Recently, we wrote about the role of natural gas as a transportation fuel and the focus was on LNG. CNG is another way that natural gas can be used as a transportation fuel. There is not a CNG or LNG specific engine. In both cases, the fuel is delivered to the automobile engine as a gas. The difference between the two fuels lies not in the engine but in how the fuel is stored.
Both CNG and LNG have their own advantages and disadvantages. We see two distinct benefits for CNG. First, CNG is cheaper than LNG and, second, the infrastructure for CNG fueling stations is more established in the United States. We also see two distinct benefits of LNG. First, the fuel is roughly twice as dense as CNG in terms of energy content. It takes 1.7 gallons of LNG and 3.8 gallons for CNG to equal the same amount of energy found in a single gallon of diesel fuel. Second, LNG does not need to be transported through pipelines so it can be made available in more remote locations.
Given these unique set of advantages and disadvantages, each is better suited for different applications. CNG is better suited for light-duty and low-mileage applications. Waste Management, UPS, FedEx, and some school bus services have converted a small portion of their fleets to CNG for this reason. LNG is better suited for high-mileage or high-horsepower applications such as to power heavy-duty trucking or drilling rigs. The increased range of LNG vehicles reduces the amount of time spent at fueling stations versus that spent on the road traveling.
Even with the benefits of natural gas there are still hurdles that must be overcome before natural gas, in any form, will be commonly used as a transportation fuel. For example, a natural gas model of the Honda Civic costs over $8,000 more than the gasoline model. Even assuming that CNG is $1.50 per gallon cheaper than gasoline, like it was in mid-2013, and assuming the U.S. Environmental Protection Agency’s fuel economy estimate of 38 miles per gallon for the Honda Civic, the natural gas-fueled car would have to be driven over 200,000 miles before the user would start saving any money. These difficult economics become impossible in the absence of a price differential between CNG and gasoline, which is the case today.
If the oil prices rise faster than the price of natural gas, akin to levels that were seen two years ago, and maintain a steady differential, natural gas use in transportation may become economically feasible although its commercial penetration will depend on a number of factors.
– Tyler Wilson and Uday Turaga
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