30 rnax: 0.35 max: 0.09 ave: 4.00 ave: 1.00 ave: 0.74 ave: 0.37 ave: 0.17 ave: 0.15 ave: 0.06 Source: 1990-91, Pollution Control Department as reported in World Bank (1994); 1992-96, Pollution Control Department. 41 Chapter 4: Implementation * Super/Premium ULG (yellow, but with anti- per cubic meter in 1991 to about 0.6 grams per valve seat recession additive); and cubic meter in 1992. The slowing in air quality * Regular ULG (red, 87 RON minimum ac- improvement during 1992-93 was due to the ex- cording to specifications but usually 92 tensive use of regular gasoline (mainly in mo- RON in response to consumer preference). torcycles) and the slowing in sales of premium ULG. Regular ULG was not introduced until May 1993. OBSERVED REDUCTION IN AMBIENT LEAD THROUGH LATE 1996 NOTES Due to the reduction in lead content in all gaso- 1. NEPO n.d. line fuels and the introduction of ULG, lead in 2. World Bank 1994. the ambient air has been observed to decrease 3. World Bank 1992. dramatically over the six-year period ending in 4. Lovei 1996. late 1996. In 1996, airborne lead levels were 5. Alpha Research Company Ltd 1995a. negligibly low. Table 4.9 shows data from 6. Amranand 1997. 1991-96 for the eight central area curb-side 7. Chongpeerapien 1992. sites shown previously in table 2.6. 8. Chongpeerapien 1992. These data are summarized in figure 4.4, pre- 9. U.K. Royal Commission on Environmental Pol- pared by PCD (combining all data) which also lution 1994. shows the air quality improvements related to 10. Chongpeerapien 1992. reducing lead in gasoline and introducing ULG. 11. NEPO 1995. This led to an immediate reduction of ambient 12. NEPO 1995. leadfromanaverageofmorethan3.0micrograms 13. NEPO 1995. Successful Conversion to Unleaded Gasoline in Thailand 42 Figure 4.4: Roadside Air Lead Level (1990-96) 4 - 3.5 3Maximum 3 95 Percentile 4-. Average iS** 5 1 Minimum 2.5 E ~1.5 * E E1 0 2 0~~~~~~~~ 1990 1991 1992 1993 1994 1995 1996 Year Notes: Ambient lead standard: -1991, 10 micrograms per cubic meter; 1991-, 1.5 micrograms per meter. Lead standard for premium gasoline: -1989, 0.45 micrograms per liter; 1989-92, 0.4 micrograms per liter; 1992-95, 0.15 micrograms per liter; 1995-, 0.0 micrograms per liter. Lead standard for regular gasoline: -1989, 0.45 micrograms per liter; 1989-92, 0.4 micrograms per liter; 1992-94, 0.15 micrograms per meter; 1994-, 0.0 micrograms per liter. Source: 1990-91, Pollution Control Department as reported in World Bank (1994); other years Pollution Control Depart- ment. CHAPTER 5: CONCLUSION AND LESSONS LEARNED Various studies have shown that lead emissions the environment Thailand had chosen to man- from motor vehicles presented severe health date the use ofcatalytic converters in all new cars hazards to Thailand's urban population, espe- sold from 1993 onward; it was also recognized cially that of Bangkok. Unleaded gasoline thatmajorbenefitswouldflowfromusingULG (ULG) was introduced into Thailand as part of (and reformulated reduced-lead gasolines) even a broader on-going strategy to reduce vehicu- without the use of catalytic converters. lar emissions, other elements of which included: It appears that the net costs attributable to introducing the capability to refine ULG were * reducing the lead content in leaded gasolines quite low, less than US$0.02 per liter (BO.5). at the same time as ULG was introduced, This is a very modest and highly cost-effective and specifying a target date by which leaded expense, given the great potential benefits at- gasoline was to be phased out; tributable to eliminating lead from gasoline.' * reformulating and otherwise improving Introducing ULG and phasing out leaded leaded gasolines while it remained on the gasolines in Thailand was a complex matter, market to reduce other harmful emissions impacting many sectors. However, Thai (carbon monoxide, hydrocarbons); policymakers completed the process within four * improving the quality of diesel fuels and lu- and one-half years, one year ahead of sched- bricants to reduce particulates and other ule. A fairly detailed plan of action had been emissions, which also had been identified drafted at the outset and implementation was as a pressing problem; generally smooth. Nonetheless, many obstacles * setting more stringent ambient air quality were faced at various times, only to be over- standards; come by fast, informed action. * setting new emission standards for motor The main features of the implementation vehicles, including requiring new motor ve- process might be transferred elsewhere: hicles to be fitted with a catalytic converter; * improving vehicle maintenance and inspec- * consultation with and obtaining consensus tion; and from all affected parties and decisionmakers; * strengthening traffic management measures * task leadership and ownership-NEPC and to raise vehicle speeds. NEPO vigorously led and managed all the project steps; The ULG and general lead reduction initia- * defining target dates for implementing key tives were introduced in recognition