Transcript Document

Florida Seaports Natural Gas
Workshop
April 10, 2014
The Fundamentals of
Natural Gas in
Transportation
Rob Vickers
CDM Smith
Tallahassee, FL
Presentation Overview
• Introduction to Natural Gas in Transportation
Sector
• Economic Considerations
• Florida-Specific Findings
• Other Modes: Rail and Seaports
• Intermodal Opportunities
Florida Seaports Natural Gas Workshop
Natural Gas Basics
• Compressed Natural Gas (CNG) - Natural gas under pressure
(compressed to pressures above 3,000 pounds per square
inch) which remains clear, odorless, and non-corrosive
• Liquefied Natural Gas (LNG) - Produced when natural gas is
cooled to minus 260 degrees Fahrenheit through a process
known as liquefaction
• Sold in units of diesel or gasoline gallon equivalents (DGEs or
GGEs) based on the energy content of a gallon of gasoline or
diesel fuel
• More than 15 million natural gas vehicles in service
• Navigant Research projects 35 million in service by 2020
Florida Seaports Natural Gas Workshop
Benefits of Natural Gas
• Energy Security – 97% of the natural gas used in the U.S. is
produced in North America
• Lower Emissions - 20-30% fewer greenhouse gas emissions
and significantly reduced tailpipe emissions compared to
petroleum
• Reduced Maintenance Costs – Cleaner burning, quieter,
longer engine life
• Comparable Performance – Similar to conventionally fueled
vehicles in terms of power, acceleration and cruising speed
• Fuel Costs – Savings of 40% - 50% compared to gas/diesel
Florida Seaports Natural Gas Workshop
Natural Gas Vehicles
• The number of OEM vehicles is growing
• CNG vehicles are cost-effective for high-mileage, centrallyfueled fleets that operate within a limited area
• The greater fuel capacity of LNG vehicles means they are
often the preferred option for long distance travel
• Most popular heavy-duty applications:
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Transit/School Buses
Refuse Trucks
Shuttle Buses
Tractor Trailers
Step Vans
Florida Seaports Natural Gas Workshop
Total Annual LNG/CNG Heavy Duty Truck Sales
North America 2013-2022
Florida Seaports Natural Gas Workshop
Natural Gas Fueling Infrastructure
• DOE reports 160,000 gasoline fueling stations nationwide
• In comparison - 1,069 CNG and 146 LNG fueling stations
nationwide (2012)
• CNG Stations: Fast-Fill vs. Time-Fill
– Fast-Fill stations are ideal for retail situations serving light- and
medium duty vehicles
– Time-Fill stations are typically used by heavy-duty fleet
operators who fuel at a central facility overnight
• LNG Stations dispense a liquid fuel and are structurally similar
to gasoline and diesel stations
• Natural gas fueling facilities vary considerably based on size,
capacity, and the type of fuel dispensed
Florida Seaports Natural Gas Workshop
July 2013 Average Fuel Prices on Energy
Equivalent Basis
Florida Seaports Natural Gas Workshop
Costs of Natural Gas Vehicles/Infrastructure
Initial NGV investments are significant…
• Representative heavy-duty CNG truck costs $63,600 more
than diesel equivalent prior to incentives (2011 DOE Report)
• CNG conversion cost for new light-duty vehicles generally
ranges between $12,000 and $18,000
• CNG fueling facility cost range from $10,000 to $2 million
depending on the size and application
• LNG fueling site can range from $1 to $4 million
The good news on costs…
• Incentives are available to help off-set initial vehicle costs
• Station builders/operators provide turn-key facilities
Florida Seaports Natural Gas Workshop
Natural Gas Vehicles/Stations in Florida
• In 2011 DOE reported there were fewer that 3,000 NGVs in
operation in Florida
• Examples of businesses and agencies converting to NGV:
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AT&T
Leon County Schools
Waste Management
Saddle Creek
J.J. Taylor Companies
Numerous transit agencies
• 60 natural gas stations in Florida
– 48 stations operational (18 public/30 private)
– 12 stations planned (10 public/2 private)
Florida Seaports Natural Gas Workshop
Natural Gas Fueling Facilities in Florida
Florida Seaports Natural Gas Workshop
Florida Natural Gas Fuel Fleet Vehicle Rebate
• Provides eligible applicants a rebate for the cost of conversion
or the incremental cost incurred in connection with
conversion, purchase or lease of a natural gas fleet vehicle
• Maximum rebate is $25,000 per purchased/leased or
converted vehicle, not to exceed 50 percent of eligible costs
• Each applicant may receive up to a total of $250,000 per fiscal
year on a first come, first serve basis
• To qualify, the vehicle must be part of a public or private fleet
and must be placed into service on or after July 1, 2013
• 60% of funds allocated for commercial applicants and 40%
allocated for governmental applicants
*See DACS Office of Energy for additional information
Florida Seaports Natural Gas Workshop
Other Modal Applications: Rail
• Both GE and Caterpillar are developing natural gaspowered locomotives
• Burlington Northern, Union Pacific, and Norfolk
Southern are collaborating with locomotive
manufacturers (CSX is reviewing the technology)
• Stricter emissions standards and fuel cost savings are
driving the interest in LNG
• Beyond the technological challenge of developing
LNG-fueled locomotives the industry must address
logistical hurdle of getting LNG to distribution
networks
Florida Seaports Natural Gas Workshop
Other Modal Applications: Seaports
• Once again, stricter emissions requirements and fuel cost
savings are driving the maritime interest in LNG
• In October 2008 member states of IMO adopted new tiers of
NOx and fuel sulfur controls for the newly established North
American Emissions Control Area (ECA)
• 2015 fuel sulfur standard of 0.1 percent fuel sulfur expected
to reduce PM and SOx emissions by more than 85 percent
• Stringent ECA fuel standard is expected to be met through
fuel switching
• Conversion to more expensive distillate fuel or installation of
emission control devices for ships operating on residual fuel
Florida Seaports Natural Gas Workshop
Current/Future Emission Control Areas
Florida Seaports Natural Gas Workshop
Key Considerations in Maritime
Investments in LNG
• Natural gas commodity prices are low relative to marine
petroleum fuels
• To be used as a marine fuel natural gas must be liquefied to
increase its energy efficiency (limited liquefaction facilities)
• Conversion of vessels to LNG is expensive (conversion of
engines, installation of LNG storage tanks and related safety
systems and ship modifications)
• Fleet operators should focus on vessels with high utilization
and fuel use relative to size and engine power (maximize fuel
cost savings)
• Economics of any specific project will hinge on: (1) vessel fuel
use; (2) delivered LNG prices; and (3) vessel conversion costs
Florida Seaports Natural Gas Workshop
Intermodal Opportunities
• Summary of CNG Port Drayage Truck Demonstration Program
– Timeline: 2010 to 2014
– Natural Gas trucks deployed: 219
– Partners: South Coast Air Quality Management District, CA Energy
Commission, CA Air Resources Board, Ports of Los Angeles and Long
Beach, U.S. DOE, Clean Cities Coalitions
– Objectives: increase use of alternative fuels; significant reductions in
diesel air pollution; create/preserve jobs to stimulate the economy;
increase end-user experience with alternative fuel vehicles
– Results: Increased use of alternative fuels (reduced consumption of
diesel fuel); significant reductions in NOx and diesel PM emissions;
reduced air toxic emissions and associated public health risk; reduced
GHG emissions; preserved/created jobs related to manufacturing,
natural gas refueling, maintenance and operation of the natural gas
vehicles
Florida Seaports Natural Gas Workshop
Potential Application: ILCs
Florida Seaports Natural Gas Workshop