NGV Industry Overview Report v9X

Natural Gas Vehicle
Market Whitepaper USA

2013-2014
Whitepaper highlights include:
NGV USA Market Overview:
Comprehensive analysis of the
North American NGV Market
Government Policies:
How they will impact the NGV
market over the next 5 years
Converting to Natural Gas:
Key considerations to address
when converting your fleet to NGVs
Infrastructure Development:
How to successfully plan and build
NGV infrastructure
For more information, visit www.ngvevent.com
WELCOME
Welcome
Dear Colleague
Thank you for your interest in this FC Gas Intelligence Whitepaper on the Natural Gas Vehicle market in North
America, 2013-14, I hope you find it valuable.
Natural Gas Vehicles (NGV) are at a seminal moment in the United States currently, with a range of
stakeholders driving the development of the market. To get a thorough overview the report interviewed over
20 industry experts, drawing their combined expertise into this document to better inform your strategies
over the next few years.
This Whitepaper is only the beginning of the debate on Natural Gas Vehicles, it has been created in
conjunction with the 3rd Natural Gas Vehicle USA Conference & Exhibition (June 11-13, Houston) more info
can be found here www.ngvevent.com
I hope you find the report useful and I look forward to speaking to you soon,
With very best wishes

Joshua Bull
Sector Head | FC Gas Intelligence
josh@fc-bi.com
For more information visit www.ngvevent.com
NGV INDUSTRY OVERVIEW
| 2
ABOUT FC BUSINESS INTELLIGENCE
About FC Gas Intelligence
A business intelligence and networking company we help leading corporations define their future strategy
and direction, develop growth opportunities and solve the problems facing their sectors. The engines of our
business are growth and change. We focus on two types of industry:
Those arising from technology developments which are moving into full global commercialisation.
Those needing to change in order to respond to disruptive technologies or global events.
Our aim is to provide companies with insights into strategic options for the future in order that they can
capitalise on opportunity.
Author
Disclaimer
FC Business Intelligence Ltd and its partners prepared the information and
opinions in this report. FC Business Intelligence has no obligation to tell you
when opinions or information in this report change. FC Business Intelligence
Ltd makes every effort to use reliable, comprehensive information, but it makes
no representation that the information is accurate or complete. In no event
shall FC Business Intelligence Ltd and its partners be liable for any damages,
losses, expenses, loss of data, loss of opportunity or prot caused by the use of
the material or contents of this report.
No part of this document may be distributed, resold, copied or adapted
without FC Business Intelligence Ltd s prior written permission.
FC Business Intelligence Ltd 2013
| 3
CONTENTS
Contents
Welcome . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
About FC Gas Intelligence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
List of Tables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7-8
Chapter 1: NGV Industry Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.0 Market Size and Growth Forecasts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.1 Growth drivers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1.2 NGVs on the Road . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.3 Locations of Existing CNG and LNG Stations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.4 Proposed expansion of
CNG and LNG fueling networks. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
1.5 Expansion of Small and Midsize LNG Liquefaction Plants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
1.6 Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Chapter 2: Government policies: How they will shape the NGV market over the next 5 years. . . . . 22
2.0 Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
2.1 Policy in context. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
2.2 Subsidies and tax incentives. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
2.3 Procurement policy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
2.4 CAF standards. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
2.5 Environmental regulation: potential risk?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.6 Export policy: potential risk?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
2.8 Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Chapter 3: Converting to Natural Gas, Vehicle issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
3.0 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
3.1 Passenger automobiles. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
3.2 Light and medium duty trucking vehicle options. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
3.3 State subsidies for light-duty NGVS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3.4 Heavy duty trucking. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
3.5 Factors to consider in HD fleet conversions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
3.6 State subsidies for heavy-duty fleet conversion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
3.7 Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Chapter 4: Building Dedicated Fuelling Infrastructure, CNG and LNG. . . . . . . . . . . . . . . . . . . . 38
4.1 Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
4.2 Basic cost considerations, CNG compared to LNG. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
4.3 Design, planning, and siting of CNG fuelling stations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
4.4 Design, planning, and siting of LNG fuelling stations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
4.5 Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
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FIGURES
Figures
Figure 1 Natural gas consumption by sector, 1990-2040 (trillion cubic feet). . . . . . . . . . . . . . . . . . . . . . . 9
Figure 2 U.S. Natural Gas Vehicle Fuel Consumption MMcf. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Figure 3 Average diesel, gasoline, and CNG prices, 2000-2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Figure 4 Price differential CNG to diesel, by state. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Figure 5 PCT. Growth in public access CNG stations 7/11-8/13. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Figure 6 Regional Transportation Corridors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Figure 7 Locations of CNG stations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Figure 8 Locations of LNG Stations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Figure 9 United States truck traffic volumes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Figure 10 Projected expansion of Trillium CNG station network, 2013-2016. . . . . . . . . . . . . . . . . . . . . . . 17
Figure 11 Projected expansion of Loves CNG network. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Figure 12 Projected rollout of Clean Energys Americas Natural Gas Highway of LNG and LCNG
stations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Figure 13 Projected network of LNG stations proposed by Shell and TravelCenters of America
partnership. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Figure 14 Blu LNG operational and pending LNG fuelling network (as of end 2013) . . . . . . . . . . . . . . . 19
Figure 15 Small and Mid Scale LNG Liquefaction plants*. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Figure 16 Calculation of light-duty truck payback, based on various fuel price and truck premium
assumptions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Figure 17 Map of states offering various incentives for light-duty CNG vehicles . . . . . . . . . . . . . . . . . . . 32
Figure 18 Natural gas engine comparison-- power (hp) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Figure 19 Natural gas engine comparison torque (ft-lb) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Figure 20 Sample calculation of expected payback for HD fleet conversion . . . . . . . . . . . . . . . . . . . . . . . 34
Figure 21 Sample CNG range calculation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Figure 22 Calculation of Heavy-duty truck payback, based on various fuel price and truck premium
assumptions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Figure 23 Heavy-duty incentives, Canada and US (as of August 2013) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Figure 24 GE CNG in a Box . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Figure 25 GE LNG in a Box . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Figure 26 Micro LNG. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
| 5
TABLES
List of Tables
Table 1
CNG average prices per region . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Table 2
Reduction of pollutants from CNG use, as compared with reformulated gasoline. . . . . . . . . 12
Table 3
Small and Mid Scale LNG Liquefaction plants in the United States*. . . . . . . . . . . . . . . . . . . . . . 20
Table 4
LNG Export facilities approved . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Table 5
Home fuelling specifications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Table 6
Ford CNG model options (as of model year 2014). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Table 7
Chrysler CNG model options (as of model year 2014) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Table 8
GMC and Chevrolet CNG model options (as of model year 2014) . . . . . . . . . . . . . . . . . . . . . . . . 30
Table 9
Summary of state incentives for light-duty CNG vehicles. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .31
Table 10 Heavy-Duty engine options. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

Table 11 Weight diesel truck compared to CNG truck and LNG truck (full tanks in lbs). . . . . . . . . . . . . 35
Table 12 CNG to LNG compared. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
| 6
EXECUTIVE SUMMARY
Executive Summary
FC Gas Intelligences Natural Gas Vehicles Market

Report USA 2013-2014 provides an up-to-theminute summary of current conditions in this
fast-growing market segment. The reports
four chapters summarizes the latest business
intelligence vital to understanding issues currently
confronting stakeholders in this market, and
provides direct guidance for fleet managers looking
for first-hand advice on key issues to consider when
deciding whether to switch to cheaper, cleanerburning natural gas.
Chapter 1: NGV USA Market Overview:
Comprehensive Analysis of the North American
NGV Market
Natural gas has significant potential to transform
the transportation sector, particularly for fleets
and commercial trucking, due to its cheaper, less
volatile price, compared diesel or gasoline. The fuel
is largely sourced in North America, in contrast to
petroleum-based fuels, which are largely sourced
from politically unstable and potentially hostile
regions of the world, especially the Middle East.
The fuel is also cleaner burning than traditional
transportation fuels, and can help provide a bridge
to a greener, lower-carbon future.
The chapter lays out in detail how the number
of CNG and LNG public access fuelling stations is
expanding rapidly, with several companies rolling
out new NG infrastructure. Detailed information
is provided about ambitious expansion plans,
launched by companies such as Trillium and Love
Travel Stops, in the era of CNG infrastructure, and
Clean Energy, Shell, and ENN- Blu LNG on the
LNG side. In partnership with Pilot Flying J Truck S,
Clean Energy is also exploring LCNG options. The
net effect of these expansion plans is that some

fleetsparticularly heavy-duty trucks servicing
major interstate transportation corridors may soon
be able to convert to natural gas without having to
develop independent fuelling infrastructure.
Chapter 2: Government Policies: How they will
impact the NGV market over the next 5 years
Federal and state government policies have
been crucial to fostering the development of NG
as a transportation fuel. Stakeholders currently
operating in this market, as well as companies
considering undertaking fleet conversions, need to
understand how government policies will continue
to shape the future development of the NGV sector
in both positive and potentially negative ways
over the next five years. The chapter provides an
overview of current federal and state policies to
promote NGVs, and provides information on what
government and private resources are available for
getting the latest information about these rapidly
evolving policies. Detailed discussion follows of
two significant policy areas environmental
regulation, both state and federal, and export
policy that could thwart or at minimum slow
development of NGVs. Understanding potential
policy risks is important for companies undertaking
or continuing significant investments in NGVs or
infrastructural development.
| 7
EXECUTIVE SUMMARY
Executive Summary
Chapter 3: Converting to Natural Gas: Key

Considerations to address when converting
your fleet to NGVs
The higher relative costs of NGVs compared
to traditionally-fuelled vehicles has thus far
presented a major obstacle to wider use of NG
as a transportation fuel. This chapter summarises
the current state of the NGV market. OEMs have
started to offer a wider range of NG options,
from automobiles, to vansboth passenger and
cargoand light and medium-duty truck options.
These vehicles cost more than conventionally
fuelled models, but some of these costs can be
offset by state incentives available for converting to
NG.
All major heavy-duty truck manufacturers
now offer NG options, either in CNG or LNG
formats, prodded by customers responding to the
potential significant fuel costs savings. The chapter
walks through specific examples of how to evaluate
the value proposition for fleet conversions, looking
at both light-duty, and heavy-duty, examples.
Chapter 4: Infrastructure Development: How to

successfully plan and build NGV infrastructure
Infrastructural considerations continue to loom large
in decisions to convert all or part of a fleets vehicles
to NGV. The future U.S. NG infrastructure will combine
a network of CNG, LNG, and LCNG stations.
This chapter analyses issues fleet managers need
to consider in deciding whether to opt for CNG of
LNG, based on where their fleets will operate, and
what their range needs are. Although more CNG
and LNG infrastructure is continually coming online, most fleets must still construct or secure access
to independent fuelling infrastructure, as existing
public access infrastructure alone cannot support
fleet range needs. This chapter discusses the issues
companies must consider when deciding whether,
where, and how to construct CNG or LNG fuelling
stations. Infrastructural specialists are expanding
their product offerings, focusing on modular, and
lower-cost options that reduce the necessary up-front
investments and also lower on-going operational and
maintenance costs, for companies constructing both
CNG and LNG fuelling infrastructure.
| 8
INDUSTRY OVERVIEW
Chapter 1: NGV Industry Overview