of lead's actions; seriously harmful effects on the population and * price and other fiscal incentives to favor ULG; 43 Successful Conversion to Unleaded Gasoline in Thailand 44 * using supporting consumer research, high capacityin Singapore (from where ULG was ini- quality acdvertising, and resources for stucly- tially imported); a favorable fall in world oil ing the various technical issues which prices; and a vigorous private sector, operating emerged during implementation; and in an increasingly liberalized petroleum market. * public infbrmation, education, and training. Thailand was also able to capitalize on some NOTES particular ci:rcumstances prevailing at the ti]ne ULG was introduced. There was spare refinery 1. World Bank 1994. BIBLIOGRAPHY Alpha Research Co. Ltd. 1995a. Thailand in sity Press. Figures 3rd Edition, 1995 to 1996. Land Transport Departrnent. 1990. Road Trans- Bangkok, Thailand. port Statistics 1989. Bangkok, Thailand. Alpha Research Co. Ltd. 1995b, Pocket Thai- Land Transport Departnent. 1996. Road Trans- land Petroleum Report, 1995. Bangkok, port Statistics 1995. Bangkok, Thailand. Thailand. Lovei, Magda. 1996. Phasing Out Lead from Alpha Research Co. Ltd. 1997. Pocket Thai- Gasoline: World-Wide Experience and land Petroleum Report, 1997. Bangkok, Policy Implications. Technical Paper No. Thailand. 397. Washington, D.C.:World Bank. Amranand. (1997). PersonalCommunication. Magistad, Mary Kay. 1991. "Bangkok's (Secretary General of NEPO). Bangkok, Progress Marked By Health Hazards." The Thailand. Washington Post Health Magazine. May Chevron. 1990. "Use of Unleaded Gasoline in 1991. Cars Designed for Leaded Gasoline." United Martin, M. 1997. Personal Communication. States. (Caltex). Chongpeerapien, Tiengchai. 1992. "Energy Ministry of Transportation and Communica- Policy Review and Outlook." PTIT Focus tions. 1994. Action Plan to Reduce Vehicle Annual Issue. Bangkok, Thailand. Emissions and Noise Pollution. Bangkok, Department of Energy Development and Pro- Thailand. motion. 1994. Thailand Energy Situation National Energy Policy Office. "Presentation 1992. Bangkok, Thailand. on ULG." Overhead presentation, Bangkok, Faiz et al. 1990. Automotive Air Pollution: Is- Thailand. Not dated. sues and Optionsfor Developing Countries. National Energy Policy Office. 1991. "Un- Washington, D.C. :World Bank. leaded Gasoline." NEPO Quarterly Volume Faiz et al. 1994. Air Pollutionfrom Motor Ve- 15, January-March. hicles. Washington, D.C.:World Bank. National Energy Policy Office. 1991. "The Halcrow Fox. 1991. Seventh Plan Urban and Reduction of Lead in Gasoline and Unleaded Regional Transport Stud: Executive Sum- Gasoline." NEPO Quarterly. mary, Prepared for NESDB, Thailand with National Energy Policy Office. 1991. "Un- support from UNDP/ World Bank. leaded Gasoline: A Description of Various Koomsup, P. . 1993. "Energy Policy." In Peter Measures To Implement ULG." NEPO G. Warr, ed., The Thai Economy in Transi- Quarterly. tion. Cambridge, Mass.:Cambridge Univer- National Energy Policy Office. 1995. "Abolition 45 Successful Conversion to Unleaded Gasoline in Thailand 46 of Leaded Gasoline." Bangkok, ThailandL Bangkok, Thailand. Panich, S. 1.994. "Bangkok and Its Air Pollu- Shell Science and Technology. n.d. Gasoline. tion Problem." Paper presented at an IIEC Bangkok, Thailand. seminar, at the Sukothai Hotel, November Tansamrit, S. 1991. "Energy Policy and Out- 1994. look." PTIT Focus, June 1990. Petroleum Authority of Thailand. 1993. Annual Thailand Development Research Institute. Report. Bangkok, Thailand. 1990. "Energy and the Environment: Choos- Petroleum Authority of Thailand. 1994. Annual ing the Right Mix, Research Report No. 7." Report. Bangkok, Thailand. Paper presented at the 1 990 TDRI Year-End Petroleum I]nstitute of Thailand. Various dates. Conference, Jomtien, Chon Buri, Thailand, Focus Magazine. December 1990. Pollution Control Department. Various Data. Thailand Environment Institute. 1994. "Solv- Bangkok, Thailand. ing the Environmental Crisis: Adjusting the PPK Consultants. 1991. "Study of Inter-City and Implementation Path." Paper presented at Rural Bus Transport." Consultants' report. TEI's Year-End Conference, Ambassador World Bank, East Asia and Pacific Regional Hotel, Bangkok, Thailand, July 29. Office, Washington, D.C. and Land Trans- The Bangkok Post. Various years. Mid-Year port Department, Bangkok, Thailand. and End-of-Year Economic Review. PublicWorksDepartment 1995. SafetyStandards Bangkok, Thailand. forStorage ofFuel. Bangkok Thailand. U. K. Royal Commission on Environment Pol- Radian Corporation. 1994. "Motor Vehicle Pol- lution. 1994. Eighteenth Report, Transport lution Control in Bangkok: A Strategy for and the Environment. :HMSO, London. Progress." Consultants' report. Polluition U.S. Agency for International Development. Control Department. Bangkok, Thailand. 1990. Ranking Environmental Health Risks Sangnimnlan, A. 1997. Personal Communica- in Bangkok Thailand. Volume 1. Washing- tion. (Senior Vice President, Bangchak). ton, D.C.:USAID. Sayeg, Philip J. 1997. 