The document discusses the history and current state of propane as a vehicle fuel in the United States. It notes that propane has been used commercially as a vehicle fuel since 1912 but that it currently only powers around 2% of vehicles in the US, facing competition from other alternative fuels like compressed natural gas. Supporters argue that propane has advantages over other fuels in that it is domestically produced, cleaner-burning, and has existing fueling infrastructure and lower fueling station costs. However, it also faces challenges of higher upfront vehicle costs and changing public perceptions in favor of other alternatives like natural gas. Supporters aim to grow the fleet market for propane vehicles to help lower costs and increase adoption rates.

1. MidstreamBusiness.com February 2013 67
Lighting the Demand
for Propane
undreds gathered in Atlanta’s Centennial Olympic Park
last April to kick off the 100-year celebration of one of
the oldest forms of alternative energy: propane. At the
Clean Air Rally and Autogas Parade, 49 propane-fueled
vehicles cruised through the streets showcasing the per-
formance and reliability of the natural gas liquid as a ve-
hicle fuel.
Propane—also known as LP gas, autogas and LPG—
was commercially used for the first time in May 1912.Less
than a year later it was fueling vehicles.Since then,accord-
ing to the U.S. Department of Energy (DOE), 17 million
LP gas vehicles have flooded the roads worldwide making
it the world’s most widely used alternative-vehicle fuel.
However, according to DOE estimates, only 2% of
those vehicles are located in the U.S. In a market that has
become engulfed in talk of compressed natural gas
(CNG) and liquefied natural gas (LNG)-fueled vehicles,
many in the propane industry are fighting an uphill bat-
tle to keep this century-old, but environmentally friendly,
fuel relevant.
After years of successful and reliable use in American vehicle fleets and farm equipment, propane is
making a charge for a prominent seat at the alternative-fuels table.
By Jennifer Postel, Assistant Editor
The 30-passanger Blue Bird Propane-Powered Micro Bird bus uses Ford’s E-450 chassis with 6.8L engine and ROUSH propane
system and has a range of up to 320 miles.
Source: Propane Education and Research Council

2. “How do we take this fuel that’s proven itself time and
time again—a fuel that is perfect for our country now,
due to excess supply—how do we turn the alternative en-
ergy tide with that fuel?” CleanFUEL USA Founder and
Chief Executive, Curtis Donaldson, tells Midstream Busi-
ness. “That’s what I find myself asking every day.”
Educating the public—including lawmakers and au-
tomobile industry leaders—of the benefits and effective-
ness of LP gas is essential, Donaldson says. There are
three main benefits that consumers should be aware of
when considering LP gas, he says. Propane has become
an abundant domestic fuel—about 70% of propane
comes from natural gas processing and, according to
Donaldson, propane’s increasing domestic production
should be at the forefront of their minds.
“After 9/11, people started caring where energy came
from, and the first big checkmark for propane is that it is
domestically produced,” Donaldson says.“With an ever-
growing supply, we have enough propane to last for gen-
erations. If we are going to build the market up to use
something different than gasoline, let’s make sure that it
is from here.”
With the increasing push to go green and a market
aiming for cleaner-burning fuels, propane passes that test
with flying colors.
“It’s cleaner burning in all aspects—NOx, CO2—the
air-quality improvement adds a checkmark,”he says.Ac-
cording to the National Propane Gas Association,
propane is an approved, alternative clean fuel that is listed
in both the 1990 Clean Air Act and the National Energy
Policy Act of 1992.
And it’s affordable. Today, propane is priced just under
$2 a gallon on a gasoline-gallon equivalent basis. Even-
tually, says Donaldson, LP gas will make sense economi-
cally for the consumer market. For
now, though, the fuel is ideally suited
for fleet operations.
Fleet operators’ choice
For years, LP gas has been the road-
transport fuel of choice for many of
America’s fleet operators. But some
people mistakenly consider the weight
and size of a propane autogas tank as
a possible hindrance to the fuel mov-
ing from on-road fleets to the show-
room floor.
In actuality, CNG or LNG-fueled
vehicles require tanks that, at times,
can take up more room than gasoline
and diesel tanks. In comparison,
propane autogas storage tanks are four
times smaller than CNG tanks, ac-
cording to CleanFUEL USA.
