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Tesla has to compete for customers. So should fuels

Americans love their freedom to choose. Someone invents something, and competitors rush in with their own similar products to fight for a market that didn’t exist before.

This is what Tesla has done with the electric vehicle: The Model S is making cold-eyed journalists swoon, and the next few months are huge: The company will soon release its eagerly awaited crossover SUV, the Model X, followed by its more-eagerly awaited “affordable” sedan, the Model 3.

But Tesla shouldn’t get too comfortable, because the established auto-makers want to steal some of its quiet, zero-emission thunder with EVs of their own: In the past week, Toyota unveiled the new Prius, trying to assure everyone it can be cool as well as get 10 percent more miles out of a battery charge; Edmunds gave its blessing for the 2016 Chevy Volt; there was a possible sighting of the 2016 Nissan Leaf, the best-selling EV in the U.S.; and there were rumors that Mercedes-Benz is working on an electric car than has a range of 311 miles.

It’s a basic rule of economics: Competitive markets are good for consumers. Which is why drivers should be demanding fuel choice as well.

Gasoline is cheap now, but it doesn’t take much to cause a price spike: The threat of a supply constriction overseas; a refinery going down (and staying down, in California’s case); output quotas in OPEC nations. Anything can cause volatility in the global market. Businesses don’t like uncertainty, and it’s bad for consumers as well.

The only way to reduce the cost structure of fuels over the long term is to create fuel choice, something the United States has never known. To quote former Shell Oil president John Hofmeister: “We will never get past the volatility of oil until we get to alternatives to oil.”

We’re not advocating an end to fossil fuels. We just want fuel choice: Ethanol, methanol, CNG, LNG, biodiesel, hydrogen and, yes, electric batteries. Anything that reduces our dependence on oil is good for America.

If gasoline, the same fuel we’ve been stuck with for more than a century, is the superior fuel for vehicles, let it compete with other choices at the pump. If oil companies don’t want competition, what are they afraid of?

Related posts:


Poet biofuels

Former Shell Oil chief: U.S. must become more oil independent

Just in time for the Fourth of July weekend: Our very own John Hofmeister speaking words of wisdom about the need for the United States to wean itself off oil as its dominant transportation fuel.

“It’s incumbent upon the United States of America to become more oil independent,” Hofmeister said at a security conference in Israel in June. “Because it still relies on nearly 7 million barrels a day of imports, and in a nation that uses 18 and a half to 19 million barrels of oil per day, the loss or the risk of 7 million barrels a day of imports puts that nation at about two-thirds of independence, and that’s not enough for the world’s largest economy.

“So there remains an interdependence, until the U.S. can find independence, and it has every right and every responsibility to pursue independence. As does every other nation.”

Watch Hofmeister’s full talk at the Herzliya Conference in Tel Aviv:

Hofmeister knows of what he speaks: He was the president of Shell Oil Co., the American subsidiary of oil giant Royal Dutch Shell, from 2005 to 2008. The author of “Why We Hate the Oil Companies” now travels the world talking about the need for alternatives to oil. He’s not only on the board of directors and advisors at Fuel Freedom, he founded a nonprofit called Citizens for Affordable Energy.

U.S. crude prices closed at $56.96 a barrel Wednesday, down $2.51 or 4 percent, the biggest one-day drop since April 8. Compare that to last summer, when the price was above $100. But the market remains volatile, and Hofmeister said having oil at an affordable price long-term is necessary for national security.

“If you’re not taking care of yourself, no one else will,” Hofmeister said.  “And so nations should look to their security — not just to their defense forces, but to their energy supplies — which in the United States, is why I’m almost entirely focused now on transitioning natural gas to transportation fuels, as well as biofuels, as well as electricity for transportation. Because the future of oil is simply limited. We’re not running out. It won’t disappear. But it simply won’t be available at this price for an indefinite future.”

Hofmeister expanded on another of his major themes: that natural gas, which is cheap and plentiful in the United States, could help the U.S. and other nations reduce oil consumption. Natural gas is used as a fuel in its gaseous, compressed form — as CNG and LNG — and it can also be processed into liquid alcohol fuel, ethanol or methanol.

“Over the next decade, nations like the United States, or like Israel, or like much of Europe if not the whole of Europe, that are not transitioning at least a third of their oil demand away from oil and toward natural gas will only look back in regret.”

(Photo credit: Poet Biorefining plant in Macon, Missouri. From


Pig power: A messy problem becomes a fuel solution

You can thank Hernando de Soto for bacon and pork chops.

The Spanish explorer gets credit for introducing the pig to America, having brought 13 of them to Tampa Bay, Florida, in 1539. By the time of de Soto’s death, three years later, that passel of piggies had grown to more than 700. Yes, pigs grow quickly. They also poop, 24 hours a day, in great quantities.

That manure can be transformed into fuel for vehicles. So even though we’ve let all that pig poop — and cow poop, for that matter — go to waste all these centuries, more of it is being processed to extract methane, the principal component of natural gas.

All over the country, this renewable form of methane is being collected and fed into the nation’s natural-gas pipelines, and then transported to fueling stations to be used as compressed natural gas (CNG) and liquefied natural gas (LNG). The fuel is not only much cheaper than petroleum-based vehicle fuels, it burns cleaner: It contains about 23 percent less in greenhouse-gas emissions than diesel and 30 percent less than gasoline. Capturing all that methane instead of letting it float away from farms is also important, since the gas is more than 20 times worse for the environment than carbon dioxide.