'Report on Progress Sum- U.S. Environmental Protection Agency. 1985. mary ofithe Action Plan for Reduction ofVe- Costs and Benefits of Reducing Lead in hicle Emissions and Noise: Thailand." Gasoline: Final Regulatory Impact Analy- Consultant'sreport WorldBank,EastAsiaand sis. EPA-230-05-85-006. Environmental Pacific Regional Office, Washington, D.C. Protection Agency, Office of Policy Analy- Sayeg, Philip J. et al. 1992. "Assessment of sis, Washington DC. Transportation Growth in Asia and Its Ef- U.S. Environmental Protection Agency. Janu- fects on Energy Use, the Environment, and ary 29, 1996. "EPA Takes Final Step in Traffic Congestion: Case Study of Bangkok, Phaseout of Leaded Gasoline." Washington, Thailand." Consultant's report. International D.C.:USEPA. Institute for Energy Conservation, Washing- University of Wisconsin. 1996. The Lead ton, D.C. Phaseout Page. World Wide Web site http:/ Shell Company of Thailand Limited. 1990. Un- gaial .ies.wisc.edu/research/leadphaseout. leaded Gasoline, Questions and Answers. Walsh, Michael. 1991. "Urban Transport and the 47 Bibliography Environment in Asia: Pacific Region" Con- World Bank. 1994. "Thailand: Mitigating Pol- sultant's report. World Bank, East Asia and lution and Congestion Impacts in A High- Pacific Regional Office, Washington, D.C. Growth Economy." Country Economic Re- Wangwongwatana, S. 1996. Personal Commu- port. World Bank, East Asia and Pacific Re- nication. (Director, PCD's Air Quality and gional Office, Washington, D.C. Noise Management Division). World Bank. 1995. "Thailand, Fifth Highway Weaver, Christopher. 1996. Personal Commu- Sector Project." Staff Appraisal Report. nication. (Specialist in Fuels, Emissions and World Bank, East Asia and Pacific Regional Engine Technology). Office, Washington, D.C. World Bank. 1992. "Thailand Fourth Highway World Bank. 1996. "Policy Briefing for Initiat- Sector Project." World Bank, East Asia and ing the Phase-Out of Leaded Gasoline in In- Pacific Regional Office, Washington, D.C. donesia" Internal briefing note. World Bank, World Bank. 1993. "Thailand Fuel Option Indonesia Country Unit, Jakarta, Indonesia. Study." World Bank, East Asia and Pacific World Resources Institute. 1996. World Re- Regional Office, Washington, D.C. sources Annual Report. Washington, D.C. APPENDIX A: NEPO's LIST OF MAKES AND MODELS OF GASOLINE-POWERED VEHICLES THAT CAN USE UNLEADED GASOLINE Table A.: NEPO's List of Gasoline Powered Vehicles that can use Unleaded Gasoline Trademark Model Productionhlmport Year Private Car ALFA ROMEO Every Model 93 or later AUDI Every Model 92 or later BENTLEY Every Model 89 or later BMW 316/4 84-89 316/2 84-87 520i 79-89 520iA 83-88 525 M20 83-85 535 M30 85-87 633 CSIM30 79-81 635i M8 80-87 635 CSIS38 80-84 731 M30 79-86 735i M30 80-86 745i M30 80-83 Every Model 86 or later CHRYSLER Every Model 94 or later CITROEN Every Model 84 or later DAEWOO Every Model 94 or later DAIMLER Every Model 89 or later DATSUN 200 C (L20A, L26) 71-76 220 C (L20A, L26) 71-76 260 C (L20A, L26) 71-76 240 Z 70 200 L 72 2000 CC (L20A, L24, L23) 66 2300 CC (L20A, L24, L23) 66 2400 CC (L20A, L24, L23) 66 1400 CC 68 1600 CC 68 160 J 77-79 180 B 72 160B 72 49 Successful Conversion to Unleaded Gasoline in Thailand 50 Trademark Model Production/lmport Year DISCOVERY Every Model 92 or later FERRARI Every Model 92 or later FIAT Every Model 87 or later FORD Every Model 89 or later HOLDEN Every Model 88 or later HONDA Every Model 84 or later HYUNDAI Every Model 92 or later ISUZU Every Model 79 or later JAGUAR Every Model 89 or later LANCIA Every Model 87 or later LOTUS Every Model 89 or later MASERATI Every Model 92 or later MAZDA Every Model of F626 78-91 929 82-89 Every Model 87 or later MERCEDE'S BENZ Every Model 82 or later MITSUBISHI IEvery Model 73 or later NISSAN STANZA 1.8 78-86 MARCH 1.0 83-88 Every Model of SENTRA (GA14S, GA16S, GA16i, CA18DE) 87-89 SENTRA SALOON (GA13D'i, GA14DS, GAI6DS, GA16DE, SR20DE) 90 or later SKYLINE 2.0 86-87 LAUREL 85 300 XX 84 Every Model of CEDRIC 80-88 CAPS1'AR (TB4Z, RB30S) 82-82 Every Model of BLUEBIRD 88-88 CEFIRO 2.0 89 or later 200 SX 89 or later 300 ZX 90 or later Every Model 91 or later OPEL Every Model of KADETT 87 or later REKORD 2.2i 86-88 Every Model 88 or later PEUGEOT Every Model of 305 GL XU5-2C 87-90 309 GT XU5-2C 1500 CC 88-90 405 GR XU9-2C 1900 CC 89-92 405 GL XU5-2C 1500 CC 89-92 405 SRI XU9-J2 1900 CC 92 or later 505 GR XN1A 1971 CC 87-89 Every Model of 605 90 or later Every Model 94 or later PORSCHE Every Model 89 or later RANGE ROVER Every Model 92 or later RENAULT Every Model 88 or later ROVER Every Model 92 or later 51 Appendix A Trademark Model Productionilmport Year SAAB Every Model 92 or later SUBARU Every Model 79 or later SUZUKI Every Model 80 or later TOYOTA Every Model of COROLLA (3K, 3K-H, 4K, 21, 2A, 2E, 4A, 4A-F, 4A-GE) 71 or later Every Model of CORONA (2T, 3T, 4A, 4S, 4A-F, 3S-F, 3S-FE) 71 or later Every Model of STARLET (3K, 4E, 2F) 71 or later Every Model of