What Is Holding Back Natural Gas As The Transport Fuel Of The Future?
Ed Dolan | Jan 07, 2013 01:17AM ET
The natural gas revolution has brought big changes to the U.S. energy scene. Natural gas prices, which used to move closely together with oil prices, have plunged in the last five years, as the following chart shows.
One result has been the rapid displacement of coal by natural gas in electric power generation. According to a recent report from the Union of Concerned Scientists, some 100 gigawatts of coal-fired electric plants, representing more than a quarter of coal capacity and nearly a tenth of total U.S. electric capacity, have either been closed or are likely soon to be closed because they have become uncompetitive with natural gas.
Natural gas has also been displacing oil at a rapid rate as a home heating fuel. In transportation, however, the use of natural gas is spreading more slowly.
Transportation ranks second only to electric power generation in total energy use. There are at least three ways to use natural gas to power transportation. One is to generate electricity with natural gas, which can then power electric cars or electrified rail lines. Another is to convert natural gas to liquids like methanol or synthetic gasoline. However, as I discussed in this post two years ago, the biggest potential lies in the direct use of compressed natural gas (CNG) or liquid natural gas (LNG) as a fuel for natural gas vehicles (NGVs).
As the next chart shows, there is nothing new about NGVs, which are in widespread use in many countries. Some governments have promoted them to reduce urban pollution and others to achieve greater energy independence.
In many of these countries, gas is widely used for light vehicles like taxis and private cars. In the United States on the other hand, the small number of NGVs now in service are mostly city busses, garbage trucks, delivery vans, and other fleet vehicles.
What is holding back the wider use of CNG in the U.S. transportation system? Not technology. Unlike hydrogen, cellulosic ethanol, algae diesel, and other futuristic alternatives, NGVs use simple, off-the-shelf technology. That is part of the reason they are popular in Pakistan, Bangladesh, Armenia, and other developing and emerging market countries. Instead, the slow spread of CNG as a transportation fuel in the United States is largely attributable to economic and political factors.
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