Natural gas has growing attraction for some of the world's largest vehicle fleet operators, but it must compete depending on the applications and vehicles involved with all other alternative fuels, a panel of fleet executives told ACT Expo's clean alternative transportation meeting Wednesday in Long Beach, CA.
This was the overriding message from representatives of Pepsico's Frito-Lay, Enterprise Holdings, United Parcel Service (UPS), and Verizon Communications. Collectively, the companies represent tens of thousands of fleet vehicles operating in some cases around the globe.
With 76,000 vehicles worldwide, Frito-Lay operates a diverse fleet that adds alternative fuels based on two criteria: the delivery needs and the alternatives available to meet those needs most economically, said Mike O'Connell, senior director of fleets, whose corporate goal is to reduce the $16 billion company's fuel costs by 50%.
"We're on a glide path to achieving that goal, being half way there," said O'Connell, who noted that compressed natural gas (CNG) "is an important part of the mix, and will continue to be so." Frito-Lay operates 1,200 CNG tractor-trailers, and 90% of the replacement vehicles are CNG, he said.
While noting that gasoline is still the cheapest way to go (for rental car and other fleets) Enterprise's Joe Stergios, manager of new vehicle and manufacturer relations, said his privately held, $16.4 billion global rental/fleet operations company has a sustainability initiative, but he sees the need for more "regulatory harmony:" between the states and federal government to help advance those goals.
As an example, Stergios said the U.S. Environmental Protection Agency (EPA) and the California Air Resources Board (CARB) need to merge their individual requirements into one certification process for alternative fuel vehicles.
UPS operates 96,000 vehicles globally with 400,000 employees who are dedicated to reducing overall miles driven and making the those that are as clean as possible, said Mike Britt, director of international maintenance and engineering, quoting the UPS CEO who says "the greenest mile is the one not driven."
UPS has 1,000 LNG trucks, and uses CNG in vehicles in various places around the world, but Britt also said propane use is growing -- particularly in the United States -- for light-duty vehicles.
Verizon has a corporate goal to reduce its carbon footprint by 50%, and Kenneth Jack, vice president of fleet operations, said the company is halfway toward meeting the goal. It operates 50,000 vehicles (1,800 on alternative fuels), many of which help a cadre of technicians maintain 42,000 cellular towers spread across the United States.
Jack underscored the panel's theme that the alternative fuel technology used must fit the job involved. One-third of Verizon's fleet is made up of vans because that is what is required for its technicians, he said.
"We haven't made a case for hybrids yet because our technicians typically drive less than 50 miles daily," said Jack, noting that CNG is closer to penciling out, but it, too, is "struggling" in some applications to prove its economics.
"We are struggling to get enough miles to amass the savings we need from the vehicles. We're constantly trying to justify the use of these vehicles, and I am happy to break even because it is the right thing to do."