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The Future Of Fleet Energy

Successful Dealer Staff April 10, 2012

Product reviews, OEM & supplier news and equipment management trends

The future of fleet energy

Price spikes slowly driving U.S. toward alternative fuels

 

 

 

Both compressed natural gas and propane yield roughly a 12 percent drop in general vehicle efficiency compared to higher-priced diesel and gasoline, but today’s fleet managers are realizing they can work with that number.

 

Sitting in the front row listening to U.S. Energy Secretary Dr. Stephen Chu speak at the NTEA Work Truck Show in Indianapolis was about as close as I’ll ever get to the Nobel Prize. Chu was a co-winner in 1997 for his work in physics, and today he’s applying that scientific knowledge to help the United States find viable energy solutions in an ever-bleaker world of speculation, geopolitics and the usual supply-and-demand issues.

We’re going to talk a lot next month in CCJ about alternative fuels, but for now, it’s enough to say that fuel prices are suddenly on the rise again, as you well know – and nobody is happy about that. Unfortunately, this is our new reality. On the surface, the sudden price spikes look awfully suspicious to the average American; in reality, the issues behind them are mind-alteringly complex.

To get a handle on what’s going on, you have to look at a wide range of factors from how many cars the Chinese are building, what’s happening in the world financial markets and what someone in Iran said to the press this morning – to name just a few. But if we learned anything from the first round of major fuel price spikes a few years back, it’s that the days of sedentary, logical energy markets are over – and the latest increases only reinforce that lesson.

For years, American fleets and car owners could count on a slow but steady – and largely predictable – climb in the price of fossil fuels as global demand gradually increased. Today, prices can go haywire literally overnight, and any long-term trends we can identify today all are negative.

As Chu noted, 12 million new cars were built and sold in the United States last year, and that number undoubtedly was flat due to the recession; consider that the Chinese put 16 million cars on the road last year. Chu said the United States is on track to build – and fill up – 20 million new cars a year by 2020. That indicates the future of fuel prices in this country and around the globe.

We’re sitting on top of the largest deposit of natural gas reserves in the world.

But the news isn’t all bad. While it looked for many years that the Middle East won the jackpot when it came to a bunch of dinosaurs dying and turning into flammable black gunk bubbling under the ground, it turns out the good ol’ USA did pretty well, too: We’re sitting on top of the largest deposit of natural gas reserves in the world. Even better, we can run cars and trucks on this stuff – and we’ve got enough on hand to last us for 100 or even 250 years or more, according to experts.

Is compressed natural gas or propane as good as gasoline or diesel? Frankly, no – they don’t have the BTUs or the range that diesel and gas offer; that’s why they never were adopted as automotive fuels in the first place. Both CNG and propane yield roughly a 12 percent drop in general vehicle efficiency compared to diesel and gas.

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