UPS invested $70 million in 1,000 propane delivery trucks.
WORK TRUCK SHOW -- UPS announced plans to purchase 1,000 propane package delivery trucks and install an initial 50 fueling stations at UPS locations. The investment in propane vehicles and fueling stations is approximately $70 million.
The propane fleet will replace older gasoline- and diesel-fueled vehicles used largely in rural areas in Louisiana and Oklahoma, with other states pending.
The vehicles on these routes can travel up to 200 miles on a tank of propane. Operations will begin by mid-2014 and be completed early next year.
UPS, in collaboration with the Propane Education & Research Council, a non-profit propane technology incubator, worked with equipment manufacturers to secure certifications with the EPA and California Air Resources Board. They made the announcement at the NTEA's Work Truck Show in Indianapolis Wednesday.
UPS tested 20 propane-powered brown delivery trucks successfully this past winter in Gainesville, Ga., and expanded its order with Freightliner Custom Chassis Corp. They use a General Motors 6-liter V-8 converted by Powertrain Integration to run on propane.
The company will continue to use other alternative fuels in areas where they fit in with available infrastructures and operations, said Dale spencer, director, maintenance and engineering, for delivery vehicles.
"Propane is readily available in the central U.S. and East Coast," he said. "This fits in rural areas where there’s no infrastructure for CNG.
"In Gainsville, drivers love ‘em. The engines have more pep with propane, which has 105 octane. Engines love this fuel. Fueling stations cost substantially less than others, CNG and LNG. They’re affordable," he said.
"We can use the others in other areas where we have economy of scale to pay for the infrastructure."
Mike Casteel, director of fleet procurement, said a propane filling station costs $40,000 to $80,000. "Gas starts at $1.5 million and you go up from there."
The new propane fleet is expected to travel more than 25 million miles and to displace approximately 3.5 million gallons of conventional gasoline and diesel per year.
The UPS deployment this year benefits from propane autogas’ wide availability as a result of increased natural gas production in the U.S., and there is more price stability with the accessible supply. UPS currently operates nearly 900 propane vehicles in Canada.
UPS has one of the largest private alternative fuel fleets in the nation with more than 3,150 alternative fuel and advanced technology vehicles. These include all-electric, hybrid electric, hydraulic hybrid, CNG, LNG, propane, biomethane, and lightweight fuel-saving composite body vehicles.
Click here for a video of UPS officials talking about the test program that led them to this decision.