Cummins propane engine project holds promise

The propane industry went big around the holidays and entered the new year by moving forward with a high-dollar engine project with extremely high expectations.

One week before Christmas, the Propane Education & Research Council (PERC) approved a $12 million funding request aimed to commercialize a Cummins 6.7-liter propane engine in 2024.

The project, with one of the highest dollar amounts ever considered by PERC, launches this year and will culminate in an engine described in the council docket as delivering “world class efficiency, diesel-like durability, excellent rating capability and low emissions.”

While the details and descriptions look great on paper, PERC and project leaders know the serious work now begins in a critical phase, and what happens in the coming years will determine the fate of a product that those involved say could change the industry.

Such an engine could give propane marketers another LPG-fueled bobtail option, supporting a stronger push for the industry to operate its delivery vehicles on its own fuel. Outside the propane industry, the engine targets “that medium-duty, on-road market that is a strategic priority for us,” says Cinch Munson, senior vice president of business development at PERC, noting beverage and package delivery vehicles, as well as school buses.

Off-road market opportunities, in material handling and agriculture, are also in the scope of the engine’s capabilities down the road.

Proven partner

Having a well-known engine manufacturer like Cummins on board is a boon for the project, say PERC leaders. The Indiana-based company has been involved since the first phase launched in 2016. PERC contributed more than $6 million to the initial phase in which Cummins built the engine and then demonstrated it last year in an AmeriGas bobtail.

“Phase 1 was really an R&D project,” says Munson, about a phase that affirmed Cummins’ commitment to the propane engine.

PERC says the next phase will involve all aspects of a successful propane-powered engine launch. This includes final optimization of the engine, performance testing and emissions certification. Another key part of this phase is identifying vehicle manufacturing partners – companies that would place the propane engine.

Talking it out

Before approving the newest phase of the project, PERC leaders and council members engaged in nearly an hourlong conversation.

They talked about the advantages of such a project, including having a strong partner and a product with excellent engine performance bringing about disruptive technology for the industry. They talked about having a partner that already knows this 6.7-liter platform and understands the importance of customer support to its brand.

Munson shared three sales and gallon projections over the first seven years, through 2030: pessimistic, realistic and optimistic. In the realistic projection, the engine generates 20,750 unit sales and about 1.25 billion gallons of propane. Optimistically, we’re talking 49,500 unit sales and nearly 3 billion gallons.

“For us to reach those optimistic projections, it will take a lot of continued investment work by PERC and the whole industry to make this engine successful,” he says. “We will not reach the optimistic level if we just watch Cummins launch an engine and hope it works.”

Munson adds, “What I see from Cummins and our industry, and what I know this engine can do, we have the potential to hit those optimistic numbers.”

But risks were also part of the conversation. They include the large investment on a project with a long-running time frame; gaining interest from OEMs not currently selling propane vehicles; and regulatory obstacles and electrification-movement impacts on the OEMs.

The contracting phase of the project became a point of discussion, too. Only after agreeing to adjustments here, to enable success in what councilor Stuart Weidie of Blossman Gas called “a very high risk and sophisticated project,” did the council give its final approval.

What a way to set 2021 in motion.