1.0 Market Size and Growth
Forecasts
Citigroup forecasts NG demand in transportation

alone to reach 2.2 billion cubic feet per day (Bcf/d) by
2020, while a Reuters poll of analysts is less bullish,
Petroleum-based fuels currently dominate the U.S.
expecting NG demand in this sector to reach only
transportation market, and this lack of fuel diversity
1.2 Bcf/d over the same period. The United States
makes this market particularly vulnerable to price
Energy Information Administration (EIA) predicts
shocks. The United States currently consumes 35
billion gallons of diesel fuel per year. Analysts disagree a gradual rise in NG usage in the transportation
sector over the next decade, as shown in Figure 1,
about how much of this current energy demand
could be displaced by cheaper alternative fuels such as a more comprehensive NG sourcing and fuelling
infrastructure is developed, comprising both
as natural gas (NG), particularly in the industrial,
compressed natural gas (CNG) and liquefied natural
power generation, and transportation sectors.
gas (LNG).
Figure 1 Natural gas consumption by sector, 1990-2040 (trillion cubic feet)
The use of NG as a transportation fuel has increased

steadily over the last decade, reaching 32,000 Million
cubic feet (MMcf ) in 2012. Most of this consumption
is currently concentrated in the heavy-duty trucking
sector. The American Clean Skies Foundation
suggests that NG provides a promising opportunity
to diversify fuel sources for both the heavy and
medium duty trucking sector, which, taken together,
account for 22% of the U.S. transportation sectors fuel
use. This diversification would come with another

benefit, for the cost of fueling with NG is substantially
cheaper than buying petroleum-based fuels, even
when necessary costs are included, both buying
relatively more expensive NGVs, and developing
fueling infrastructure, Fleet operators have a potential
opportunity to capitalize on a major cost-saving
opportunity, since fuel accounts for their secondhighest cost.
| 9
INDUSTRY OVERVIEW
Figure 2 U.S. Natural Gas Vehicle Fuel Consumption MMcf
1.1
Growth drivers
Fuel price
The principal factor driving growth in interest in NGVs

is the lower overall price of NG compared to the cost
of either gasoline or refined diesel fuels. Over the last
decade, NG prices have dropped dramatically as new
North American sources of supply have opened up,
with the United States moving from a potential NG
importer to a potential significant NG exporter over
this time period.
Oil prices, by contrast, have been especially volatile

over the same time period. Since 2000, refined diesel
prices as measured by Diesel Gallon Equivalents
(DGEs) have always exceeded NG prices, sometimes
by as much as $2, but usually by at least $1.50, per
DGE. Similarly, gasoline prices have always exceeded
NG prices, when measured by Gasoline Gallon Equiva
lents (GGEs), by as much as $1.50 per unit.
Figure 3 Average diesel, gasoline, and CNG prices, 2000-2012
Source: Clean Cities Alternative Fuel Price Report, July 2013
| 10
INDUSTRY OVERVIEW
Politically stable source of supply
Regional price variations
In addition to the comparative price advantage, NG

supplies are more stable and certain, and virtually
all demand can be supplied either domestically, or
by turning to Canada or Mexico; the three countries
are linked in a fully integrated NG transportation and
distribution system. About 85% of the NG consumed
in the United States is sourced domestically, from
one of the 32 U.S. states that currently produce NG.
Overall, 97% of the NG used in the U.S. comes either
from the United States, Canada, or Mexico.
As Table 1 indicates, CNG currently has a lower

average price than diesel for all regions of the country,
with the largest difference ($1.83 per DGE) being in
the Rocky Mountain region. CNG costs on average
about $1.52 less than diesel on a DGE basis.
Table 1 CNG average prices per region
Region
CNG Price ($/DGE)
Diesel Price ($)
New England
$2.86
$4.07
Central Atlantic
$2.48
$3.81
By contrast, oil is sourced from politically unstable or

Lower Atlantic
$2.24
$3.82
potentially hostile places, including Latin America,
Midwest
$2.08
$3.86
Russia, and especially the Middle East. Political
Gulf Coast
$2.26
$3.82
instability in the Middle East often translates into
Rocky Mountain
$2.03
$3.86
price volatility and also raises periodic concerns
West Coast
$2.71
$4.08
about supply interruptions. Increased use of NG
National Average $2.39
$3.91
would translate into lessened dependence on energy
imports from these politically unstable parts of the
world.
Price stability
In addition to their more attractive absolute price

levels, NG prices also have another advantage for
corporate planning purposes in that they have in
recent years traded in a much narrower band than
either diesel or gasoline prices, with the prices varying
since 2000 about $1 from lowest to highest price.
Since late 2004, this price spread has been even
tighter, varying by no more than $0.75.
It has not always been the case that NG prices have
traded in such a narrow band, and in fact, until
technology increased the domestically produced
supply, NG prices had been among the most volatile
commodities traded on the New York Mercantile
Exchange (NYMEX). Future forecasts of NG supply
suggest that future volatility will follow the recent
pattern of tighter trading spreads.
| 11
INDUSTRY OVERVIEW
Figure 4 illustrates price differentials by state for CNG

relative to diesel. In this map, negative numbers
represent prices for CNG lower than prices for diesel.
States not highlighted with a colour did not have any
CNG data points in the latest Clean Cities Alternative
Fuel Price Report, published in July 2013. For all states

for which pricing data are available, CNG prices were
cheaper than diesel, with the most favourable relative
CNG prices found in states located in the Midwest,
Rocky Mountain, and West Coast regions.
Figure 4 Price differential CNG to diesel, by state
CNG Price Difference

Relative to Diesel
($1.99) - ($1.50)
($1.49) - ($0.95)
($2.30) - ($2.00)
($1.99) - ($1.50)
($0.94) - ($0.55)
Environmental benefits
There are considerable environmental benefits

to wider adoption of NG as a transportation fuel,
whether in CNG or LNG form. The United States
Environmental Protection Agency (EPA) recognizes
that natural gas vehicles (NGVs) produce lower levels
of harmful emissions, including greenhouse gases,
carbon dioxide, nitrogen oxide, particulate matter,
and toxic and carcinogenic pollutants. The exact
degree of emissions benefits depends on the type
and model of the vehicle used, as well as the choice
of the conventionally fueled vehicle benchmark. The
Alternative Fuels Data Center (AFDC) of the United
States Department of Energy (DoE) provides tools for
performing detailed emissions comparisons. Many
fleet operators are as attracted to NGs potential to
enable them to meet their emissions targets as they
are to the potential for fuel cost savings compared to

using diesel or gasoline.
Table 2 Reduction of pollutants from CNG use, as
compared with reformulated gasoline
Volatile Organic Compounds
Carbon Monoxide
Nitrogen Oxides
Particulate Matter
10%
20-40%
0%
80%
Source: A Full Fuel-Cycle Analysis of Energy and Emissions Impacts

of Transportation Fuels Produced From Natural Gas, Wang, M.Q.
and Huang, H.S., 1999
| 12
INDUSTRY OVERVIEW
1.2 NGVs on the Road

The DoE as of September 2013 estimated that about
112,000 NGVs operate in the United States.
Market observers say that these DoE figures lag the
actual state of play, and that the number of NGVs
currently on the road is probably approaching
150,000. Transit buses currently form the largest
category of NGVs, and are powered by either CNG or
LNG. Waste collection vehicles comprise the second
largest category of NGVs, with roughly half of all such
vehicles fueled by NG. Airports are the third largest
NGV users, with about 35 using NGVs, either by
operating their own fleets or promoting the use of
private fleets that burn NG.
Wider use of NG in both short-haul fleets and
long distance trucking is being facilitated by the
development of CNG, LNG, and LCNG fueling
networks. Technological innovation is producing more
affordable light-duty, medium-duty, and heavy-duty
NG truck options, as well as NG-fueled passenger
vehicles, largely for fleet use, although the premium
for all such vehicles remains high. These premiums
are expected to drop as demand for these vehicles
increases, but even on current estimates, a viable
model for heavy-duty trucks driving 125,000 miles a
year suggests that payback on CNG fleet conversion
can occur in fewer than 2 years (as described more
fully in section 3.__ below).
1.3 Locations of Existing CNG

and LNG Stations
CNG stations
As of September 4, 2013, 602 public access CNG

stations operate across the United States, and
633 private access stations. These stations are
substantially concentrated regionally. California and
Utah have been at the forefront of adopting NG as
a transportation fuel, and now each of these two
states is covered with a network of stations, with 157
stations operating in California, serving a population
of about 38 million, and 42 in Utah, serving a
population of approximately 2.9 million. (The state
of Utah owns natural gas production facilities and
has promoted NG use in transportation; in contrast to
other states, Utah has eschewed direct subsidies to
this end, and has instead concentrated on building
NG infrastructure.)
Other states with significant concentrations of CNG
stations include the key NG producing states of
Louisiana, Oklahoma, and Texas, as well as urban
states such as New York. Pennsylvania and Ohio have
shown the highest growth rate in building CNG
stations in the last two years, and now have 21 and 13
public access stations operating, respectively.
Figure 5 PCT. Growth in public access CNG stations 7/11-8/13
Source: NGV Today, August 19, 2013, p. 9
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INDUSTRY OVERVIEW
LNG stations
There are 33 LNG public access stations, and 40

private access LNG stations operating in the United
States as of September 2013. The initial impetus for
creating LNG infrastructure for heavy duty NGVs was
provided by the development of clean transportation
corridors. The first of these, the Interstate Clean
Transportation Corridor (ICTC), was a public-private
partnership launched in 1995 to link major Californian
cities, and Salt Lake City, Las Vegas, and Reno. The ICTC
network now comprises 28 public access
alternative fuel stations and displaces nearly 8 million

gallons of diesel each year. Other regions have
followed suit, such as Texas, which created the Texas
Clean Transportation Triangle; the Rocky Mountain
states, which created the Rocky Mountain Corridor;
Pennsylvania, which launched the Pennsylvania
Clean Transportation Corridor; and the states linked
by interstate highway 75-- Michigan, Ohio, Kentucky,
Tennessee, Georgia, and Florida-- which created the
I-75 Green Corridor Project.
Figure 6 Regional Transportation Corridors
87
82
94
43
39
90
84
75
29
81
76
72
ICTC
74
57
64
55 24
40
27
8
29
10
I-75
44
25
65
12 59
35
37
91
85
77
26
30
20
84
89
PCTC
68
70
66
71
79
88
RMC
86
69
96
90
95
4
35
Source: Pioneer Natural Resources, http://www.tamest.org/assets/docs/events/2011-texas-energy-summit/lyon-presentation.pdf

Locating CNG and LNG stations
The DoEs AFDC provides up to date numbers on the location of public access CNG and LNG stations across
the United States, through an interactive website: http://www.afdc.energy.gov
Users of this website may locate public access stations supplying different types of alternative fuels, including
but not limited to NG. The website allows users to generate a map to locate facilities within a state, or near an
address or zip code, and includes a function to plot CNG or LNG stations located along a particular route.
| 14
INDUSTRY OVERVIEW
Figure 7 Locations of CNG stations
Source: http://www.afdc.energy.gov/locator/stations/results?utf8=&location=&filtered=true&fuel=CNG&owner=all&payment=all&
ev_level1=true&ev_level2=true&ev_dc_fast=true&radius_miles=5
Some companies have stepped in to make publicly

available via the internet not only station location
and tracking tools, but other relevant information.
CNGprices.com, for example, supplies up-to-theminute information on CNG prices at a particular
station, as well as crowd sourced information about
station reliability, opening hours, and payment
information.
http://www.cngprices.com/index.php
CNGnow.com incorporates a GPS application. http://
www.cngnow.com
LNG suppliers, such as Blu LNG, have incorporated
station finder features in their websites, which also
include pricing information, opening hours, and
payment options. http://blulng.com
Figure 8 Locations of LNG Stations
Source: http://www.afdc.energy.gov/locator/stations/results?utf8=&location=&filtered=true&fuel=LNG&owner=all&payment=all&
ev_level1=true&ev_level2=true&ev_dc_fast=true&radius_miles=5
| 15
INDUSTRY OVERVIEW
1.4 Proposed expansion of

CNG and LNG fueling networks
In the past two years, several companies have
announced ambitious efforts to construct public
access NG infrastructure. These plans generally closely

track major U.S. trucking routes and patterns. In
general, to date CNG fuelling station networks have
been designed largely to serve local and regional
fleets. The thrust of LNG station development has
been to connect these regional hubs.
Figure 9 United States truck traffic volumes
CNG stations
In the CNG area, for example, Trillium announced

an expansion project in June 2013 to construct
and open 101 new CNG stations in 29 states within
three years. This project includes plans to build new
stations in states that already have extensive CNG
infrastructure-- including California, New York, Ohio,
and Pennsylvania, Texasand will also locate many

new stations in states that currently have few public
access CNG stations, including Florida and Georgia,
but are nonetheless high-volume parts of current U.S.
trucking networks.
| 16
INDUSTRY OVERVIEW
Figure 10 Projected expansion of Trillium CNG station network, 2013-2016
Stations Opening
2013-2016 Projected
06/13
Existing Trillium Stations

Existing
Trillium
Stations
Stations Opening
2013-2016rojected
P
Source: Trillium CNG, http://www.trilliumcng.com/fuel/pdf/expansion_map.pdf

Loves Travel Stops and Country Stores
Loves Travel Stops & Country Stores, a familyowned, Oklahoma City-based company, currently
operates more than 300 travel stops across 39 states
that include fueling facilities and restaurants. The
company has provided NG fueling capabilities at
some of its locations for light and mediumduty
vehicles since 2010. In 2012, Loves constructed
its first heavy-duty CNG station in its home city of

Oklahoma City, specifically for Class 8 vehicles, and
the company is adding fast-fill CNG fueling capability
to service Class 8 trucks at eight of its travel stops on
highways along the Texas Triangle of Dallas, Houston
and San Antonio, each intended to be operational by
the fourth quarter of 2013.
Figure 11 Projected expansion of Loves CNG network

TACOMA
WASHINGTON
ELLENSBURG
NAPAVINE
POST
FALLS
WILLISTON
TROUTDALE
MONTANA
MAINE
NORTH DAKOTA
MINNESOTA
85
FARGO
ROSEBURG
ONTARIO
IDAHO
NEW
YORK
WISCONSIN
OREGON
VT
NH
SOUTH DAKOTA
IDAHO FALLS
MA
OAKDALE
HEYBURN
MICHIGAN
ALBERT LEA
SIOUX FALLS
BINGHAMTON
CT
WYOMING
CORNING
CALIFORNIA
OAK CREEK
CONNEAUT
MARSHALL
WELLS
WAMSUTTER
FERNLEY
SALT LAKE CITY
PERRYSBURG
CHEYENNE
NEWTON
CLIVE
UTICA
De MOTTE
RIPON
ELLIS
BOONVILLE
MEMPHIS
INDIANA
OTTAWA
PUEBLO
LAMAR
BOISE CITY
ARIZONA
BARSTOW
KINGMAN
MATTHEWS
TONKAWA
CHOUTEAU
MILAN
ALBUQUERQUE
SANTA ROSA
TUCUMCARI
AMARILLO
BUCKEYE
CHANDLER
YUMA
ERICK
CLAUDE
ARDMORE
ELOY
WICHITA FALLS
BENSON
ATOKA
WEATHERFORD FT. WORTH

RANGER
SWEETWATER
ANTHONY
HUTCHINS
ODESSA
EL PASO
BATESVILLE
TENNESSEE
GREENWOOD MINDEN
LUFKIN
TALLULAH
FLOWOOD
CLEVELAND
WALLER
SEGUIN LULING
WEIMAR
SAN ANTONIO
EDNA
KATY
VINTON LAKE CHARLES
HOUSTON DEER PARK
SOUTH
CAROLINA
DUBLIN
CLANTON
RICHMOND HILL
TOOMSUBA
EVERGREEN
LOXLEY
COTTONDALE
JASPER
LEE
BILOXI
ORMOND BEACH
OCALA
BAYTOWN
NATALIA
THREE RIVERS
LAREDO
CNG AVAILABLE NOW
FEASIBLE CNG STATIONS
CNG COMING SOON
CNG UNLIKELY
FA
BRUNSWICK
TIFTON
GEORGIA
PORT ALLEN
ORANGEBURG
JACKSON
McCALLA
LOUISIANA
McCOMB
WILLIS
COMFORT
THOMSON
HOGANSVILLE
HEARNE
NORTH
CAROLINA
DILLON
NEWBERRY
EMERSON
ALABAMA
FAIRFIELD
HILLSBORO
DUNN
BLACKSBURG
FT. MILL
WACO
JASPER
CANTON MISSISSIPPI
MIDLOTHIAN
VAN HORN
TEXAS
STEELE
SKIPPERS
LAMBSBURG
MARION
LENOIR CITY
CHARLESTON
FAIR PLAY
FALKVILLE
TUPELO
PRESCOTT
MT. VERNON
ROCKWALL
VAN
CHRISTIANA
MEMPHIS
LEARY
ANNA
DALLAS
LAS CRUCES
DICKSON
COLUMBIA
WEST MEMPHIS
PALESTINE
MORRILTON
N. LITTLE ROCK
LITTLE ROCK
COLBERT
DENTON
RHOME
NEW MEXICO
LORDSBURG
EUFAULA
PAULS VALLEY
LAWTON
GILA BEND
WEBBERS FALLS OZARK
OKEMAH
NORMAN
HINTON
MEMPHIS
CLOVIS
OKLAHOMA CITY
ELK CITY CLINTON
JACKSON
ARKANSAS
SOUTH HILL
DANDRIDGE
BAXTER
NASHVILLE
OKLAHOMA
GALLUP
JOSEPH CITY
QUARTZSITE
VIRGINIA
MAX MEADOW
HORSE CAVE
CALVERT CITY
JOPLIN
HOOKER
CLAYTON
LAKE HAVASU
COACHELLA
RUTHER
GLEN
GRAYSON
CORBIN
KENTUCKY
STRAFFORD
TEHACHAPI
MD DE
WEST
VIRGINIA
RICHMOND
SHEPHERDSVILLE
MISSOURI
KANSAS
SPARTA
WADDY
HAUBSTADT
INA
ROLLA
LAS VEGAS
RIPLEY
OHIO
WHITELAND ST. PAUL
GREENVILLE
CEDAR CITY
TULARE
LOST HILLS
NJ
TOMS
BROOK
JEFFERSONVILLE
BELLEVILLE
NEVADA
SANTA NELLA
BORDENTOWN
CARLISLE
ZANESVILLE
RICHMOND
PITTSBORO
ST. JOSEPH
BENNETT
HAMBURG
MARION
WHITESTOWN
LEROY
ILLINOIS WILLIAMSVILLE
RI
MIFFLINVILLE
JONESTOWN
BURBANK
N. BALTIMORE
KANKAKEE
DWIGHT
AURORA
HUDSON
COLORADO
HUBBARD
GARY
DAVENPORT
NORTH PLATTE
UTAH
PENNSYLVANIA
ROSCOE
IOWA
SIOUX CITY
NEBRASKA
AUBURNDALE
FT. PIERCE
FLORIDA
KINGSVILLE
EDINBURG
Source: Loves Travel Stops and Country Stores, August 3, 2013 presentation
| 17
INDUSTRY OVERVIEW
Americas Natural Gas Highway
Clean Energy Fuels, the largest provider of NG fuel

for transportation in North America, in July 2011 was
the first private company to jump aggressively into
supplying NG infrastructure when it announced plans
to construct Americas Natural Gas Highway, a network
of 150 public access LNG-fuelling stations, across 33
states. So far, about 70 stations have been completed,
although rollout is proceeding slower than originally
anticipated, partly due to Clean Energys desire to
secure anchor tenants before construction of new
facilities. Using two liquefaction plants, one planned
and one operational, Clean Energy will supply both
stages of the supply chain, production and marketing.

Clean Energy has also entered into a partnership
with Pilot Flying J Truck Travel Centers, which will
allow Clean Energy to add NG fuelling options to the
services already offered at Pilot Flying Js extensive
network of existing truck stops throughout the United
States. Clean Energy also intends to add CNG-fuelling
capacity at selected locations on the network, as and
where it determines there will be sufficient demand to
support such facilities.
Figure 12 Projected rollout of Clean Energys Americas Natural Gas Highway of LNG and LCNG stations
Source: Clean Energy Fuels

Shell and TravelCenters of America partnership
Shell and TravelCenters of America announced in April

2013 that they would partner to provide a nationwide
network of LNG fueling stations for heavy-duty road
transportation customers. The companies intend to
construct at least two LNG fueling lanes and a storage
facility at 100 existing TravelCenters of America or
Petro Stopping Centers full service travel centers
located along the U.S. interstate highway system.
Shell anticipates that the first of these stations will
be operational within a year and intends to make it a
priority to develop LNG fueling infrastructure along
the main trucking corridors.
Shell is also investing in both LNG liquefaction and
refuelling infrastructure, and plans to build two
liquefaction plants. These will supply the basis for

two new LNG refuelling networks, in the Gulf Coast
Corridor (Texas and Louisiana) and the Great Lakes
Corridor. These Shell-fueled networks have the
potential to link up with planned or existing clean
transportation corridors, including the Texas Triangle
and the I-75 Clean Transportation Corridor. Market
observers suggest that Shells entry into the NG market
is serving as a wake-up call signaling the growing
importance of NG as a transportation fuel, as Shell
is a major multinational player with the scale and
resources to transform this domestic U.S. LNG market
substantially.
| 18
INDUSTRY OVERVIEW
Figure 13 Projected network of LNG stations proposed by Shell and TravelCenters of America
partnership
Source: Shell
ENN initiatives
Chinese-owned ENN is also investing heavily in U.S.

LNG fuelling infrastructure, with plans to build up
to 500 LNG stations. ENN has partnered with a small
Utah company, CH4 Energy, to create a joint venture

trading as Blu LNG. ENN has ambitions of building
LNG plants in the future.
Figure 14 Blu LNG operational and pending LNG fuelling network (as of end 2013)
Source: Blu LNG, http://blulng.com/station-finder/
| 19
INDUSTRY OVERVIEW
1.5 Expansion of Small and

Midsize LNG Liquefaction Plants
Crucial to the rollout of a wider use of LNG as a
transportation fuel is increasing geographic access
to its supply, which is partly being achieved by

developing small and midscale LNG liquefaction
infrastructure. Gas producers, suppliers, utilities, and
public companies are planning and building new
facilities.
Figure 15 Small and Mid Scale LNG Liquefaction plants*
*Planned and operational small and mid scale liquefaction facilities in the United States, where the location has been made public or
disclosed directly to FC Business Intelligence.
Table 3 Small and Mid Scale LNG Liquefaction plants in the United States*
Small-Mid Scale LNG Liquefaction Faciliies in the US*
Map Key
Name
Location
LNG production
Stage
Noble Energy
Weld County, Colorado
100,000 gal/day
APNG Topock LNG Plant
Arizona
86,000 gal/day
Clean Energy California Plant
Boron, California
160,000 gal/day
The Pickens Plant
Willis, Texas
100,000 gal/day
Shell, Geismar
Geismar, Louisiana
250,000
Shell, Sarnia
Sarnia, Ontario
250,000
Stabilis Energy
Eagle Ford Shale
100,000/250,000
Stabilis Energy
West Texas
100,000/250,000
Stabilis Energy
The Bakken
100,000/250,000
10
Stabilis Energy
Western Oklahoma
100,000/250,000
11
Stabilis Energy
Haynesville, East Texas
100,000/250,000
12
Grande Prairie
Elmworth, Canada
190,000 litres/day
13
Colony Energy Partners
Reno
180,000 gal/day (initial)
14
Spectrum LNG
Prudhoe Bay, Alaska
100,000 gal/day
15
Spectrum LNG
Ehrenberg, Arizona
60,000 gal/day
16
Exxon LaBarge
Shute Creek, WY
60,000 gal/day
17
Prometheus Bowerman LFG to LNG California
5,000 gal/day
P = Planned
E = Expansion
*Details disclosed/available
O = Operational S = Site Selection C = Construction R = Reg. approvals
| 20
INDUSTRY OVERVIEW
1.6 Conclusion
Natural gas has significant potential to displace diesel
and gasoline usage in the transportation sector. NG
prices are both cheaper than either diesel or gasoline,
and are also less volatile. NG is largely sourced in
North America, especially the U.S., in contrast to oil
and diesel, which are largely foreign-sourced, from
politically unstable and potentially hostile regions of
the world, especially the Middle East.
The number of CNG and LNG public access fuelling

stations is expanding rapidly. Several companies
have committed themselves to rolling out new NG
infrastructure. On the CNG side, Trillium and Love
Travel Stops have announced extensive plans, while
on the LNG side, Shell, and ENN in a joint venture
with Blu LNG, are major players. Clean Energy has also
announced an extensive LNG plan, Americas Natural
Gas Highway, and in partnership with Pilot Flying J
truck stops is also exploring LCNG options.
| 21
INDUSTRY OVERVIEW
Chapter 2: Government policies: How they will

shape the NGV market over the next 5 years
2.0 Introduction
Government policies, at both federal and state
levels, have played a significant role in fostering the
development of NG as a transportation fuel. The
following chapter describes how such policies will
continue to shape the future development of the NGV
sector, focusing on the next five years. The chapter
begins by discussing various state and federal policies
to promote NGVs, including subsidies, tax incentives,
procurement policies, and emissions standards. The
chapter concludes by discussing two potential policy
risk factors that could thwart or at minimum slow
development of NGVsenvironmental regulation,
and export policy.
2.1 Policy in context

The DoE in 1993 launched the Clean Cities initiative,
the flagship federal program designed to reduce
petroleum consumption for transportation uses
by promoting the use of alternative fuel vehicles.
This program created a national network of more
than 100 Clean Cities coalitions, which link fuel
suppliers, private companies, original equipment
manufacturers (OEMs), federal and state agencies,
national laboratories, and local governments, among
others, in designing and implementing alternative
transportation policies for their local communities.
Clean Cities seeks to reduce the use of fossil fuels by
measures such as using alternative and renewable
fuels, making improvements in fuel economy, and
promoting emerging transportation technologies.
or heavy-duty trucks, compared to diesel or gasolinepowered vehicles; and the lack of a comprehensive
fuelling infrastructure for either CNG or LNG vehicles.
Both the federal government and many state
governments provide a plethora of subsidies, tax
incentives, and loan programs to address these two
obstacles (some of these incentive programmes
are discussed more fully belowsee sections 3.__
and 3.__, and 4.__ and 4.__). These public policies
promote the use of NGVs (and other alternative fuel
vehicles) by defraying their higher upfront costs
and also support build-out of more NG fuelling
stations. Other policies provide incentives to use
alternative fuel vehiclessuch as the ability to use
high occupancy vehicle (HOV) lanes regardless of the
number of passengers in a vehicle.
Most of the NG-specific policies the United States
has in place promote the use of NG. But one federal
excise tax policy currently disadvantages LNG,
and this measure has attracted many reform calls
among various NGV stakeholders. The federal
excise tax on both LNG and diesel is currently 24.3
cents per gallon, but since it takes 1.7 gallons of
LNG to produce the same amount of energy that
a gallon of diesel produces, LNG is effectively
taxed at a rate 70% higher than that of diesel.
Both gasoline and CNG are also taxed according to
energy output, leaving LNG as the odd fuel out.
Taxing the fuels on an energy content basis rather

than on a volume basis would create a level playing
2.2 Subsidies and tax incentives field for LNG, and Mac Thornberry, a member of the
United States House of Representatives from Texas in
2013 introduced the LNG Excise Tax Equalization Act
The significant and sustained lower relative cost of
of 2013 (H.R.2202), to achieve that goal. Thornberry
NG compared to petroleum-based fuels provides a
believes that this reform would promote expanded
strong incentive for fleets and individuals to shift to
NGVs. Yet those who seek to make such a switch face private-sector investment in LNG infrastructure and
production.
two significant obstacles: the higher upfront cost of
NGVs, whether automobiles, vans, or light, medium,
| 22
INDUSTRY OVERVIEW
Senator Michael Bennet of Colorado has introduced

a companion bill, S. 1103, l into the United States
Senate, but as of October 2013, the measures had
been referred to their respective committees for
consideration, and no further action has been taken
on these measures.
The federal government currently has twenty-seven
NG promotion policies in place, covering a range
of areas, including infrastructural development,
HOV lane use, aftermarket conversions, public
transportation, and technological development.
The DoEs AFDC regularly updated website provides
current summaries of existing federal policies: http://
www.afdc.energy.gov/laws/laws/US/tech/3253
All states currently have at least one NG promotion
policy in place, and the DoEs AFDC website allows
to search current such policies by fuel, and by
state. Many urban states are strong NG supporters,
including California (with 27 NG policies in place),
Virginia (16), and Indiana (18). States that produce
NG also promote its use, these include Colorado (11),
Oklahoma (14) Texas (15), and Utah ( 10).
http://www.afdc.energy.gov/laws/matrix/tech.
Policies fall to three broad areas: those that offset
the incremental costs of NGV purchase; those that
provide fuel incentives; and those that provide
special privileges to NGV users (e.g., access to HOV
lanes, additional parking, concessions on emissions
inspections).
California has led the way in promoting clean air
policies, and adopted its Air Pollution Control
Act in 1947nearly a decade before the federal
government began to address air quality issues.
The state has been at the forefront of promoting
the use of alternative fuels, and currently has 27
NG state incentives in placemore than any other
state and these include policies to promote
NGVs, to encourage NG infrastructural
development, to advance the use of NG for public
transit, and to foster NG-related technological
development.
The DoEs AFDC website summarises the states

current policies http://www.afdc.energy.gov/laws/
laws/CA/tech/3253
California has pioneered some innovative alternative

fuel promotion policies, including parking incentives,
and the ability to use HOV lanes regardless of
the number of passengers in a vehicle. Drivers of
qualifying alternative fuel vehiclesincluding CNG,
hydrogen, electric, and plug-in hybrids-- that meet
specified state and federal emissions standards are
given special stickers. Vehicles are also exempted from
certain toll charges, unless prohibited by federal law.
On September 28 Governor Jerry Brown signed
into law a bill that will extend various other clean
vehicle incentive programs until 2023. He also signed
another piece of legislation that will extend for HOV
lane access for certain alternative fuels vehicles until
January 1, 2019.
2.3 Procurement policy

Both federal and state governments can advance the
use of NGVs via the procurement policies they enact.
Federal policy
President Obama issued a Presidential Memorandum

in May 2011 directing all federal agencies to purchase
or lease only alternative fuel passenger vehicles or LD
trucks by 2015. This policy required no congressional
action to be implemented and took immediate
effect upon announcement. Mandating the use of
alternative fuel vehicles for federal fleets was expected
to have the direct effect of stimulating demand for
such vehicles and, by creating economies of scale,
reducing the upfront costs of such vehicles, thus
increasing their attractiveness to a wider market.
Further, in the case of NGVs, placing more of them
on the road was also intended to increase utilization
of existing NG infrastructure, and promote demand
for additional fuelling stations. The policy was also
expected to have indirect effects, as drivers of these
vehicles will increase their familiarity with these
vehicles and, in the case of NGVs, become aware of
their far lower fuelling cost compared to petroleumfuelled vehicles.
State policy
States have followed the federal lead in developing

their own NGV procurement policies. The governors
of Colorado, Wyoming, Pennsylvania, and Oklahoma
| 23
INDUSTRY OVERVIEW
announced a Memorandum of Understanding (MOU)

in November 2011 to work together to convert their
state vehicle fleets to NG. The MOU calls for a joint,
multistate request for proposal for purchasing NGs
for state fleets, and commits each state to purchase a
specific number of NGVs. Many state fleets standing
alone are not large enough convince OEMs that the
vehicle needs of individual states represent a viable,
stable, long-term market upon which to base product
launch decisions. By developing a common proposal
for NGV purchases and pooling their resources, the
states hope to encourage OEMs to offer a wider range
of NGVs. More than 20 states are now committed to
follow this NGV sourcing approach.
These procurement policies have already influenced
product offerings. The three major U.S.-headquartered
OEMs Chrysler, Ford, and GM (Chevrolet) have
all launched bi-fuel pickup trucks, and GM and Ford
offer a bi-fuel van for commercial and fleet customers.
Honda is the first OEM to offer a NG-fuelled
automobile, the Civic NG, nationwide to non-fleet
customers, and Chevrolet intends to offer its Impala
model in a bi-fuel option for model year 2015. Various
other companies offer competitive NG-conversion
options.
Private initiatives
greenhouse gas emissions by over 20 million metric

tons annually. Moreover, the foundation emphasizes
that by leveraging its influence with freight carriers
and other suppliers, such a programme would allow
the federal government an opportunity to create very
large multiplier effects, and thus effectively reduce
the dependence of the trucking industry and other
private sector transportation providers on petroleum
imports.
2.4 CAF standards

The United States in 1975 first implemented
Corporate Average Fuel Economy (CAF standards)
to encourage manufacturers to produce more fuelefficient cars. The Obama administration and thirteen
OEMs on August 28, 2012 announced new standards
for automobiles, and light and medium duty trucks,
levelling the playing field between NG and other
alternative fuels for these categories of vehicles.
These standards cover model years 2017-2025. The
standards are ambitious ones, which by setting
an average fuel economy standard of 54.5 miles
per gallon (MPG) by 2025double the 27.3 MPG
2011 average-- are intended to push OEMs toward
technological innovation. The standards include tax
incentives for purchase of certain types of alternative
fuel vehicles, and an incentive multiplier to encourage
adoption of fuel. The highest multiplier, 2.0, applies to
electric vehicles; NGVs and hybrids enjoy a multiplier
of 1.6a significant improvement on the previous
standard.
These public procurement initiatives have inspired the

American Clean Skies Foundation to develop a wider
procurement plan for the third-party transportation
services used by the federal government. Every year,
federal agencies spend roughly $150 billion on such
transportation services.
The Obama administration was the first to launch
emissions standards for heavy-duty vehicles in 2011.
The foundation has proposed requiring federal
These are due to be revised and extended soon, with
agencies to apply to third-party transportation
a proposed rule expected imminently, which will be
providers the same kinds of alternative fuel targets,
finalized sometime in 2015.
efficiency standards and reporting practices they
currently apply to their own vehicle fleets. Such a
policy would reduce overall oil consumptionand
its associated economic and environmental costs.
The foundation estimates that the programme it
outlined in an August 2012 report could deliver
approximately $7 billion in annual cost savings; cut
petroleum consumption by billions of gallons each
year; stimulate the introduction of tens of thousands
of new alternatively fuelled vehicles; and reduce
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INDUSTRY OVERVIEW
2.5 Environmental regulation:

potential risk?
One potential risk factor for broader NGV development
is whether additional environmental restrictions will
be imposed on fracking operations. At the federal
level, the Bureau of Land Management sets drilling
standards for federal lands, and the Environmental
Protection Agency (EPA) has broad influence over
fracking due to its authority to set air and water quality
standards. The EPA in 2012 set air quality standards for
fracking operations, requiring companies to capture
gases released in the processbut these measures
only codified best industry practices. The EPA is
expected to announce fracking-related water quality
standards in 2014, and is expected to take a similar
approach.
The fracking industry remains vulnerable to the risk
of lawsuits, which are largely brought under state law.
Landowners have targeted energy companies in many
states where fracking is widespread, in some cases, via
class action lawsuits. But the United States Supreme
Court has in recent years made it much more difficult
for private plaintiffs to succeed in such lawsuits,
especially, in class actions. So far, no company has lost
a fracking suit, and the barriers to prevailing in such
litigation for alleged harms including groundwater
contamination, triggering of earthquakes, or
environmental degradation, are formidable.
The possibility exists that lawsuits or state-level policy
changes could slow the spread of fracking in certain
states. Yet absent a major shift in the composition of
either Congress or the Supreme Court, it is unlikely
that fracking lawsuits will impose major constraints on
energy producers nationwide.
2.6 Export policy: potential

risk?
United States NG export policy could also have
a significant impact on the development of NG
as a transportation fuel. Until recently, NG from
domestic sources was not traded widely outside
North America, and the United States did not export
significant quantities of NG. In fact, before the shale
gas revolution began, plans were underway to allow
importation of substantial quantities of NG, and these
included proposals to develop the infrastructure to

achieve this goal. Some of the NG export terminals
discussed below were originally intended to be import
facilities.
Now, as domestic NG reserves continue to be
developed, and the spread between NG and world
oil prices continues to be so wide, this situation
has reversed itself. Yet U.S. NG exports are subject
to a complex export regime, which requires federal
government approval of NG export facilities and
involves separate permitting processes undertaken
by the DoE and the Federal Energy Regulatory
Commission (FERC). To date, the DoE has approved
four applications to permit export of U.S.-produced
LNG have been approved, and more than twenty
are pending. In 2011, the DoE approved Cheniere
Energys Sabine Pass project, located on the Sabine
River in the Louisiana/Texas border, thus clearing the
way for the first new LNG construction in forty years
(this project had originally been planned as an import
terminal). Final clearance for this project led to a
pause in consideration of other export applications.
During this period, two studies were undertaken that
examined the expected impact of NG exports on
domestic prices, and in this interim period, NG exports
were authorized to countries with which the US has
free trade agreements, such as Canada and Mexico
-- both members of the North American Free Trade
Agreement (NAFTA).
In 2013, the DoE has approved three projects for
export to non free-trade agreement destinations:
Freeport LNGs in Quintana Island, Texas, in May; Lake
Charles LLCs in Lake Charles, Louisiana, in August; and
Dominion Resourcess Cove Point facility on Marylands
Chesapeake Bay, in September. The DoE has seemingly
accelerated its review process in response to political
and company complaints about previous delays, and
is currently reviewing expansion of Freeport LNGs
terminal in Freeport, Texas; Sempra Energys proposed
project in Cameron, Louisiana; and Veresens Jordan
Cove project in Coos Bay, Oregon.
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INDUSTRY OVERVIEW
Table 4 LNG Export facilities approved

Company
Location
State
Date
Cheniere
Energy
Sabine Pass
Louisiana/
Texas
border
Apr 2012
Freeport LNG
Quintana
Island
Texas
May 2013
Lake Charles
Louisiana
In September 2013, AEA filed a formal motion

to intervene in the DOEs proceeding evaluating
Freeport LNGs export application for its Freeport,
Texas terminal. This application, if authorized would
raise the cumulative volume of authorized LNG
exports to 8.31 Bcf/d.
AEA seeks to encourage the DoE to develop a more

formal rulemaking process based on current data
and assessments of the current supply and demand
Dominion
Cove Point
Maryland
Sep 2013
environment. AEA asserts that current LNG export
Resources
(Chesapeake
applications are being granted based on guidelines
Bay)
developed for NG imports in the 1980s. AEAs motion
NG producers view exports as a way to earn higher
also alleges that the legal standards the DOE used to
prices than are available for NG in either the domestic analyse the public interest in two previous permitting
U.S. or wider North American market. Yet significant
applications were not adequate, appropriate, or
LNG exports could distort the domestic supply/
sustainable.
demand relationship, and thereby raise domestic NG
prices. As long as NG is largely traded within North
APGA and the Industrial Energy Consumers of
America, prices remain insulated from the volatility
America (IECA) are working toward developing a
(and outright manipulation) that occurs in the world responsible production policy, arguing that while
oil market.
exporting NG might maximize the price domestic
producers receive for their product, it will reduce the
The acceleration of export procedures is already
price advantage NG currently enjoys relative to refined
provoking a backlash. Cove Points conditional
diesel or gasoline, and thus reduce the attractiveness
approval to export up to 0.77 Bcf/d of NG raises
of NG as a transportation fuel. If that occurs, these
the overall amount of permitted NG exports,
organizations emphasize, NGs full potential to reduce
breaching the export levels of 6 Bcf/d the low
Americas energy dependency will not be achieved.
export scenario set forth in an earlier report
commissioned by the DoE that examined the impact The DOE may choose to undertake another pause in
of NG exports on domestic prices and on which the
its permitting procedures, but this is unlikely to occur
agency relied in approving three previous LNG export before year-end 2013, when new data should be
applications.
available from the Energy Information Administrations
preliminary annual energy outlook for 2014.
Americas Energy Advantage (AEA), a coalition
of manufacturers and consumers, is working to
A lively debate is raging on how Americas NG
reserve US NG to promote a US manufacturing
reserves should be deployedto maximize producer
renaissance. AEA members include domesticrevenues, or to support domestic manufacturing
headquartered companies such as Alcoa, Celanese,
and encourage energy self-sufficiency. Opponents of
Dow Chemical, Eastman, Huntsman, and Nucor, and increased NG exports emphasise that if all pending
trade associations, such as the American Public Gas
export applications were to be approved, half of
Association (APGA). Its membership also includes
current NG supply would be exported. Instead,
firms such as Incitec Pivot, a global explosives and
they advocate building necessary infrastructure to
fertilizer manufacturer based in Australia, that recently consume NG domestically, not only for transportation
began construction of an $850 million ammonia plant uses, but for power generation as well.
in Waggaman, Louisiana.
Lake Charles
LLC
Aug 2013
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INDUSTRY OVERVIEW
2.8 Conclusion
Government policies, both federal and state, have
played a major role in promoting the development of
NG as a transportation fuel, and will continue to do so
both in the near-term ad over the coming decades.
California has been a leader in developing alternative
fuels, and currently has the most comprehensive NG
fuelling infrastructure. While the state continues to
lead the way in policy innovation, many other states
are also on the NG bandwagon, and are providing
various incentives as well as setting their own
procurement policies, to promote NG use.
Although it at this point appears unlikely that

environmental regulations or public or private
lawsuits, may significantly slow U.S. shale gas
production, the long-term shape of U.S. NG export
policy is a cause for some concern, as it has the
potential to equalise somewhat domestic and world
NG prices, and thereby, reduce the economic case for
fleets to switch to NG. A lively debate is brewing over
whether NG should be reserved for domestic uses,
pitting conflicting interests of NG producers against
other among NG stakeholders. Since the setting of
export policy requires federal government action, this
debate will require political resolution at the highest
level.
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INDUSTRY OVERVIEW
Chapter 3: Converting to Natural Gas, Vehicle

issues
3.0 Introduction
Despite the relative cost advantage for fuelling NGVs
compared to traditional diesel or gasoline-fuelled
models, the higher relative costs of NGVs compared
to traditionally-fuelled vehicles has presented a major
obstacle to wider use of NG as a transportation fuel.
This chapter focuses on costs and other issues that
should be considered when contemplating switching
to NGVs, while the next discusses the equally
important issue of ensuring access to adequate
fuelling infrastructure.
OEMs have started to offer a wider range of NG
options, from automobiles, to vansboth passenger
and cargoand light and medium-duty truck
options. Total sales have been modest but growing,
and each OEM has announced plans for expansion
of NG product offerings in forthcoming model years.
At least twenty-one states provide some form of
incentive for fleets to convert to light-duty CNG
vehicles, in the form of grants or rebates, loans, state
tax credits, or combinations of these policies.
With OEMs now offering a wider range of NGVs, the
impact of these incentive policies may now be more
pronounced.
Chevrolet announced in October 2013 that it will

launch a bi-fuel Impala, beginning with the 2015
model year, to both passenger and fleet customers.
The vehicle will include both a CNG tank in the trunk,
and a gasoline tank, allowing for a total range of up to
500 miles by switching between the two fuels-- 150
miles on CNG and 350 miles on gasoline. GM has
neither announced an expected price, nor projected
fuel economy figures, and expects to sell as many as
1000 vehicles, largely to fleets, during its first model
year.
Despite a lack of strong consumer demand, OEMs
recognize that shifting to NG provides immediate
emissions benefits, without any need for further
technological innovation, and thus help fulfil their
obligations to meet emissions standards for their
product offerings.
Two major obstacles have prevented wider consumer

adoption of NGVs. Although the costs of operating
CNG vehicles are much lower, consumers must first
pay the higher incremental cost of buying a CNG
vehicle. The actual break-even point depends on
the higher incremental cost for the CNG vehicle, and
All major heavy-duty truck manufacturers offer NG
average number of miles driven. Moreover, passenger
options, either in CNG or LNG formats.
cars face greater infrastructural obstacles, for unlike
fleets, they do not necessarily drive in consistent and
familiar patterns, and they lack access to dedicated
3.1 Passenger automobiles
fuelling arrangementseither company-owned, or
The US market lags significantly behind the European third-party that are available to fleets.
market in the number of NG options offered as
Use of NG is impractical, at present, for non-fleet
passenger vehicles. Currently, only Honda offers
passenger vehicles, outside of states that have wella CNG option, the Civic NG, nationwide in the US,
developed CNG infrastructure, such as California, New
compared to Europe, where many automakers,
York, Oklahoma, Texas, and Utah. In the near-term,
including Fiat, GM, Mercedes, Peugeot, Toyota and
there are other pockets where use of such vehicles
Volkswagen, offer CNG options. Honda is strongly
might catch on, especially in bi-fuel options, which
committed to develop the US NGV market and has
can reduce fuelling and range anxiety.
offered a CNG automobile option since 1998 in the
US.
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INDUSTRY OVERVIEW
One looming technological innovation might

promote popularity of NG as a transportation fuel
for passenger vehicles: the development of a cheap,
widely available home refuelling option. At present,
consumers are making a switch in how they view
fuelling options. Outside of remote rural areas,
drivers are not accustomed to considering refuelling
possibilities when they drive passenger cars. But this is
changing, with the hybrids such as Toyotas Prius and
Chevrolets Volt.
of the NGV passenger automobile market, one which

the federal government has devoted part of $30
million in research funds to finance proposals to
create such appliances. The Drive Natural Gas Initiative
(DNGI), a major industry trade association launched
its Home Fueling Appliance Task Force determine
specifications for such a product. The appliance
should be able to provide a fuelling rate of 1 GGE
per hour, should provide for 6,000 hours of service,
and should cost less than $1,500. This translates to a
fuelling cost per GGE of CNG of $0.25 (in addition with
Wider use of such vehicles may promote a shift in
the cost of the fuel itself and the cost of the electricity
how drivers think about fuelling their cars.
to run the compressor). The task force decided that
Electric vehicles have limited range, and are generally the cost of the appliance, plus the premium paid for
most useful for commuting short distances.
the CNG vehicle (compared to the same non-CNG
Drivers are able to charge their batteries when the
model), must payout in 3 years or less, in order to
vehicle returns home.
support a sustainable market. Several utilities, and
manufacturers, are joining to develop products that
The lack of a cost-effective home fuelling appliance
meet these specifications. The timeframe for launch
is seen as a major impediment to the development
remains at least eighteen months away.
Table 5 Home fuelling specifications
TCO
Base Case
Miles
% CNG
NGV Cost
HFA Cost
Actual miles
13,476
26,583
18,719
Daily miles
37
73
51
CNG percent
55%
NGV Premium
$4,000
HFA (installed)
$2,000
Simple Payout (yrs)
8.0
106%
3.0
3.0
High-Miles /
High CNG %
80%
723
-$1,277
3.0
3.0
3.0
Market of 10 million
commuters
Source: Americas Natural Gas Alliance
3.2 Light and medium duty trucking vehicle options

The major OEMs have responded to demand for
CNG-fuelled vehicles, and either now offer, or plan to
offer for model year 2014, a mix of vans, and light and
heavy duty pick-up trucks.
of similar vehicles. Beginning with model year 2014,

Ford intends to extend its product range and offer
its F-150 truck with a gaseous-fuel prep option on
the 3.7-liter V6 engine, enabling the vehicle to run on
CNG or LPG. This prep package includes hardened
valves, valve seats, pistons and rings so it can operate
Ford
Ford expects to sell 15,000 CNG/LPG-prepped vehicles on either CNG/LPG or gasoline through separate fuel
in 2013, representing a 25% increase on its 2012 sales systems, and from the factory costs approximately
| 29
INDUSTRY OVERVIEW
$315 before the customer chooses a Ford Qualified

Vehicle Modifier to supply fuel tanks, fuel lines and
unique fuel injectors. Upfits run approximately $7,500
to $9,500, depending on fuel tank capacity.
So equipped, F-150s would be able to run more than
750 miles on one tank of gas, depending on the tank
size selected. The Ford F-150 averages 23 mpg on the
highway. Ford expects that CNG versions of the F-150
will qualify for California HOV lane status certification,
thus providing its commercial customers with a
significant time advantage, in addition to the cost
savings they can expect to achieve on fuel.
With the addition of the F-150, Ford will have eight
commercial vehicles available to run on CNG/LPG.
Table 6 Ford CNG model options (as of model
year 2014)
Model
Type
F-150
Light-duty pick up
Transit Connect
van and wagon
Transit
van, wagon, cutaway, and

stripped chassis
E-Series
van, wagon, cutaway, and

stripped chassis
F-Series Super Duty
pick-up
F350
chassis cab
F-Series Super Duty (F-450,

F-550)
chassis cab
F-650
medium-duty truck
F53 and F59
stripped chassis
Source: Ford September 19, 2013 press release

Chrysler
Chrysler launched the Ram 2500 CNG pick-up in

2012 and sold its first vehicles in 2013. This is a bifuel vehicle that uses CNG as its primary fuel source,
but automatically switches to gasoline when the
CNG tanks are emptied. Using its two CNG tanks, the
vehicles range exceeds 250 miles, and its back-up
gasoline tank extends this range to nearly 370
miles. The Ram 2500 is available to fleet and retail
customers, and is powered by a Hemi 5.7 liter V8
engine.
Of the three major US OEMs, Chrysler offers the
smallest range of CNG products, offering a pick-up
only for model year 2014.
Table 7 Chrysler CNG model options (as of model

year 2014)
Model
Type
Dodge Ram 2500 Bi-fuel
pick up
Source: Chrysler March 6, 2013 press release

GM
In 2013, GMC introduced its bi-fuel CNG Silverado

2500 HD extended cab pick-up truck (the equivalent
Chevrolet model is called the Sierra 2500 HD), and
expects to sell 1300 of these vehicles during the 2013
model year. The vehicle incorporates factory-installed
hardened exhaust valves and intake/exhaust valve
seats, both of which are engineered to GM durability
standards for gaseous fuel use.
The bi-fuel CNG option is available on long- or
standard-bed models in either 2WD or 4WD. The fuel
system automatically switches to gasoline when the
CNG tank is empty, or the driver may manually switch
between fuel sources while driving. The combined 17
GGE CNG tank and 36-gallon gasoline tank allow for a
total range of about 650 miles.
GMC and Chevrolet expect to offer a range of several
truck and cargo van options for the 2014 model year.
Chevrolet has also announced plans to offer its Impala
automobile in a CNG configuration (see section 3.1
above.)
Table 8 GMC and Chevrolet CNG model options
(as of model year 2014)
Model
Type
Bi-Fuel CNG Chevrolet Silverado

2500HD extended cab
pick-up
Bi-Fuel CNG GMC Sierra 2500HD

extended cab
pick-up
Chevrolet Express 3500
cut-away
GMC Savana 3500
cut-away
Chevrolet Express Cargo 2500
cargo van
GMC Savana Cargo 2500
cargo van
Chevrolet Express Cutaway 4500
cut-away
Chevrolet Express Cargo 2500
cargo van
Source: GM website http://www.gmfleet.com/vehicle-overviews/

fuel-efficiency/bi-fuel.html
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INDUSTRY OVERVIEW
Payback: Bottom line
Assessing the conditions under which switching to

NG may be a commercially viable strategy for light
and medium-duty LGVs relies on a careful assessment
of over what timespan the additional premium for
purchasing differential vehicle can be recouped
by the cost savings for CNG fuelwhich currently
average between $1.50 and $2 per DGE or GGE (as
discussed more fully in section 1.1 above).
Leaving aside access to fuelling infrastructurewhich
will be discussed more fully in chapter 4 belowa
fleet operator must consider how many miles can
be driven fuelled by CNG alone, since most OEM bifuel options actually are currently configured with a
much higher gasoline capacity compared to CNG. In
general, payback calculations are a less certain value
proposition, since vehicles in these classes already
have higher fuel economy, and travel fewer models.
Many states offer significant incentives in switching

to CNG, but these vary widely among states, and
many of them are time-bound. These factors may tip
the balance toward CNG significantly beyond what
market factors alone would dictate.
3.3 State subsidies for lightduty NGVS

As of September 2013, 27 states offer some form
of incentives for converting fleets to light-duty
NGVs, according to VNG.CO, a company that offers a
nationwide CNG retail-centric fuelling facility program
to owners and operators of light-duty NGVs. Thirteen
states offer grants or rebates, eight states offer tax
credits, and six offer loan financing at concessionary
rates. Several states offer various combinations of
these incentives.
Table 9 Summary of state incentives for lightFigure 16 Calculation of light-duty truck payback, duty CNG vehicles
based on various fuel price and truck premium
Type of Incentive Number of
Description
assumptions
states
$10.00
Grants or rebates
13
$2500 to $25,000 per

vehicle
$8.00
Loans
Rates from 0% to 5%
$7.00
State tax credits
$500 to $7500 per

vehicle
$9.00
$6.00
$5.00
Source: VNG.CO website
$4.00
$3.00
$2.00
$1.00
$0.00
$16,000
$8,000
$0
12,000 miles per yr - 3 yr Payback

Source: Paul Armstrong, GTI Director of Business Development,

to Guild of Gas Managers, April 3, 2012.
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INDUSTRY OVERVIEW
Figure 17 Map of states offering various incentives for light-duty CNG vehicles
Tax Credit
Rebate/Grant
Loan
Arkansas
Up to $5,000 (<8,501 lbs)

or up to $8,000 (8,501-14,000 lbs)
California
$3,000 (<8,501 lbs) or

$8,000 (8,501-14,000 lbs)
Colorado
10.5% of total vehicle

costs, up to $6,000 per vehicle
Connecticut
Unspecified funding
for public fleet NGVs only
Florida
50% of incremental costs,

up to $25,000
Georgia
10% of total vehicle costs,

up to $2,500
Illinois
80% of incremental costs,

up to $4,000
Indiana
Up to $150,000 per fleet

conversion project (max for all vehicles purchased)
Louisiana
50% of incremental costs

Maryland
$3,000 (<8,501 lbs) or

$5,000 (8,501-14,000 lbs)
Mississippi
Zero-interest loans for

municipal vehicle NGV fleets only
Montana
50% of conversion costs,

up to $500
Nebraska
5% interest loans, up to
$750,000 per borrower
North
Carolina Up to 80% of incremental costs

Oklahoma Tax credits of 50%
of incremental costs, 3% interest

loans
Oregon
Low-interest loans (terms

not specified)
Pennsylvania
50% of incremental
costs, up to $25,000
Texas
$2,500 rebates (up to 9,600

lbs), grants up to 90% of total costs
(8,501+ lbs)
Utah Tax credits of 35% of total
cost up to $2,500, grants of 50%

incremental costs
Virginia Unspecified grants and
loans for public fleets only
Washington
Exemption from 6.8%

state sales tax on vehicle purchase
West
Virginia 35% of new vehicle

purchase price or 50% of conversion costs, up to $7,500
VNG.go provides details on these state programmes, as of September 2013, at the following link:
http://vng.co/wp-content/uploads/2013/09/VNG-State-Incentive-Summary-September-2013.pdf
This information is presented in a more user-friendly summary form than the more comprehensive
information available at the DoEs AFDC site, which includes links to relevant state statutory and regulatory
information. http://www.afdc.energy.gov/laws/matrix/tech.
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INDUSTRY OVERVIEW
3.4 Heavy duty trucking

Fleets operating heavy-duty trucks now have the
option to consider both CNG or LNG options. All
major truck manufacturers currently offer NG engine
options, including Freightliner, Isuzu, Kenworth,
Navistar, Peterbilt, and Volvo/Mack. These are based
around engines offered & manufactured by Westport
Innovations, in a 15 liter LNG option only, and in a
joint venture between Westport and Cummins, in
both CNG and LNG versions, and 8.9 liter and 11.9 liter
sizes. Volvo has announced plans to launch its own 13
liter LNG engine sometime in 2015.
Figure 18 Natural gas engine comparison-- power

(hp)
CWI ISL G
250
CWI ISX12 G
375
400
Westport 15L
475
500
Source: http://www.westport.com/products/engines/15
Figure 19 Natural gas engine comparison

torque (ft-lb)
CWI ISX12 G
CWI ISL G
Westport 15L
Technological innovation should over the longer term
reduce these premiums. Manufacturers are currently 600
1,000
1,200 1,400
1,600
1,800
developing new tank designs for both CNG and LNG.
Additionally, innovations in the fuel system space-Source: http://www.westport.com/products/engines/15
which accounts for the majority of the premium,
should reduce overall truck premiums as well.
CNG to LNG compared
For heavy-duty trucks, both CNG and LNG options are

available, and fleets looking to switch must carefully
consider which option better suits their needs. CNG
trucks are heavierdue largely to tank design, and
LNG has fuel-economy advantages in long-haul
situations. The additional weight required for its tanks
disadvantages CNG, but since 75% of heavy-duty
trucks cube out before they weigh out, this is not
necessarily dispositive, particularly given the currently
more extensive CNG filling station network. (See
section 4.2 below, and especially Table 12, for more
LNG engine discussion of these considerations.)
Some idea of the current premium for heavy duty

CNG or LNG rigs can be derived from Table 10, which
compares a CNG truck equipped with saddle tanks
with 90 DGE of storage capacity to a single tank LNG
truck with 75 DGE of storage capacity. All of these
figures are provisional, and are highly dependent
on the relationships between suppliers and fleet
managers.
Table 10 Heavy-Duty engine options
Manufacturer
Model
CNG engine
price
premium
price
premium
Cummins/
Westport
ISL G 8.9 L
$32,000$40,000
$35,000$58,000
Cummins/
Westport
ISX G 11.9 L
$47,000$80,000
$60,000$98,000
Westport
Innovations
HPDI 15 L
LNG option
only
$75,000$120,000
Source: Loves Travel Stops, August 3, 2013 presentation
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INDUSTRY OVERVIEW
3.5 Factors to consider in HD

fleet conversions
Assuming access to adequate fuelling infrastructure,
without the need to construct or secure access to
a private fuelling network, many calculations of
expected payback on conversion from diesel to either
CNG or LNG rely only on the average differential in
fuel pricecurrently about $2 for CNG, and $1 for
LNG. Yet there are other inefficiencies necessary
to consider when running heavy-duty trucks, and
these should be quantified on a per unit basis and
deducting the sum of inefficiencies from the gross
discount.
LNG Filling issues
Figure 20 Sample calculation of expected

payback for HD fleet conversion
CNG vs. LNG Comparison
CNG
LNG
Diesel Price
$4.000
$4.000
Natural Gas Retail Price
$2.000
$3.000
Gross Discount to Diesel
$2.000
$1.000
Fuel Economy Loss (12%)
-0.240
-0.360
Out of Route Miles
-0.025
-0.025
Payload Loss
-0.050
-0.020
Additional Maintenance
-0.030
-0.030
Fuel Loss from Venting
-0.015
Salvage Value Deduction
-0.060
-0.060
Total Inefficiencies
-0.405
-0.510
Net Discount to Diesel
$1.595
$0.490
Truck Inefficiencies
LNG may vent fuel into the atmosphere to avoid

explosion in a vacuum tank, and it may have a shelf
Truck Comparison
CNG
LNG
life as short as four days. Filling completely empty
Miles Driven (Annual)
125,000
125,000
methane tanks can be problematic, as methane
Fuel Economy
6.20
6.20
may expand rapidly as LNG enters a tank at ambient
Fuel Consumption
20,161
20,161
temperature, sometimes delaying operations by up to
Truck
Premium
(CW
11.9L)
60,000
60,000
one day until a complete fill can be achieved.
$1.60
$0.49
Dealing with low temperature LNG raises some safety Net Discount to Diesel
$32,157
$9,879
concerns; dealing with these imposes certain training Fuel Savings (Annual)
costs and also raises possible workers compensation
Payback (Years)
1.87
6.07
concerns.
Range considerations
Onboard fuel capacity dictates the range for both

