Do alternative fuel vehicles make sense for your fleet?

A Fleet of Alternative Fuel Vehicles

By Dan Deary, posted in Phoenix truck painting on September 19, 2013

The group of products known as “alternative fuels” presents an interesting set of options for the American business owner.

Companies large and small are converting to alternative fuel vehicles. Shipping company UPS moves 16 million packages around the world each day using alternative fuel vehicles in its fleet, which includes more than 2,700 vehicles. The company operates vehicles that run a diverse spectrum of alternative fuels, including:

The UPS alternative fuel fleet is composed of vehicles made in countries all over the world, including the US, Germany, Hong Kong, South Korea and Brazil, pushing the envelope where alternative fuels and technology meet.

So how does this mini UPS case study apply to you? Their stated criteria may sound familiar to many business owners and can serve as a basic guideline when considering converting to alternative fuel vehicles:

1. Must be economically viable in initial purchase price and maintenance
2. Must have a reliable fuel infrastructure
3. Supply of vehicles and parts must be predictable
4. Measureable improvement in emissions, fuel savings and environmental benefit
5. Has to be safe: to drive, to operate, and to maintain

In order to understand alternative fuel vehicles, it helps to have a basic grasp of what are known as “alternative fuels.” Here’s a quick primer:

• Ethanol is made in the United States from corn, and when used, emits less greenhouse gas emissions than conventional fuels. It is widely available commercially.
• Biodiesel is made from vegetable oils and animal fats and actually produces less air pollutants than normal diesel.
• Natural Gas is a fossil fuel that burns cleaner than gasoline and is plentiful in the United States.
• Propane is also called liquefied petroleum gas (LPG), is domestically abundant and generates fewer air pollutants and greenhouse gases than gasoline.
• H2 can be produced domestically from coal, nuclear or hydropower. Fuel cell vehicles driven by pure hydrogen create zero harmful air pollutants.

Choosing the right alternative fuel vehicles for your fleet may depend on factors related to available fuel supply and the types of alternative fuel vehicles most viable for your geographic location. For example, propane is a popular choice for fleet vehicles in the Southwest because it is readily available thanks to multiple supplier locations, and propane can be simply stored as a liquid.

One Georgia small business owner chose clean propane autogas for a fleet of 20 vehicles. They company converted a portion of its existing fleet to propane fuel to reduce fuel costs and cut greenhouse emissions. The company is already saving money on fuel since it began in April of 2013.

One can see why it might make sense to switch to alternative-fuel vehicles on a price basis alone. A comparable “gallon” of natural gas runs only $1.63 compared to gasoline prices typically topping $3.50 per gallon.

Conversion costs aren’t cheap, admittedly. A typical conversion from gasoline to natural gas runs $12,000 to $15,000 for a heavy pickup truck. Amortized over a three-year period, those costs come out to at least $333 per month.

Using the most pedestrian example, a twice-weekly gasoline fill-up at $3.50 per gallon for a 16-gallon heavy pickup truck runs $112, or $448 per month. Comparably, the natural gas fill-up per week would be $52.16 or $208.64 per month. That’s a potential savings of $276.48 per month.

Given that the typical fleet vehicle is used to drive between 18,000 and 30,000 miles per year, with vehicles that get anywhere from 3 mpg to 15 mpg, costs will vary among fleets using very large vehicles and those that are able to afford fuel-saving hybrids or other vehicles that use less gas.

The U.S. government is invested in providing tax and other incentives to companies that convert to alternative fuel vehicles. Technology has been known to create jobs, after all, and alternative fuels are a direct way to help promote America’s energy independence. That’s a practical brand of patriotism, and some of America’s best companies have signed on through the National Clean Fleets Partnership to replace gas and diesel-powered vehicles with those that use natural energy.

About the author:
Robert J. Hall is president of Track Your Truck, a leader in GPS vehicle tracking systems and software for small and midsized companies.