The point is that while coal will most likely continue its decline in fueling electrical generation facilities; natural gas needs another demand sector to increase demand and further replace dirty fossil fuels from our energy inventory. The sluggish U.S. economy has reduced expectations for new construction in the industrial, commercial and residential market, all potential users of natural gas.
This leaves the transportation industry as the only other viable sector that can make a significant impact on the energy mix by using an alternative fuel. While there are reports of U.S. hybrid and electric vehicle sales jumping in March, the overall penetration of EV are far less than many in the industry would have you believe. A March 2012 report in the New York Times stated: “…the state of the electric car is dismal, the victim of hyped expectations, technological flops, high costs and a hostile political climate. General Motors has temporarily suspended production of the plug-in electric Chevy Volt because of low sales. Nissan’s all-electric Leaf is struggling in the market. A number of start-up electric vehicle and battery companies have folded. And the federal government has slowed its multibillion-dollar program of support for advanced technology vehicles in the face of market setbacks and heavy political criticism.”[9]
It must be noted that almost every conventional gasoline and diesel internal combustion engine can be converted to run on compressed natural gas (CNG). No innovations technological advancements are needed to power vehicles on CNG. Furthermore, natural gas is an abundant resource base that complements U.S. national energy security initiatives.
Not that incentives are a good thing, but to play on a level playing field with petroleum, either oil subsides should be reduced or incentives should be given to end users of CNG powered vehicles (see Oil Subsidies 101).[10] All CNG incentives offered by the federal government have expired. There is rhetoric, and just that, on Capitol Hill to do something to stimulate usage of natural gas in the transportation sector.
Taking these factors into consideration, some forward thinking states such as Oklahoma offer a one-time income tax credit up to 50% of the incremental cost of purchasing a new CNG vehicle from an original equipment manufacturer or to cover the cost of converting a vehicle to operate on an alternative fuel such as natural gas.[11]
According to the Natural Gas Vehicles for America,
- “There are about 120,000 NGVs on U.S. roads today and more than 14.8 million worldwide.
- There are about 1,000 NGV fueling stations in the U.S., about half of which are open to the public.
- There are also “Home Refueling Appliances” available.
- In the U.S., about 30 different manufacturers produce 100 models of light-, medium-, and heavy-duty vehicles and engines.
- Natural gas currently costs from $1.50–$2.00 less per gasoline gallon equivalent (GGE).
- In the U.S. alone, NGVs offset the use of nearly 360 million gallons of gasoline in 2011.
- NGVs meet the strictest emission standards, including California’s AT-PZEV standard.
- NGVs are as safe as or safer than traditional gasoline or diesel vehicles.”[12]
There are a few disadvantages of using CNG, these include the limited number of models offered for sale or that can be retrofitted for CNG. A good part of this limitation is due to EPA regulations that make the CNG certification process rather lengthy and costly. Also, there are few certified conversion shops and CNG kits suppliers. CNG is less readily available than gasoline & diesel. Conversion is not cheap; passenger vehicles can be converted for $10,000 each, parts and labor.
In closing, like it or not, renewable energy has a long way to go to make an impact on U.S.’s energy inventory. Natural gas, being the least disruptive fossil fuel, could serve as a ‘bridge’ to a low-carbon future. Natural gas will buy time to further develop, cleaner fuels; hopefully there will be something at the end of the day, whether it takes 25 years or the end of the century. Then why are our lawmakers asleep to the needs of the country?
References:
[1] The Economic and Employment Contributions of Shale Gas in the US, IHS Global; http://www.ihs.com/info/ecc/a/shale-gas-jobs-report.aspx
[2] U.S. Energy Information Administration, Today in Energy, January 24, 2012; http://205.254.135.7/todayinenergy/detail.cfm?id=4690
[3] Renewable or not? How states count hydropower, Midwest Energy News, January 13, 2012, http://www.danhaugen.com/2012/01/13/renewable-or-not-how-states-count-hydropower/
[4] U.S. Energy Information Administration, Renewable Energy Explained; http://www.eia.gov/energyexplained/index.cfm?page=renewable_home
[5] U.S. Energy Information Administration, Annual Energy Review 2010, pg 361; http://205.254.135.7/totalenergy/data/annual/pdf/aer.pdf
[6] U.S. Energy Information Administration, Today in Energy, July 13, 2012: http://205.254.135.7/todayinenergy/detail.cfm?id=7090
[7] Coal Age, Coal and Natural Gas Reach Parity in April; http://www.coalage.com/index.php/news/latest/2118-coal-and-natural-gas-reach-parity-in-april.html
[8] NaturalGas.org, Natural Gas and the Environment; http://www.naturalgas.org/environment/naturalgas.asp
[9] The Electric Car, Unplugged, The New York Times, March 24, 2012; http://www.nytimes.com/2012/03/25/sunday-review/the-electric-car-unplugged.html?pagewanted=all
[10] Oil Subsides 101, BarryOnEnergy, September 24, 2011; http://barryonenergy.wordpress.com/2011/09/24/oil-subsidies-101
[11] U.S. Department of Energy, Alternative Fuels Data Center; http://www.afdc.energy.gov/laws/laws/OK/tech/3253
[12] Natural Gas Vehicles for America, Facts About Natural Gas Vehicles; http://www.ngvc.org/about_ngv/index.html
The opinions expressed in this article are solely those of the author Dr. Barry Stevens, an accomplished business developer and entrepreneur in technology-driven enterprises. He is the founder of TBD America Inc., a global technology business development group. In this role, he is responsible for leading the development of emerging and mature technology driven enterprises in the shale gas, natural gas, renewable energy and sustainability industries. To learn more about TBD America, please visit: http://tbdamericainc.com/