CNG and LNG trucks. Standard CNG fuel systems
come equipped with the option of either 90 DGE
saddle tanks or 120 DGE behind-the-cab tanks. Only
about 90% of this capacity is considered usable,
since a CNG truck also experiences a shortfall when
filling at rates higher than ten DGEs per minute.
Although fuel is not lost, the rapid fuelling produces
heat which expands the hydrocarbons, thus taking
up more space, and resulting in a capacity loss of
approximately 5%, leaving total range for a CNG
vehicle with saddle tanks at about 450 miles of
range.
| 34
INDUSTRY OVERVIEW
Figure 21 Sample CNG range calculation

90 DGE Storage Capacity
(9 DGE Unusable + 4.5 DGE Heat Expansion)
= 76.5 DGE Useable Capacity
Table 11 Weight diesel truck compared to CNG

truck and LNG truck (full tanks in lbs)
CNG 80 DGE LNG 75 DGE
NG tank weight
1600
1200
Diesel tank weight (75

gallon)
665
665
SCR System and DEF

weight
458
458
Net additional NG weight
477
77
Less
76.5 DGE Useable Capacity * 6 Miles Per Gallon

Fuel Economy = 459 Miles of Range
CNG fuel systems are currently available with up to

150 DGE capacity that yield over 750 miles of range.
* Note, however, that trucks that use HPDI technology,

such as the Westport 15 Liter Engine, are compression
ignited and require an SCR system under current
emissions standards.
LNG has a fuel system design which allows a truck to

use one hundred 100% of all fuel capacity, usually 75
DGE for a single tank or one 150 DGE for dual saddle
tanks. Using the same fuel economy calculations as for
CNG above, LNG vehicles can achieve a range of up to
900 miles.
Payback: Bottom Line
When all these factors are carefully considered-and once again, emphasising that all necessary
costs for any infrastructural construction are left to
chapter 4 to discuss, payback for fleet conversion,
assuming 125,000 miles driven annually, can be fewer
Truck Weight
The additional weight differential for an NGV truck is than 2 years for CNG vehicles using a Cummins/
often overstated since it considers only the additional Westport 11.9 liter engine, and just over 6 years
for an equivalent LNG rig. These calculations do
weight of needed storage tanks and mounting
not consider possible state subsidies, which are
brackets, without subtracting the weight of parallel
components required by diesel trucks, or the weight summarised in the next section.
advantage of CNG itself compared to an equivalent
The preceding analysis is based on calculations done
energy output of diesel. An aluminium diesel tank
by Loves Travel Stores, but others have made similar
with mounting kit can weigh between 100 and 200
calculationson slightly different assumptions.
pounds. Also, depending on API gravity, diesel fuel
can weigh between 6.95 and 7.05 pounds per gallon
versus a natural gas DGE at 6.50 pounds per gallon,
giving NG a weight advantage of .50 pounds per
gallon. Neither do spark ignited NG engines require
SCR systems or a DEF tank.
| 35
INDUSTRY OVERVIEW
Diesel to NG Price Spread For Economic Payback
Figure 22 Calculation of Heavy-duty truck payback, based on various fuel price and truck premium
assumptions
$2.50
High fuel price

differential
$2.00
Lower cost NGV

options (as volume
grows)
$1.50
$1.00
$0.50
$0.00
$100,000
$90,000
$80,000
$70,000
$60,000
$50,000
$40,000
$30,000
$20,000
NG Truck Price Premium

2 yr Payback
4 yr Payback
Source: Paul Armstrong, GTI Director of Business Development, to Guild of Gas Managers, April 3, 2012. http://www.northeastgas.org/
pdf/p_armstrong_gti_040412.pdf
Gemini, Loves private truck fleet that hauls fuel

to its 300 retail locations in 39 states has opted to
purchase 50 Freightliner 400 HP trucks equipped
with the Cummins Westport ISX G 11.9 liter engine.
Robert Transport, a Canadian long-distance

trucking firm has opted to begin converting to LNG,
using Westport 15 Liter HPDI engines in Peterbilt
and Kenworth Trucks, driven by price, energy
security, and emissions concerns.
3.6 State subsidies for heavy-duty fleet conversion

The DoEs AFDC is the best source for current
subsidies for heavy-duty fleets. http://www.afdc.
energy.gov/laws/matrix/tech.
As of September 2013, Cummins-Westport has

summarized some of the principal incentives available
for heavy-duty vehicles in Canada and the US in a
more user-friendly framework.
| 36
INDUSTRY OVERVIEW
Figure 23 Heavy-duty incentives, Canada and US (as of August 2013)

QUEBEC
BRITISH COLUMBIA
FORTIS Natural Gas for Transport
(NGT) Incentive Program for LNG
Covers up to 70% of incremental
LNG only:HD Class 8 (11,793kg
+) MD Vocational (incl. waste,
transit, marine)
COLORADO
Alternative Fuel Income Tax Credit
Accelerated Capital Cost

Allowance
35% tax creditcapped at $6,000

for vehicles under 26,000lbs
60% depreciation for

LNG trucks
CNG and bi-fuel
WEST VIRGINIA
Until 2016
AFV Tax credit of 35%
FORTIS Light Duty Vehicle

Incentive Program
$7500 < 26,000lbs
Bi-fuel WiNG 250-550 eligible up

to $10,000 per vehicle
Dedicated or bi fuel
CNG/LNG
$25,000 > 26,000lbs
No close date
OKLAHOMA
One-time income tax
credit for 50% of the
incremental costs
CALIFORNIA
Until Sept. 10, 2013
SJVAD Drive Clean Rebate

Program
NORTH CAROLINA
Rebate up to $3,000
Reimbursement
program, up to 80% of
incremental costs
BAF products on eligibility list

Ongoing
Until Sept. 10, 2013
TEXAS
H-GAC Clean Vehicles Grant
Program
$20 - $40,000 for HD
CNG/ LNG/ bi-fuel
Open until funds exhaust
New
Existing
ARKANSAS
LOUISIANA
50% rebates for CNG

and LNG conversions,
up to $4500
Income tax credit up to

50% of the incremental
cost up to $3,000
Dedicated CNG/LNG
only
Source: http://www.cumminswestport.com/pdfs/general/Aug%20-%20Sept%202013%20NA%20On-Road%20Incentives.pdf
3.7 Conclusion
Manufacturers have stepped up their offerings of
NGVs, across vehicle classes, especially in the heavyduty truck sector, where customers are responding to
the potential significant fuel costs savings.
The value proposition for passenger cars is less
certain, outside certain regions already well-served
by adequate fuelling infrastructure, in the absence
of a home refuelling option. In the light-duty sector,
the value proposition is also at present somewhat
ambiguous, but should improve, once technological

improvements and economies of scale drive the
premiums for NGVs downward. At the moment, many
of the NGVs on offer are not fully configured by the
OEM, but involce conversion elements. Costs should
fall when OEMs commit to fully configuring NGVS
themselves, rather than relying on outsourcing and
conversions.
| 37
INDUSTRY OVERVIEW
Chapter 4: Building Dedicated Fuelling

Infrastructure, CNG and LNG
4.1 Introduction
Infrastructural considerations continue to loom large
in decisions to convert all or part of a fleets vehicles
to NGV, and with the increasing availability of various
types of NGVs, are the largest consideration in fleet
conversion decisions. Although more infrastructure,
both CNG and LNG, is continually coming on-line,
as described in (sections 1.3 and 1.4 above), at
present, fleets located in most regions with the
exception of California, New York, Oklahoma, Texas,
and Utah still need to construct or secure access to
independent fuelling infrastructure, as existing public
access infrastructure alone cannot support fleet
range needs. Companies have sometimes found that
they may enter into access arrangements with other
companies or utilities that have already constructed
their own NG infrastructure.
Yet the time is coming when more fleets will be able
to rely on either public networks, or arrangements
negotiated with other private stations, for either
CNG or LNG refuelling needs. Development of CNG
infrastructure to date has been largely locally or
regionally concentrated although major initiatives
announced by Trillium and Loves Travel Stops are
somewhat shifting this pattern. Separate initiatives
are also underway, announced by Clean Energy, ENN/
Blu LNG, and Shell, to connect up these regional
CNG hubs, via long-distance orientated LNG or LCNG
fuelling networks.
a much more complex liquefaction process, involving

compression and a multistage heat exchanger either
using liquid nitrogen or newer methods involving
methane, at significantly greater cost than applies to
CNG.
Pipeline compared to trucking
CNG is transported to a retail location via an existing

NG pipeline. Although significant variations exist in
delivered costs due to existing load on the pipeline,
and distance from NG sources of supply-- delivery via
a NG pipeline remains the cheapest available method
of NG transportation. LNG, by contrast, is delivered via
a tanker truck, and the length of such hauls is typically
two to five times that of a traditional diesel haul. To
be sure, the construction of additional liquefaction
plants can reduce the average length of such hauls,
but this construction comes at a cost, as the average
capital costs of new liquefaction facilities currently
exceeds a minimum of 150,000,000 dollars (although
development of simpler and modular solutions, such
as GEs LNG in A Box system, and Micro LNG facilities,
are reducing such capital and operational costs).
Differential tax treatment
CNG currently enjoys three significant cost benefits

compared to LNG.
CNG and LNG are taxed differently, and CNG is

currently taxed more favourably, based on energy
content sold, per DGE. LNG is taxed on the basis of
an LNG gallon (as discussed more fully in section 2.2
above). The net result is a $0.15-$0.25 cost advantage
for CNG. This cost differential should be taken into
account when choosing between CNG and LNG, yet
since this cost difference is caused by government
policy, it could more easily be erased than the
previous two cost differentials.
Compression compared to liquefaction
Total cost differential
4.2 Basic cost considerations,

CNG compared to LNG
CNG uses multistage compressors, which take NG at

pipeline pressure and condense it to volumes. LNG
also takes NG off a pipeline at line pressure, but uses
The net result of these cost differences is that CNG

is roughly $2.00 cheaper than diesel, for energy
equivalent amounts, while LNG is $1.00 cheaper.
| 38
INDUSTRY OVERVIEW
For some applicationspassenger vehicles, cargo

4.3 Design, planning, and siting
vans, and light-duty trucks CNG is the only option of CNG fuelling stations
available. Fuel cost differentials, however, are only one
consideration in deciding whether to opt for CNG or
Many considerations go into design, planning, and
LNG in applications where both are viable, such as
siting of CNG stations. These considerations differ
heavy-duty trucks and marine applications.
for different types of companies that are considering
building a CNG station. There is no such thing as a
Table 12 CNG to LNG compared
one-size-fits-all, standard CNG station model. The cost
of such stations can vary greatly, and needs to be
CNG
LNG
carefully designed to suit its intended purposes.
Stored in high-pressure
Stored in vacuum tanks, at
cylinders, typically at 30003600 psi
stations and on vehicles
Same methane as in
NG pipelines; emerging
sources in landfills
Methane cryogenically
frozen, to temperatures
lower than -200 F
Lowest price (wheel to

well), but require access
to NG pipeline; increased
NG demands may lead
to pipeline expansion to
eliminate bottlenecks
Price higher due to cost of

freezing, need to transport
via truck, and differential tax
treatment
CNG will always be cheaper LNG can be turned into

than LCNG
LCNG, but not vice versa
Not tied to a manufacturing Fewer supply options can
lead to attempted price
facility or on-road
manipulation
logistics, so multiple
suppliers should maximize
competition
Heaviest fuel
Heavier than diesel, lighter

than CNG
Multiple tanks required to

carry fuel supply
Better range and fuel

economy
About a 5% efficiency
loss results when filling
at rates greater than 10
GGE per minute, since the
rapid fuelling produces
heat which expands the
hydrocarbons taking up
more space (although no
fuel is lost)
LNG vents to atmosphere

as it warms in storage tanks,
creating an efficiency loss
CNG is non-toxic, requires

no personal protective
equipment, does not
require spill containment,
and has no evaporative
issues
LNG raises safety concerns,

and zoning regulations
restrict where facilities can
be sited, particularly in
urban areas
Currently more popular

for vehicles following local
and regional ranges, and
is reflected in structure of
CNG fuelling network
Build-out of better fuelling

infrastructure may increase
attractiveness for long-haul
trucking
Generally speaking, three types of companies have

