Tim Denny, Vice President – Administration at Chesapeake Energy, told the audience at Telogis Latitude about his company’s experience integrating natural gas vehicles (NGVs) into its fleet. The energy company plays a major role in managing wells that extract natural gas in North America, and is also playing a role in bringing the fueling infrastructure to the market.
In 2008, the company started bringing in compressed natural gas vehicles to its fleet. Chesapeake Energy has about 4,000 vehicles in its fleet and predicts that they’ll all be natural gas-powered by 2016. As for cost, the company has spent about $9,000 per vehicle for the conversion kit. With fuel savings of about $1.50 per gallon and lifecycle fuel savings of about $2,100, the company has found its pay-off time to be 38.9 months. This is based on running fleet vehicles over a four year, 120,000 mile analysis period.
Chesapeake Energy is working with General Electric by integrating GE’s “station in a box” product into its fueling network. It offers a self-contained design that’s faster to set up than traditional CNG stations.
Natural gas vehicles are very small in numbers compared to other parts of the world. According to Denny, there are 15 million NGVs in the world, with less than 1% on US roads. One problem in the US is the fueling infrastructure; there are only 600 natural gas public fueling stations versus about 120,000 gasoline stations. Many fleets are starting to adopt them, and appreciate that natural gas is costing the equivalent of $1.95 to $2.35 per gallon at the pump, and is comparing very competitively with gasoline and diesel.
OEMs bringing NGVs to market is helping the situation as well, Denny said. Ford, GM, Chrysler, and Honda have been supportive on the light-duty side and Volvo, Peterbilt Navistar Freightliner and Kenworth have been on the commercial side.