From:
Fueling With Natural Gas
Refuse and Recycling Fleets Are Leading the Way
Sunday, February 28, 2010
By T. Boone Pickens
There was a time, and not so long ago, when if a municipality was in the market for a new or replacement refuse or recycling truck the issue of fuel was…irrelevant. It was going to run on diesel, and that was that.
Until recently, diesel was the only realistic option because natural-gas supplies were considered to be too limited or challenging to be used as a transportation fuel. Natural gas was necessary for the chemical and pharmaceutical industries, for heating and cooking, and to generate about 20% of our nation’s electricity needs.
When new drilling techniques came on-stream, the natural gas we’ve always known to be contained in the enormous shale deposits under Texas, Louisiana, Arkansas, and Appalachia suddenly became available for commercial recovery.
Study after study concluded that, rather than being a limited natural resource, the natural gas reserves in the continental United States now are among the largest in the world and will last for over 100 years.
So a new issue has been introduced into the refuse and recycling truck purchasing equation: diesel or natural gas?
More and more municipalities are opting for natural-gas vehicles (NGVs) for a variety of reasons. First, the life cycle costs of an NGV are less than a diesel-powered truck because of the fuel costs and the lower maintenance costs. Those fuel-cost differences are significant. While oil is no longer selling for $147 per barrel as it was in July of 2008, neither is it selling for $35 per barrel as it was earlier this year.
Oil has stabilized for the moment at a trading range of between $75 and $80 per barrel, which makes natural gas approximately one dollar per gallon equivalent cheaper than diesel.
Second, natural gas is significantly cleaner than diesel. Refuse and recycling trucks are among the most inefficient vehicles because they spend a huge proportion of their working days idling or driving in first or second gear.
In fact, with respect to urban pollution, replacing one existing diesel trash truck with a new natural-gas one is like taking 300 new cars off the road. As more and more cities and states adopt clean air standards, NGVs are gaining favor.
Last, and in some ways most important, natural gas is an American fuel. We import nearly 70% of the oil we need, most of which is used as a transportation fuel: gasoline for cars and light trucks; diesel for heavy trucks.
In 2009 we imported over 4 billion barrels of oil at a cost of nearly a third of a trillion dollars. All of that money leaves the American economy; a great deal of it goes into the economies of countries which are unstable, unfriendly, or both.
The infrastructure issues that are claimed for a massive increase in passenger vehicles and light trucks running on natural gas, simply do not apply to heavy trucks—or any fleet vehicle that goes home to the barn every night.
Natural gas is, after water, the most widely distributed natural resource in the nation. Natural-gas lines run up and down just about every street in America. Installing and operating a central fueling facility for natural gas is a very manageable investment. In fact, leading refuse operators in Florida, New Jersey, Idaho, and California have opened new natural-gas fuel stations to support deployment of their growing fleets of CNG refuse collection trucks.
There is legislation in Congress that will greatly accelerate the development of NGV fleets. The NAT GAS Act—H.R. 1835 and S. 1408—builds upon and augments existing tax incentives to help get even more NGVs on America’s roads.
In the meantime, it should come as no surprise to anyone that the refuse and recycling truck industry is leading the way in converting from dirty, expensive, foreign diesel to clean, cheaper, domestic natural gas.
Author's Bio: American financier T. Boone Pickens chairs the BP Capital Management hedge fund.
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