Fuel Smarts

Analyst: Natural Gas Makes Sense For Trucking Industry

December 2009, TruckingInfo.com - Feature

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While passenger cars may be well-suited to hybrid and electric technology, natural gas makes more sense for the trucking industry, and would be taking off among fleets, were it not for the economy, according to David Woodburn
Woodburn says natural gas-powered vehicles, such as this one, make sense for the trucking industry. This Kenworth is equipped with the Westport LNG Fuel System.
Woodburn says natural gas-powered vehicles, such as this one, make sense for the trucking industry. This Kenworth is equipped with the Westport LNG Fuel System.
, a sell-side research analyst for ThinkEquity.

As part of its Oil & Gas Production and Distribution Report, the Wall Street Transcript conducted several interviews with industry executives, including Woodburn, who was drilled on the topic of natural gas.

"I think people kind of laugh at the idea of natural gas for vehicles here in the U.S. because it might take decades to install the infrastructure to match that for diesel, let alone gasoline," Woodburn said. "But the passenger market is not really where you'd want to start anyway. The smart thing is to focus on high-volume fuel users that utilize a single or require few refueling stations."

Woodburn doesn't believe hybrid and electric vehicles will catch on with fleets because of the weight of the battery, which can reduce the carrying capacity by 10 or 20 percent, he said.

He points to a number of incentives in place to encourage adoption of natural gas, including an excise tax credit for the fuel itself of 50 cents a gallon equivalent. Federal tax credits are also available to fund the purchase of natural gas or alternative fuel vehicles. Woodburn also discusses the NAT GAS legislation, which was introduced in the House in April and in the Senate in the summer. This legislation, he said, would extend these tax credits and boost these incentives.

"So natural gas is actually getting a lot of attention in Washington," he said. "With climate legislation stalled right now, you could see some of these natural gas incentives in an energy bill or a transportation bill."

Woodburn said climate change and the issue of alternative fuels are not exactly priorities for Washington these days, with health care at the top of everyone's agenda.

"However, the natural gas industry is working hard on a promoting natural gas as cleaner and cheaper than coal and oil, and domestically sourced as well," he added.

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