Pivotal LNG announced it will supply liquefied natural gas to fueling stations being built for UPS Freight's heavy-duty tractor fleet at its Nashville and Knoxville, Tenn., terminals.
Earlier this week UPS said it will buy 700 LNG Class 8 trucks to replace diesel tractors and build four refueling stations by the end of 2014 after operating 112 tractor-trailers between Ontario, Calif., Las Vegas, Phoenix and Salt Lake City for the past two years.
The other UPS LNG stations will be in Memphis, Tenn., and Dallas. UPS has its own LNG fueling station in Ontario.
Pivotal LNG is a subsidiary of AGL Resources, an Atlanta-based energy services holding company that also owns Caribbean container line Tropical Shipping. Under a 10-year contract, it will provide UPS with an average of 500,000 gallons of LNG per month for its fueling stations.
Many freight transportation companies, from railroads to shipping lines and motor carriers, are experimenting with adding LNG-powered conveyances to their fleets, while several have already begun to purchase them for regular operations.
Werner Enterprises, a major truckload carrier, is experimenting with LNG and compressed natural gas, Derek Leathers, the company's president and chief operating officer, told House lawmakers Wednesday during a hearing on developing a national freight transportation policy for the United States.
UPS officials say they will recoup the higher cost of the LNG vehicles and the $18 million for fueling infrastructure because LNG's price is much lower than that of diesel fuel. The Atlanta-based logistics integrator said its new fuel stations and public ones will enable it to add LNG trucks to routes from Dallas, Houston and San Antonio.
Clean Energy has begun building an initial network of 100 LNG fuel stations on key highways frequented by truckers, eventually growing its "Natural Gas Highway" to 150 stations. Meanwhile, Shell Oil is partnering with Travel Centers of America and Petro to install LNG pumps at up to 100 of their truck stops.
LNG is as much as $1.50 cheaper per gallon than diesel, thanks in part to the enormous supply of natural gas that energy companies are beginning to extract with advanced techniques from shale rock formations in the United States. It also burns much cleaner, creating fewer greenhouse gases and other emissions. But in addition to the higher cost of trucks and the lack of fueling infrastructure, motor carriers must deal with other LNG challenges such as new maintenance procedures, training, safety considerations, the extra weight of LNG tanks, and reduced driving range.
Read more about the trucking industry's growing interest in LNG in the feature story "What's in Your Tank?"
published in the February 2012 American Shipper
. - Eric Kulisch