Is Natural Gas the Next Generation of Vehicle Fuel in America?
There's been a lot of talk about the potential of natural gas in the US lately. Coupled with the current prices of gas at the pump, the market is starting to signal needs for natural gas powered vehicles that will open up access to significantly cleaner burning, cheaper and domestically plentiful supplies of fuel, while reducing the country's reliance on imported, overpriced barrels of oil.
“We have a supply of natural gas that can last America nearly 100 years,” declared President Barack Obama in his State of the Union speech in January.
Companies like Clean Energy Fuels, General Electric and Chesapeake Energy are pumping millions of dollars into building natural gas highways in preparation of the next generation of vehicle fuel in the country. Of course, if a fueling highway is to be worth investing in, vehicle adoption will be the most important first step. Initially, natural gas fueling has focused on the trucking market, where companies' bottom lines are the greatest deciding factor. Lately, however, more automakers are starting to test the waters with their own lines of passenger cars, vans and trucks.
Unlike electric vehicles, cars with compressed natural gas (CNG) engines eliminate drivers' range anxiety. That especially goes for those who purchase GM's recently revealed bi-fuel pickup trucks built with both a CNG tank and gasoline tank. Combined, the new trucks have a range of well over 650 miles. Similar to GM's approach with the Chevy Volt, an electric powered car with a backup gasoline engine, the trucks address range anxiety issues by providing two systems within one vehicle. The primary system, either electric or a CNG engine, helps both the company and its customers test the technology before fully converting.
“We really feel that these trucks will be a barometer on what the true CNG market is like out there,” says Mike Jones, product manager, GM Fleet and Commercial. “The full sized trucks with bi-fuel capabilities are likely to have a widely used platform, so I think this product is going to tell us whether or not this market has legs and can be sustained.”
Although sales for the Volt were much lower than expected, the CNG-powered Chevrolet Silverado and GMC Sierra 2500 pickups are expected to have a lot more traction in today's market. Not only is the transition into more natural gas a politically and environmentally ideal move, but also relatively easy for owners with immediate and easy to identify cost savings.
Having the dual fuel system built in GM's new line of trucks will allow buyers to take advantage of cheaper natural gas prices without having to be completely reliant on the current stage of natural gas fueling infrastructure. Although there are pockets of decent infrastructure in states like California, Oklahoma, Utah and New York, there are currently less than 400 CNG fueling stations throughout the US. Country-wide adoption will still take some time. That's why automakers are taking the best possible approaches to prepare and invest appropriately as that infrastructure continues to grow.
“The biggest challenge we face is current infrastructure,” says Jones. “There is quite a bit of variation from state to state. Bi-fuel pickups offer flexibility to go beyond the range of a CNG station to where the next might be, alleviating that concern for the buyer.”
Last month, the company started taking orders and will begin production in the fourth quarter. At the same time, Dodge also revealed its line of heavy duty CNG-powered trucks. However, Jones says the CNG tanks in GM's new line only use about 25 percent of bed space compared to about 40 percent in the CNG-powered Dodge Rams. They also offer greater flexibility with an increased range.
Honda has been selling passenger cars since the late 1990s at 200 dealerships throughout 36 states. Ford currently offers CNG prep kits for about a half dozen vehicles, modifying those engines at its factories to operate on CNG. Once demand increases, Ford says it will be able to switch to factory-built lines of CNG vehicles.
With gas prices skyrocketing, these changes are happening at an ideal time—good news for the American economy and the environment.
Ofwat allows retailers to raise prices from April
Retailers can recover a portion of excess bad debt by temporarily increasing prices from April 2022, according to an Ofwat statement.
The regulator confirmed its view that levels of bad debt costs across the business retail market are exceeding 2% of non-household revenue, thereby allowing "a temporary increase" in the maximum prices. Adjustments to price caps will apply for a minimum of two years to reduce the step changes in price that customers might experience.
Measures introduced since March 2020 to contain the spread of Covid-19 could lead to retailers facing higher levels of customer bad debt. Retailers’ abilities to respond to this are expected to be constrained by Ofwat strengthening protections for non-household customers during Covid-19 and the presence of price caps.
In April last year, Ofwat committed to provide additional regulatory protection if bad debt costs across the market exceeded 2% of non-household revenue.
Georgina Mills, Business Retail Market Director at Ofwat said: “These decisions aim to protect the interests of non-household customers in the short and longer term, including from the risk of systemic Retailer failure as the business retail market continues to feel the impacts of COVID-19. By implementing market-wide adjustments to price caps, we aim to minimise any additional costs for customers in the shorter term by promoting efficiency and supporting competition.”
There are also three areas where Ofwat has not reached definitive conclusions and is seeking further evidence and views from stakeholders:
- Pooling excess bad debt costs – Ofwat proposes that the recovery of excess bad debt costs is pooled across all non-household customers, via a uniform uplift to price caps.
- Keeping open the option of not pursuing a true up – For example if outturn bad debt costs are not materially higher than the 2% threshold.
- Undertaking the true up – If a 'true up' is required, Ofwat has set out how it expects this to work in practice.
Further consultation on the proposed adjustments to REC price caps can be expected by December.
"While it’s great that regulators are helping the industry deal with bad debt in the wake of the pandemic, raising prices only treats the symptoms. Instead, water companies should head upstream, using customer data to identify and rectify the causes of bad debt, stop it at source and help prevent it from occurring in the first place," she said.
"While recouping costs is a must, water companies shouldn’t just rely on the regulator. Data can help companies segment customers, identify and assist customers that are struggling financially, avoiding penalising the entire customer in tackling the cause of the issue."
United Utilities picks up pipeline award
A race-against-time plumbing job to connect four huge water pipes into the large Haweswater Aqueduct in Cumbria saw United Utilities awarded Utility Project of the Year by Pipeline Industries Guild.
The Hallbank project, near Kendal, was completed within a tight eight-day deadline, in a storm and during the second COVID lockdown last November – and with three hours to spare. Principal construction manager John Dawson said the project helped boost the resilience of water supplies across the North West.
“I think what made us stand out was the scale, the use of future technology and the fact that we were really just one team, working collaboratively for a common goal," he said.
Camus Energy secures $16m funding
Camus Energy, which provides advanced grid management technology, has secured $16 million in a Series A round, led by Park West Asset Management and joined by Congruent Ventures, Wave Capital and other investors, including an investor-owned utility. Camus will leverage the operating capital to expand its grid management software platform to meet growing demand from utilities across North America.
As local utilities look to save money and increase their use of clean energy by tapping into low-cost and low-carbon local resources, Camus' grid management platform provides connectivity between the utility's operations team, its grid-connected equipment and customer devices.