Natural gas vehicles on the rise
Infrastructure Developing to Meet Demand
A dynamic change in vehicle fuels in North America is happening right now — the wide-spread adoption of natural gas as a vehicle fuel. We’ve long understood its potential. Now the change is underway. Dissatisfaction with high gasoline and diesel fuel costs abound.
Problems with Petroleum
Today about 50% of U.S. crude oil comes from sources outside of the U.S. or Canada. This compares with U.S. natural gas supplies, 98% of which are currently from the U.S. or Canada. Further, gasoline and diesel have emission problems with NOx, particulates and VOCs. Diesel engines in particular are often noisy. These fuels are expensive and promise to remain so into the indefinite future.
With burgeoning production of natural gas using new drilling technologies, the price of compressed natural gas (CNG) on a gallon-of-gasoline-equivalent (GGE) basis is increasingly attractive. Industrial and commercial operators of road vehicles with significant daily mileage requirements have discovered CNG and in some cases liquid natural gas (LNG) as the fuel of choice for now and for the future. Retailers are typically selling CNG at a price well below $2 per GGE.
Infrastructure Under Construction
The infrastructure for refueling is developing. Take the example of a retailer that is enthusiastic about the future of natural gas as a motor fuel — Kwik Trip Inc., a privately-held firm headquartered in La Crosse, Wisconsin with over 400 convenience stores and travel centers in Wisconsin, Minnesota and Iowa.
Kwik Trip representative Chad Hollett was recently a presenter at a Technology & Market Assessment Forum sponsored by the Energy Solutions Center. Kwik Trip operates the first “alternative fuels fueling station” in the U.S., offering access to propane, biodiesel, E-85, electric vehicle charging, LNG and CNG.
Full Range of Fuel Options
Hollett indicated, “Kwik Trip is committed to developing a functional natural gas infrastructure in Wisconsin, Minnesota and Iowa.” He notes that the company has already developed two natural gas fueling sites in La Crosse, Wisconsin and one each in Sturdevant, Wisconsin (near Milwaukee) and in Rochester, Minnesota. As many as a dozen more sites, mostly along Interstate Highway routes, are currently under study for CNG fueling development.
Kwik Trip’s Alternative Fuels Superintendent Joel Hirschboeck emphasizes the company’s focus on development of a functional infrastructure. “We see great potential for this as a motor fuel. As we qualify locations for CNG fueling, we evaluate local energy users who might convert to CNG usage.” He feels that key users might be refuse haulers, ready-mix concrete firms or regional haulers.
Certain Users Obvious Winners
“Typically these are operators of low-mpg vehicles that put on considerable annual mileage and return to a home station at night.” If they are relatively small operations, or if they are just getting into CNG, they may not want the immediate expense or uncertainty of a dedicated fueling operation. “That’s where we come in. We will offer a fast-fill capability in a convenient location and we can get them started on CNG.”
Hirschboeck notes that Kwik Trip itself operates a fleet of 150 heavy-duty road trucks and an additional 100 light-duty trucks and cars. Currently the company is operating 24 vehicles on CNG, with 14 more on order and an additional 11 vehicles planned for spring delivery. He explains that the acceptance of the CNG vehicles by drivers has been excellent. “The 8.9 CNG liter truck engine we use is relatively small and it pulls loads of 65,000 lbs and more. But the drivers have adjusted to CNG and like it. They notice that that it is significantly quieter and it doesn’t leave an oily diesel smell on their clothes. And they like the idea of using a domestic fuel resource. They feel good about that.”
From the company’s perspective, the biggest attraction is significantly lower fuel cost per ton-mile. Hirschboeck adds that because there are fewer residual combustion byproducts, engines stay cleaner and lubricating oils last longer. Further, with future diesel engines, more expensive fuel treatment and emission controls will be required.
Similarly, with light duty vehicles, for Kwik Trip the first attraction is also lower fuel cost. Hirschboeck says, “If you are operating a light-duty vehicle 25,000 to 30,000 miles per year the payback is very short — less than two years.”
According to Natural Gas Vehicles for America (NGVA), there are more than 120,000 natural gas vehicles operating in the U.S. today, and more than 15.2 million worldwide. This includes more than 11,000 transit buses, 4,000 refuse trucks, 3,000 school buses, about 17,000 medium duty vehicles such as airport shuttles, and more than 30,000 light duty vehicles. There is also a growing use of natural gas fueling for heavy-duty over-the-road trucks.
Roles for Both Public and Private Sites
For some fleet operators the best fueling option may be an in-house time-fill refueling station. For operators that have less predictable fueling needs, the best solution may be an on-site fast fill facility, or using a public facility. Currently there are approximately 525 public CNG fast-fill facilities in the U.S., with many more planned or under study. Public facilities are particularly abundant in California, Oklahoma, and Utah.
Susan Davis from Questar Corporation was a recent presenter at a Technology & Market Assessment Forum. Questar in Utah is one of the national utility leaders in encouraging and sponsoring the development of natural gas vehicles. Davis explained that the company feels infrastructure development is one of the keys to a successful national adoption of natural gas vehicle use.
I-15 Corridor in Utah
In Utah, there are 72 natural fueling stations, including 27 operated by Questar and available for public use. Others are operated by the State of Utah, and by other private owners. The I-15 corridor from north to south through Utah is dotted with many fueling stations, making inter-city transportation by natural gas vehicles possible.
Davis indicated that Questar Corporation recently created a non-regulated subsidiary called Questar Fueling with a mission of developing natural gas fueling with a national scope. The firm offers consultation, design, installation and leasing for natural gas fueling stations, both public and private.
Judd Cook is Director, Business Development for Questar Fueling. He says that the I-15 corridor experience shows the growth potential of natural gas for transportation. Cook says, “We have seen just under a 20% increase in sales volumes this year over the same period last year.” Vehicle operators have begun to understand the potential.
Short Paybacks Encourage Transitions
Cook credits the obvious savings in fuel costs for fleet operators for the growing interest in natural gas fuels. “Many of the customers we are working with in the heavy duty market are currently seeing paybacks between 14 and 18 months.” He believes paybacks of two to three years or less will incent users to convert or purchase new vehicles.
Interest in CNG fueling is growing. Cook says, “We are currently working with several of the nation’s largest trucking companies who are testing natural gas vehicles.”
Consider the Natural Gas Option
Whether your business is inter-city trucking or local delivery, refuse pickup or ready mix delivery, school busing or parts expediting, there’s a good chance that natural gas should be in your vehicle planning cycle. There are many organizations that can help you do the evaluation. But before you commit to buying your next diesel or gasoline vehicle, consider the third choice — natural gas.
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Before the calendar turned, 2016 already had the makings of a pivotal year for manufacturing, and for the world.
There were the big events for the year, including the United States as Partner Country at Hannover Messe in April and the 2016 International Manufacturing Technology Show in Chicago in September. There's also the matter of the U.S. presidential elections in November, which promise to shape policy in manufacturing for years to come.
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Read more: 2015 Salary Survey