Propane-conversion tanks are also
generally smaller than CNG tanks, ac-
cording to the Environmental Protec-
tion Agency (EPA), adding only a
slight increase in weight compared to
that of a gasoline-powered vehicle.
And, according to the DOE, with a
340-mile driving range, propane-fu-
eled vehicles are comparable to their
gasoline-fueled counterparts.
According to the EPA’s propane fact
sheet, converting to LP gas includes
adding a special fuel tank to the vehi-
cle’s trunk, which takes up the same
space as a spare tire and only adds 100
pounds to the vehicle’s weight.
However, according to the EPA,
propane vehicles are more expensive
than gasoline-fueled vehicles, costing
CleanFUEL USA
builds a range of
state-of-the-art fuel
dispensers to meet
specific fleet-fueling
needs Propane
refueling sites are
extremely cost
effective to install,
averaging $30,000.
Source:CleanFuelsUSA
February 2013 MidstreamBusiness.com68

3. $3,000 to $4,000 more for light-duty vehicles and $4,000
to $5,000 more for medium-duty trucks. Both the EPA
and Donaldson expect the cost to decrease as more
propane vehicles are manufactured, sold and put into use
by fleets.
In theory, building the American fleet market would
drive down the costs for consumer propane-fueled vehi-
cles by bringing about more fueling stations, more infra-
structure availability and increasing the volume of
production, says Donaldson.
Infrastructure advantage
Propane has a strong advantage among alternative fuels
when it comes to infrastructure. There are already more
than 2,500 LP gas refueling stations around the country,
according to the Energy Information Administration.
An LP gas station costs considerably less to build than
a CNG station, which requires more space and more so-
phisticated technology to compress the natural gas so it
can be used in a vehicle. A high-end version of an LP gas
station will top out about $40,000, while it can cost
$500,000 to build a low-end CNG station, Donaldson
says. In addition, many propane suppliers will build a sta-
tion for a client in return for a multiyear contract.
Yet despite these benefits, propane still faces a world
of challenges—including the swirling myths and rumors
about the cost of infrastructure.
“The argument about infrastructure cost doesn’t make
sense when you peel the onion back a little further,”Don-
aldson says. “The infrastructure for propane is mature;
numerous terminals are already in place. Our country has
to do nothing tomorrow morning to get propane around
this country because, guess what, it already exists.”
No doubt, natural gas and its CNG fuel present
propane with formidable competition. But propane and
CNG are linked because both are taking on gasoline and
diesel as they work to expand into the fleet market. Stay-
ing vigilant and focused on that task is the key to keep-
ing propane relevant in the competitive world of
alternative fuels, says Tucker Perkins, chief business de-
velopment officer with the Propane Education & Re-
search Council.
“Every day we have some kind of small win that tells
us we’re moving in the right direction,” he says. “Today
the National Park Service came to us and said,‘We’re very
interested in converting our fleet to operate on propane
autogas, including what we do with our commercial
mowing operations.’”
For Perkins, that kind of opportunity, along with cus-
tomers ranging from Sears to police fleets to thousands of
small businesses, will help turn the tide for LP gas.“When
enough people see that, it begins to be a follow-the-herd
mentality. But the truth is, it becomes such a competitive
advantage for people who are using it, that those people
who stay committed to gasoline or diesel fuel all of the sud-
den might find themselves at a competitive disadvantage.”
And propane’s advantage, Perkins says, is significant.
About 140,000 vehicles operating in the U.S. today run
“How do we take this fuel that’s proven itself time
and time again—a fuel that is perfect for our country
now due to excess supply—how do we turn the
alternative energy tide with that fuel?”
—Curtis Donaldson, president, CleanFUEL USA
ccording to CleanFUEL USA, both propane and compressed natural gas (CNG)
are appealing alternative fuels options but “the difference is in the details.” Here
is its list of propane’s benefits.
• The cost of converting a vehicle to run on propane is 50% less than the
cost of converting a vehicle to CNG.
