WSJ: will truckers ditch diesel for natural gas?

TornadoRed

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Will Truckers Ditch Diesel?
Surplus of Natural Gas Prompts Some Fleets to Switch; Lack of Fueling Stations

By REBECCA SMITH

Rising diesel costs last year forced Waste Management Inc. to charge customers an extra $169 million, just to keep its garbage trucks fueled. This year, the nation's biggest trash hauler has a new defensive strategy: it is buying trucks that will run on cheaper natural gas.
(snip)
"The economics favoring natural gas are overwhelming," says Scott Perry, a vice president at Ryder Systems Inc., one of the nation's largest truck-leasing companies and a transporter for the grocery, automotive, electronics and retail industries.

The shale gas revolution, which cut the price of natural gas by about 45% over the past year, already has triggered a shift by the utility industry to natural gas from coal. Vast amounts of natural gas in shale rock formations have been unlocked by improved drilling techniques, making the fuel cheap and plentiful across the U.S.

Now the shale-gas boom is rippling through transportation. Never before has the price gap between natural gas and diesel been so large, suddenly making natural-gas-powered trucks an alluring option for company fleets... Railroad operators also are being affected as coal shipments decline.

Many fleet operators, particularly long-haul truckers, remain concerned about a scarcity of refueling stations. Other challenges include the bulky tanks for compressed gas and the hazards of handling liquefied gas. In the past, the volatility of natural-gas prices also hampered wider use.

But today, truck manufacturers are embracing natural gas for everything from bi-fuel pickup trucks like the Chevy Silverado HD to eighteen-wheelers that can burn natural gas either compressed, called CNG, or super-chilled, called LNG. Navistar International Corp., Cummins Inc. and General Motors Co. all are courting the market with new natural-gas powered trucks or engines.

Navistar's goal is to "expand to a full range of products using natural gas in the next 18 months," says Eric Tech, president of Navistar's engine business. This year, the Illinois company is introducing delivery trucks burning natural gas. Next year, it is adding long-haul trucks with its biggest engines.

Mr. Tech says in a couple of years, one in three Navistar trucks sold will burn natural gas. "This is not a subsidy-driven market," Mr. Tech says. "It's developing on its own because the economics are compelling."

Companies like United Parcel Service Inc. and AT&T Inc. are buying the vehicles. AT&T recently ordered 1,200 Chevrolet Express cargo vans equipped to run on compressed natural gas, which GM said was its largest CNG vehicle order ever.
(snip)
For years, a barrel of oil cost about as much as six units of natural gas and their prices moved in tandem, notes Don Mason, a gas-industry consultant in Ohio. Today, a barrel of West Texas Intermediate crude costs more than 33 times as much as a unit of natural gas in the U.S. At the pump, a gallon of diesel often costs more than twice as much as CNG, on a diesel-gallon-equivalent basis.

Although the U.S. has loads of natural gas, adoption of natural gas vehicles has been spotty. Less than 0.1% of vehicles on American roads burn the fuel today and the percentage sagged slightly from 2005 to 2010, when federal policies encouraging their use waned. The number began edging up last year, lifted by market forces.
(snip)
Many people are trying to figure out whether natural gas really has legs as a transportation fuel. Greg Burns, chairman and chief executive of PLS Logistics Services Inc. in Pittsburgh decided this year to ask 100 trucking company executives. The result: eight in 10 respondents said natural gas in its densest form, as LNG, has potential for highway use. Nearly a third said they were actively researching it for their own companies. But 54% said current infrastructure is inadequate and 23% worried about the higher cost of the trucks.
(snip)
The potential market is enormous. The 3.2 million big rigs on U.S. roads today burn some 25 billion gallons of diesel annually. Almost 7 million single-unit trucks, such as UPS or FedEx Corp. trucks, consume another 10 billion gallons of diesel.

Converting even a modest number of these trucks, which often get 5 to 8 miles a gallon, to natural gas could save significant amounts of money. Tailpipe emissions also would drop, since natural gas burns cleaner than diesel or gasoline.
(snip)
Ann Duignan, managing director at J.P. Morgan Equity Research, says "there's huge excitement" about natural gas but infrastructure immaturity will depress truck sales. She expects fastest adoption among fleets that can run on CNG and return home each night but is skeptical about long-haul trucking. "It will be slow, steady, one-fleet-at-a-time type growth," she says.
(end of excerpt)

http://online.wsj.com/article/SB10001424052702304707604577422192910235090.html?mod=WSJ_hp_editorsPicks_5#printMode

I am happy with diesel, and hope that it will get cheaper as truckers switch to natural gas. But if I could get a Sprinter van that ran on CNG or LNG, I think I could make a lot of money with it.
 
