Natural Gas VehiclesNatural Gas Vehicles

NYCLHVCC CNG WorkshopNYCLHVCC CNG Workshop

March 13, 2012March 13, 2012

• We Have the Fuel – And It’s Ours

• Substantial Air Quality: Urban Pollution

• Substantial Air Quality: GHGs

• Biomethane Makes GHG Case Stronger

• Only Natural Gas Can Displace Diesel

• NGVs are a Here-and-Now Technology

• Policymakers are Recognizing the Value of NGVs

• Money!!

Why the NGV Market Will GrowWhy the NGV Market Will Grow

Barriers to NGV Development Barriers to NGV Development

• Initial high cost of vehicle and fueling infrastructure

• Economics not compelling enough for fleets that do not use enough fuel

• Many fleets require very short payback periods– Anywhere from 3-5 years

Barriers to NGV Development Barriers to NGV Development

• Reluctance of fleets to share private fueling stations (security, insurance, safety issues)

• Resistance to new technology

• Lack of light duty OEM products

• Lack of bi-fuel LDVs in CARB states

How to Overcome Barriers How to Overcome Barriers

• Target high fuel use fleet applications first

• Develop open access stations – public or private locations

• Provide incentives for station owners to build large stations

Overcoming Barriers Overcoming Barriers

• Provide incentives for station owners to build near major transportation corridors

• Provide incentives to help buy-down incremental cost of vehicles to accelerate payback, increase demand for vehicles

US Target MarketsUS Target Markets• Heavy-duty freight trucks:

– Water ports and rail

– “Less-than-Load” (e.g., Yellow-Roadway, Forward Air, Swift)

• Transit buses/shuttle buses/school buses

• Major metro fleet management and public works departments

• Trash, recycling, cement and other vocational work trucks

• Medium-duty delivery and commercial service trucks:– Telecom ─ food ─ beverage ─ snack food ─ newspapers

– linen/laundry ─ grocery ─ furnishings/appliances ─ office products

• Taxis and light-duty service vehicles

NGV Market Development Creates Jobs• Exploration & Production Jobs• Manufacturing Jobs• Installation / Service Jobs• Indirect /Secondary Job Creation

– Local businesses (stores, restaurants)

– Increased profitability; fleets save 30-50%

• Freight Hauling

• F&B Delivery, Consumable services

• Refuse Collection/Transfer

• Transit

• Taxi/Shuttle

• Energy/Communications Utilities

•

Expanding Infrastructure Expanding Infrastructure

US IncentivesUS Incentives• Fuel Use Credit.

– 50 cents per gge goes to the seller of CNG/LNG when used as a transportation fuel

– Expired on 12/31/2011 (Extension possible)

• Infrastructure Credit– The lesser of $30,000 or 30 percent of the cost of a

fueling station – $1,000 for a home refueling unit– Expired on 12/31/2011 (Extension possible)

• Various State Incentives (continued)

Innovative State Legislative ProposalsInnovative State Legislative Proposals

• Offer tax credits on a competitive basis or first-come-basis

• Capping annual tax credits so as to limit budgetary impact

Innovative State Legislative ProposalsInnovative State Legislative Proposals

• Allowing tax credits to count against income taxes as well as other types of taxes

• Allowing tax credits to be transferred or sold

• Targeting credits to fueling stations located near corridors and/or requiring open access

US Legislative ProposalUS Legislative Proposal• New Alternative Transportation to Give Americans

Solutions (NAT GAS) Act of 2011 :– To accelerate use and growth of NGVs– Introduced in both the House and the Senate

• Key tax credit provisions would address:– Fuel use– Vehicle purchase price– Fueling infrastructure installation– Indian Tribes

(continued)

US Legislative ProposalUS Legislative Proposal

• Key provisions would address:– OEM Vehicle Production Incentives– NGV RD&D– Streamlining EPA conversion systems certification

Questions?Questions?

Contact Paul C. KerkhovenContact Paul C. Kerkhoven202.824.7363202.824.7363

pkerkhoven@ngvamerica.orgpkerkhoven@ngvamerica.org

www.ngvamerica.org www.ngvamerica.org