Private Fleet Executives Praise Natural Gas Trucks

CINCINNATI — There is strong interest among corporate fleet executives in converting from diesel-powered trucks to those that run on compressed and liquefied natural gas as more fueling stations are built and more powerful engines are available, according to panelists at an industry meeting here last week.

Speaking at the National Private Truck Council Annual Education Management Conference, executives from two fleets that are making the switch — Jeff Shefchik, president of Paper Transport, Green Bay, Wis., and Mike Lickert, corporate fleet manager for Talon Logistics, Pittsburgh — said they plan to buy more NG vehicles as the number of fueling stations increases and engines with more power become available.

Shefchik and Lickert were part of a session on natural gas that drew an overflow crowd of more than 100 fleet executives April 29. Both Paper Transport and Talon Logistics are already using CNG-powered tractors in their operations.

“We are pleased with the miles per gallon of the CNG trucks,” Lickert said. “There is a slight decrease in mpg mainly due to a slightly lower compression ratio compared to diesel. That said, we are averaging 5.2-plus miles per gallon for CNG, and the trucks are improving as we accumulate miles.”

Lickert said his fleet, which delivers groceries to Giant Eagle stores, will add more trucks as the fueling infrastructure expands and as truck and engine manufacturers develop bigger 12-liter natural-gas engines that are more suitable for over-the-road freight hauling.

Most natural-gas engines now available are 9-liter and were developed primarily for refuse and bus markets, and some models require small amounts of diesel to initiate combustion. The Environmental Protection Agency requires those trucks that use diesel to have emissions controls, including diesel particulate traps and diesel exhaust fluid.

Paper Transport’s Shefchik said he began testing two prototype tractors with 12-liter 100% CNG engines in December and has about 20 CNG-powered trucks in his fleet of 350 trucks.

“The full use of CNG trucks has been somewhat limited by the fact that the 9-liter engine was all that was available,” Shefchik said. “The 12-liter’s capability to handle steeper grades will be a nice feature.”

Officials at diesel engine maker Cummins Inc. said 12-liter natural gas engines are expected to be available in the market in early 2013.

Meanwhile, a number of companies have laid out plans to develop natural-gas fueling stations.

Convenience store operator Kwik-Trip Inc., La Crosse, Wis., plans to develop a natural-gas fueling network throughout Wisconsin, Iowa and Minnesota to serve its own fleet of trucks but also to serve the general public. A prototype fueling station will offer CNG and LNG, several grades of diesel, biodiesel blends, gasoline and E85.

“Kwik-Trip’s goal is to promote and educate customers about the benefits of natural gas as a vehicle fuel,” said Chad Hollett, director of distribution and transportation. The company’s own distribution fleet, Convenience Transportation, operates 20 natural-gas vehicles, including pickup trucks and Class 8 tractors.

Kwik-Trip is one of four or five convenience-store chains that are making plans to sell natural gas in local and regional markets where the greatest demand is expected to be, said Stephen Yborra, director of marketing for Natural Gas Vehicles for America, a trade group representing the natural-gas industry.

Yborra said the exact number of natural-gas fueling stations nationwide is unknown, but he expects to see growth of about 25%, or roughly 200 to 250 new stations, this year.

Clean Energy Fuels Corp., Seal Beach, Calif., a company founded in 1996 by T. Boone Pickens, operates the largest network of CNG and LNG fueling stations, serving 22,700 vehicles at 238 locations in the United States and Canada.

In Oklahoma, Love’s Travel Stops & Country Stores and OnCue Express, a convenience-store chain, have partnered with Chesapeake Energy Corp., Oklahoma City, a natural-gas producer, to open more than two dozen CNG fueling stations. By the end of 2012, Oklahoma is expected to have more than 70 public CNG stations, and Oklahoma Gov. May Fallin is leading an effort to pool purchases of CNG-powered vehicles from 13 states to accelerate development and production of cars and trucks fueled by natural gas.

Yborra said while some companies are pursuing a corridor strategy while others are using a hub and spoke model for development.

Yborra said the cost differential between natural gas and diesel is driving adoption of alternative fuels. The cost of natural gas is about $1.50 to $2 a gallon less than diesel on a gallon equivalent basis.

Furthermore, the cost of natural gas is only about 20% of the retail price, with costs associated with processing and delivery making up the rest. In contrast, with diesel fuel, oil makes up 80% of the cost of the fuel and 20% is related to distribution. That makes diesel much more vulnerable to changes in oil prices.

Yborra said if natural gas doubled in price from the current levels of about $2 per million cubic feet, it would raise the price of the fuel from by 5 cents. If oil doubles in price, the impact on diesel is much more significant.

“The price of natural gas has decoupled from petroleum,” he said.