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nicklockard

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I'm in favor of more alternative fuels. I can see an opportunity for municipal waste plants capturing their anaerobic digester methane gas, as well as municipal landfills capturing methane. Seems possible they could form co-op arrangements to consolidate dewatering, compression, storage, and sales terminals--all while saving government money.
 

oilhammer

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We had the dual-fuel Metro buses here for a while. Very problematic. Not sure which versions they have now, but some (most) are diesel, some are CNG. But the CNG ones may still be dual fuel, just a newer better version. The old ones used diesel for pilot injection, and CNG for the rest of the power stroke. Sort of like propane injection, only instead of it being used as a power adder it was used to actually move the vehicle. Idea was sound, but the systems were notoriously unreliable, and left many busses reverting to limp mode, which was diesel only, and just enough to get them to move to the side of the road. Where a diesel-powered service vehicle came to rescue them :rolleyes:.

I'm sure the technology has improved. Of course, so has diesel.
 

Ski in NC

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Two very different strategies for burning ng in engines: One is the dual fuel referred to above, the other is low compression ratio spark ignition like a gasoline engine.

The dual fuel has the advantage of being able to complete a trip on diesel if ng runs out. But I wonder if it can meet emissions since the ng will tend to hide in quench areas that normally only hold air. HC emissions might be high??

Spark ignition is limited to one fuel (maybe could have gasoline backup??) and due to nature of that throttled engine cycle, has pretty poor thermal efficiency.

And once all these ng fired electric plants come on line, that's really going to suck up alot of that excess gas... and prices go where??

But until then, I'm all for ng vehicles, especially delivery routes in cities, suburbia etc where short range and fueling can be easily handled. And benefits of cleaner burn are more significant.
 

robnitro

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LNG is crazy...you need to be at -162 C to keep it liquid. I toured a LNG plant a few years ago. The hard parts are converting to liquid and then liquid to gas (for use). Also, the tank would have to be kept chilled or emptied when not in use.
 

nicklockard

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(snipped) But I wonder if it can meet emissions since the ng will tend to hide in quench areas that normally only hold air. HC emissions might be high??(snipped).

The gas should be well mixed with air prior to the piston reaching TDC--remember the swirl port and combustion chamber are optimized to mix hard-to-ignite droplets and air. They can certainly mix two gases well. I doubt this would be a problem...or I'm not aware of it. Do you know of any research on this topic?
 

TDIMeister

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Ski brings up a legitimate question and there is ample research on wall/crevice quenching and HC emissions. The short answer is that this is address with oxidizing/3-way catalysts but it is indeed more difficult to convert methane in aftertreatment and modified precious metal loading catalysts are usually employed.

Edit: Google http://bit.ly/KgyGXa
 
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Ski in NC

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No, aware of no research. Just thinking aloud.

What I was getting at was the areas between the flat piston top (outside of bowl) and flat head surface. NG and air (yes, well mixed) gets squeezed there and due to the close proximity of relatively cool metal, does not like to combust. That's one reason why gasoline engines have very open combustion chambers. They minimize squish volumes. Probably ways around this somehow..

The Cummins engine I looked at was regular spark ignition, no diesel at all.
 

CNGVW

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The gas should be well mixed with air prior to the piston reaching TDC--remember the swirl port and combustion chamber are optimized to mix hard-to-ignite droplets and air. They can certainly mix two gases well. I doubt this would be a problem...or I'm not aware of it. Do you know of any research on this topic?
I was bring the data into my post TDI CNG Blend in the next few weeks. But it has been locked so much for infomation on Alternative Diesel Fuels here.
Bob Mann
 

nicklockard

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I was bring the data into my post TDI CNG Blend in the next few weeks. But it has been locked so much for infomation on Alternative Diesel Fuels here.
Bob Mann
Your CNG thread was TEMPORARILY locked because you posted commercial content (customer testimonials) in a non-classifieds section. That is against forum rules. As I said in that thread, the temporary lock will be released once you simply APPLY for vendor registration. After that, you will have a grace period to post all non-commercial content in that thread and any other until the application is approved. Once your application is approved, you can post all the customer testimonials your heart desires in a VENDOR thread, where it belongs.

If you want to keep being a big baby and making an issue about a non-issue, you're going to get a time-out. I've been perfectly fair with you. Harassing moderators with posts like this and the 3 or 4 PM's you've sent is not a good strategy on a limited scope board.