CELICA (2T, 2T-G, 2TB, 4A-GE, 4A-FE, 3S-GE) 72 or later Every Model 78 or later VOLKSWAKEN Every Model 87 or later VOLVO Every Model 79 or later Van and Pick-up TOYOTA Van - HIACE (2Y, 3Y, 1 RZ) 82-present Van - LITEACE (3K, 4K, 5K) 71 or later Pick-up HILUX (1Y, 2Y, 3Y, 4Y) 84 or later NISSAN Pick-up (620) (J 15) 67-75 Pick-up - PROFESSIONAL (720) (J 16) 79-86 Pick-up - BIG M (D21) (Z 16, Z 20) 86-95 Van - VANETTE (C 120) (A 15) 76-81 Van - URVAN (E 23) (Z 20) 76-81 Van - URVAN (E 24) (Z 20) 89-95 VOLKSWAKEN Van - CARAVELLE 94 Van - SYNCRO 4 x 4 94 MAZDA Pick-up - FAMILIA STANDARD (TC) 1300 CC 4 Gear, 5 Gear To Produce July 90 or later Pick-up - FAMILIA SUPERCAP (TC) 1300 CC 4 Gear, 5 Gear To Produce July 90 or later Pick-up - FAMILIA Short Portion (TC) 1300 cc 4 Gear To Produce July 90 or later MAZDA Pick-up - B 1600 Maxnum (F6) 1600 CC 87-88 Pick-up - B 2000 Maxnum (FE) 2000 CC 87-88 ISUZU Pick-up - FASTER Z (KB 29) 87-present Pick-up - FASTER Z (TES 16 HSR) 90- present Note: NEPO confirmed this information by contac6ng the production or importing company. APPENDIX B: THAILAND' S SPECIFICATIONS FOR AUTOMOTIVE GASOLINE Table B.1: Specifications For Automotive Gasoline Test Items Limits Regular ULG Premium ULG ASTM Test Method Type I Type 2 1. Octane No. 2. Research Octane No. D 2699 Producer Min 87.0 95.0 95.0 Retailer Min 86.6 94.6 94.6 3. Motor Octane No. D 2700 Producer Min 76.0 84.0 84.0 Retailer Min 75.6 83.6 83.6 4. Lead Content (g/l) Max 0,013 0.013 0.013 D 3116 Or Equivalent 5. Sulfur Content (% wt) Max i 0.10 i 0.10! 0.10 A D 4294 Or Equivalent 6. Phosphorus Content (gA) Max 0.0013 0.0013 0.0013 D 3231 7. Copper Strip Corrosion, No. Max 1 1 1 D 130 8. Oxidation Stability, Mins Max 360 360 360 D 525 9. Existent Gum (g/100 ml) Max 0.004 0.004 0.004 D 381 10. Distillation (°C) D 86 10 percent Col. Evaporated Max 70 70 70 50 percent Col. Evaporated Min 70 70 70 Max 110 110 110 90 percent Col. Evaporated Max 170 170 170 11. FBP (°C) Max 200 200 200 12. Residue (% vol.) Max 2.0 2.0 2.0 13. Reid Vapor Pressure @ 37.8C, Kpa Non-Oxygenate Blends Max 62 62 62 D 323 Oxygenate Blends Max 62 62 62 D 4953 14.Benzene (% vol.) Max 3.5 3.5 3.5 D 3606 15. Aromatic (% vol.) Before 1 Jan. 2000 Max 50 50 50 Since 1 Jan. 2000 Max 35 i 35 d 35 L 16. Color 17. Hue Red Green Pale Yellow (1) Visual Inspection 18. Dye Content (mgA) Min 10.0 4.0 - Or (2) D2392 19. Intensity Min - - 0.5 Or(3) D 1500 Max - - 1.0 20. Water (% wt.) Non-Oxygenate Blends Max Nil Nil Nil Visual Inspection Oxygenate Blends Max 0.7 0.7!p 0.7 e E 203 53 Successful Conversion to Unleaded Gasoline in Thailand 54 Test Iems Limits Regular ULG Premium ULG ASTM Test Method Type 1 Type 2 Oxygenated Compounds (% vol.) Min -a 5.5 e 5.5 °f Max 11.0 11.0 Y 11.0 y 21. PFI/IVDC Additive - X X X - 22. Valve Seat Recession - - X Protection Additive Y1 (In Cases Where Additives other - X X X than Benzene or Aromatics Are Used Must Inform In Advance) Appearance Bright And Clear Visual Inspection a/ Conduct The Test When Having Phosphorus In The Additive b/ Use 2-Naphthalenol [ (Phenylazo) Phenyl ] Azo Alkyl Derivatives Compounds And 1, 3-Benzenediol, 2, 4 -B3is[ (Alkylphenyl) Azo- Compounds In The Ratio 57:8 By Weight And Use Test Method (1) Or (2) c/ Use 1,4-Dialkylamino Anthraquinone Compounds And 1,c3-3enzendiol, 2, 4 -Bis ((Alkylphenyl) Azo-) Compounds In The Ration 9:4 And Use Test Method (1) Or (2) d/ Use Test Method (3) e/ Maximum Content Of Methanol Blend Is 3.0 percent By Volume f/ Mandated Especially For Gasolines Which Show X Signs Source: Department Of Commercial Registration,Ministry of Commerce, Bangkok, September 9,1995. APPENDIX C: DATA ON UNLEADED GASOLINE SALES Figure C.G: Consumption of Premium Gasoline (1991-95) Oct-95 Aug.95 Jun-95 Apr.95 Feb-95 Dec-94 Oct-94 .3Unleaded Aug-94 mLeadedI Jun-94 Apr-94 Feb-94 Dec-93 Oct-93 Aug-93 s Jun-93 g Apr-93 Feb-93 Dec-92 Oct-92 Aug-92 Jun-92 Apr-92 Feb-92 Dec-91 Oct-91 Aug-91 Jun-91 Apr-91 350 300 250 200 150 100 50 0 Million liters 55 Successful Conversion to Unleaded Gasoline in Thailand 56 Figure C 2: Consumption of Regular Gasoline (1993-95) - g | | | | } | | tOct-95 Sep.95 Aug-95 Jul195 Jun-95 May-95 . Apr-95 Mar-95 T Feb-95 Jan-95 1- _______1 ____1 _____1 ________ Dec-94 - Nov-94 ______________________ Oct-94 - Sep.94 'I--- I I I II I I--- Aug-94 1L ~~~Jul-94 Jun-94 * Leaded . l | | l l ~~~~~Dec-93 _ _ _ . | | , , ~~~~~~~~Nov-93 _- Aug-93 _ _ _ _ _ _ ~~~~~~~~~~Jul-93 _ _ _ ___ _ _ ~~~~~~~Jun-93 May-93 Apr-93 _ _ _ _ _ =~ _ _ _ Mar-93 Feb-93 Jan-93 200 180 1604 140 120 100 8 0 20 Million liters APPENDIX D: UNLEADED GASOLINE PRODUCTION AND IMPORTATION, 1990-95 This appendix describes the extent of produc- tation of premium leaded and unleaded gaso- tion and importation of unleaded gasoline line from 1991 to 1995 is shown in table D.2. (ULG) and regular and premium leaded In 1991 ULG represented about 15 percent of gasolines in Thailand from 1990 to 1995. Table the premium gasoline market, growing to about D. 1 shows the extent of net production of ULG, 30 