Natural gas should be fuel of the future

With all the attention — and hype — on electric vehicles and biofuels, we are in danger of missing out on other technologies where Canada has much greater expertise and commercial opportunity and which can significantly reduce greenhouse gas emissions in transportation, and at lower cost than electric batteries or biofuels.

With all the attention — and hype — on electric vehicles and biofuels, we are in danger of missing out on other technologies where Canada has much greater expertise and commercial opportunity and which can significantly reduce greenhouse gas emissions in transportation, and at lower cost than electric batteries or biofuels.

This technology uses liquid or compressed natural gas instead of gasoline or diesel fuel for motor vehicles. Given that the world may be literally awash in natural gas so that future prices will be much lower than oil, it makes sense to pursue this option, as well as electric vehicles.

We can also generate biogas from water treatment plants in our cities to fuel bus fleets.

Given a growing economy, vehicle energy use in Canada is projected to increase by 31 per cent between 2004 and 2020, according to Natural Resources Canada, meeting the country’s even minimal emission reduction targets of 17 per cent by 2020 cannot be achieved without major cuts in the transportation sector.

Research shows that the place to start is with trucking and bus fleets. According to the Canadian Gas Association, heavy diesel trucks account for just four per cent of motor vehicles in Canada but they emit 30 per cent of transportation-related greenhouse gas emissions. Natural gas is still a hydrocarbon, and a source of greenhouse gases. But it is much less polluting than oil, so converting a large part of the heavy-duty truck fleet, not to mention urban buses, to natural gas could play a key role in reducing Canada’s greenhouse gas emissions.

In the United States, John Rowe, chairman of energy giant Exelon Corp., has calculated that replacing 3.5 million heavy-duty vehicles with natural gas vehicles would save more than 1.2 million barrels of oil per day and reduce oil imports by about US$43 billion, in addition to greenhouse gas reductions. Moreover, the U.S. could become self-sufficient in natural gas.

Natural gas has been around as a fuel for vehicles for in the 1980 and into the 1990s, but incentives declined over time. But because Canada once offered incentives for natural gas vehicles (especially urban buses), a technology base exists, with a number of Canadian companies possessing expertise in the development and application of technology.

Westport Innovations, based in Vancouver, is Canada’s leading company in developing technologies for natural gas engines, notably for heavy-duty trucks and buses, and has close relations with many of the world’s leading truck manufacturers and fleet operators. It operates a joint venture with Cummins Inc., a major U.S. engine manufacturer, Cummins Westport Inc., and joint ventures with Chinese and Hong Kong companies.

Westport was recently awarded $2.3 million in funding from Sustainable Development Technology Canada to advance its capacities in high-horsepower engines. And the University of British Columbia was recently awarded $499,824 in funding over five years from the Automotive Partnership Canada fund to support technology development in natural gas engines, working with Westport Innovations.

A recent Roundtable report on natural gas use in transportation — Natural Gas Use in the Canadian Transportation Sector — makes a strong case for a concerted effort by Canada to become a leader in the use of natural gas as a fuel, starting with truck fleets and urban bus systems, with potential future use in automobiles.

This will mean some incentives for early adoption of the technology and provision of fuelling systems, providing much better information on the use of natural gas to fleet operators, updating standards codes to ensuring safe use, and investing much more in research and development for future competitiveness.

While the U.S. is increasing funding support for natural gas vehicle research and development, public support in Canada “remains minimal,” according to the Roundtable report. “Canadian companies are world leading producers of natural gas vehicle technology because of past R&D investments.”

The fact that the U.S. and other countries are stepping up their R&D investments while Canada sits still — an all-too-familiar Canadian story — means Canadian companies will be tempted to relocate activities in other countries to gain access to their R&D programs.

This is why it is critical that Canada make some big decisions on the future role of natural gas vehicles and infrastructure systems. We did not build on our early strengths in hydrogen fuel cells so our potential is weaker than it should have been. It would be a great loss to Canada’s future prosperity if we failed to reinvigorate our strengths in natural gas vehicles and infrastructure as well.

Economist David Crane is a syndicated Toronto Star columnist. He can be reached at crane@interlog.com.

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