Edit: now let's get back to discussing the merits of WSJ article and NG subject.
 
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CNGVW

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Your CNG thread was TEMPORARILY locked because you posted commercial content (customer testimonials) in a non-classifieds section. That is against forum rules. As I said in that thread, the temporary lock will be released once you simply APPLY for vendor registration. After that, you will have a grace period to post all non-commercial content in that thread and any other until the application is approved. Once your application is approved, you can post all the customer testimonials your heart desires in a VENDOR thread, where it belongs.

If you want to keep being a big baby and making an issue about a non-issue, you're going to get a time-out. I've been perfectly fair with you. Harassing moderators is not a good strategy on a limited scope board.

Edit: now let's get back to discussing the merits of WSJ article and NG subject.
Faxed in the form and for the commercial content (customer testimonials if you read it some one was posting bad math to down play the savings and the customers email was to show real cost for CNG not bad math. But you know that
Bob Mann
 

nicklockard

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Well Bob,

yours said:
"Here is a email that show what others are paying for home refueling.
Would you post what you pay for Diesel on this test I payed $4.00 a GAL
Hello Bob, I just wanted to say thank you so much for the great job you did on our two Audi A4 CNG conversion kits. We are coming up on a year of use with them and my two sons are away at college one in Madison Wisconsin and one in Minneapolis Minnesota. They absolutely love the fact that they have to pay a little over a dollar a gallon for CNG especially on a college budget.

I'm so glad that I found you on the Internet because having five VW's and two Audi's I didn't know who would know how to put on CNG systems . It's been great having bifuel systems so when we run out of Cng we can just run on straight gasoline even though it's much more expensive. I'm looking forward to having you do our other automobiles because I'm very happy with how you made sure the cars were perfect before they left your shop. I'm looking forward to getting our own home Cng pump so that I can take advantage of natural gas prices at $.49 a gallon right out of the line coming to our house.

Be prepared for another phone call soon as I'm going to need the rest of my VW's done in the near future Bob. Thank you so much again I appreciate your professional work.

Dr. Curt Draeger
Bob Mann"
Reads like a customer testimonial to me. Your quote contains ZERO FACTS about prices or math. There is a CLAIM. But a CLAIM is not the same as a fact. I'm done. You sure like to push buttons.
 

Scott_DeWitt

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NG prices are very low and continue to go down, however there are several liquifaction terminals being constructed with completion in the next few years, and once those terminals are online, prices are bound to go up as NG gets exported. Also there are several GTL processes which will drive the price up one it's low enough to make those technologies cost effective.
 

tdi90hp

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I think in the end...all markets adjust...Do you think big oil is gonna let the gaz guys steal their market? doubt it....the NG trucks are more costly to build and as demand growsNG gets more expensive and diesel may drop and gain efficiencies as well in mileage and design as well..do NG trucks have enough torque to pull big loads across the mountain ranges etc...?? can NG trucks do long distances or are they so limited in range that trucker is stopping more and this in the end drives up the cost of the delivery albeit with a temporarily cheaper fuel...I would not count Rudolf Diesel out of this game for one minute...
 

Craneguru

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I think in the end...all markets adjust...Do you think big oil is gonna let the gaz guys steal their market? doubt it....the NG trucks are more costly to build and as demand growsNG gets more expensive and diesel may drop and gain efficiencies as well in mileage and design as well..do NG trucks have enough torque to pull big loads across the mountain ranges etc...?? can NG trucks do long distances or are they so limited in range that trucker is stopping more and this in the end drives up the cost of the delivery albeit with a temporarily cheaper fuel...I would not count Rudolf Diesel out of this game for one minute...
O/T: "big oil and the gaz guys" are the same folks here in the USofA.

Back on topic: You aren't kidding about the trucks being more costly. Current estimate for a factory installed Cummins Westport LNG conversion kit is approximately $80kusd over the same rig with a conventional diesel powered engine.

Also, until there is an infrastructure in place to refill at convenient points along all the major interstate highways, either CNG or LNG will pretty much be limited to 'local hauls' where the trucks return home each night. Local UPS, FedEx, city drivers, garbage trucks, school buses would be excellent candidates for NG usage.

I also recently learned that LNG 'vents' to atmosphere as it heats up. So if your truck is sitting there not using the fuel, it 'burps' unburnt NG out of a set of vent pipes about every three to five minutes. This can't be much better for out atmosphere than current technology DPF/SCR based diesel engines.

