Knowledge

The future of fleets: A focus on LNG

Following our recent consideration of the potential role for LNG in the global energy transition (September issue of Fuel Oil News), Lise-Lotte Nordholm, Vice President and General Manager of Clean Energy and Global Platforms at DFS, spoke with Fuel Oil News to explain the thinking behind her view that LNG can positively impact fleet businesses.

Lise-Lotte Nordholm

Emissions from transport have been on the rise since 2021, nearly rising back to pre-pandemic figures, with heavy goods vehicles (HGVs) being the second largest contributors, only behind cars, responsible for 28% of climate emissions from road transport in Europe, while accounting for only 2% of vehicles on the road.

The natural increase in HGV and long-haul fleet deliveries means many companies are starting to look at alternative fuels to reduce the emissions produced. Lise-Lotte believes that Liquefied natural gas (LNG) could be that solution.

Benefits of LNG to fleet owners

LNG is a natural gas that has been reduced to a liquid state through a process of cooling, and is the cleanest burning fossil fuel, producing 40% less carbon dioxide than coal and 30% less than oil. LNG can gradually be replaced by Bio-LNG, which emits 85% less CO2 than diesel and will be key to minimising emissions from the HGV sector. So, although natural gas is still an abundant resource, LNG enables transport companies to seamlessly transition to an alternative fuel source, which is better for the environment and will enable them to meet global decarbonisation goals.

For the drivers of HGVs, LNG doesn’t detract from the driving experience or vehicle performance.

One additional benefit is that LNG engines are 50% quieter than diesel engines, which means greater flexibility with regard to loading times in city centres and a reduction in the costs associated with day deliveries and traffic jams for fleet owners, allowing for late- night deliveries with less disturbance to quieter areas.

Transitioning to LNG can positively impact fleet business in several ways. Firstly, LNG engines often boast a longer lifespan than traditional diesel engines, enhancing the overall durability of a fleet. There is a growing network of LNG refuelling stations worldwide, the majority of which are currently in Western Europe and Asia.

LNG infrastructure may be embryonic, but it is fast growing. There are around 725 LNG stations on the continent, with the bulk concentrated in Western Europe, and its cost- competitive benefits means it has strong potential for commercial transport.

LNG is especially well-suited for long- distance road freight transport, given the limited availability of alternatives to diesel in this case, especially given its familiar and fast refuelling method, which is very similar to diesel.

With the emergence of reliable and convenient refuelling units, it becomes easier for fuel retailers to implement clean energies with minimal work or additional costs, and this can even be in addition to conventional fuel dispensers at larger service stations, to cover a multitude of drivers.

The future of LNG for fleets

As the EU transitions towards its intermediate target of a 55% reduction of net-emissions by 2030, ‘transitional fuels’ (like LNG) will likely play a large part in everything from long haul transport to powering our home deliveries.

A transitional fuel, in contrast to conventional fuels such as oil-derived petrol and diesel, are any types of fuels which contribute to FIT reduction targets. The shift towards LNG being incorporated into transport logistics strategies, as a transitional fuel, marks a much wider evolution in the way the transport and shipping industry approaches its fuelling.

Although LNG stations require CAPEX investments, which can be relatively high when compared to petrol or diesel, high volumes of LNG can be sold to many trucks, when compared to EV and H2 infrastructure.

According to the European Commission, LNG development into a global commodity can improve the security of energy supply in general by boosting the use of natural gas as fuel for transport. LNG provides a long-term solution, as The International Energy Agency predicts there are enough resources to last 230 years, if consumption remains at current levels.

Joost Jansen, Business Development Manager at DFS, suggests that: “With its environmental advantages, cost-effectiveness, and positive business impacts, (Bio)LNG is on the way to becoming one of the most in-demand fuels globally for heavy-duty transport, alongside hydrogen.

“It can contribute to future energy security measures and facilitate the worldwide transition to decarbonise major carbon- emitting economies. We’re witnessing the evolution of the consumer experience in fuelling and convenience retail.”

Often referred to as a “bridge” fuel within energy transition efforts, LNG represents an alternative with lower carbon emissions when compared to other fossil-fuel resources, such as coal and oil. As a result, the global demand for LNG continues to grow, but it

is not without its own complex challenges when considered as a fuel for HGV fleets. There are questions around the size of CO2 reduction benefit when compared with diesel, total emission implications and the infrastructure needed for viability across all geographic areas.

What are your thoughts on the use of transitional fuels for HGV reduction and the role LNG may play in that? margaret@fueloilnews.co.uk

Image credit: DFS