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2014 NGV Trends: Infrastructure, Technology, Global Competition

While advancements in fueling infrastructure and technology for natural gas vehicles (NGV) are expected to continue this year, one analyst also expects growing competition globally for fuel and vehicles to support an accelerated shift to NGV use in places like China.

China represents "low-hanging fruit" for natural gas transportation and all that it entails, according to The Motley Fool analyst Justin Loiseau. As a Wall Street observer, The Motley Fool recommends a number of companies in the NGV sector as fuel providers, engine-makers and alternative vehicle fleet operators.

Loiseau predicts that compressed natural gas (CNG) and liquefied natural gas (LNG) will continue to have an advantage over diesel in fleets. "Leaders in NGV transport could see major gains abroad," he said in an analysis for The Motley Fool.

Conceding that the United States needs more of a real network of NGV fueling stations, Loiseau said there are 640 CNG and 45 LNG public fueling facilities, while noting that California-based Clean Energy Fuels Corp. is leading the industry in efforts to expand fueling infrastructure, particularly for LNG in over-the-road trucking (see Daily GPI, Jan. 2).

Loiseau argues that looking at just the public-access NGV fueling spots only covers about half of the infrastructure because private, fleet operator fueling stations number 364 for CNG and another 39 for LNG. He cites UPS, a company in which he owns stock, as operating 110 LNG trucks in its fleet with a goal of increasing that by 700 at the end of this year.

UPS, which has operated some of its vehicles on LNG since 2000, also plans to build four more LNG fueling stations in its private network this year, Loiseau said.

The other driver for NGV growth comes from technology advances, particularly for dedicated natural gas engines, Loiseau said. He cited Cummins and Westport Innovations, which have operated a joint venture (JV) since 2001, for driving the bulk of the advances.

The JV has more than 35,000 of their engines in service globally, and Loiseau said orders worldwide may spike in 2015 when stricter emission standards kick in for the United States, Europe and China.

The Motley Fool recently released a report handicapping some of the best firms operating in the growing NGV space. It is available on its website (www.fool.com).

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