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The roadblocks to a Natural Gas revolution
Math and “pencil pushers” won’t bring about a revolution in America’s fueling preferences according to Thomas O’Brien, president and CEO TravelCenters of America, who spoke before an audience gathered at the ACT Expo in Washington D.C. Tuesday.
Instead, revolution will come from visionaries who are willing to overcome what O’Brien called three “roadblocks” between themselves and the adaptation of natural gas.
Roadblock No. 1: Natural gas equipment costs more.
Roadblock No. 2: If demand for natural gas goes up, price will go with it.
Roadblock No.3: There’s little to no infrastructure “On cost of investment…everybody has heard ‘do the math’,” O’Brien says. “Nobody really cares anymore. We’ve deemed that the math is close enough.”
O’Brien added there are more than two sides to the natural gas story – a third party has emerged from traditional pro- and anti-change camps.
“I think the majority is the group of us who are convinced that the ultimate answer will not be found just in the math,” he says. “Getting into natural gas today increases operating flexibility in the future. And that future may include a variety of fuel choices.”
“Economic benefit for using natural gas over-the-road will persist over time,” he says, “and has even greater savings potential (over diesel), even if demand for diesel is replaced with demand for natural gas.”
O’Brien says infrastructure will come with demand, which will be driven by the number of natural gas trucks on the road.
“The pace of adaptation is accelerating,” he says. “In a recent survey, 61 percent of fleet managers say they have natural gas vehicles already in their fleet, with another 11 percent saying they plan to add natural gas trucks. Only 19 percent said had no plans to incorporate natural gas trucks.”
O’Brien says some studies suggest upwards of 25 percent of all heavy trucks on the road in 2020 will be powered by natural gas.
“Looking at current adaptation rates, we will have well over half a million Class 8 trucks on the road in seven years,” he adds.
TravelCenters already has a seat at the table in trying to bolster the infrastructure, announcing a joint effort with Shell to construct 100 TA and Petro-branded fueling stations nationwide with LNG lanes.
The facilities will also offer LNG truck repair capabilities. Initially, plans to service LNG trucks will be limited to stations that carry LNG fuel, but O’Brien said service would be rolled out when and where demand called for it.
The first LNG enabled TA/Petro stations will be located in Nevada, California and Texas by 2014, with a nationwide rollout to follow in regions where traffic and demand dictate.
“We plan to place LNG fueling stations approximately 250 miles apart,” O’Brien says.
Such an initiative will require the investment of millions of dollars.
O’Brien says the installation of LNG lanes costs six to seven times more than diesel lanes. Incremental additional lanes cost significanly less, but can still require a capital investment of twice that of diesel.
“To make natural gas cost effective,” he adds. “We need to reduce the cost of infasructure equipment. And I think that will happen.”