Natural gas trucks will be ahead of curve if fuel stays high: Westport

VANCOUVER, (Aug. 3, 2005) — An American study shows that heavy-duty natural gas vehicles with 2010 technology will be cost-competitive with their diesel counterparts and markedly more affordable if crude oil prices remain high, according to B.C.-based Westport Innovations.

The study, “Comparative Costs of 2010 Heavy-Duty Diesel and Natural Gas Technologies”, indicates natural gas vehicles in refuse hauler, transit bus, and short-haul truck applications may have a significant advantage in life cycle costs over diesel counterparts if oil prices remain high. The study by TIAX LLC states that the expected slightly higher capital costs of NGVs will be offset by lower fueling costs over the life cycles of these vehicles.

Westport — a leading developer of environmental technologies that allow engines to operate on clean-burning fuels such as natural gas, and hydrogen — says this new study documents what the company has been observing for some time, namely that “international pressures on oil supply and increasing oil prices are creating new economic advantages and opportunities for natural gas engines and vehicles.”

“Transit, refuse, and short-haul fleet managers should carefully evaluate natural gas and diesel vehicle technologies that meet 2010 emissions standards,” Mike Jackson, senior director of TIAX and one of the contributors to the report, said in a release. “For these applications, our study indicates vehicles equipped with stoichiometric natural gas engines and three-way catalysts will have similar owning and operating costs compared to diesel engines equipped with advanced aftertreatment technologies, which enable both sets of vehicles, respectively, to meet new emissions standards.

“That said,” Jackson added, “at oil prices above $31 US per barrel, natural gas technologies are cheaper than the diesel alternatives and may well be the best overall option for fleet managers.”

The TIAX study is said to be based on a sophisticated life cycle cost model that incorporates key variables. It factors in expected vehicle, fuel, operational, and maintenance costs (including fuel consumption) during a vehicle’s initial ownership life, and then varies several factors independently. Key factors include: crude oil cost per barrel, percentage of NGVs in the national fleet, choice of diesel exhaust gas aftertreatment system, price of natural gas fuel versus diesel fuel, price of liquefied natural gas (LNG) versus compressed natural gas (CNG), engine cost, and fuel economy.

Oil prices emerged as the variable with the largest impact on life cycle cost in this study. The TIAX model projects that various categories of NGVs will become less expensive to buy, operate, and maintain than comparable diesel vehicles at varying oil prices: a refuse hauler at $22 a barrel (in 2005 dollars), a short-haul truck at $28 per barrel, and transit bus operations when oil price reaches $31 per barrel, for example. If crude oil price is $60 a barrel (the highest price considered), NGVs will have a significant average annual life cycle cost advantage in all applications, according to the report.

Westport, which partners with Cummins to deliver a joint natural gas powered engine, says there are over 12,000 Cummins Westport natural gas engines powering such commercial vehicles as trucks and buses on the roads worldwide today.

“We see expanding interest in Cummins Westport’s current products as well as Westport’s emerging engine technology,” said Michael Gallagher, president and COO of Westport Innovations.

Copies of the report can be accessed and downloaded from the California Natural Gas Vehicle Partnership website. Please visit the following web address: www.cngvp.org/HDDV_NGVCostComparisonFinalr3.pdf.