Speaking to fleets and truck dealers on a regular basis, it has become clear there is a large amount of confusion as to which form of natural gas is superior. Both Compressed Natural Gas (CNG) and Liquefied Natural Gas (LNG) are worthy fuels if you are need to improve your profitability and increase your competitive advantage by moving to a lower cost fuel. I will spoil the surprise by telling you upfront that neither of one of these is superior to the other. They are simply different, and different fleet operations have different priorities. Most natural gas fuel providers have only invested in one technology or the other. For example, Trillium specializes in CNG stations, and will tell you CNG is vastly superior. If you talk to Shell, they will likely pitch you on the benefits of LNG. People sell what they know, and very few fueling companies in the industry (with the exception of Clean Energy) do both. This creates a good amount of confusion for fleets trying to determine the best fit. So what should you do? Simply evaluate your fleet priorities based on the information below and you can quickly decipher which fuel is best suited your needs.
1. Introduction to CNG & LNG
Let's start with the basics. CNG and LNG are the same fuel, but stored in a different physical form on board your truck. CNG is a gaseous fuel that is lighter than air. CNG stations tap into the local gas utility lines and compress the gas up to 3,600 pounds per square inch (psi). It is then dispensed into vehicles and stored in a high pressure storage cylinder that looks like this:
On tractor units, the CNG tanks are typically mounted on the frame rails, behind the cab, or a combination of the two, as seen below:
LNG is the same fuel, but it is stored in a cryogenic form. At approximately -260 F, natural gas turns into a colorless, odorless liquid fuel. It is produced at an industrial processing facility and then trucked to the fueling station where it is stored as a liquid. It is dispensed into vehicles at as a cryogenic liquid.
2. Fuel Cost
CNG is almost always going to be less expensive than LNG. This is primarily due to the lack of transportation costs to get the fuel to the station. The CNG distribution system is already in place via our nation's natural gas pipeline system. This is not the case with LNG. LNG must be trucked into the station and is therefore more costly. Costs can vary depending on where you are getting the fuel (onsite vs. retail station). In general, you can expect to pay around $2.20 for a Diesel Gallon Equivalent (DGE) of CNG and closer to $2.50 for a DGE of LNG. Both fuels provide significant savings compared to diesel fuel, but CNG is typically going to be even more affordable.
3. Fueling Experience: Heat of Compression vs. Boil Off
The fueling experience is a bit different with each fuel. CNG is very similar to fueling with gasoline and diesel fuel. It requires no special protective gear and minimal training. There are two types of CNG stations, time-fill and fast-fill. You can read about those in detail in our previous CNG station blog post here. CNG stations designed for trucking applications tend to be fast-fill, and they have a unique problem known as heat of compression. Heat of compression means that compressed gas shot into the fuel tanks at a high rate gets very hot. The CNG tanks account for this heat by allowing room in the fuel tanks for the gas to expand as it cools. This means if you are carrying 100 DGEs of fuel, you will likely only get about 80 usable gallons of fuel onto the vehicle. The problem is worse on a hot day and less noticeable in cold weather. This leads to a need to increase your fuel storage on-board the vehicle. I will discuss the impacts of that below in the weight section.
LNG is cryogenic liquid and therefore requires a bit more training as well as protective eye wear and gloves (see below). This may be a consideration if your fleet already has dedicated fueling personnel. This is not rocket science, it's just basic safety. Keep in mind diesel fuel is also highly toxic -- we are just used to diesel as a fuel because it is so prevalent. No fuel is safe enough enough to bathe in, except maybe solar.
LNG is not compressed, and therefore it has no issues with heat of compression. Instead, it gets it own special issue -- boil off. LNG is stored at -260 F and has a natural tendency to heat up. As it heats up, it begins to boil in the tank and will eventually vent off. If you leave a fully fueled LNG vehicle in Las Vegas in the summer for two weeks, you will lose about 5% of your fuel. In practice this is rarely a major problem. You don't normally fuel your trucks so you can leave them idle for two weeks. Your fleet is your workhorse, and if you're reading this article, you probably use your workhorses for a specific job. If you a fueling your truck every day or two, you will not notice any major boil off issues.
4. Fuel Economy
Regardless of how you are storing the fuel (CNG vs. LNG) , once the fuel hits the engine, it is a gaseous fuel. Speaking specifically about the current Cummins 12 L gas engine, fuel economy is going to be a bit lower when compared to a current diesel engine. On a DGE basis, you can expect to see a 5-20% loss in fuel economy with natural gas in general. This is true with both CNG and LNG trucks. This impacts the final economics of the program, but it is typically not a deal killer. As always, transmission choice, driver training, gearing, etc. will heavily impact the final fuel economy. You need to monitor drivers and attempt to improve this in the same way you do with you diesel fleet. You don't get a free pass just to ignore these details just because you are now using an alternative fuel.
