Posted on 05/16/2008 7:57:42 AM PDT by shove_it
You know somethings afoot (or in this case, ready to rev) when a Texas oil tycoon like T. Boone Pickens calls one of his companies Clean Energy (CLNE). That is, when hes not trying to corner the market on water or harness the strong winds in the Texas panhandle.
Pickens has become a true believer in natural gas as a fuel for transport. He controls a majority of shares of Clean Energy, which provides CNG (compressed natural gas) and LNG (liquefied natural gas) for use in refuse, transit, ports, shuttle, taxi, trucking, airport and municipal fleet markets. He even has a fuel terminal named after him.
There are plenty of reasons, from high diesel prices to global warming, to look to natural gas as an alternative fuel in certain niches, and some cities and companies are remaking their truck and bus fleets to run on natural gas. Some 20% of new transit buses on order will have natural-gas-powered engines.
Waste Management (WMI) operates a fleet of nearly 500 gas-powered trash trucks, and UPS (UPS) just announced a new order for 300 new CNG vehicles. Pickens CLNE fuel will fill the tanks of many of these vehicles. Pickens is also invested heavily in Westport Innovations (WPIVF.PK), a Vancouver company that makes proprietary solutions allowing engines to operate on clean-burning fuels such as CLNEs compressed natural gas [CNG] and liquefied natural gas [LNG], as well as hydrogen and biofuels such as landfill gas.
Westports flagship product is its high-pressure direct-injection technology, or HPDI, which turns natural gas into a viable fuel for heavy-duty engines. Like gasoline, natural gas needs an ignition source to burn, while diesel engines rely on the heat and pressure derived from the upstroke of the piston. Westport has managed to combine these two technologies with its innovative HPDI.
Pickens interest in Westport is shared by Cummins (CMI), another unlikely but increasingly convincing addition to the clean energy crowd. Cummins-Westport is a joint venture, using Westports modifications to tweak Cummins engines into clean machines. The tweaking allows Cummins diesel engines to operate on natural gas, without the usual nasty particulates spewn out by a typical diesel engine. (Weve all been in the smelly wake of a typical diesel.) The Cummins-Westport system works by compressing a small amount of diesel fuel, then, at the point of ignition, injecting natural gas directly into the cylinder, at high pressure. The result is plenty of power sans pollutants.
Westport-Cummins is collaborating with Sterling, Daimlers (DAI) U.S. division, which just announced the launch of its first natural gas-powered vehicle, the Sterling Set-Back 113, featuring the Cummins-Westport ISL G engine. The company is also working with Peterbilt in a number of projects, including a natural gas version of Peterbilts Model 386 for Wal-Mart (WMT). The trucks, which will meet 2008 EPA and CARB emission levels, will be eligible for federal tax credits as well as state-specific emission credits.
Tweaked trucks might seem to be a limited niche, but demand for the Cummins-Westport engine has been fueled by such clean-energy initiatives as Californias Clean Air Action Plan [CAAP], which focuses on alternative fuel use to reduce the heavy truck-created pollution around its ports. The CAAP seeks to reduce diesel fuel pollutants from port sources by nearly 50 percent in five years and anticipates the replacement of more than 16,000 old diesel trucks with new LNG trucks as well as new or converted diesel trucks that meet standards for reduced particulate emissions.
In March, Southern Counties Express [SCE] placed an initial order for 50 Kenworth LNG T800 Class trucks, representing a value of $4 million to go to Westport. The trucks, to become part of SCEs GreenFleet, were purchased with financial support from the San Pedro Bay Ports Clean Trucks Program, led by the Port of Los Angeles, the Port of Long Beach and the South Coast Air Quality Management District. All this makes for a nice three-way play on clean energy, with Cummins in the drivers seat.
Cummins, which you could have gotten at the bargain-basement price of $50 a share just a month ago, has already surpassed the price target set by some analysts. But its recent earnings report and an upbeat statement by its CEO indicate considerable upside, at least in the long term.
Cummins showed strength across all its business segments, both in the U.S. and international market, including China and India, and it increased its market share substantially for its medium-duty and heavy-duty truck engines. (Note: Westports price jumped initially with the announcement of the CAAP initiative, but has settled in the mid 3.50 range.)
One drawback is that its trading volume in the U.S. is light (its traded over-the-counter, with stock ticker WPIVF.PK in the U.S., WPT on the TSE). Clean Energy meanwhile continues to add to its garbage-truck fueling business, with the cities of Brookhaven, New York, and Fresno added to its list of customers. It will also be fueling taxis near the Golden Gate Bridge, as part of San Franciscos Green Taxi program.
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That is, 16,000 small business owners will be put out of business, or have to mortgage their house to buy a new $100,000-plus truck that will get worse fuel mileage than the truck it replaces.
Converting conventional engines to burn natural gas is the next dot com mini-boom.
The problem with Natural Gas is that there’s only enough of it because we don’t use it to drive out cars.
If any significant number of people switch to NG cars, the price will double and the supply will plummet.
In fact, there are a lot of oil people who are saying that the real shortage even now isn’t oil, but natural gas.
Also, natural gas is the perfect energy source for heating people’s houses, and for emergency/peak power generation. So why waste it on driving cars around.
Electric motors are GREAT at moving things, we should be focusing on solving the problem of electric cars. That way, we can charge them with whatever initial energy source is most available.
BTW, interesting side note: One of the power plants here in Virginia can actually burn WOOD to generate electricity.
That's true using current technology but there's also 5 quadrillion cubic meters of methane ice on the ocean floor. This came from the microbial reduction of CO2. Possibly genetically engineered microbes could create more natural gas by eating un-extractable coal and oil deposits.
We have huge amounts of NG in the Rocky Mtn. region of the US. Absolutely huge.
Trouble is, quite of a bunch of it was locked away by the Clinton-era “roadless forests” initiative.
But there are other sources of NG - Right now, there is a huge boom in Wyoming where drillers are extracting methane from coal beds - just drill down into a sloppy formation of lignite and pipe off the gas.
Domestic heating is one of the areas where we could see the greatest returns by conservation (eg, better insulation in doors and windows, then in walls, etc) and by use of things as simple as passive solar heating systems and better design of houses. Using NG for heating homes is a solution only for the pure decadence and sloth of the American public.
Absent that, we could be using lots of other things for the heating plant on housing other than natural gas - starting with burning wood, for example. Everyone decries how fat Americans are.
Well, if Joe and Jane had to go out and split a few cords of wood every year, they’d get skinny in a hurry. Sure kept me skinny as a kid. Wood is CO2 neutral, so the greenies have no issues there.
The biggest problem with electric cars is the battery technology. Even as we’ve made rapid and large strides in motors, control systems, etc in electric motivation, the battery technology is lagging far behind. When you solve that problem, you just expose the lack of transmission capacity in the grid, followed by a lack of generation capacity. The amount of investment necessary to upgrade the grid to allow even 10% of the driving public to use rechargeable cars is staggering. The amount of investment required to allow 50% of the cars on the road to be replaced with rechargeable electrics requires an amount of money not extant in the US markets right now, absent huge government subsidies and direct payments.
If we really wanted to leap forward in a practical way with hybrid technology, we’d be using diesel engine to drive a hybrid, not a gas engine. 100+ MPG is entirely feasible.
Here’s a vid of the CNBC interview ~ suffer thru a preliminary ad:
http://cosmos.bcst.yahoo.com/up/player/popup/?rn=289004&cl=7845893&src=finance&ch=4043681
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