BUSRide spoke with George Kalet, CNG applications and key account manager for Atlas Copco, Gas and Process Group, to discuss the future of compressed natural gas (CNG) systems for buses and coaches. In this informative Q&A, Kalet assesses the current state of CNG fueling systems, as well as the perceptions, prices, trends and politics surrounding the market. Furthermore, he previews the technological advances expected to benefit operators in the near future.
What is your assessment of the state of CNG fuel and propulsion currently?
The markets have been down a bit for obvious reasons, particularly because of the low petroleum prices. Now that the elections are over and the country begins to settle in, we’ll give the new president-elect some time to unveil his policies. I think ultimately this will be good for the natural gas businesses, though we are certainly facing some challenges with a Republican majority in both houses of government.
By the same token, CNG fuel is definitely good for the country in terms of the environment, energy security and jobs.
What advances and developments in CNG propulsion can operators in the bus and coach markets expect?
We have seen a lot of new development, especially with heavy-duty buses and trucks, where the cost of the onboard fuel storage has gotten more competitive and the capacity of the fuel storage systems has increased dramatically. This alone helps move CNG-powered vehicles toward more transparency with the competing diesel powered vehicles.
Do you find it frustrating, given the benefits and the advantages of CNG, to run up against hurdles that seemingly have to do with perceptions, prices, market trends and politics?
It’s very frustrating. Especially at this time because, as an industry, we felt we had really turned a corner as oil prices stabilized; not necessarily at 5 dollars per gallon, but trending up, and the cost of natural gas was 40 to 50 percent less in many cases. It was great for getting operators to jump on board. Our industry as a whole felt like it was gaining some momentum and staying power, with economics working in our favor.
So the artificially low pricing for gasoline and diesel has presented a frustrating turn of events. I don’t think anyone every predicted or expected oil prices would be this low for this long.
What steps are you taking amidst the challenges to build your case for natural gas?
We are addressing them from the top down. We still face challenges with the infrastructure, which will drive a greater blanket adoption of natural gas vehicles. This will come from commercial vehicles and fleet customers. Private consumers will most likely be the last to jump on board.
It’s a fact of economic life: the adoption of something as large-scale as this depends on high volume users to facilitate the development of infrastructure. I believe this is going to continue.
Over-the-road vehicles, both buses and trucks, are starting to see real infrastructure development. For example, San Antonio’s VIA Metropolitan Transit just placed an order with Volvo’s Nova Bus for 425 new CNG buses. Atlas Copco is providing the fuel station infrastructure at the manufacturing facility for fueling the new buses for the drive from upstate New York to Texas. In the past, they would tow any CNG to the client, due to the lack of enough fueling infrastructure to drive across country.
These trips from Plattsburgh to San Antonio will be a strong testimony for the cause of natural gas.
Can you speak a little further to public transit?
We see a lot of activity with municipalities for both transit and city utility fleets moving toward natural gas, simply because of the inherent environmental benefits. At this time, it’s probably close to being a cost “wash” in terms of any fuel savings, but two years ago it was just the opposite. It was a very short payback of less than three years. That’s a kind of benchmark for making those kinds of capital investment decisions. It is also very encouraging to see who have already made the commitment to natural gas continuing to expand their CNG fleets and installing new fuel station infrastructure to fuel those vehicles.
Is it safe to say, with the cost being a wash against fossil fuels this time, you’ll be able to turn the focus to the benefits of CNG?
Absolutely. We definitely need to drive those points home a lot harder than if it were solely a financial no-brainer, which it has been in the past.