5. Weight, Range & Incremental Truck Price
The primary driver of the choice between CNG and LNG comes down to weight and range. You can simplify this entire evaluation by asking yourself this one question:
How sensitive is your operation to weight and how far do you need to go before refueling?
Lets start with CNG. CNG cylinders are very safe and very strong due to their pressure requirements, but these attributes come with one downside: weight. Despite numerous advances in material sciences, CNG fuel systems continue to add significant weight to the truck when compared to a traditional diesel vehicle. You get to delete the Diesel Particulate Filter (DPF) and the Diesel Emission Fluid (DEF) system on the truck (which your maintenance team will love). However, if you add 80 DGEs of CNG storage, you can expect to add at least 1,000 lbs of weight.
Work closely with you dealer and the fuel tank manufacturer to get the exact weight difference between the diesel and CNG platform. If your trucks have a shorter route and you only need 60 DGEs of fuel to get through the day, this may not be a major issue. If that is the case, then CNG is most likely the best fit. This is also good time to right-size your fuel storage spec. Most fleets these days carry WAY too much fuel. I think this is a basic driver / range anxiety concern. Are you burning 50 gallons / day and carrying 100? Why? Don't carry fuel you don't need. You obviously want a buffer, but be realistic. Take this opportunity to actually determine the correct fuel storage spec. You will need to make sure you account for the heat of compression factor we discussed above. If you are burning 50 gallons a day and will be using a fast-fill CNG station, a spec of 70-80 DGEs is very reasonable.
This leads us to the final factor: incremental truck cost. Natural gas trucks carry a premium over diesel units. The vast majority of the incremental cost of a CNG truck is due to the fuel tanks. They are expensive. A 100 DGE fuel storage system can easily add $70,000 to the truck price. So again, make sure you have the right fuel spec nailed down. If you have shorter routes, and right-size the fuel storage spec, you should see a payback period somewhere between 2-3 years. Conversely, if you need 1,000 miles of range before refueling, you CAN do this with CNG, but is it cost effective? There are CNG storage systems well above 200 DGE available now. But this will obviously add a lot of weight and a LOT of cost. So if you find yourself looking at that option, it may be time to shift over to an LNG evaluation.
LNG storage tanks are essentially highly insulated diesel tanks. Fully loaded, they will weigh less than a comparable CNG system. They will also cost less in higher storage specs. For example, a 100 DGE storage system might be a $70,000 premium with CNG, but only $40,000 with an LNG system. So you get the same basic range, with a lower incremental cost and a lower weight penalty. This may be worth the slightly higher fuel price of LNG. If you are extremely weight sensitive AND you have a long range route, LNG is worth a look. This why you see rail, mining, and marine vessels all going to LNG. They all have extreme range requirements and are incredibly sensitive to weight limits.
Summary & Resources
I know this is a lot of information, but don't make it too complicated. Trucking firms and logistics providers no longer have the option of simply ignoring this transition. If you competition reduces their fuel cost by 40% and you do not, you lose and they win. Period.
If you have shorter routes and are not ultra weight sensitive, CNG is most likely going to be a better fit. Trash trucks, for example, are almost always CNG because they typically have short routes. CNG works well in this application and quickly improves profitability. If you are running long routes and max out the weight each and every time, LNG needs to be in your evaluation. A good example might be a sand and gravel hauler running a 700 mile round trip before refueling. This is probably a good fit for LNG. I recommend starting with a CNG evaluation and determining if you would need to run additional routes to move the same amount of product. If you do, then take a look at LNG and see if you can do it without additional routes. Put your dealers to work for you and have them work up costs and weight comparisons on both options. Then put your fuel partners to work and take a look at fueling locations already available + onsite fueling options. You can typically justify a new fueling location with 25 trucks phased in over five years.
For payback, below are links to both a simple payback on the incremental truck cost, as well as a much more advanced calculator that allows you to input the weight of the tractor and trailer.
The Alt Fuels Data Center is a great resource that can show you station locations, as well as financial incentives that may be available in your State. For example, Colorado has a $20,000 tax credit for heavy trucks natural gas trucks, as well as a grant that can supply an additional $22,000 per truck. ($42,000 per unit!) They also have a 1,000 lb weight exemption for natural gas trucks, making CNG a VERY attractive option. Many other States such as Texas and Pennsylvania also have vehicle incentives currently available for natural gas truck purchases.
If you need help during these evaluations don't hesitate to contact me. I am happy to help answer any questions you may have.