Forecasting the Consumption of Gasoline in Transport Sector in Pakistan Based on ARIMA Model Abdul Waheed Bhutto , a,b Aqeel Ahmed Bazmi, c Khadija Qureshi, b Khanji Harijan, d Sadia Karim, a and Muhammad Shakil Ahmad e a Department of Chemical Engineering, Dawood University of Engineering & Technology, Karachi, Pakistan; abdulwaheed27@hotmail.com (for correspondence) b Department of Chemical Engineering, Mehran University of Engineering and Technology, Jamshoro, 76062, Pakistan c Process and Energy Systems Engineering Center-PRESTIGE, Department of Chemical Engineering, COMSATS Institute of Information Technology, Lahore, Pakistan d Department of Mechanical Engineering, Mehran University of Engineering and Technology, Jamshoro, 76062, Pakistan e Department of Management Sciences, COMSATS Institute of Information Technology, Attock, Pakistan Published online 00 Month 2017 in Wiley Online Library (wileyonlinelibrary.com). DOI 10.1002/ep.12593 An important part of renewable energy strategy of any country is to find suitable transportation fuels to substitute for gasoline and diesel oil. Ethanol has been widely adopted as a substitute for gasoline and diesel oil. The quantity of ethanol required as renewable transport fuel is related to nature of gas- oline and diesel demand. Based on data for 1991–2014, this study used autoregressive integrated moving average (ARIMA) method to estimate the consumption of gasoline in transporta- tion sector in Pakistan from 2015 to 2025. The model results fit well with historical data showing high degree of accuracy. Study provides useful information for designing policy in favor of substituting gasoline with ethanol. Additionally, forecasted results provide useful support for designing an appropriate infrastructure and investment plan with reference to both gas- oline and E10 in future. This study also provides a drive for existing refineries to focus on upgrading production configurations in order to increase the share of gasoline in their product-mix. V C 2017 American Institute of Chemical Engineers Environ Prog, 00: 000–000, 2017 Keywords: gasoline consumption, forecasting, ARIMA, Pakistan INTRODUCTION Transportation is the major economic sector where large amount of petroleum products are consumed in the form of gasoline and diesel. Fossil resource supplies 95% of the total energy used by world’s transportation sector which is responsible for about 23% of total energy-related CO 2 emis- sions worldwide with about three quarters coming from road vehicles [1]. Transportation sector significantly influences the decarbonisation of the entire energy system [2]. Worldwide, petroleum and other liquid fuels (including natural gas plant liquids, biofuels, gas-to-liquids, and coal-to-liquids) are the dominant source of transportation energy, although their share of total transportation energy declines over the Interna- tional Energy Outlook 2016 (IEO2016) projection period, from 96% in 2012 to 88% in 2040. In regions outside of the Organization for Economic Cooperation and Development (non-OECD), where 80% of the world’s population resides, transportation energy demand nearly doubles, from 47 quadril- lion Btu in 2012 to 94 quadrillion Btu in 2040, with an average annual increase of 2.5%. [3]. The demand for clean renewable biofuel is increasing as new benchmarks are legislated amid increased pressure to reduce the world’s dependence on fossil fuels for energy [4]. Because of rising fuel price and more stringent emission laws, a paradigm shift in diesel engine fuel technology is necessary to achieve the desired emission standards and high performance of the engine. In order to improve the emission characteristics of diesel engine fuel, many research- ers [4–8] have come up with a number of liquid and gaseous fuel alternatives. The gaseous fuel, by virtue of its nature, mixes easily with air to produce a homogeneous mixture, which is conducive to better combustion. Among the gaseous fuels, natural gas has turned out to be one of the most widely used gaseous fuel for engine applications because of its favorable properties like higher calorific value, better safety, availability and reasonable cost [4]. E.U. Renewable Energy Directive (2009/28/EC) set a man- datory target of a 10% renewable transport fuels ((RTF) for 2020 [9]. U.S. “20 in 10” initiative call for the replacing 15% of the projected gasoline consumption by 2017 [10]. RTF obligation may be achieved by replacing the traditional fossil fuel based liquid transport fuels with biofuels which can be used either pure or as a blend. For liquid fuels the blending option include bioethanol, bio-methanol, bio-butanol, dimethyl ether, Fischer–Tropsch liquids, biodiesel while bio- gas and H 2 derived from renewable sources can be blended with compressed natural gas (CNG) [11]. Large interest in adopting biofuel is on reducing the greenhouse gas (GHG) V C 2017 American Institute of Chemical Engineers Environmental Progress & Sustainable Energy (Vol.00, No.00) DOI 10.1002/ep Month 2017 1