United Parcel Service (UPS) on Tuesday said it plans to further transform its nationwide transit fleet by purchasing 700 more liquefied natural gas (LNG) vehicles and spending $18 million to build four fueling stations in Tennessee and Texas by the end of 2014.

Noting it has been operating natural gas vehicles (NGV) for more than a decade with more than 1,000 in its fleet today (see Daily GPI, Feb. 24, 2011), UPS said it is responding to natural gas prices that are 30-40% lower than diesel fuel and the fact that domestic gas production continues on the upswing.

UPS plans to invest “more aggressively” in gas infrastructure needed to transform its delivery fleet. “Beyond favorable fuel cost and domestic resource access, the industry cites 25% less carbon dioxide emissions.”

Overall, UPS boasts an “alternative fuel and advanced technology fleet” numbering more than 2,600 vehicles, including low-emission vehicles, such as electric vehicles, electric hybrids, hydraulic hybrids, propane, compressed natural gas (CNG) and biomethane. The alternative fuel fleet has now logged more than 295 million miles globally, according to the company.

The new UPS fueling stations are to be in Dallas, as well as in Tennessee in Knoxville, Nashville and Memphis. With the additional accessibility of LNG fueling, UPS said it would add LNG trucks on its Texas routes from Dallas, Houston and San Antonio to further extend its range.

UPS currently operates 112 LNG-fueled tractor-trailers from stations in Las Vegas; Phoenix, AZ; Salt Lake City and Beaver, UT; and in Ontario, CA.

“LNG will be a viable alternative transportation fuel for UPS in the next decade as a bridge between traditional fossil fuels and emerging renewable alternative fuels and technologies that are not quite ready for broad-based, long-term commercial deployment,” said CEO Scott Davis.

Davis credited “public-private partnerships and legislative action” as steps that can remove “disincentives” from fuel taxes on natural gas as well as helping offset the higher incremental costs of NGVs.

“We plan expansion through infrastructure partnerships and a broader fleet in states that are leading the way to make alternative fuel vehicles economically feasible,” he said.

UPS is part of the collaborative that began the Interstate Clean Transportation Corridor (ICTC), the start of “America’s Natural Gas Highway” two years ago (see Daily GPI, Aug. 25, 2011). The ICTC includes eight government and regulatory agencies at the local, state and national levels, according to Davis.

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