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‘Urgent’ Need For Natural Gas Refueling Infrastructure, Navigant Says

Natural Gas Station GrowthAs more natural gas vehicles hit the road, the need for refueling stations is becoming urgent, says a Navigant Research report that predicts 40 percent of the stations that will be opened in the next two years will be in North America.  By 2020, there will be 30,000 stations worldwide, the report forecasts.

Natural Gas Vehicle Refueling Infrastructure says the growth of natural gas vehicles depends on the availability of compressed natural gas (CNG), and for heavy-duty vehicles, liquefied natural gas (LNG). With the explosive growth in hydraulic fracturing, or fracking, making natural gas cheaper than ever, new pipelines offer increased supply.

This will lead to robust growth in refueling infrastructure as companies look to take advantage of the emerging market, but that infrastructure is more expensive than the set up for other types of fuel, the report says.

While CNG has an established component supply chain, building new pipelines to transport the fuel from the gas grid to the stations can be challenging, Navigant says. And LNG does not have a robust supply chain, so it has followed the diesel model by having fuel trucked in.

But despite these challenges, since both CNG and LNG are cheaper than diesel and gasoline, they are becoming more popular, leading to more demand for the vehicles and supply-chain infrastructure. CNG can be used by all vehicle classes but LNG is limited to heavy-duty vehicles. This, according to the report, which is why the market for CNG is more mature than the LNG market.

Fleet operators have begun switching to natural gas because of the price advantage. For example, United Parcel Service expects to save 40 percent in fuel costs by switching its long-haul semi-tractor trailer fleet to natural gas.  Scott Wicker, chief sustainability officer at the world’s largest package-delivery company told, told Bloomberg that UPS is reducing gasoline and diesel to cut emissions.

 

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One thought on “‘Urgent’ Need For Natural Gas Refueling Infrastructure, Navigant Says

  1. UPS’s announcement that it’s going to shifting some of its Fleet over to liquefied natural gas could be the catalyst for other large companies to do the same. The fact that UPS did this for reasons of cost savings and not environmental ones is probably causing a lot of bean counters in other companies to start crunching the “diesel vs. natural gas” numbers.

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