Official EV focus ignores value of CNG vehicles

Of course when the Obama Administration put up $5 billion to promote alternative EV technology, the price of natural gas had not yet dropped to roughly half that of gasoline today.

The numbers come from a post by Chicago Tribune reporter Julie Wernau, who implies the value of CNG is being drowned out by the buzz around electric vehicles. Instead it seems the EV is being undermined by the relative low cost of petrol and natural gas.

The numbers are also projections of the number of electric and natural gas vehicles will be on US roads by the Smart Transportation studies conducted by Pike Research.

"Hindsight is always 20-20," the report quotes Christopher Knittel, the William Barton Rogers Professor of Energy Economics at the Massachusetts Institute of Technology Sloan School of Management as stating. "The drop in natural gas prices brings up an interesting issue, which is which technology do we want to put our money behind?"

Both technologies suffer from the need for a delivery infrastructure, but like EVs, CNG vehicles can be fueled at home where natural gas is used with just a relatively inexpensive fueling line mounted in the garage.

The advantage of CNG is the relatively low cost of a car variant that uses it. The disadvantage is the relatively high cost of building a network of fueling stations to support it.

"Natural gas vehicles just don't have the cost challenges that electric vehicles do. You don't need that same level of incentive," The Chicago Tribute quoted Dave Hurst, a senior research analyst at Pike Research, as stating. The firm specifically studies electric and natural gas vehicle markets. "I think the more interesting question is, why aren't there more incentives on the infrastructure side for natural gas?"

Even so, at this stage of the game, installation of charging stations is far outpacing the creation of CNG fueling stations. So the electric has the lead in that department, if only the cars weren’t so expensive.

Of course, DIY electric conversion kits are soon to be available, throwing the choice of electric vehicles wide open, as the costs head back down to earth.

Existing combustion engine cars can be converted to CNG as well, but the process is pretty intense for the do-it-yourself minded.

"In some ways it's pretty similar to the challenges we're seeing on the electric vehicle front," Hurst added. "Should infrastructure lead the vehicles, or should vehicles lead the infrastructure?"

So far, Honda is the only manufacturer with a factory produced CNG passenger vehicle; the Honda Civic NG is $5,650 more than the gas-powered Civic EX. Notably they are now in showrooms and available in all 50 states.

While the Federal tax credit does not currently apply to CNG vehicles, certain states provide their own incentives. Illinois offers buyers a $4,000 tax credit on the purchase of a CNG vehicle, virtually wiping out the extra cost of the natural gas model.

Part of the difference is proponents of CNG vehicles have focused more on fleet vehicles and EVs are better suited to daily commuter and passenger vehicles.

"Electric vehicles are more well-suited to the consumer market," Hurst concluded. "But when you start getting into these medium-duty and heavy-duty trucks, electric is never going to be a great solution for those. Such vehicles use a tremendous amount of fuel and (gain) just a couple of miles per gallon."

The final part of the equation is that the money saved on producing CNG vehicles, is spent building natural gas filling stations. The massive reinforced storage tanks they require, along with expensive compressors, cost from $0.5 to $1.5 million. A traditional gas station is only about $200,000 to $400,000 while the most exorbitant charging station is only $50,000.

Last February, Obama proposed extending the tax credit to $10,000 and opening it up to alternative technologies like CNG and fuel-cell vehicles.

So it doesn’t matter what you drive, there’s a lot of money wrapped up in building and fueling it. What it all comes down to is this – who gets all of this money and how are we going to spend it?

That, TN readers, is the chink in the drive train.