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GE NextFuel

Trains Turn to Natural Gas to Cut Fuel Costs, Compete with Trucks

GE NextFuelGeneral Electric’s locomotive division and other companies are testing natural gas equipment as rail companies look for ways to take advantage of natural gas production, which has halved the price of fuel, the Christian Science Monitor reports.

The savings could be in the billions, the publication reports. Union Pacific, the nation’s biggest freight railroad, spent more than $3.6 billion on fuel in 2012, about a quarter of its total expenses.

GE’s NextFuel kits (pictured) allow railroads to use liquefied natural gas (LNG) as a fuel source, reducing emissions and fuel costs. Caterpillar’s Electro-Motive Diesel has also developed an LNG prototypes; both will be tested by Union Pacific, CSX, BNSF and Canadian National railroads this year.

Natural gas could help railroads improve their profits and better compete against trucks, the Christian Science Monitor reports. However, any changes will happen slowly as they would require expensive new fueling stations and infrastructure across the US’ 140,000-mile freight-rail system.

The natural gas truck market experienced a growth spurt in late 2013 driven by lower fuel costs and environmental benefits over diesel, according to an analysis by Navigant Research published last month. The report forecasts this trend will continue this year as new engines and vehicles are introduced. Overall, the markets for natural gas trucks and buses are expected to grow at a compound annual growth rate of 12.6 percent and 6.4 percent, respectively, between 2013 and 2022, the report says.

New emissions regulations coupled with low LNG costs are also driving commercial maritime firms to LNG-powered fleets.

Shell, GE and Clean Energy Fuels will this year begin construction on the US’ first fuel station for liquefied natural gas-fueled cargo ships in Jacksonville, Fla.

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