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CNG continues years-long push into trash collection market

Source: Waste & Recycling News.com

Trash haulers continue on what one observer calls a remarkable journey toward the increased adoption of natural-gas-powered collection vehicles.

Joanna D. Underwood, as president of Energy Visionin New York City, has kept an eye on the transportation sector’s use of alternative fuels for years. Her non-profit group promotes a shift away from petroleum-based fuel and has a particularly keen interest in the garbage business.

“We have a real shift taking place now that it has become clear that this fuel is the cleanest commercially available for these large fleets, period, that it’s reducing greenhouse gases, that the technology of using natural gas is sophisticated,” Underwood said.

“The trucks are high-performance trucks, the drivers are less exposed to diesel fuels. It’s a remarkable shift that’s taking place after a century of relying only on petroleum-based fuels,” she said.

The nation’s two largest solid waste management companies, Waste Management Inc. and Republic Services Inc., have been helping to push for increased adoption of natural gas-powered vehicles in the industry in recent years.

But the technology is no longer the purview of just the largest players with the largest fleets.

“Now it’s the next tier and municipalities that are really starting to add to that,” said Patrick S. Carroll, president of Environmental Solutions Group, an operation owned by Dover Corp. that includes garbage truck maker Heil Environmental.

Heil now sees about 35% to 40% of its production going to CNG vehicles and the number is growing by about 10% each year, Carroll said.

“In three years, it will be over 50%,” he said, and “continue to grow.”

Those owning larger fleets have an advantage over smaller fleets because they can concentrate operation of CNG trucks in particular areas and move existing traditional diesel-powered vehicles into other markets they serve.

Those with smaller fleets in a limited geographic area of just a county or two or three don’t have that flexibility, he said. Those with smaller fleets also are maybe buying only a few new trucks each year, so transitioning from a diesel fleet to a CNG fleet is more difficult.

“The flexibility is that the larger fleets, they can take these (diesel) trucks and move them,” the company president said. “A municipality, a private hauler doesn’t have that flexibility.”

But what they do have is an ever-growing number of third-party fueling stations that they will be able to use with growing frequency in years to come.

Clean Energy Fuels Corp. might be the most widely known name in the natural gas fueling business, thanks in part to the fame of billionaire founder T. Boone Pickens.

But there certainly are plenty of players jumping into that business, Underwood said.

“You have major initiatives under way to build infrastructure across the country,” she said.

Ron Pecora, spokesman for Waste Pro USA Inc., agreed that people see CNG fueling as a business opportunity.

“There’s a cottage industry that’s been created in the construction of CNG fueling facilities,” he said. “There are a lot of people in that game. It’s just part of the marketplace. People see opportunity.”

The Longwood, Fla.-based solid waste management company has almost 100 CNG trucks in operation these days with plans to add more.

Underwood, the Energy Vision leader, sees this as both an economic and a climate change story as companies are moving forward with the adoption of natural gas as a transportation fuel.

CNG burns cleaner and is less expensive than diesel fuel, allowing truck buyers to recoup the added cost of natural gas-powered vehicles.

Waste Pro had revenue of $420 million last year and has steadily grown. The company has spent about $50 million of $100 million specifically set aside for adoption of CNG, Pecora said.

The bulk of Waste Pro’s CNG vehicles, about 80 of them, are located at its Fort Pierce, Fla., operations. In total, Waste Pro has about 1,500 heavy-duty trucks.

Waste Pro derives a large portion of its revenue through contracts with municipalities and counties, and those entities are increasingly interested in having their trash and recyclables collected with cleaner-burning CNG vehicles, Pecora said.

“It’s going to be what the market demands,” Pecora said about the level of his company’s continued adoption of the technology. He estimated the number of CNG trucks will grow to a couple of hundred in the next few years. “In five years, I don’t know, but I would say it will continue at that pace.”

“We expect to have a great part of our fleet – and I don’t know how much – operating on CNG,” he said.

Underwood’s group is getting ready to release a new report on the adoption of CNG vehicles in the New York City, Long Island and New Jersey areas.

“There is skyrocketing use of natural gas refuse trucks,” she said. “The number of natural gas refuse trucks has gone up about 11 times since the beginning of 2007. That’s a lot.”