either constructed or have on the drawing board
planned CNG fuelling networks:
producers or utilities, including Sempra Utilities,
Apache Corporation, and Trillium (which have also
often adopted CNG for their own fleets);
fleets, comprising a wide range of users, which
have different siting considerations, depending on
the patterns of truck usage, and how often they
return to base; some representative companies
include waste management firms (Waste
Management, Emterra) and trucking companies
(Dillon Transport and Ryder); and delivery
companies (UPS, FedEx).
convenience stores and truck stops, which are
generally adding CNG (or as described below LNG
or LCNG) to existing product offerings; companies
include Kwik Trip, Loves Travel Stops; these
companies are also opting for CNG vehicles for
their own fleets.
Filling times
Using current technologies, neither CNG nor LNG

fills at the speed of diesel. Typically, CNG fill times
have averaged no more than five DGEs per minute,
with NG flowing from on-site storage tanks to the
dispenser. Yet Trilliums technology, for example, can
fill at speeds of up to 12 GGE per minute.
Faster fuelling, however, increases costs: in general,
the faster the fill, the more expensive the cost. Slowfill posts cost less, and in general, do not require large,
expensive compressors to configure adequately.
Many fleets that cover a limited range such as
Californias Sempra Utilitiesfind the most costeffective way to construct stations is to rely slow
| 39
INDUSTRY OVERVIEW
fill posts, which can fill a vehicle overnight when it

returns to base; Canadas waste hauler Emterra has
adopted a similar strategy. Another advantage of
slow-fill overnight is that an operator does not need
to take time out of the day to refill a vehicle. Relying
on the slow-fill option does not mean eschewing
some fast-fill capacity in station design, as some such
capacity is usually necessary, especially for larger
fleets.
Truck stops and some convenience stores are
designing systems around such high-speed fuelling
capacity to create a filling experience that resembles
that of conventional petroleum-based fuels. Loves
Travel Stops, for example, which is constructing CNG
fuelling facilities to serve commercial markets, aims to
make it possible for a truck to perform all necessary
functions and exit within ten minutes, regardless of
whether it enters a diesel or CNG lane. Loves employs
newer technologies specifically designed for trucks
with larger tank capacities that require faster fill times.
Direct fill applications have been engineered for
heavy-duty fill application without having to use on
site CNG storage tanks, and can achieve fill rates of 12
DGEs.
Public or private access, or hybrids
In designing stations, companies need to consider the

expected load on a station. Some companies such
as Waste Management and many of the utilities are
generally committed to constructing public access
stations. Likewise (and somewhat obviously), that is
also the model for convenience stores and truck stops.
Whichever model is followed, companies often seek
to sign up an anchor tenant before committing to
station construction, as this provides a way to recoup
their upfront capital expenditures.
Sizing
Stations take time to come on-board, whereas

purchasing vehicles can be done quickly and
at relatively lower cost. Companies should
therefore err on the side of initially overbuilding
fuelling infrastructure, particularly if they service
remote locations, so there is sufficient capacity to
accommodate expanded CNG fleets. If, for example,
a company purchases ten CNG vehicles upfront, but
expects to have 50 CNG vehicles in service within 5
years, it should construct facilities with that higher
target number in mind.
CNG source compared to demand
Site design
Optimal equipment configuration is only one

component of site design. Companies must also
consider the size of vehicles that will use its station,
their turning radius, typical vehicle capacity, and
location of exits and entrances.
System redundancy
The degree of necessary system redundancy is a

major cost consideration. Utah state utility
Questara pioneer in CNG infrastructure, due to the
states ownership of its own natural gas supplies
has followed a simple standardization model, building
facilities at minimal cost. Questar eschews installing
a back-up compressor on-site for each of its stations,
preferring to rely on a mobile compressor that can
be moved into place if a stations compressor is not
working. Emterra, which recently constructed the
largest CNG fuelling facility in Canada, opted to
include two compressors in its site design. Even more
important than having two compressors is setting up
alternative fuelling sites.
In designing its projected long-distance CNG fuelling

network, Trillium has carefully compared potential
sourcee.g., location on existing pipeline networks
to projected demande.g., current trucking volumes
(see the discussion in section 1.4 and the associated
figures therein).
Emterra, Canadas largest waste hauler with
operations that also extend to Michigan and a
fleet of 400 vehicles, has launched the largest
CNG filling station in Canada, to serve about 60
vehiclesmaking it the largest user of CNG trucks
for waste haulage applications globally. The station
is configured to include 65 time fill posts, which it
expects to expand to 80 posts. The entire CNG fleet
can be filled via slow fill posts in 7 hours, and the
station also includes fast-fill capacity to fill a truck
in 10 minutes. The station has two compressors
on site.
| 40
INDUSTRY OVERVIEW
In constructing its planned network of stations,

Trillium considers three factors: good customer
thoroughfare, secured by a base or anchor tenant;
good accessibility to high traffic corridors that will
eventually draw more customers; and pipeline
access. Working with pipeline transmission
systems and utilities, Trillium identifies where the
pipelines are, and cross-references this information
by customer demand points, to decide where to
site stations. Trillium avoids building stations
on speculation because that locks up capital,
and instead looks to lock up a base or anchor
tenant before it commits capital to a station, and

to commit the tenant to a take or pay contract
over a specific term. In performing a pro forma
cost estimate, the company looks carefully at the
load promised by the anchor tenant, prospective
public demand (which is assumed will grow from a
baseline, rather than shrink), and if it meets certain
thresholds, Trillium proceeds with the station.
Although no company is in the business of building
stations it thinks will lose money, sometimes, it is
necessary to build stations so as to avoid a CNG
desert.
Modular solutions: CNG in a Box
In partnership with Chesapeake Energy Corporation,

GE developed and is marketing a proprietary CNG
In A Box technology, a plug and play unit that NG
from the existing pipeline network and compresses
it onsite. The fuel dispensers are similar to those
currently used for diesel or gasoline fuelling, and
provide the end user with fuelling times of about 7
GGEs per minute. The CNG In A Box units provide
a quicker path to a more robust NG infrastructural
market, and other companies may elect to market

similar products. One advantage of modular systems
is that they are mobile, making initial siting decisions
less crucial than they might be for fixed infrastructure.
They may be maintained remotely, and breakage
is not a major issue. Some other manufacturers are
developing similar systems, but the lowest initial bid is
not necessarily the cheapest comprehensive longterm solution.
Figure 24 GE CNG in a Box
The CNG
CNG In A
The
Box
Box design
design
allows
easier
allows for easier
gas
gas compression,
compression,
storage,
cooling,
storage, cooling,
drying,
and
drying, and
cooling;
the
cooling; the
systems
controls
systems controls
are
easy
to
ship
are easy to ship
and
and maintain.
maintain.
Units come
come
Units
in
in two
two
configurations:
configurations:
an
20
an 88 foot xx 20
foot
foot container
container
or
foot xx40
40
or an
an 8 foot
foot
container.
foot container.
The system
system isis
The
designed
tobe
be
designed to
modular
and
modular and
intuitive,
and
intuitive, and
plug
play
plug and
and play
on-site.
on-site.
The system
system
can include
includeGE
GE
Wayne
branded
Wayne branded
dispensers
dispensers
with credit
creditcard
card
capability
and
capability and
provision
for
provision for
point
of sale
sale
point of
interface.
interface
Fuel isisdispensed
Fuel
dispensed
at a rate
rateof
of
approximately
approximately 77
GGEs
perminute.
minute.
GGEs per
| 41
INDUSTRY OVERVIEW
Overall cost estimates for CNG stations
Cost estimates for CNG stations vary widely,

depending on stations configuration. Excluding
land, costs can range from $100,000 to $1.5 million. A
small station with only a few slow-fill posts can cost as
little as $100,000 to configure, excluding land and site
preparation, and could support a fleet of a dozen pickup trucks, for example. Fast-fill stations pumping 1000
GGE could cost upwards of 1 million. The trade-off is
usually between compression and storage. Storage
is less expensive, but requires more space, whereas
compression is noisy, but takes less space. Optimal
configurations may therefore vary, depending on
land costs, and noise restrictions. There is no one-sizefits all model for CNG stations, and companies need
to consider carefully their fuelling needs, as well as
existing and projected fuelling network development
in the areas their fleets cover, in deciding what, if any,
infrastructural investments are necessary.
4.4 Design, planning, and siting

of LNG fuelling stations
The process of designing, planning, and siting LNG
facilities differs from CNG siting, in that LNG facilities
need to be located with an eye to existing or planned
liquefaction facilities. CNG thus far has had an
advantage, because it is easier to select a site, and the
existing pipeline distribution system is already built.
Traditional large LNG liquefaction facilities are custom
facilities, and are project based. They require huge
upfront capital outlays, and can take up to 72 months
to be operational. As discussed in section 1.5 above,
crucial to LNG rollout is increasing geographic access
to its supply, which is occurring in part developing

small and midscale LNG liquefaction infrastructure.
Gas producers, suppliers, utilities, and public
companies are planning and building new facilities
(see figure 15 above).
The aggressive timetables set for nationwide LNG
networks, by Clean Energy, Shell, and Blu LNG/ENN,
do not allow for such extensive lead times. Instead,
led by GE, LNG for many transportation applications
is moving toward smaller facilities, with 6-24 month
lead times, and reduced capital and operational
expenditure requirements. These solutions are
modular and simplified, and focus on product rather
than project.
Modular solutions: GEs LNG in a Box
As with CNG, GE has worked to develop modular and

streamlined solutions that can reduce the potential
costs of planned LNG facilities. With a capacity of
10,000-50,00 gallons per day of fuelling capacity, this
system is deigned to be used for fuelling stations
that cater to heavy-duty trucks, and can include
waste haulers, long-distance trucking applications,
and remote industrial applications. The inlet gas for
this system comes from a pipelineso that this LNG
solution gets the benefits associated with pulling
gas off a pipeline, and reducing trucking costs. Being
pipeline-dependent imposes costs as well. As with
the parallel CNG in a Box system the modular nature
of LNG in a Box reduces the importance of initial
siting decisions. The lead-time for such a facility is 6-12
months.
| 42
INDUSTRY OVERVIEW
Figure 25 GE LNG in a Box

Performance:
10,000-50,000 gallons per day LNG
production
Inlet gas: Pipeline
Gas recovery: 80-82%
Specific power 1.4 kWh/gal (1.3MJ/liter)
Features
Modular, rapidly (re)deployable design
Simple methane cycle
Minimal pad prep & quick installation
6-12 month lead time
Highly automated operation
Gas engine option available
Equipment financing available
Source: http://www.gastechnology.org/Training/Documents/LNG17-proceedings/Transport-18-Ujjwal-Kumar-Presentation.pdf
Micro LNG
Micro LNG facilities, also pioneered by GE, are capable the systems is designed for use in heavy-duty trucking
of producing 100,000-300,000 gallons per day. They
hubs, and they require a 12-15 month lead-time to be
too source inlet gas from a pipeline. The capacity of
operational.
Figure 26 Micro LNG
Performance:
100,000-300,000 gallons per day LNG production
Inlet gas: Pipeline
Features
Methane based system with boil off recovery
8% improved power efficiency
40% reduced wasted methane
Scalable design w/ multiple standard packages
for rapid deployment
Factory
tested skids
Plug & play, light civil work
Targeting 12-15 month lead time
Source: http://www.gastechnology.org/Training/Documents/LNG17-proceedings/Transport-18-Ujjwal-Kumar-Presentation.pdf
| 43
INDUSTRY OVERVIEW
Overall cost estimates for LNG stations
Costs of LNG stations currently range from $500,000$750,000 for private stations, to public facilities that
may cost between $1.5 - $2 million.
4.5 Conclusion
The future of NG infrastructure in the United States
will combine a network of CNG, LNG, and LCNG
stations. In deciding whether to opt for CNG of LNG,
managers need to consider what is better for their
fleets. This depends on where the fleet will operate,
and what its range needs are. This chapter has
discussed various considerations that determine
whether CNG or LNG makes most sense for a fleet,
as well as what considerations should go into a
companys decision to construct fuelling stations
whether CNG, or LNG.
| 44

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