percent by 1993. At first, all ULG was im- premium, and regular gasoline in 1990 and ported, mainly from Singapore, but by 1993 47 1991. In March 1991 the Government of Thai- percent of total ULG demand was supplied lo- land first campaigned for the introduction of cally. This continued until the end of 1995, ULG; the industry first introduced ULG in May when all local ULG demand was satisfied by 1991. Initially ULG was imported from local production. Singapore as there was then no local refinery Table D.3 supplies data on regular gasoline. capable of producing ULG. In 1991, almost 300 Although the overall implementation timetable million liters of ULG (about 15 percent of total set a particular date by which leaded regular premium gasoline demand) was produced and gasoline was to be phased out, early attention consumed. ULG was first produced in August focused on providing premium ULG. Regular 1991, as shown in table D.1. ULG was introduced during mid-1993-mid- An overview of the production and impor- 1994, as shown in table D.3. Table D.1: Thailand Gasoline Net Production and Imports, 1990-1991 (Units: million liters) Product 1990 1991 Net Production Imports Total Net Production Imports Total Premium Gasoline 1,269.4 472.3 1,741.7 1,187.0 400.5 1,587.5 Unleaded Premium Gasoline 0.0 0.0 0.0 3.9 285.8 289.7 Regular Gasoline 1,758.4 187.6 1,946.0 1,893.9 91.6 1,985.5 Note: Net production assumed to equal: production less exports. Exports of premium and regular gasoline were small and that for ULG zero in these two years. Source: Pocket Thailand Petroleum Report, 1995, Alpha Research Company Ltd (1995b). 57 Successful Conversion to Unleaded Gasoline in Thailand 58 Table D.2: Thailand Premium Gasoline Production and Imports (1990-95) (Units: million liters) Product 1991 1992 1993 1994 1995 a Premium Gasoline Production 1187.7 1,306.1 1,539.1 1,769.6 1,138.9 b Premium Gasoline Imports 400.5 607.2 370.0 127.0 143.0 a+b Sub-total, Premium Gasoline 1,588.2 1,913.3 1,909.1 1923.6 1281.9 c ULG, Premium Production 3.9 147.2 401.2 1,220.8 2,408.0 d ULG, Premium Imports 285.8 380.3 459.6 290.1 221.0 c+d Sub-tcital, ULG, Premium 289.7 527.5 860.8 1510.9 2629.0 e Total IJLG (c+d) and Leaded 1,877.9 2,440.8 2,769.9 1801.0 2850.0 Premium (a+b) f percent ULG (c+d) of Total (e) 15.4 percent 21.6 percent 31.1 percent 83.9 percent 92.2 percent g percent ULG (d) Imported of 99.0 percent 72.1 percent 53.4 percent 19.2 percent 8.4 percent Sub-Total ULG (c+d) Note' NEPO figures for earlier years differ somewhat from those in Pocket Thailand Petroleum Report. Import figures for 1994 and 1995 are unavailable. Source: All figures to 1993 from Pocket Thailand Petboleum Report, 1995, Alpha Research Company Ltd (1 995b). Production figures for 1994 and 1995 from NEPO except imports from 1994 and 1995 from Alpha Research Company Ltd (1997). Table D.3: Thailand Regular Gasoline Production and Imports (1990-95) (Units: million liters) Product 1991 1992 1993 1994 1995 a Regular Gasoline Production 1,911.0 2,248.2 2,352.2 174.2 184.7 b Regular Gasoline Imports 91.6 71.2 109.2 25.8 0.0 a+b Sub-total, Regular Gasoline 2,002.6 2,319.4 2,461.4 200.0 184.7 c ULLG, Regular Production 0.0 0.0 0.0 1,828.7 2,059.2 d ULG, Regular Imports 0.0 0.0 NA 390.2 289.1 c+d Sub-total, ULG, Regular 0.0 0.0 NA 2,218.9 2,348.3 e Total Regular (a+ b) and 2,006.8 2,116.3 2,163.9 2,418.9 2,533.0 Regular ULG Consumption (c+d) f percent ULG (c+d) of Total (a) 0.0 percent: 0.0 percent NA 91.7 percent 92.7 percent g percent ULG imported (d) of 0.0 percen: 0.0 percent NA 16.1 percent 11.4 percent Sub-Total ULG (c+d) Note: NEPO figures for earlier years differ somewhat from those in Pocket Thailand Petroleum Report. Import figures for I1994 and 1995 from Alpha Research Company Ltd (1997). Production figures for regular ULG 1991 and 1992 are believed to be negligible. Source: All figures to 1993 from Pocket Thailand Petroleum Report, 1995. Production figures for 1994 and 1995 from NEPO. Distributors of COLOMBIA GERMANY Tel: (52 5) 624-2800 POLAND Faac (941) 432104 Infoenlace Ltda. UNO-Verag ISRAEL Fax: (525)624-2822 International Publishing Service E-mail: LHI-4L@r.lanka.ret W orld Bank Carrera 6 No. 51-21 Poppelsdorler Allee 55 Yozmot Literature Ltd. E-mail: infotec@rn.net.mx Ul. Piekna 31/37 Apartado Aereo 34270 53115 Boan PO. Boa 560550067WraaSE N Publications Santald de Bogol2, D.C. Tel: (49 228) 949020 3 Yohunan Hasaxd6ar Street Mundi-Prensa Mexico S.A. de C.V Tel: (482) 628-6089 WennergrEN-Williams AS Prices and credit terms varV frern Tel: (57 1) 285-2788 Fax: (49 228) 217492 Tel Aviv 61560 c/Rio Panaco, t41-Coloxia Cuauhftemoac Faa: (48 2) 621-7255 P O. Boo 1305 country to country. Consult yotr Fax: (57 1) 285-2798 E-mail: unovedag@aol.com Tel: (972 3)5285-397 86508 Meaico, D.F E-mail: booas%ips@ikp.atm.com.pl S-171 25 Sotna Faa: (872 3) 5285-387 Tel: (52 5) 533-5658 Tel: (46 8) 705-97-50 local distribuitor before placing an COTE D IVOIRE GHANA Fax: (52 5) 5144799 PORTUGAL Fax: (46 8) 27-00-71 order. Center dEdition