While fuel prices again have turned to an upward trajectory, more attention continues to be paid to natural gas and how it can potentially be an asset for freight transportation sector stakeholders.
And while natural gas is making inroads as a possible way for shippers and carriers to counter increasing and uncertain energy costs, a recent survey published by Transport Capital Partners and ACT Research shows that there are cautious reasons to be optimistic when gauging future natural gas prospects.
Data for the survey was based on feedback from roughly 100 motor carriers.
Perhaps the most significant finding of the survey is that 51.4 percent of respondents are considering natural gas-fueled trucks when making new truck purchases.
But even though more than 50 percent of respondents indicated that natural gas-powered trucks are a possibility, it by no means suggests that it does not come without some caveats.
The biggest concern among respondents—at 91.4 percent—is fuel station availability, followed by higher vehicle purchase price at 81.9 percent. Two other concerns—each expressed by 50 percent of respondents—were needed product specs/performance and secondary market value, respectively.
On top of those concerns was another survey question which focused on how close carrier operations would a commercial fueling station—for Compressed Natural Gas (CNG) or Liquefied Natural Gas (LNG)—need to be for a carrier to consider natural gas fueled vehicles for their next new truck buys.
Slightly less than 20 percent of respondents said 5 miles or less, with 15 percent saying 6-25 miles and another 15 percent indicating 26-100 miles. Rounding out the top 5 were slightly less than 10 percent at 101-200 miles and about 13 percent saying 201-500 miles.
In an interview with LM, Richard Mikes, a partner at TCP, said that the degree of interest in natural gas-powered trucks by survey respondents was higher than TCP originally anticipated.
And he also explained that a question regarding respondents’ knowledge of natural gas engines in their tractors was somewhat telling.
More than one-third—or about 35 percent of respondents—said they little knowledge, while nearly half—about 45.8 percent—said they had some average knowledge and 20-25 percent said they had above average knowledge.
“The fairly high level of interest compared to degree of knowledge was surprising,” said Mikes.
He pointed out that for carriers with less than $25 million in revenue those will little knowledge of natural gas in tractors was much higher at 70 percent compared to 15 percent of carriers with revenues above $25 million.
“The smaller carriers may not have as much knowledge about it, because they are more focused on day-to-day operations,” he said. “They are smaller staffed and have to do everything and know everything. And they may not have the time…to get into the natural gas arena.
Looking ahead, the survey asked carriers what percentage of their fleets will be fueled by natural gas in five years.
29 percent said natural gas will account for less than 5 percent of their total fleet, and 27.8 percent said it will represent 16-25 percent of their total fleet, and 19 percent noting it will represent 6-15 percent of their total fleet.
As diesel prices continue to pick up steam, having risen for the last eight weeks and sitting at more than $4 per gallon the last two weeks, natural gas continues to gain traction as a possible fuel alternative for motor carriers.
T. Boone Pickens, founder and chairman of BP Capital Management and perhaps the biggest proponent of natural gas usage for transportation anywhere in the world, has repeatedly explained if the 8 million Class 8 vehicles on the road today in the U.S. switched from diesel to natural gas, that would represent a reduction of 2.5 million barrels in imported oil per day and cut down on the 35 billion gallons of diesel consumed per day by the trucking industry, with a $1-$2 dollar per gallon decrease, too.