APGA strongly supports the growth and development of the natural gas vehicle (NGV) industry. NGVs provide a key alternative fuel option for many businesses and consumers across the country. Many APGA members not only supply gas to NGV fueling stations, but also maintain and manage fueling stations or operations of their own. NGVs’ low emission profile and relative price stability make them an attractive option for urban fleets, long-haul shipping, and municipal and local vehicles.
What are the Benefits of Natural Gas Vehicles?
NGVs are some of the cleanest vehicles on the road. The newest NGVs emit zero or near-zero NOx emissions and significantly reduce greenhouse gas emissions when compared to gasoline or diesel engines. NGVs are an available alternative to conventional engines an pratical means to reduce emissions from the transportation sector, particularly from heavy-use applications. NGVs have helped bring localities into compliance with federal ambient air quality standards and other state and local pollution laws and regulations. NGVs also provide acute emissions reductions benefits – switching from a diesel to natural gas school bus, garbage truck, or other municipal vehicle can significantly reduce harmful tailpipe emissions and ensure that localities have cleaner air.
Further advancing the environmental benefits of NGVs is the ongoing development of renewable natural gas (RNG). RNG is methane extracted from the decomposition of biodegradable sources, such as from landfills and agriculture waste. RNG is collected from the breakdown of organic materials, treated and cleaned, and redistributed as pipeline-grade methane. Often, RNG is used for transportation purposes. The RNG process ultimately takes methane out of the air. Thus, a waste collection company or agency that installs an RNG plant for its collections could actually have negative net greenhouse gas emissions.
Due to developments in production and transportation, natural gas prices have remained mostly stable over the last several years. Based on current supply and production levels, prices of natural gas are not expected to significantly fluctuate in the near term. Prices of liquefied natural gas (LNG) and compressed natural gas (CNG) for transportation use have accordingly remained stable. Fleets that use NGVs have been able to fairly accurately plan their fuel prices and optimize business investments due to the flat price regime of natural gas.
NGVs are available in every vehicle class, including light duty, and are used in commercial, municipal, freight, port and transit, and other applications. APGA members are proud to supply and operate NGV fleets and fueling stations across the country.
Below are a few more specific APGA positions regarding the natural gas direct use. Please click on the policy position to view its description and details.
A few cities have gone to the extreme of banning natural gas, mostly in new construction. This heavy-handed approach eliminates consumer choice, stifles innovation, and diminishes the flexibility to respond to GHG emissions goals, with the least-cost solutions for consumers. Appliances will have to be replaced, and there is no doubt, electric infrastructure will need to be upgraded. In addition, consumers will be impacted with higher energy bills. All of this with no evidence the environmental impacts are substantial enough to warrant forced fuel switching. APGA hopes any policy development will be considerate of environmental benefits balanced with consumer affordability, and APGA and its members stand ready to work on this type of solution.
Under current law, the federal highway excise tax on both LNG for use in motor vehicles and diesel are taxed on a volumetric basis at 24.3 cents per gallon. LNG is less energy dense than diesel, as it requires 1.7 gallons of LNG to equal the energy content of 1 gallon of diesel. Based on this fact, LNG trucks will consume more fuel than their diesel counterparts and therefore will pay more in federal highway taxes than their diesel counterpart.
This additional tax burden provides a strong disincentive for consumers to purchase an LNG-powered truck. Taking into account the incremental cost of an LNG truck, which can be up to $60,000, the additional fuel tax burden may be sufficient to prevent fleets from using cleaner-burning LNG.
This legislation should be passed to remedy that disincentive by taxing LNG on an energy content basis, as CNG is taxed. This would level the playing field between LNG and diesel.
Federal & State Incentives
FEMP provides guidance and assistance to help implement Federal legislative and regulatory requirements mandating reduced petroleum consumption and increased alternative fuel use. FEMP's efforts include assisting agencies with implementing and managing energy-efficient and alternative fuel vehicles and facilitating a coordinated effort to reduce petroleum consumption and increase alternative fuel use annually. http://www1.eere.energy.gov/femp/program/fedfleet_management.html