et de Dilfusion Africaines Epp Books Services ROY International Livrada Portugal E-mail: mail@wwi.se (CODA) P0. Boo 44 P0 Baa t3056 NEPAL Apartado 2681, Rua Da Carara 70-74 ARGENTINA 04 B P 541 TUC Tel Aviv 61130 Everest Media Intemabonal Services (P) LId. 1200 Lisbon SWITZERLAND Olicina del Libro Internacional Abidjan 04 Accra Tel: (972 3) 5461423 GPO Box 5443 Tel: (1) 347-4882 Lib6irie Payot Service Institationnel Av. Cordoba 1877 Tel: (225)246510:246511 Fax: (9723)5461442 Kathmandu Fax:(1)347-264 Cotes-de-Montbenon38 1120Buenos Aires GREECE E-mail: royil@netvision.net.il Tel: (977 1)472 152 1002 Lausanne Tel (541) 815-8354Fa: (25)25567 Papasotiriou S.A. Fax: (9771) 224 431 ROMANIA Tel: (41 21) 341-3229 Tel: (54 1) 815-8354 35, Stoumvara Str. Paetna uhrt/ideEast Compani Do Librarii Bacaresti S A.Fa:412)3125 E-maiL:oilibros@atink.com CentertSApplied Research Te: 106 82 Athens Index nformoation Services NETHERLANDS Str LLiuscani no. 26, sector 3 E-mai: oliibroOatlin.comCenpru Col plieg eserhTel: (30 1) 364-1826 P0.B. 18582 Jerusalem Do LindeboonatIxOr-Publikaties Bucharest ADECO Van Diermen EditionsTechniqaes AUSTRALIA, FIJI, PAPUA NEW GUINEA, 6, Diogene Street, Engomi Fax:(301)364-8254 Tel: (972 2)6271219 PO. Ba 028 7480 AE Haaksbergen Tel (4 3 5 e o Lacue 4 SOLOMON ISLANDS, VANUATU, AND P0.' Box 20'06 Faa: (872 2)6271634 Tel: (31 53) 574-8804 Fax: (40 1) 312 4880 CH1807 Bloaxy SAMOANcoi HAITI Fax: (31 53) 572-8296 TelANFDEAIO a: (41 21) 943 2673 Nicosia ~ ~~~~Cultare ODloousin ITALY E-mxil: liedeboa@woddonlixe.xl RUsdaesIAN FVeDEMrATO>a:(12)9330 D.A. Infonrnation Services Tel: (357 2) 44-1730 5, Rae Capois Licosa Cammissionaria Sanooni SPA g,Klpdate hnoy PVeaMreuoHALN 648 Wdhitehare Road Fax: (3572)46-2051 CP 257 Via Daca Di Calabda, 1/1 NEW ZEALAND 9aM Kopchi Pereu1okentHalAND Michram CZCHREUBI Padt-au-Prince Casella Poatale 552 EBSCO NZ Ltd. .ITel:cow 1095 17831 90 Cetrlo Booksdirbta TeL (61)320 7777U CZECH REPU a Tel: (58)23 8260 50125 Firenze Private Mail Bag 99914 Tel: (7 095) 917 87459 Bangkok 10500 Faa: (61) 3 821077788 USISekNISPrden Faa: (508( 23 4858 Tel: (55) 645-415 New Market Faae(785)17258Banko 105500 E-mail: service@dadirect.com.au 13000 Prague 3 HONG KONG, CHINA; MACAO E-mail: licosa(6 tbcc.2 Tel d S64A9)R524-8119 TAIWAN, Fax: (662)235-8321 Tel: (420 2) 2423 1486 Asia 2000 Ltd. Fa: (64 9) 524-8119 MYANMAR9 BRUNEI AUSTRIA Fax: (4202)24231114 Sales & Circulation Depadment JAMAICA Fax:(6 5- Ashgate Publishing Asia Pacific Pte. Ltd. TRINIDAD & TOBAGO eihr ganse 26 DENMARK Seabnd Housex unIt 0102 an Randle Publiohem Ltd. NIGERIA 41 Kallang Pudding Road #04-03 AND THE CARRIBBEAN A-iloll Wisen2 DEaMtnALtRK l Hong8 KxnghmStet Central 286 Old Hope Rxad, Kingston 6 Unixersity Preas Limited Goldex) Wheel Boilding Systematica Studies Ltd. A-10112Wien Sam2undsLR n eratur Hong Kong Tel: 876-927-2085 Three Crowns Building Jericho Singapore 348316 St. Augustine Shopping Center Tel: (43 1) 512-47-31 -0 Tel: (65) 741-5166 Eastem Main Road, St. Augustine~~~~~~~~~~~~~~~~Tel:(65 741516 Faa: (43 1) 512-47-31-28 DK-1870rRosenoemsAlle1 Tel: (852) 2530-1409 Fax:876-977-0243 Private Mail Bag 5095 Fax: (65) 742-9356 Eastemr Main Road,gSt.Augastine Fax: (43 1) 512-47-31-29 DK 1970 Frederiksberg C Fax: (852) 2526-1107 E-mail: irpl@colis,com lbadan E-alsgt~sacnetcmTrindad Tobago 64511ndie Tel: (45 31) 351942 E-mail: sales@asia2OOO.com.hk Tel: (234 22) 4i-1356 E-mail: asbgate@aaiaxcanaxcl com Trnd & TbgWetdi BANGLADESH Fax: (45 31) 357822 JAPAN Fax: (234 22) 41-2056 SLOVENIA Fax: (868) 645-8467 Micro Industries Development HUNGARY Eastem Book SeFvice Gospodarsd VesFmk Publishing Group E-mail: to8betnicad.net Assistance Society (MIDAS) ECUADOR Euro Info Service 3E13 Hongo 3-chome, Bunkyo-ku NORWAY 1000j0ka cesna U House 5, Rood 16 LibS Mundi Marg8oszgnti Europa Ha! 3-3Tokyo 13-coe uq-aNIInoRWAYS Gos0 dao0 VjblatnikPbihnara -mGAil.Nobe@tAd iad Dhanmondi R'Area Librerialntemacional H-1138 Badapest Toklo (8113 8N8 n6 BookDepartment,SPostboks6512Enerstad Te et32POBox9997,MadhvaniaBuilding PD. Boa 17-01-3029 ~~~~Tel: (36 1) 350 8024,3508256Te: (813) 388-086 100 L 1)ban UGANDA3 Dhaka 1208 BookBoDepa01m309t,3P0xst25xkax6512 3EO8era0ad Tel: (386 61) 133 83 47; 132 12 30GataLd Fax: (8802)811188 Quito -mail: xurxioto@mxil.maax.ha E-mail: orders@ox-eba.co.)p Tel: (47 22) 87-4500 6-molt: repanxek)@gvestnik.si Plot 16/4 Jinja Rd. Tel (8802) 328427 Juan Leon Mera 851 E-mail. uroinfo3 ma6Imtvhu t)35Emilrdr@stebo.pFax: (47 22) 97-4545 Kampala Fax: (880 2) 81118 Quitel (5932) 21-6084(5032)544-16 TelB (593 2) 5210 (593 2) 544-185 INDIA KENYA SOUTH AFRICA, BOTSWANA Tel: (256 41) 251 467 BELGIUM Fax: (593 2)i504-209 Allied Publishers Ltd. Afrca Book Service (E.A.) Ltd. PAKISTAN Forsingle tttes: Fax: (256 41) 251 468 An. da Rol 282 . 