CG
 

TornadoRed

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An interesting article in Forbes (or at least on the Forbes website)
http://www.forbes.com/sites/matthew...y-american-natural-gas-will-change-the-world/

Natural gas is roughly $2.50 per million British thermal units (mmbtu) at the Henry hub in Louisiana, compared to $20/mmbtu in Singapore -- with prices in Europe somewhere in the middle. So there is a huge incentive to liquify natural gas so it can be exported.

Also, prices in the US are too low to justify increased production. Because prices have dropped so low, the EIA has just downgraded recoverable shale reserves from 827tcf in 2011 to 482tcf in 2012. (TCF = trillions of cubic feet). What was recoverable at $6 or $8 is not economically recoverable at $2.50.

So, in my opinion, US policy ought to encourage liquification and export, at the same time as new pipelines are built to send natural gas to more domestic markets. (Not Vermont, though, because it has indicated it doesn't want natural gas.)

The US has more proven reserves of natural gas than any other country; and with coal and shale oil, more carbon fuels by far than anyone else. With the right policies, we can reduce our crude oil imports while expanding exports of LNG, breaking the back of OPEC with finality, narrowing our balance-of-payments deficit, and creating huge numbers of new jobs.

Getting these policies right is the key. The current Department of Energy seems determined to put up barriers to energy production everywhere, and is looking for legal means to block natural gas production.
 

aja8888

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NG prices are very low and continue to go down, however there are several liquifaction terminals being constructed with completion in the next few years, and once those terminals are online, prices are bound to go up as NG gets exported. Also there are several GTL processes which will drive the price up one it's low enough to make those technologies cost effective.
Scott (or someone else: Can you enlighten me as to the "several gas to liquids plants" (not re-gasification) that are under construction in the U.S? I know of maybe one, and I know of several construction permit applications that were cancelled due to the improbability of being granted in the last few years, but I am not aware of any big plans in the U.S. to build these plants. Cheniere Energy has facilities in the Gulf area and plans for expansion, but those are long term and in need of financing.

There are a slew of plants being planned or under construction in other countries, but they don't face the regulatory, permitting and political challenges like U.S. companies. The U.S. does have several re-gasification facilities that were built years ago and are in operation, but those are for foreign LNG processing.

Thanks.
 

RNDDUDE

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CNG trucks are very common in Ca. but only in daily route service....garbage trucks, street sweepers, metro busses, etc.....anything where the truck returns to a storage & refuelling depot every night and as such fuel availibility is not an issue. MUCH better than their diesel-fueled counterparts, at least from my lungs perspective.
 

eb2143

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The company I used to work for purchased 4 CNG busses before I left—made in California (ElDorado National) with Cummins B Gas Plus (spark ignited) CNG engines. In fact, I was riding home in one about 10 minutes ago.

There was definitely some anxiety over the switch towards CNG...all the other busses are Cummins ISB, with B20 used. Initially, it looked like the CNG doubters would be proven correct, but they seem to have the kinks ironed out now.

I don't have much new to add except that I don't see any reason not to ride the wave of cheap NG...although it will eventually end of course.

As was mentioned, there is certainly no threat to OTR trucking from CNG in the immediate future, not only due to the lack of infrastructure, but I don't think the range would be satisfactory given the room for tanks on a tractor. The tanks on our busses' roofs need to be massive to match the range of a single 100 gallon diesel tank; maybe they could up the pressures in the future though.

As far as how the Cummins CNG engines work, my experiences have been as follows:
- quiet and clean (not only no particulates, but no smell when you're behind one)
- power feels about on par to equal displacement ISB with exhaust treatment, but less than the older ISBs without the exhaust treatment, which have some nice grunt
- CNGs don't like the cold! Lots of problems there for us: I think the issues were mainly due to minuscule amounts of water vapor in the fuel, so dryers are required.
- The NG busses have to have reinforced roofs (which creates a lower ceiling where the brace runs) as well as a fancy engine compartment fire extinguishing system.
- Expensive fast fueling (high pressure) stations are required, otherwise they take over a day to fill.

Somewhat O/T Rant: I get sick watching NG treated as waste at drilling sites, and I hope we get the regulations in place to utilize the resource...somehow...even if today's low gas prices make NG capture cost excessive at this time—we have to have foresight. I also can't really get behind NG if the obvious problems with hydraulic fracturing aren't addressed in an open forum that includes scientists who aren't under the influence of the oil and gas industry. In the end, oil and NG are both pretty dirty.

http://www.nytimes.com/2011/09/27/b...-flickers-against-the-sky.html?pagewanted=all
Every day, more than 100 million cubic feet of natural gas is flared this way — enough energy to heat half a million homes for a day.
The flared gas also spews at least two million tons of carbon dioxide into the atmosphere every year, as much as 384,000 cars or a medium-size coal-fired power plant would emit, alarming some environmentalists.
All told, 30 percent of the natural gas produced in North Dakota is burned as waste. No other major domestic oil field currently flares close to that much, though the practice is still common in countries like Russia, Nigeria and Iran.
 