• The cost of implementing a propane refueling station is generally
one-tenth of the cost of a comparable CNG station.
• Based on the electricity required to store and pump the fuel, a propane
station's environmental footprint is one-tenth that of a CNG station.
• Propane-storage tanks are four times smaller than CNG tanks for
comparable amounts of fuel.
• A propane tank's operating pressure is 17 times less than the pressure of
a CNG tank.
• Unlike CNG, propane is not a greenhouse gas and therefore does not
contribute to planetary warming trends when released directly into the
atmosphere.
MidstreamBusiness.com February 2013 69
Propane vs. CNG

4. on propane, and the fleets that have made the switch to
propane reaped the rewards of this cleaner burning, do-
mestically produced fuel.
“The Dallas school system said recently in a press in-
terview that they had saved $1.5 million last year using
propane-fueled school buses,”he says.“We see that in the
literature every day where municipalities have converted
their police fleet or their school bus system and begin to
talk about the savings with propane autogas.”
And both Donaldson and Perkins see continued
growth for propane.
In the fleet market, Perkins says that the number of
customers in December 2012 was significantly higher
than one year ago, although he was unable to give an
exact number, and, he says, “our forecast for next year
could easily double again.’
Donaldson, on the other hand, sees the growth of
propane as an alternative fuel as “slow but steady.”
Propane, he says, has taken a back seat to CNG and the
battle for public opinion and perception has been and
will continue to be fiercely fought.
“CNG is winning some of the battles with recent
public relations campaigns but propane is winning bat-
tles where it really counts,” he tells Midstream Business.
“There are more fleets converting to propane than
CNG but less about propane is reported in the main-
stream media. I think it is a battle of getting more
OEM [original equipment manufacturers] products to
market and convincing more fleets to convert so even-
tually the tide turns; then the dynamics of what’s hap-
pening in the marketplace and the perception of what’s
happening become one in the same. That is how you
win the battle.” I
Jennifer Postel can be reached at jpostel@hartenergy.com
or 713-260-5205.
Lawn-Care Industry Takes to Propane
ne sector shifting to propane is the commercial lawn-care industry due
to potential fuel-cost savings and lower greenhouse-gas emissions.
“Everything about a propane-fueled commercial lawnmower is ex-
ceptional,” Tucker Perkins, chief business development officer for the
Propane Education & Research Council (PERC), tells Midstream Busi-
ness. “We started this five years ago with one manufacturer, and now we
have 12 manufacturers in the market, soon to be 14.”
From performance and costs to maintenance, many of the benefits of
this sustainable solution can be felt right away. Propane is priced very com-
petitively with gasoline and diesel, the traditional fuels for landscape con-
tractors. The savings depend on the size of the contractor’s fleet and usage.
“And as for performance, not only do they [lawnmowers] not lose
torque and power but they have gained it,” Perkins says. “Also from the
emissions profile alone, when you convert a commercial lawnmower to
propane, the statistic we generally use, it has the same effect as taking
four vehicles off the road.”
Conversions for commercial lawnmowers may cost the owner about
$1,500, according to Perkins. PERC offers landscape firms a financial in-
centive for converting qualified commercial models to propane, “So for
most of the commercial-mowing universe, the payback is well inside the
first year,” he says.
The market for propane-fueled lawnmowers is growing at an in-
creasing rate, Perkins says, and each company has a different reason for
making the switch.
“A lot of people do it because they want to have a better image, a lot
of people do it because they want to save money,” he says. “And the
good news is, what we are seeing in that space, is you have commercial-
mowing companies that started off just having a couple of mowers run-
ning on propane, now all of a sudden they are having their pickup trucks
converted to propane, and now we are seeing them move to their weed
eaters, their blowers and all those others, and they end up having a full
propane operation.
“And they like their image, they like their savings and, better yet, their
customers like the image that they get when they use somebody that is
environmentally conscious cutting their lawn,” Perkins adds. “It’s one of
those deals where it is just win, win, win. There is no downside to it.” I
Every day we have some kind of small win that
tells us we’re moving in the right direction”
–Tucker Perkins, chief business development officer,
Propane Education & Research Council
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February 2013 MidstreamBusiness.com70