751 Moaxt Road Oa~~~~~~~~~~~~~~~~~~~~~Qarax Hoase, Mfangano Street Mirza Book Agency Oxford Univerodty Press Soathem Atrica E-mail: gaa@swihxuganda.com JeanDe Lannoy E-mail: librimul1@1ibrimundi.com.ec 71Madrs-600 QurnosMtnaoleladSarhe-adeAa Vasco Boulevard,Goodwood Emi:uEwuad.o 1000 Bdu el COEUMam-6002 PO. Box 45245 65, Shahrahr-e-Ouaid-e-AzamVacBaear,Gdmd MadTel: (8144852-3938 Nairobi Lahore54000 PO. Box 12119, Ni City 7463 UNITED KINGDOM Tt: (32B2) 538-5189 Raiz do Casilla 763, Edil. Expocolor Fa: (91 44) 852-0649 Tel: (254 2) 223 641 Tel: (92 42) 735 3601 Cape Toin Microinfo Ltd. Fa.: (32 2) 538-5841 Primer pisa, Ol. 02 .) Fax: (254 2) 330 272 Fax: (92 42) 576 3714 Tel: (27 21) 595 4400 PO. Box 3, Ahton, Hampshire GU34 2PG :Oim INDONESIA Fax: (27 21) 595 4430 England BRAZIL TeEFax: (5932)507-383; 253-091 Pt. Indira Limled KOREA, REPUBUC OF Oxford University Press E-mail: oxiord@oup.co.za Tel: (44 1420) 86848 Publicacdes Tecnicas Intemacionais Ltda. E-mail: codeu@impsat.net.ec Jalan Borobudur 20 Daejon Trading Co. Ltd. 5 Bangalore Town Fax: (441420) 88889 Rua Peixoto Gomide, 209 PO. Box 181 PO. Box 34, Youida, 706 Seoun Bldg Sharae Faisal Forsubscriptiondordes: E-mail: wbank@ukminfo.demon.co.uk 01409 Sao Paulo, SP EGYPT, ARAB REPUBLIC OF Jakarta 10320 44-6 Youido-Dong, Yeongchengpo-Ku PO Box 13033 International Subscription Service Tel: (55 11) 259-6644 Al Ahram Distribution Agency Tel: (62 21) 390-4290 Seoul Karachi-75350 PO. Box 41095 The Statioxery Office Fax: (55 11)2586990 AlGalaa Street Fax: (6221)390-4289 Tel: (82 2) 785-1631/4 Tel: (9221)446307 Craighall 51 Nine Elms Lane E-mail: postmaster@pti.uol.br Cairo Fax: (92 2) 784-0315 Fax: (92 21) 4547840 Johannesburg 2024 London SW8 SDR Tel: (202)578-6093 IRAN E-mail: oauppak@TheOllice.net Tel: (2711) 880-1448 Tel: (44 171) 873-8400 CANADA Fax: (20 2) 578-6833 Ketab Sara Co. Fublishers LEBANON Fax: (27 11) 880-6248 Fax: (44 171) 873-8242 Renouf Publishing Co. Ltd. Khaled Eslamboli Ave., 6th Street Librairie du Liban Pak Book Corporation E-mail: iss@is.co.za 5369 Canotek Road The Middle East Observer Delafrooz Alley No. 8 PO. Box 11-9232 Aziz Chambers 21, Queen's Road VENEZUELA Otawa, Ornado K1J 9J3 41 Shenit Street PO. Box 15745-733 Beirut Lahore SPAIN Tecni-Ciencia Libros, S.A. Tel: (613) 745-2665 Cairo Tehran 15117 Tel: (961 9)217944 Tel: (92 42) 636 3222; 636 0885 Mundi-Prensa Libros, SA. Centra Cuidad Comercial Tamanco Fax: (613) 745-7660 Tel: (20 2) 393-9732 Tel: (98 21) 8717819; 8716104 fax: (961 9) 217 434 Fax: (92 42) 636 2328 Castello 37 Nivel C2, Caracas E-mail: order .dept@renoufbooks.com Fax: (202) 393-9732 Fax: (98 21) 8712479 E-mail: pbc@brai net.pk 28501 Madrid Tel: (58 2) 9595547; 5035; 001 E-mail: ketab-sara@neda.net.ir MALAYSIA Txl: (341) 431-33998 Fax: (582)9595636 CHINA FINLAND Universiay o Malaya Cooperative PERU Faa: (34l1)575-3988 China Financial & Economic Akateeminen Kirjakauppa Kowkab Publishers Bookshop, Limied Editorial Desarmollo SA E-mail: libreria@mundiprxnsa es ZAMBIA Publishing House PO Box28 PO. Box 19575-5t1 PO. Box 1127 Apartado 3824, Lima1 UniseraityaBookehop,aUnixerRitydotmZambia 8,DaFo SiDongJie FIN-00101 Helsinki Tehran Jalan Pantai Baru Tel: (51 14) 285380 Mosdi-PressaBarcelsxa GreatEastRoadCampus Beijing Tel: (3580)1214418 Tel: (88 21)258-3723 59700 KualaLumpur Fax: (51 14) 286628 Consellde Cent, 391 PO. Box 32379 Tel: (86 10) 6333-8257 Fax: (358 0) 121-4435 Fax: (98 21) 258-3723 Tel: (60 3) 756-5000 0800 NES 39 Barcelona Telk (260 t 252 576 (96 10) 6401-7365 E-mail: oktilausBslockmasn.ti Fax:(60)755-4424 PHILIPPINES Tel:(33)488-3402 Tel: (2601)25257 Fax: (61)60-35Emi:aaiassokanl IRELAND E-mail: umkoop@tm.net.MY Intemational Booksource Center Inc. Fax: (34 3) 487-7659 Fax: (26001) 2530952 Chinx Snok Import Ceotre FRANCE Govemment Supplies Agency 11 27-A Antipolo SI, Barangay, Venezuela E-mail: barcelona@mundiprensaaes Ch0n Boxklpt 2825 WoRANd BakPbiOix itigax tSoldthair MEXICO Makati City ZIMBABWE PO,Boxijin 5 vVord Bank Publications 4-5 Hacouil Road INFOTEC Tel: (63 2) 896 6501 6505; 6507 SRI LANKA, THE MALDIVES Academic and Baobab Books (Pvt.) Ltd. Beijing 66, asenux d¼i7na Dublin 2 Av. SaxnFemando No. 37 Fax: (632)896 1741 Lake House Bookshop 4 Conald Road, Granieside 75116 Pasis Tel: (353 1)0661-31 11 Col. Torixllo Guerra 100, Sir Chittampalamn Gardiner Mamatho po Box 567 Tel: (33 t) 40-69-30-5b/57 Fax: (353 31) 475-2670 14050 Mesxico, D.F Colombo 2 Harare Fax: (33 1) 40-00-30-68 Tel: )94 1) 32105 Tel: 263 4 755035 Fax: 263 4 781913 IBRD 29527 SU HANBURIX j :2 Meow , AYT!; A: .: 0 S.- - - -aX ) 0 -i lf o ,:f rhil d S NAKHON HALN \ . PATHOMa F Provinces ~ Other Five Provinces{~ in )- Road CHACHOENs \ - - ~~~ ~ ~~~~~~~~~~~SAO Mo/ Natokhril CiGut of Thaiilndr VIOTNGKH10 0AM / iX 50NGKHRSt . . THAILAND . BANGKOK METROPOLITAN REGION(BMR ULDOR. HINA Comprising, Bangkok Metropolifon Area o o Tand Five Provinces % s | j ~~~~~~~~~~~~~Bangkok Metrapolitan Arrea 6) Province (Changwat) Copitols j fbr THAILIAN D ) 1 - 4 Other five Provircesfinclded in BMR o Roods mop L National Capi t ol ,airoooods 8 % _tlongkok.S - Province (Changwat) Souinclries W sf1vers \ ( =1 \ CAMBODIA . S ) )J i ~~~~~~~~~~~~~~Intemational Boundariiess_ Cartals t $ / (/ f f s<,ETNA,U O ~ ~~ ~~~ 1.0 20 AID4 X Thaligzf < W~~~~~~~~~~~LOMETERS k;~~~~~~~~~~~~~~~~~~~~~~~~~~~~h.q 'o- by .h Mo .d~Vi of. mL^YSIA .