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aja8888

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Somewhat O/T Rant: I get sick watching NG treated as waste at drilling sites, and I hope we get the regs in place to utilize the resource...somehow...even if today's low gas prices make NG capture cost excessive at this time—we have to have foresight. I also can't really get behind NG if the obvious problems with hydraulic fracturing aren't addressed in an open forum that includes scientists who aren't under the influence of the oil and gas industry. In the end, oil and NG are both pretty dirty.

http://www.nytimes.com/2011/09/27/b...-flickers-against-the-sky.html?pagewanted=all
Maybe you can figure out how to have multi-million dollar pipelines in place ahead of time (with take or pay contracts) at remote drilling locations IF natural gas it encountered during drilling for oil (no one is drilling new wells for natural gas these days). It's not as easy as the press makes it seem.

It takes a lot of time, money and effort to get fresh gas to a storage facility or end user. Unfortunately, most wells being drilled are in locations where no transmission facilities exist ahead of time. And the ones that are in-place are usually at capacity. So we flare gas to get the oil, which goes into your diesel fuel which runs your car. Oh, and we frac the wells to get the hydrocarbons like we have been doing since the 1940's.
 

Ski in NC

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Maybe you can figure out how to have multi-million dollar pipelines in place ahead of time (with take or pay contracts) at remote drilling locations IF natural gas it encountered during drilling for oil (no one is drilling new wells for natural gas these days). It's not as easy as the press makes it seem.

It takes a lot of time, money and effort to get fresh gas to a storage facility or end user. Unfortunately, most wells being drilled are in locations where no transmission facilities exist ahead of time. And the ones that are in-place are usually at capacity. So we flare gas to get the oil, which goes into your diesel fuel which runs your car. Oh, and we frac the wells to get the hydrocarbons like we have been doing since the 1940's.
How about portable gas fired gensets to put the ng to use that would otherwise be flared?
 

aja8888

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How about portable gas fired gensets to put the ng to use that would otherwise be flared?
Believe it or not, they use them in most places where commercial power is not available. Plus, nearby farmers are asked if they want the gas for their use (many take it). Most places can only flare for a short period (6 months to a year), then the State requires end use or transportation out (or shut the well in).

The biggest problem now in the U.S. gas market is over capacity and full storage (underground salt caverns). Large producers are shutting in wells. This last warm winter was a problem for gas consumption. Add that to the slow industrial capacity (recession), and gas is cheap and plentiful.
 

john.jackson9213

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I'm in favor of more alternative fuels. I can see an opportunity for municipal waste plants capturing their anaerobic digester methane gas, as well as municipal landfills capturing methane. Seems possible they could form co-op arrangements to consolidate dewatering, compression, storage, and sales terminals--all while saving government money.
This size operation is quite small scale and not cheap. The city of San Diego uses digester gas to run some generators at land fills and waste water plants. But the total power is quite small. SD is also working with using digester gas to power some fuel cells. Nice, but this is only a very marginal power source. Hard reality, it is a feel good project. Like, 40 megawatts?
 

kjclow

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Scott (or someone else: Can you enlighten me as to the "several gas to liquids plants" (not re-gasification) that are under construction in the U.S? I know of maybe one, and I know of several construction permit applications that were cancelled due to the improbability of being granted in the last few years, but I am not aware of any big plans in the U.S. to build these plants. Cheniere Energy has facilities in the Gulf area and plans for expansion, but those are long term and in need of financing.

There are a slew of plants being planned or under construction in other countries, but they don't face the regulatory, permitting and political challenges like U.S. companies. The U.S. does have several re-gasification facilities that were built years ago and are in operation, but those are for foreign LNG processing.

Thanks.
Shell is in the process of getting permits to begin product of a plant outside of Pittsburgh. They have an agreement on the land but have to wait for property transfer at the end of this year to begin production. With NG down to $2.50, I wonder what the price of the liquid fuels will be coming out the other end? They also planning on making other chemicals out of their cracker that are currently mostly refined from crude. In addition to cheaper diesel and gasoline, you might see the result of less expensive flat screen TVs.
 
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