YRC Freight buys four LNG-powered trucks from Clean Energy

YRC Freight, the largest subsidiary of less-than-truckload transportation services provider YRC Worldwide, said this week that it completed an agreement with Clean Energy Fuels Corp. in which it will buy four liquefied natural gas (LNG) trucks to be used in Southern California.

YRC said these trucks will be used as part of a pilot program and serve the Port of Long Beach and other surrounding areas, while leveraging Clean Energy’s fueling infrastructure in Southern California. The company also said that the pilot program’s findings will be analyzed by its maintenance, fuel, and operations teams and that it plans to operate these trucks for a number of years to assess short term and long term issues. 

A YRC Freight executive told LM that this effort makes sense on various levels, citing the ongoing emergence of natural gas as a viable alternative to fossil fuels.

“Natural gas is emerging as one of the first real alternatives to diesel fuel,” said Don Pabst VP Equipment Services YRC Freight.  “It’s important that we become familiar with the technology.  We have been working with Clean Energy for months to find the best location for our test.  We do not plan on any rapid, wholesale transition to natural gas but we want to be a part of the collective learning experience of the heavy duty trucking industry.”

Going forward with this effort, Pabst said that YRC Freight needs to determine the benefits and challenges of operating natural gas vehicles in its network. 

While natural gas is cheaper than diesel, capital cost in trucks and fueling stations are significant, and he also noted that there is also a learning curve for the company’s mechanics. 

“The real benefits of the test pilot project are to see if these vehicles are a fit for our fleet and then, if so, where and when do we expand their use,” he said. “It’s clear that natural gas will be a player in our industry as a fuel source.  It’s our responsibility to determine what opportunities exist for YRC Freight.”

YRCW said that YRC Freight has also been conducting a pilot project with diesel electric hybrids in the Northeast for the last several years, and Pabst said this pilot has resulted in significant fuel savings and performed well.

“We are eager to test natural gas trucks in the Southern California area and see how they perform within our network,” said Jeff Rogers, president of YRC Freight, in a statement.  “The LNG project will build on our sustainability initiatives, including our ongoing network optimization that is engineered to provide the highest quality customer service in the most efficient manner possible.  My thanks to the Clean Energy team for bringing their industry expertise to the table and helping to make this happen.”

The advent of natural gas as a major source of transportation fuel has gained momentum in recent years. And now that diesel prices are at their highest level since August 2008, it stands to reason that interest will begin to increase even more.

T. Boone Pickens, chairman of Dallas-based BP Capital Management and board member of Clean Energy Fuels, has said repeatedly that switching to natural gas as a transportation fuel and for power generation can replace more than one-third of U.S. foreign oil imports in ten years.

A one-third reduction is no small sum, especially when considering that the U.S. imports oil from OPEC at a cost of roughly $1 billion per day or about $1 trillion per year. And of that $1 trillion annual tally, the U.S. is on the hook for 25 percent of that bill on a daily basis, said Pickens.

“Out of the 20 billion barrels we use per day, we produce seven and import 13,” said Pickens at the 2011 Transplace Shipper Symposium. “There are 270 million vehicles in America, and we are importing 65 percent of all oil we use, with 70 percent of all the oil produced goes to transportation. Washington does not understand the problem we have here. If we go ten more years and do nothing but just import more oil, we will be importing 75 percent of all oil, with the price per gallon of diesel and oil barrels going to $300-to-$400.”