Natural Gas-Fired Vehicles Gain Traction in U.S. Market

Kansas City Star
December 5, 2011

Natural Gas Vehicles Are Making Inroads in U.S. Market
Steve Everly

The natural gas-powered Honda Civic won this year’s Green Car of the Year award from Green Car Journal, leading the way for natural gas-powered vehicles to enter the American market. According to the Journal, the car has the cleanest-burning engine ever certified by the U.S. Environmental Protection Agency. The Civic Natural Gas is currently the only production car of its kind in the United States. Honda has sold more than 2,000 units this year, double previous annual sales numbers. The car costs $5,500 more than a conventional Civic, gets 38 mpg and goes 240 miles per tank. But the higher price is easily offset over time through lower fuel costs; the nationwide average gasoline price was $3.46 per gallon in October, compared to $2.09 for the natural gas equivalent, according to the U.S. Department of Energy. Moreover, in terms of energy equivalence, with natural gas it’s like paying $10 for the same amount of energy that is in a $90 barrel of oil.

The big issue is developing the infrastructure – a network of fueling stations – to support widespread deployment of natural gas-fired vehicles. Because of high upfront costs, switching to natural gas may not translate into savings for the consumer right away. Natural-gas fueling stations can cost $500,000 to $1 million. Congress is considering legislation, the NATGAS Act [New Alternative Transportation to Give American Solutions], that would provide financial help to build the network. The most outspoken proponent of the NATGAS Act? T. Boone Pickens, who founded Clean Energy, the company that operates natural gas stations around the country.

Irrespective of the financial self-interest of Pickens in promoting natural gas-fired vehicles, the NATGAS Act is worthy of attention. With the increased supply of natural gas from shale gas development throughout the country, it makes sense from a national security perspective to migrate away from imported oil to power our vehicles to domestic natural gas. The economic and environmental case is compelling as well, given the price advantage of natural gas over oil and the reduced emissions. With the political gridlock in DC, however, and Republican opposition to anything that looks like a subsidy, it is unlikely the NATGAS Act will be enacted, notwithstanding its considerable merits. That is an unfortunate outcome.