As an offshoot of the global economic impacts on energy supply/demand spurred by the coronavirus, natural gas vehicles (NGV) may get a boost as power markets and renewable equipment production are seen as potential casualties.

In a weekly assessment earlier this month, Wood Mackenzie’s energy transition team said electric vehicles (EV) were “particularly exposed” to the virus economic impacts.

Researchers called the EV’s nascent supply chain and status as a “premium consumer purchase” as troublesome to the sector. “The outsized decline in EV sales compared to internal combustion engines in China in January and February highlights the impact.”

While EVs have solid long-term fundamentals, the firm predicted that gigafactory facilities would be delayed and newer manufacturers could be forced into bankruptcy.

Wood Mackenzie also offered optimism for clean fuels. Vice President for Corporate Analysis Valentina Kretzschmar said past price downturns have shown that renewables can compete for investment, particularly when U.S. oil prices are at $35/bbl or lower.

“Oil and gas projects are now in line with average returns from low-risk solar and wind projects,” Kretzschmar said. “Renewable projects suddenly look as attractive as upstream projects at $35/bbl.”

The president of U.S. trade group NGVAmerica, Daniel Gage, said he suspected that refuse and freight markets are “still very strong” for NGVs, but public transit most likely is down with the slowdown.

In the future, the cost-effective attributes of compressed natural gas and renewable natural gas (RNG) “put the NGV sector in a strong position,” said Gage. When the U.S. economy is moving again, investments in NGVs may be a solid choice for public and private sector fleet operators. He said electric options are not always viable for financial, duty-cycle or locational reasons, and “NGVs fill those gaps...

“Even if we want to shift to 100% electric for transit and transport needs, there are not enough components worldwide to meet that demand, not to mention the very real human and environmental impacts from cobalt, copper and nickel mining  -- and more,” Gage said.

“In the aftermath of the Covid-19 crisis, with public sector budgets being decimated, it will be increasingly hard for governments to justify dumping hundreds of billions of dollars more in subsidies to get a fraction cleaner with EVs when RNG-fueled vehicles get you there today,” Gage said.

A major NGV fueling company, TruStar Energy LLC CEO Adam Comora told NGI he thinks RNG can serve a "critical role" in the ongoing economic downturn with near-term job creation and growth in the logistics, trucking and refuse hauling sectors. A unit of White Plains, NY-based Fortistar, the owner/operator of more than 60 landfill-to-energy projects in the United States and Canada, TruStar's customers see opportunity in the virus lockdown, Comora said.

"Along with the economic benefits of new job growth for us and more business for our customers, RNG is the lowest carbon fuel commercially available for the heavy-duty trucking fleets, reducing the carbon footprint versus diesel between 60% and 300%," he said.