~~~~~~~~~~~~~~~~~~~~-yxgt .be of. tw?n~y$ aQny0dm Gtw MAY 1 998 RECENT WORLD BANK TECHNICAL PAPERS (continued) No. 370 Dejene, Shishira, Yanda, and Johnsen, Land Degradation in Thnzania: Perception from the Village No. 371 Essama-Nssah, Analyse d'une re'vartition du niveau de vie No. 372 Cleaver and Schreiber, Inverser la spriale: Les interactions entre la population, I'agriculture et l'environnement en Afrique subsaharienne No. 373 Onursal and Gautam, Vehicular Air Pollution: Experiencesfrom Seven Latin American Urban Centers No. 374 Jones, Sector Investment Programs in Africa: Issues and Experiences No. 375 Francis, Milimo, Njobvo, and Tembo, Listening to Farmers: Participatory Assessment of Policy Reform in Zambia's Agriculture Sector No. 376 Tsunokawa and Hoban, Roads and the Environment: A Handbook No. 377 Walsh and Shah, Clean Fuels for Asia: Technical Options for Moving toward Unleaded Gasoline and Low-Sulfur Diesel No. 378 Shah and Nagpal, eds., Urban Air Quality Management Strategy in Asia: Kathmandu Valley Report No. 379 Shah and Nagpal, eds., Urban Air Quality Management Strategy in Asia: Jakarta Report No. 380 Shah and Nagpal, eds., Urban Air Quality Management Strategy in Asia: Metro Manila Report No. 381 Shah and Nagpal, eds., Urban Air Quality Management Strategy in Asia: Greater Mumbai Report No. 382 Barker, Tenenbaum, and Woolf, Governance and Regulation of Power Pools and System Operators: An International Comparison No. 383 Goldman, Ergas, Ralph, and Felker, Technology Institutions and Policies: Their Role in Developing Technological Capability in Industry No. 384 Kojima and Okada, Catching Up to Leadership: The Role of Technology Support Institutions in Japan's Casting Sector No. 385 Rowat, Lubrano, and Porrata, Competition Policy and MERCOSUR No. 386 Dinar and Subramanian, Water Pricing Experiences: An International Perspective No. 387 Oskarsson, Berglund, Seling, Snellman, Stenback, and Fritz, A Planner's Guide for Selecting Clean-Coal Technologies for Power Plants No. 388 Sanjayan, Shen, and Jansen, Experiences with Integrated-Conservation Development Projects in Asia No. 389 International Commission on Irrigation and Drainage (ICID), Planning the Management, Operation, and Maintenance of Irrigation and Drainage Systems: A Guidefor the Preparation of Strategies and Manuals No. 390 Foster, Lawrence, and Morris, Groundwater in Urban Development: Assessing Management Needs and Formulating Policy Strategies No. 391 Lovei and Weiss, Jr., Environmental Management and Institutions in OECD Countries" Lessons from Experience No. 392 Felker, Chaudhuri, Gybrgy, and Goldman, The Pharmaceutical Industry in India and Hungary: Policies, Institutions, and Technological Development No. 393 Mohan, ed., Bibliography of Publications: Africa Region, 1990-97 No. 394 Hill and Shields, Incentivesfor Joint Forest Management in India: Analytical Methods and Case Studies No. 395 Saleth and Dinar, Satisfying Urban Thirst: Water Supply Augmentation and Pricing Policy in Hyderabad City, India No. 396 Kikeri, Privatization and Labor: What Happens to Workers When Governments Divest? No. 397 Lovei, Phasing Out Leadfrom Gasoline: Worldwide Experience and Policy Implications No. 398 Ayres, Anderson, and Hanrahan, Setting Priorities for Environmental MAnagement: An Application to the Mining Sector in Bolivia No. 399 Kerf, Gray, Irwin, Levesque, Taylor, and Klein, Concessionsfor Infrastructure: A Guide to Their Design and Award No. 401 Benson and Clay, The Impact of Drought on Sub-Saharan African Economies: A Preliminary Examination No. 402 Dinar, Mendelsohn, Evenson, Parikh, Sanghi, Kumar, McKinsey, and Lonergan, Measuring the Impact of Climate Change on Indian Agriculture No. 403 Welch and Fremond, The Case-by-Case Approach to Privatization: Techniques and Examples No. 404 Stephenson, Donnay, Frolova, Melnick, and Worzala, Improving Women's Health Services in the Russian Federation: Results of a Pilot Project No. 405 Onorato, Fox, and Strongman. World Bank Group Assistancefor Minerals Sector Development and Reform in Member Countries No. 406 Milazzo, Subsidies in World Fisheries: A Reexamination No. 407 Wiens and Guadagni, Designing Rules for Demand-Driven Rural Investment Funds: The Latin American Experience No. 409 Heggie and Vickers, Commercial Management and Financing of Roads THE WORLD BANK t L 1 tLcI,. \ \ . \\ :shm .Iw D.( :. 211433 t S \ F1.Ic 1.I TIC: 202-47,7-12. 4 I .,.sil,,i: 2112-47dt, ,-,Q51 I CI.\: \1( :I 04145 \\ 01k .1)1:) V\\k \1( 24-423 \\( )RIDII) \'\I rif[-I 1 \\ i.C \\cIh: III Ip: \\ \\ \\.\\,,, Hmi I-,1I w1 t 1- ,,,11LI: h( )III\s ,{ " M -11-ti IT ,41.( W- Metropolitan Environmental Improvement Program SM1t1t11 \S.i IC4hI',1. 1' WX II)IITiIICHJI S.CtL,,- \1:,,,;1i,C,,,.,, t ,i.11.\,,111;,1 I I St,-.c, \,\\. \\ ,ishiiiLj, ,,. D .(:. 20l433. t S\ I 1. cIII I,,c: 21 l2-4S.- I 00 4 1~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ 41 2,4, 3t2S2 19,( 9 7808 21 342398 ISBN 0-8213-4239-8