Optimism remains about the future of propane autogas

November 3, 2022 By    

The path for propane autogas has taken industry stakeholders on a roller-coaster ride over the past couple of years.

Autogas already offers vehicle fleets the lowest total cost of ownership, according to the Propane Education & Research Council (PERC), but record-high gasoline and diesel prices earlier this year continued to make the financial case for fleets seeking an abundant, low-cost, low-carbon fuel.

“When the price spreads get this wide, you should have fleets coming to you,” Tucker Perkins, the president and CEO of PERC, told an educational session audience at the Northeast Propane Show in August.

As California goes …

That same month, the California Air Resources Board approved regulations that would phase out internal combustion engine cars and light-duty trucks by 2035, mandating the sale of new zero-emission vehicles and giving rise to plug-in hybrid, battery-electric and hydrogen fuel cell vehicles.

For a state that has proposed bans on internal combustion engine forklifts and gas appliances, moving away from internal combustion engine vehicles would seem cause for more concern, especially when a host of other states could follow the Golden State’s lead.

Perkins isn’t ready to hit the panic button. The California mandate covers only passenger vehicles and not the medium- and heavy-duty fleet sweet spot – autogas’s target market.

“The concern is always this mindset that starts in California and seems to go broader – forget the [lack of] technology, the cost, the inability to charge,” Perkins says. “People are saying this is what we have to do, and they overlook all of these hurdles.”

The challenges of a full-scale rollout of EVs lead Perkins to say, “I’m not afraid to position propane against electric,” noting the cost, payload, range and reliability advantages of autogas.

He remains encouraged that the business needs of fleet customers today can be met with autogas – even without bringing renewable propane and DME into the conversation.

Factors at the federal level

Federal infrastructure and inflation legislation that passed late last year and earlier this year, respectively, offers more ups and downs.

The infrastructure law opened funding for propane in school bus and other fleet applications. The inflation legislation extended the alternative fuel tax credit for three years.

Though the extension continues to incentivize the use of autogas vehicles, the credit is unknown beyond 2024. The National Propane Gas Association believes Congress may favor a clean fuel reduction credit that wouldn’t offer the same benefits for traditional propane.

Moreover, any celebration by the industry about activity at the federal level was clouded by the government’s emphasis on electrification projects.

How to grow

Perkins foresees the industry growing the autogas market by displacing dirty diesel, which is under attack and facing strict, expensive emissions mandates in the coming years. New propane engine technology under development at Cummins looks to help the industry do just that – serving both on- and off-road applications, including the use in propane-fueled bobtails.

In the meantime, autogas success stories abound and are available to counter the heavy-handed side of the electrification movement. 

Among the successes are school buses, paratransit shuttles and mail delivery contractors, with the latter two gaining more attention in recent years.

The Americans with Disabilities Act requires every county in the U.S. to provide paratransit service, says PERC, which offers a webpage about these fleets at propane.com/paratransit.

The U.S. Postal Service moves mail via tens of thousands of routes, often with independent contractors, across the country. These contractors exist in your state.

The fleets are there for the taking. The industry has the technology, the solutions providers (among them, Alliance AutoGas, Campbell-Parnell, Icom North America and Roush CleanTech) and plenty of propane.

Fleets have a reason to choose autogas. Give them that option.

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About the Author:

Brian Richesson is the editor in chief of LP Gas Magazine. Contact him at brichesson@northcoastmedia.net or 216-706-3748.

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