Sales of natural-gas powered big rigs could jump as much as fivefold this year as falling prices for both natural gas and the carbon fuel tanks required for such trucks come down, the Wall Street Journal says.

Lowe's, Procter & Gamble, UPS and PepsiCo are among the major US companies that have gone on record saying they're expanding their fleet of trucks that can run on either compressed natural gas (CNG) or liquefied natural gas (LNG). For instance, UPS is buying 1,000 natural-gas trucks by year-end, and P&G, whose fleet is about seven percent natural gas, is looking to boost that figure to 20 percent by 2015. FedEx wants 30 percent of its long-distance trucks to be powered by natural gas by 2023, while engine makers like Cummins Westport and Volvo are adding products to the market. As a result, as much as five percent of new heavy-duty trucks may be natural-gas powered in 2013, up from about one percent last year.

CNG sells for about $1.50 a gallon, less than half the $3.87 price of diesel last week. That means that, even with a carbon fuel tank boosting the price of a $120,000 rig by another $40,000 or so, a trucker that typically gets about six miles a gallon and drives about 100,000 miles a year, could pay back the extra cost in about two years. Already about 60 percent of new garbage trucks in the US will be natural-gas powered this year. Those drivers will be helped by an expanding network of CNG stations across the country. Autoblog's got more on natural-gas trucks here.


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  • 20 Comments
      BipDBo
      • 1 Year Ago
      I'm just surprised this has taken this long. NG is perfect for trucking. NG is getting cheaper while diesel is getting more expensive. Also, emission regulations are making more expensive to operate a diesel truck. Unlike passenger cars, trucks go long distances between fueling, so they can hop between NG fuel stations which are more rare. Local trucking companies and utilities such as postal and garbage collection can refuel on NG at the central hub. The transition to NG is easier, therefore, for trucking than for passenger cars.
        Spec
        • 1 Year Ago
        @BipDBo
        Indeed, this is long overdue and a great solution for trucking.
      Marcopolo
      • 1 Year Ago
      There are quite a number of countries in the world where all heavy traffic runs on a natural gas derivative. As Spec quite correctly points out, until recently, natural gas was considered a waste product of oil production and simply flared off, or sold cheaply. With the discovery of easily recovered reserves in North America, and new technologies to manage this resource more economically, Natural Gas has found itself back in favour a a viable energy source. Unlike the US, most countries tax gasoline/diesel heavily at the pump, leaving a margin for NG to remain profitable in comparison. Most of Asia, especially the PRC import increasing volumes of NG derivatives, for their energy hungry economies. It would not be unreasonable for the US to increase the tax on diesel in favour of more environmental NG products.
      Wm
      • 1 Year Ago
      Last week I drove by a gas station that has a CNG pump and the price on the sign said $.85 for a gallon equivilant. Not sure why it's so much less in OK, but gas is also down around $2.80. I don't know if CNG prices have road tax, but there is a significant between CNG and diesel. Truck operators can easily spend $250k/year on fuel. Switching to CNG could easily be cost effective.
      Spec
      • 1 Year Ago
      I think this is a great way to reduce pollution and reduce costs for heavy trucking. Keep on Truckin' . . . with NG.
      • 1 Year Ago
      Hello, Thanks to new technology developments that have lowered the costs of new wind projects and increased electricity production, our new analysis shows wind power could play an even greater role than natural gas in replacing existing coal plants. http://luxxorgas.com/
      Davey Hiltz
      • 4 Months Ago
      What an excellent change! I'm always excited when companies make the decision to go more green. It's a stand that's not so common these days. I hope others will follow their example. http://www.voyagernation.com/owner_operator_jobs.html
      goodoldgorr
      • 1 Year Ago
      Many are interrested to buy. We gonna breath better and i hope it will push the price of petrol down.
      raktmn
      • 1 Year Ago
      "falling prices for ... natural gas" Actually, natural gas has been trending upward since hitting a low in April 2012 (based on EIA data on historic NYMEX Henry Hub spot price trends). It has been trading around 3.30 - 3.50 recently, compared to 2012 lows in the 1.80 - 1.90 range.
        Spec
        • 1 Year Ago
        @raktmn
        Well, it depends on the time scale you use . . . the mid $3s prices are very cheap compared to the $6s to 9s in previous years. And it will probably remain low. They've reduced drilling just for natural gas but with the fracking for oil they still capture a lot of natural gas that will be sent to market.l (Except all the remote sites where they just flare it sadly . . . what a massive waste. Should be illegal IMHO.)
          raktmn
          • 1 Year Ago
          @Spec
          EZEE -- To be accurate, I quoted both the CEO of Exxon, and the former CEO of Chesapeake to support my point. I quoted them because their statements can be fact checked for confirmation from many other sources, not because they can be trusted. I could have also chosen to quote at least 2 dozen various news organizations, from the Wall Street Journal to Rolling Stone magazine, who all say the same thing. I could have chosen a govt agency like the EIA, who also says the same thing. It is an easily fact checked reality that the low price of natural gas is unsustainable, and is below the cost of extraction. It will not continue to stay this low over the long term. NG is a nice alternative to diesel or gas. But if I were a green truck fleet manager, I wouldn't be crazy enough to calculate a 10 or 14 year investment based upon current NG prices as if they would stay as low as they are right now through that entire decade. I hope they keep converting to NG, because it is nice and green and all. But this false narrative of NG being on a permanent downward price slide, that will continue forever is just utterly and provably false by anyone who bothers to fact check it. When the prices eventually and inevitably go up at least to the point of being profitable, I don't want to hear people like you or Glennn Beckkk whining and crying about those "hippy greenies lefties" being wrong when they told everyone that NG was so cheap.
          raktmn
          • 1 Year Ago
          @Spec
          Here is the chief executive of Exxon Mobil, commenting on the price when it was in the high 2's to low 3's range: “We are all losing our shirts today,” Mr. Tillerson said. “We’re making no money. It’s all in the red.” It isn't going to keep going down, or even stay as low as it is over the long term. The cuts in drilling you are talking about will have to continue to be cut until the price goes up. They aren't cutting drilling because they are just so tired of making so much money. They are cutting in order to push the price up.
          EZEE
          • 1 Year Ago
          @Spec
          @rak You quoted the Exxon mobile chief to make your point? I think CoolWater's head just exploded! :D On a positive note (and, I am always positive), although still Dino juice, it is far cleaner than the diesel it replaces, so regardless, pretty cool.
          raktmn
          • 1 Year Ago
          @Spec
          Spec, in response to your comment about flaring, I think the drillers should have to keep track of every single kilo of natural gas they flare, and pay state and federal royalties on every single bit of it. They shouldn't get out of royalty payments for resources they extract, just because they choose to waste it by burning it off instead of collecting it.
          raktmn
          • 1 Year Ago
          @Spec
          Not even owner of Chesapeake Energy (the largest natural gas leaseholder in the United States) believes that the current low prices are sustainable. These low prices are purely the side-effect of their attempt at cornering the natural gas lease market so they can sell the leases for a future profit. As McClendon (owner of Chesapeake Energy) put it in a conference call with Wall Street analysts a few years ago, "I can assure you that buying leases for x and selling them for 5x or 10x is a lot more profitable than trying to produce gas at $5 or $6 per million cubic feet." $3 bucks is very, very, very cheap. So cheap that it is not sustainable. Chesapeake is actually losing money drilling for natural gas at that price. They were even forced into a squeeze where they had to refinance in order to avoid bankruptcy recently. But because the leases require that they must drill and produce or they forfeit the lease, they have to keep drilling and keep selling cheap in order to keep those leases. They believe the leases themselves are more valuable to them than the actual natural gas, so they are willing to sell the natural gas at a loss just so they can someday sell the lease at a profit. (Actually, I don't believe they will ever sell the leases. They are monetizing the leases by selling complex financial instruments the same way the Banks sold home mortgages in CDO's, and didn't actually sell the mortgages themselves. They will make their profits off of this monetization, and won't care when the whole thing comes crashing down, but that is a whole nuther story...)
          mylexicon
          • 1 Year Ago
          @Spec
          @ rak Natural gas won't come crashing down. The industry is increasing market demand with CNG/LPG trucking partnerships and by lobbying the EPA to eliminate coal electricity. Nat Gas is also lobbying Congress to fund natural gas export infrastructure. If trucking, electricity, and export are modestly successful, the age of natural gas will begin before this decade is out. Prices will recover, but good luck guessing exactly when it will happen.
          raktmn
          • 1 Year Ago
          @Spec
          Mylexicon, I never said natural gas drilling would come crashing down. I specifically said that Chesapeake Energy's monetization of their lease holdings through complex financial instruments will some day come crashing down. There is a vast difference between the actual market for Natural Gas, and Chesapeake's financial derivatives they use to monetize their lease holdings (similar to Bank CDO derivatives on the mortgage industry). Please do not confuse the two.
      • 1 Year Ago
      Assuming the figures are accurate and no extra costs are being left out, then this is good news. Especially for reducing particulate pollution, and for the shorter routes (given the lower energy density of natural gas/greater fueling frequency). I've read that for regular cars, the costs are beyond those of a hybrid, and new natural gas infrastructure would be required for substantially greater demand. Ultimately maybe that's what will be necessary. Who knows, as the technologies mature and realize economies of scale, the ideal might be a natural gas hybrid.
      Actionable Mango
      • 1 Year Ago
      I've noticed that when Waste Management garbage trucks (pictured) switch to natural gas, they became WAY quieter than the old diesel trucks. I wonder does anyone know if this is true of NG vehicles in general, or is it just a coincidence and some other technology in the new trucks made them much quieter?
        raktmn
        • 1 Year Ago
        @Actionable Mango
        You might be referring to Waste Management's converted E7G Mack truck diesel engines that are fully converted to 100% NG by making them lower compression than diesel engines, and using a spark (spark plugs) instead of compression to ignite the fuel. This method of conversion makes the engines much quieter because the compression ratio is reduced from around 16 or 18 to 1, down to between 10 or 12 to one. This is the best compression ratio for Natural Gas's approx 130 octane rating. Other conversions (like what UPS has done with OTR diesels) can keep the diesel engine a high compression diesel that does not need spark plugs. These conversions require some diesel fuel still be burned at times like startup, so they aren't a pure NG conversion. These would stay just as loud because they keep the high compression noise.
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