Navigant Research Blog

Fleet Managers Seek Alternative Fuels

Scott Shepard — May 28, 2013

To meet federal, state, and local mandates for alternative drive vehicle adoption and fossil fuel reductions, local fleet managers must find replacements for traditional gasoline-powered vehicles that are both economically and environmentally beneficial.  At the Green Transportation Conference hosted by TransEnergy Solutions recently, it was clear that finding the optimum alternative drive vehicle replacement for any given fleet is not easy.

Advanced technologies for alternative drive vehicles come with a price premium, alternative fuel infrastructure requirements, and the need for driver training programs on how best to operate and refuel the replacement vehicle.  The fuel cost savings of the replacement vehicles have to pay back the aggregated costs of those items in as few as 3 years to make the alternative drive vehicles appealing to fleet buyers.

Adding to the difficulty is the fact that there are many alternative fuels and drive technologies for fleets to choose from.  Technologies featured at the conference included regular hybrids, hydraulic hybrids, compressed natural gas (CNG), liquefied natural gas (LNG), liquefied propane gas (LPG), plug-in electric vehicles (PEVs), and fuel-cell vehicles (FCVs).

Find Your Niche

Choosing the wrong technology for the wrong application can turn potential savings into costs.  For instance, purchasing a light duty hybrid to replace a low-mileage light duty fleet vehicle would not likely pay back the cost of the advanced technology, as hybrid technologies accrue the greatest savings per city-mile driven; the more the vehicle is driven on city roads with stop and go traffic, the quicker it pays back its premium.  Equally economically inefficient is purchasing an LNG-powered medium duty truck for inner-city applications, as the evaporative nature of LNG reduces the fuel economy of the technology considerably when the vehicle is idling.

In other words, each alternative drive technology is best suited for a particular market niche.  LPG is particularly suited for smaller fleets with medium duty vehicles and for school bus fleets, since the infrastructure costs are low.  LNG is best suited for long distance heavy duty trucks whose idling time is minimal.  Hydraulic hybrids produce the best returns for fleet vehicles used for stop and go driving, like shuttle buses, refuse trucks, and mail delivery.  The hydraulic hybrid system works like a spring, compressing hydraulic fluid when braking and releasing when accelerating, capturing 70% to 80% of the accumulated energy.  The hydraulic system provides fuel savings and faster acceleration than diesel or CNG-powered vehicles.

The alternative drive vehicle industry still has a long way to go to convince fleet managers of the benefits of transitioning from gasoline and diesel power.  Though lower greenhouse gas (GHG) emissions are great benefits of alternative drive adoption, educating fleet managers on the options that will give them the greatest financial return is the best way to achieve market growth for all alternative drive technologies.

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