Natural Gas Promoted As Cheaper Fuel For Trucks In NW

Jan 20, 2012

SALEM, Ore. – Natural gas prices are falling and likely to stay low for the coming years. That’s because of the dramatic increase in domestic gas supply from new drilling technologies. Oil prices on the other hand are rising again.

People in this region’s trucking industry are now taking a hard look at switching to natural gas as a motor fuel. But some significant hurdles remain before you’ll see a lot of natural gas-fueled trucks on the road.

I’m as the gas station to refuel, and darn it all, the price per gallon is creeping up again. There it is, another thirty dollars down the tubes… and all I drive is a thrifty Toyota compact.

Whatever pain at the pump I feel though, it’s nothing compared to people like Randy McCulley. He manages a fleet of snow plows, dump trucks, garbage haulers and heavy duty pickups for the Deschutes County, Oregon Road Department.

“We spend about $900,000 a year on fuel, about half of that being diesel,” McCulley says. “It went up considerably (in price) of course in the past few years.”

So that’s why McCulley along with dozens of other fleet managers and truck drivers came to a green transportation conference in Salem. Other attendees included Safeway, Sysco and assorted school districts. They checked out a display of trucks fueled with cheaper compressed natural gas or propane.

“I think it is important that we start using fuels that are created in this country and get away from the foreign dependence on oil,” McCulley says.

Both Portland-based Freightliner and Bellevue-based Paccar have started making natural gas fueled big rigs. Freightliner sales manager Bob Carrick says the semis cost more up front — up to $42,000 more — but that can be offset through fuel savings.

“You’re paying let’s say $2 per gallon versus $4 a gallon for diesel fuel,” Carrick explains. “That pays for this truck very quickly and then every month after that, you’re putting those savings in your pocket.”

Natural gas supply has grown in part because of the controversial drilling practice known as fracking.

Carrick ticks off what he sees as advantages of natural gas motor fuel. It’s cleaner burning than diesel, safer, has a smaller carbon footprint. But sales are limited because there are so few places to refuel with compressed natural gas (CNG) or liquefied natural gas (LNG).

“Literally, we could have sold five times as many of these vehicles if the infrastructure was out there,” Carrick says.

This is where we come to the classic chicken-or-egg dilemma. Fleet operators won’t buy natural gas vehicles until they see more filling stations. But truck stops won’t offer the alternative fuel until more users hit the road.

At least two startup companies from the Seattle area propose to finesse the conundrum.

“We talk about how we need a chicken and egg omelet,” quips Ernie Jones, VP for sales & marketing at Emerald Energy NW. His startup aims to put together groups of fuel consumers around central refueling stations.

“We need as I would see it, partners that have skin in the game to invest,” he says. “Then you build a production facility knowing that you have customers that can come to you.”

It’s not cheap to build a compressed natural gas fueling station. The price tag can easily exceed $1 million for a big one.

But then you have people like Texas billionaire T. Boone Pickens entering this space. A company he co-founded just announced plans to open a network of liquefied natural gas fueling stations along truck routes nationwide. Promised locations in the Northwest include Tacoma, Portland, the Rogue Valley, near Hermiston and Caldwell, Idaho.

On the Web:

Freightliner natural gas trucks: