Natural Gas - Affordable, Abundant and American: Making the care for natural gas in the transportation sector
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Due to the recent Gulf oil spill, a collective conscious has begun to ponder the question: When will we stop using oil as a base for transportation fuel, and what will replace it? While it is unlikely that conventional, petroleum-based fuels will be completely replaced in the next decade; it is possible that the ever increasing demand for energy in the transportation sector could be met by a variety of fuels and technologies. The most likely options include biodiesel, ethanol, compressed natural gas (CNG) and electrification. One of the primary reasons for pursuing alternative fueled vehicles is to decrease emissions of environmentally harmful pollutants into the atmosphere. As legislation like the renewable-fuels standards and low-carbon fuel standards intensify, a niche market for alternative fuels is beginning to emerge. The importance of reducing energy demand and carbon intensities of fuels is going to greatly impact the type of vehicles and choices of fuels expected to be manufactured in the future automobile industry. Natural gas, as an alternative, is very attractive due to its low price and low carbon intensities. Per unit of energy, natural gas contains less carbon than any other fossil fuel, and thus produces lower carbon dioxide (CO2) emissions per vehicle mile traveled. While there is a current lack of infrastructure that has greatly limited natural gas use to captive public fleets, commercial industries are beginning to invest in alternative fuel vehicles. Making America less dependent on foreign oil is a national priority. President Obama, in accepting his party’s nomination, established his own clear goals: “For the sake of our economy, our security and the future of our planet, I will set a clear goal as president: in 10 years, we will finally end our dependence on oil from the Middle East.” While the United States imports more than 60 percent of the oil it uses, 98 percent of the natural gas used in the U.S. was produced in North America. Every gallon equivalent of natural gas used in vehicles is one less gallon of petroleum that has to be imported. (Federal NGV Tax Incentives, 2010) Despite the recent growth in interest of natural gas, there is still significant obstacles natural gas vehicles face in order to capture a major share of the market. Concerns amount around economics-whether the equivalent gasoline or diesel vehicle is cheaper, as well as concerns about safety and availability of refueling stations. This paper investigates evidence around all of these concerns as well as identifies markets where natural gas vehicles would be the most efficient.