Economic Benefits of Natural Gas

The economic benefits of natural gas are compelling to consumers, fleet owners and governments alike.

To start, the cost of natural gas is about 50% less than petrol and also approximately 30% less than diesel fuel. This computes to major long-term savings: According to a 2013 analysis performed by the European Gas Forum, increased use of natural gas in transportation could bring about €60 billion to €70 billion in savings by 2030.

Recognizing this, governments around the world are providing incentives to purchase natural gas vehicles (NGVs) and to build natural gas refueling stations. For example:

  • In January 2013, the European Commission allocated approximately €116.5 million in funding as part of the second Marco POLO program to incentivize companies to use more environmentally sound ways of shipping, including rail and marine vessels that use natural gas.
  • That same year, Swedish policymakers renewed a law that reduces the tax rate for purchasing new clean cars by 40%, thereby decreasing the cost of NGVs to the same general range as those of traditionally fueled vehicles and indirectly stimulating the development of natural gas fueling stations.
  • In Germany, the government plans to maintain reduced tax rates for NGVs through 2018 as part of a strategy to put 1.4 million natural gas cars and 550,000 commercial vehicles running on natural gas on the road by 2020.
  • In the United States, policymakers created an income tax credit equal to 30% of the cost of natural gas refueling equipment of up to $30,000 in the case of large stations and $1,000 for home refueling appliances.

Even though the initial purchase price of vehicles running on natural gas is higher than those fueled by petrol or diesel, the cost savings provided over the lifespan of natural gas-powered vehicles easily repay the initial investment in just a fraction of the vehicles’ lifetime. This is because:

  • Vehicles running on natural gas have substantially lower operating and maintenance costs because natural gas burns cleanly, causing less engine deterioration than petroleum-based fuels, which in turn generate significant savings over the life cycle of a vehicle.
  • Natural gas-powered vehicles consume less fuel per kilometer, making them more fuel efficient than other forms of transportation.
  • A tank of natural gas costs nearly a third less than a tank of a traditional vehicle fuel.
  • Many countries provide tax breaks for using environmentally friendly forms of transportation.

Combined, this is tempting more and more drivers to switch to natural gas each day. So many more that, according to Pike Research, global NGV sales are expected to rise at a compound annual growth rate of 7.9%, reaching 19.9 million NGVs by 2016!

With the natural gas-run vehicles proving to be so much more cost-effective than diesel and petroleum fueled vehicles, who wouldn’t want to fill their tanks with natural gas? As NGV technology continues to improve and fueling stations are constructed around the world, more and more drivers will begin to open their eyes to the economic benefits of natural gas.

This is one of the many reasons why Blue Corridor is encouraging the increased use of natural gas in transportation worldwide. If you’re not convinced, then take a look through the below blog posts, videos, photos and presentations demonstrating the cost benefits of natural gas written by Blue Corridor, representatives from the companies supporting it and experts in transportation, energy and policy analysts.

Economic Benefits of Natural Gas Stories

POLEKO 2014: Report on Poland’s NGV events

Over four days, specialists from the Green Fuel Foundation and cng.auto.pl portal presented CNG vehicles, methane refueling systems, CNG tanks, and the installation of CNG service capabilities. During the NGV Methane for Automotive International Conference, under the patronage of the University of Science and Technology’s Scientific Rector, shows a cross-section of the most innovative CNG […]

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Blue Corridor NGV rally celebrates completing its 6600-km route

On October 31, 2014 the participants of the 8th international NGV natural gas-fuelled vehicles (NGV) rally, Blue Corridor 2014, successfully arrived in Russia, leaving behind more than 6000 km of roads across Europe. The leading car of the caravan passed through the Vasilievsky Slope, beside the Kremlin, to the Bolshoy Moskvoretsky Bridge. Despite the weather, […]

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Natural gas experts hold a lively debate in Budapest

On October 28th 2014, the Hungarian capital of Budapest hosted the Blue Corridor Rally for the first time. Considered to be an established natural gas fired vehicles (NGV) market, it was only fitting to organize a high-level roundtable in which a group of international experts exchanged their experience and excitement for CNG. As the 2014 […]

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