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Survey shows more fleets eyeing LNG

Jason Cannon May 10, 2013

According to a recent PLS Logistics Services survey, an increasing number of fleets are planning to purchase natural gas powered trucks.

To determine the potential of LNG vehicle use for industrial freight, PLS Logistics Services surveyed senior executives at 100 large industrial freight carriers, and survey respondents represent key decision makers at some of the largest industrial trucking companies in the United States.

“The results of our latest survey show significant movement within the trucking industry toward adoption of LNG technology,” PLS Logistics Services’ Chairman and CEO Greg Burns says. “PLS believes LNG has an important role to play as a U.S. energy source, and our future surveys will track adoption rates and attitudes towards this alternative fuel in the future. “

Survey data indicates that 9 percent of carriers expect to purchase an LNG truck in 2013 or at some later date, compared with a 1 percent intent to purchase in 2012. The percent of respondents who feel there will be no adoption or limited adoption went from 72 percent in 2012 down to 48 percent in 2013.

In contrast, the percent of carriers that believe LNG vehicles will be widely adopted or present a viable alternative to diesel went from just 28 percent in 2012 to 52 percent in 2013. An analysis of survey responses based on carrier size, shows that 59 percent of large carriers believe LNG trucks will play an important role in heavy-duty trucking compared to 46 percent of carriers with a fleet size below 100.

In follow-up interviews, carriers told PLS Logistics that increased enthusiasm about LNG-powered trucks is due, in part, to the recent progress of engine makers. In 2013, four new 12-liter LNG engines, designed for Class-8 tractors, will be introduced. The heavy-duty carriers we spoke to indicate a preference for engines with 450-550 horsepower and 1600-1800 lb.-ft. of torque. The Westport 15-liter natural gas engine is in this range and the new 12- and 13-liter engines coming on the market get closer to the desired power requirement.

Obviously, cost to purchase LNG equipment plays a large role in purchase plans, but survey results indicate that federal tax incentives would positively impact a decision to purchase LNG vehicles for more than one third of carriers.

The primary barrier to LNG adoption continues to be a concern that the current refueling infrastructure is inadequate. Currently, according to the Department of Energy, there are 71 LNG fuel stations in the U.S. – up from 46 in Q1 2012. But that number is growing quickly. Clean Energy says it will add 70 additional LNG stations to its network this year, most located at Pilot-Flying J truck stops. Shell Oil Co. and TravelCenters of America have announced plans to construct at least two LNG fueling lanes and a storage facility at up to 100 existing TA and Petro Stopping Centers on U.S. interstate highways.

The second significant barrier to carrier adoption of LNG vehicles according to the survey is the higher cost of LNG trucks relative to diesel. Estimates of this cost differential range from $30,000 to $80,000. Survey responses differ, however, between small and large carriers.

Poorly capitalized smaller carriers actually regard vehicle cost as the number one barrier to LNG truck purchases, whereas large carriers seem far more concerned with the refueling infrastructure.

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