December 2, 2013 2:00 AM, EST

Alternative Fuels Expand Their Presence as an Option for Over-the-Road Fleets

By Bruce Harmon, Managing Editor — Magazines & Features

This story appears in the Dec. 2 print edition of Transport Topics.

Transport Topics’ special report on alternative fuels for trucking, included with this week’s newspaper, examines the key issues involved in shifting to natural gas and also looks into other nondiesel choices available to truckers.

Following up a year later on the watershed summit on natural gas in transportation presented by American Trucking Associations, TT’s special report covers topics ranging from natural-gas pricing, vehicle maintenance and the influence of shippers in the fuel choices of some carriers.

The article on pricing shows that the price of natural gas, the most broadly used alternative fuel, has been unlinked from the price of diesel fuel for several years because of significant increases in the domestic supply that ensure the cost of natural gas will remain relatively flat.

Diesel, on the other hand, is subject to ups and downs along with the market for crude oil, most of which is produced in foreign countries and subject to a variety of supply shocks.

Because natural gas has begun to establish itself as a desired alternative for many fleets, a substantial infrastructure for delivering it to consumers is well on the way to becoming reality, according to TT’s special report.

Also, while natural-gas trucks have initial costs noticeably higher than their diesel-powered counterparts — mainly because the fuel-storage tanks on board nat-gas trucks are expensive — the price gap between conventional diesel trucks and those powered by nat gas is expected to diminish as sales of the natural gas-fueled trucks continue to increase.

Those higher sales of natural gas trucks to carriers are driven in part by pressure from shippers seeking a lower-cost fuel with a more predictable price trajectory relatively free from diesel surcharges, which can make predicting costs difficult. Sales also are being helped by a variety of state incentives that encourage fleets to buy alternative-fuel trucks.

But there are drawbacks to natural gas, as TT’s report outlines, leading some fleets to wait before switching. Maintaining trucks is more complex and expensive, and natural-gas technicians have to be specially trained. Some fleets are interested, but don’t want to jump in with both feet, so they are leasing a few trucks to see whether natural gas works for them.

Many investors are intrigued by the possibility that natural gas will become widely adopted, making companies that make trucks, engines and ancillary products potentially attractive. Yet, as TT reports, many investors are still on the sidelines, waiting to be sure natural gas doesn’t fail to gain widespread use or be supplanted by some other technology, as has happened with alternative propulsion methods in the past.

And there are other alternative fuels available now or in the near future to limited markets. Among them are methane generated by waste products or dimethyl ether, which is produced from renewable vegetable matter.

The report is included in the mailing bag that contained this week’s issue of TT.