01/13/2015

Is Natural Gas Right For Your Fleet?

Close view of water droplets on leaf

In 2013 natural gas was the largest source of new electricity generating capacity in the United States1. As natural gas develops, more businesses are looking to their operations to see if they could reap the benefits of using natural gas in their transportation operations. Whether you run a private fleet, dedicated fleet, drayage, or any other type of operation, in many cases natural gas powered fleets have proven to cut costs in comparison to the diesel fleets. However, not all businesses fit the ideal profile to effectively run on natural gas. Before you convert to natural gas, make sure to ask yourself:

Fleets – Is my current fleet compatible with natural gas tanks?

The condition of your fleet and the number of vehicles you run can affect your decision to employ natural gas or remain with diesel. It has become much simpler to convert diesel trucks to natural gas with a natural gas tank conversion system. If you want to convert your trucks, make sure that they were manufactured prior to 2009. If the trucks are newer than 2009 or if it doesn’t seem feasible to convert your existing trucks, new fully dedicated natural gas tractors are available for purchase or lease. Tractors manufactured after 2009 are not yet approved by the EPA to convert to dual fuel.

Another aspect to keep in mind is the size of your fleet. If your company is going to use existing natural gas fueling stations, you would ideally need to have four or more tractors to make the investment worthwhile. If natural gas fueling stations do not already exist in the right area, many natural gas providers can work with you to build a new one. This option would require a significant fuel commitment from upwards of fifteen or more tractors.

Geography – Are my operations near natural gas fueling stations?

To leverage pre-existing infrastructure it’s important to look at where your fleets operate. There are natural gas stations in almost every state but there are areas where stations are more prominent making them ideal regions for natural gas fleets to run. These areas include the West Coast, Texas, Oklahoma, Florida, Georgia, and areas surrounding the great lakes. As natural gas becomes more popular, the growing number of fueling stations will make it easier for fleets to leverage existing infrastructure. Many natural gas providers are working to increase the amount of stations in the United States every year.

Miles – Does my fleet run enough to make natural gas a good financial decision?

When it comes to natural gas, the more miles traveled, the better the return. Ideally, fleets should travel more than 120,000 miles a year and no less than 100,000. Routes that run about 550 miles between fueling are ideal for natural gas fleets. This allows for tractors to minimize down time and maximize the distance it travels before having to refuel. If your fleet does not travel this much, it is still possible to obtain a return if long-term (5 or more years) leasing agreements are made. Natural gas tractors have a life expectancy of about 600,000 miles.

Weight – Is my freight too heavy for natural gas tractors?

In addition to where and how your fleet operates, it is important for you to keep in mind the weight of your goods. Natural gas tractors weigh, on average, an additional 1,500 lbs. more than standard diesel day cabs. Companies with loads that are not weight sensitive would be the best match since the amount of weight could alter how much product can get loaded at a time.

Time – Am I willing to commit to make a long-term commitment?

Companies interested in natural gas need to be willing to make a commitment. As stated above, an average natural gas truck should run about 120,000 miles a year and 600,000 miles in its life time. That means to see the investment through, your company should plan to commit about 4-5 years. With this type of commitment, many can see initial returns over diesel within the first year.

The natural gas industry is expected to grow over the next thirty to forty years. In fact, it is projected to increase 56% by 20402. There have been many advances in natural gas technology within the past year that has made it more affordable and available. As natural gas technology continues to evolve, its ideal fleet profile will also change. How has your experience with natural gas been? Let us know in the comments.

Sources

  1. http://www.greentechmedia.com/articles/read/u.s.-solar-market-grows-41-has-record-year-in-2
  2. http://breakingenergy.com/2013/12/23/eia-projects-strong-growth-in-u-s-oil-and-natural-gas-production/