What are some of the benefits of natural gas vehicles (NGVs)?

OC: Firstly, natural gas generally has a more stable price, and is often cheaper, than diesel or petrol. In the longer term, depending on the taxation direction taken by governments and the global availability and price of petroleum, cost saving is likely to become a major benefit. For domestic users, the convenience of home refuelling is a clear benefit, and the use of natural gas also offers households a tangible opportunity to contribute individually to the national greenhouse gas emissions reductions agenda.

A major community benefit would be the opportunity to become totally self-sufficient in terms of transport energy supply. The cost of providing refuelling infrastructure pales in insignificance when compared with the annual import savings available by substituting imported petroleum with natural gas. Expanding the use of NGVs would also lead to expansion of the natural gas transmission and distribution infrastructure, thereby delivering gas to rural and urban fringe areas hitherto without supply.

BJ: The use of natural gas also has environmental benefits, as it can reduce air pollutants by as much as 90 per cent, as well as reduced carbon dioxide (CO2) emissions of between 10 and 30 per cent. Natural gas doesn’t pollute waterways in the event of a leakage in transit. Who is leading the way in the development of NGVs?

BJ: Technology – Germany probably has the edge in the light duty arena, while the heavy duty sector is too broad to pick a leader. Most countries engaged in NGV production are pretty sophisticated these days. Iran, for example, was one of the first countries in the world to produce turbo-charged compressed natural gas (CNG) sedans.

Vehicle numbers – There are several countries over the one million vehicle mark but most of them are relying on conversions. For original equipment manufacturer (OEM) vehicle production, Iran is probably the most prolific, closely followed by Italy.

OC: In particular, the Trucking Industry Council and its members, and the heavy haulage sectors, have taken giant strides in making LNG successful as a fuel for long distance semi trailers, b-doubles and road trains in parts of Western Australia, Victoria and soon, Tasmania. There has also been significant progress by a small number of medium-sized truck manufacturers and the rate of uptake of these CNG vehicles is encouraging.

How can technology improve to make natural gas vehicles more widely feasible? OC: The technology requires little improvement. Globally, there are now in excess of 150 vehicle models manufactured by OEMs for use with natural gas. Regrettably, apart from a small (but growing) number of medium-size truck manufacturers, no Australian car manufacturer as yet produces an OEM NGV, however in the commercial vehicle sector, Mack, Iveco and Kenworth are manufacturing NGVs locally. Engine conversion technology is also advanced and largely available locally for all sectors of the Australian fleet. In terms of LNG and CNG refuelling plants and onboard storage, technology has been steadily improving over the past 20 years. It is extremely safe, reliable and user-friendly.

BJ: The technology is totally feasible as it is. Turbo-charged natural gas sedans are available off showroom floors now and heavy duty natural gas engines in the United States were achieving 2010 emissions standards as early as 2007. Here in Australia, we’ve got natural gas fuelling 150 tonne road trains. In many countries, especially in Sweden, entire fleets are running on renewable biomethane. So the technology isn’t the problem, it’s the fuel availability which is simply a matter of infrastructure investment.

What policy or legislation would you like to see adopted in order for natural gas vehicles to develop further?

OC: A suite of policies aimed at guiding the nation towards zero net petroleum importation is required. As consumption grows and indigenous petroleum reserves further diminish, the supply gap is fully met by natural gas. Such a policy might require minimum, if any, fuel tax on natural gas for an extended period and might require gas producers to continue to supply gas to the local market on the present ‘cost plus’ basis, to avoid the windfall gains likely to become available to producers as global LNG market forces push prices toward global crude oil prices.

Governments could assist in the area of refuelling infrastructure by reassuring energy retailers of the intended policy direction and by perhaps contributing a part of the capital cost, by taxation relief or grants.

BJ: Because fleet operators want certainty with fuel pricing, delaying the introduction of excises on CNG and LNG has worked overseas. A re-introduction of conversion grants similar to the Alternative Fuels Conversion Program could also be effective. Beyond that, the major risk takers in an NGV program are the OEM vehicle and engine manufacturers, and the gas or energy companies that invest in the filling infrastructure. They can be catered for with tax breaks, one-off grants and other incentives that offset risk or reduce payback times. In all cases any programs would need to cover the vehicles and the fuel use. I would begin with programs targeting medium and heavy duty vehicles as that’s where the fuel volumes will deliver the broadest benefits relative to the infrastructure investment.