Navistar Inc. and natural gas provider Clean Energy Fuels Corp. on Wednesday, Feb. 1, announced a plan to develop gas-powered medium-duty and heavy-duty trucks and a nationwide infrastructure to fuel them.
The plan includes financial incentives to enable customers to see a quick return on a premium of about $35,000 for the new technology. That’s largely due to a natural gas costing $1.50 a gallon less than diesel.
“By the end of 2013, virtually every product we have will be available in natural gas,” said Jim Hebe, Navistar senior vice president for North American sales.
The Navistar-Clean Energy plan differs from other alternative fuel initiatives because natural gas in this scenario does not depend on government subsidies, said Daniel Ustian, Navistar chairman, president and chief executive officer, during a press conference in Chicago. “It can stand on its own and stand very tall,” Ustian said.
Clean Energy will invest $200 million to build liquid natural gas fueling facilities, said Andrew Littlefair, Clean Energy president and CEO. The company announced last month that is expects to have 70 stations open by the end of 2012 in 33 states, many of them at Pilot-Flying J Travel Centers.
The earliest openings will cover major highway segments linking San Diego, Los Angeles, Riverside and Las Vegas; the Texas triangle (Houston, San Antonio, Dallas/Ft. Worth); Los Angeles and Dallas; Houston and Chicago; and Chicago and Atlanta. Other facilities will cover major highways in Illinois, Indiana, Ohio, Missouri, Kentucky, Tennessee, Kansas, Oklahoma and Alabama. Opening of the first 150 stations through 2013 is planned to coincide with the introduction of Navistar’s new gas engines.
Swift Transportation has been testing some of them, said Jerry Moyes, founder and CEO. “We like what we see,” Moyes said. “There is a savings to it.”
The initiative should go a long way toward ending the United States’ dependence on OPEC oil, said T. Boone Pickens, a 30 percent shareholder of Clean Energy. “The cheapest fuel in the world is in the United States,” he said. “This opportunity cannot go unused.”
Officials said the partnership will help accelerate the adoption of natural gas technologies by including incentives to neutralize the cost difference for the diesel fuel equivalent for those who purchase at least 1,000 diesel gallon equivalents of natural gas each month. At today’s prices, gas is $1.50 a gallon cheaper than diesel. Clean Energy will guarantee fuel prices for five years at a significant reduction from diesel.
Navistar will continue to offer DuraStar and WorkStar vocational trucks with its natural gas-powered MaxxForce DT developed in conjunction with Emissions Solutions Inc.
For the regional haul and Class 7 and Class 8 vocational market, Navistar will offer the Cummins-Westport ISL-G in the International TranStar and WorkStar. Additionally, Navistar will enter into a phase II developmental agreement with Clean Air Power on the ProStar, WorkStar and PayStar vocational trucks, powered by a diesel pilot injection LNG MaxxForce 13-liter engine.
“One of the major obstacles in customer transition to natural gas has been the lack of a gas-powered range of engines designed to meet the multiple requirements without compromise,” said Hebe. “When the MaxxForce 13L is introduced in mid-2013, customers will have a capable range of natural gas engines and trucks, from 7.6 liter to 13 liter, with horsepower ranging from 200 to 450.”