There are some 191 renewable-methane projects on farms in the United States, according to the American Biogas Council (the EPA’s AgSTAR Stories project has profiles on many of them). These farms use anaerobic digesters, which involve storing the manure in tanks or ponds. The fecal matter, as well as food scraps and other farm waste, is broken down into smaller molecules, and the material usually is covered, to help elevate the temperature inside. That allows anaerobic bacteria (which don’t take in oxygen) to go to work on them. Methane is made as a result, and machines vacuum off the gas, cleanse it of impurities (like CO2) and ship it off to be used as fuel.


A Clean Energy renewable-methane plant outside of Memphis.

Clean Energy Fuels of Newport Beach, California, has invested heavily in what it calls Redeem, its proprietary biogas made from organic waste. Twelve of its contracted projects in North America are at landfills — discarded food produces large amounts of methane, as does cellulosic trash like cardboard and paper — and three other projects are agricultural.

“There’s a tremendous energy potential in waste, and this is one of the more efficient and cost-effective ways of capturing that,” says Harrison Clay, president of the company’s subsidiary, Clean Energy Renewable Fuels. “I think there’ll be more and more opportunity at these large, concentrated agricultural operations to take their waste and turn it into an energy project, from a problem to a solution.”

Methane accumulates in large landfills, and many are legally required to flare it once it starts to seep out. Clean Energy’s equipment captures it instead. “So it’s a tremendous GHG emission benefit,” Clay said, “because you’re capturing all this methane that otherwise would go into the atmosphere, and you’re turning it into fuel and displacing oil.”

Ingenious ideas for turning waste into fuel are coming from all quarters: In England, a passenger bus called the Bio-Bus runs on human waste, as well as inedible food waste, culled from a sewage treatment plant.

Livestock is uniquely suited to be a renewable fuel source, because cows and pigs are prolific producers of manure. According to the USDA, dairy cows account for about 80 pounds per day (per 1,000 pounds of animal weight). The equivalent in hogs accounts for 63.1 pounds per day.

At Circle Four Farms near Milford, Utah (about halfway between Salt Lake City and Las Vegas), a million and a half hogs are raised and taken to market each year. It’s the largest pig farm in the western United States, and every day those hogs produce a million gallons of manure.

Three years ago, a Provo firm called Alpental Energy Partners, which finances alternative-energy projects, noticed the potential of the massive farm. (How could one not notice? The odor from the facility can be smelled for miles.) Alpental built anaerobic digesters that turn all that poop into electricity that powers more than 3,000 homes in a town hundreds of miles away.  (Here’s a great local TV report on the project.)

Such a project could easily provide the same benefits, but for drivers of cars, trucks and SUVs that run on natural gas, which also happens to be a “feedstock” for alcohol fuels that can run in flex-fuel vehicles.

Paul Stephan, managing partner at Alpental, said various incentives, including carbon credits and investment tax credits, which enhanced the revenue stream from the pig project. But those were complicated to secure. “If we didn’t have one of those [revenue] attributes, it would probably be more profitable for us to sell it as transportation fuel,” he said. “I think if I was going to go look at doing another project in the United States off of pig manure and methane, I’d probably sell it as transportation fuel.”


Natural gas touted as the next alternative fuel in San Diego

“I’m not proud of it, but I’m a reformed diesel guy,” said Andrew Douglas, senior VP of sales and marketing at Agility Fuel Systems of Santa Ana, California.

Douglas was among the dozens of attendees at the L-NGV2015 conference in San Diego last week, a gathering mostly aimed at the compressed natural gas (CNG) and liquefied natural gas (LNG) industry. Agility retrofits tractor-trailers to run on CNG, and has produced 25,000 such vehicles since it was founded in 1996.

cylinder_stackMore and more companies are converting to CNG: In the early years the customers were mostly city transit buses and garbage trucks, but the shipping sector is taking advantage of systems that can stash more fuel on board and propel the big trucks longer distances. On the company’s new Saddle Creek Gen 5 model, four cylinders of CNG totaling 160-gallon diesel equivalent are stacked up behind the driver’s cab. The setup weighs more than 3,000 pounds, but it can travel 750 to 850 miles without refueling.

But the industry has challenges: Douglas said the goal is to get 10 percent of the nation’s heavy-duty trucks running on natural gas by 2020. The cost of such vehicles is steep, although Agility says companies can make that money back within 2 years.

“Eighty years ago there was a transition to an alternative fuel going — diesel,” he told a conference room of about 40 people. The industry is seeing a migration to a “new alternative fuel,” natural gas. Just as decades ago, price is the motivator.

Diesel is averaging about $2.86 a gallon, compared with $2.11 for CNG.

“I think we’re seeing an evolution to a cheaper fuel source, in this case, natural gas,” he said.

Later, showing off one of Agility’s behind-the-cab systems on a Frito-Lay truck in a cavernous room of the San Diego Convention Center, Douglas talked about being a trucking guy at heart, trying to convince trucking companies to switch away from a fuel that has been synonymous with big trucks for decades.

“Sometimes you have moments of doubt. And whenever I go there, I think to myself, No matter what the obstacles are, it’s about the price of fuel — or the differential (between NG and diesel). That’s what’s going to drive this.”

CNG truck22Fuel Freedom Foundation co-founder and chairman Yossie Hollander presented on the same panel as Douglas and Greg Roche from Applied LNG of Westlake Village, California. Hollander praised CNG and LNG, saying it’s going to be a “sustainable business for a long time.” But he reminded the panelists that the market for light-duty vehicles is 3.5 times bigger than the market for larger vehicles. “That’s the larger market here.”

One solution is to make liquid alcohol fuels, like ethanol and methanol, out of natural gas. Those fuels can run in many of the vehicles Americans drive already, without the need to buy a new vehicle or undertake an expensive conversion.

Fuel Freedom seeks to open the fuels market so all fuels, including CNG, LNG and alcohol fuels, are available to the consumer, not just gasoline. “We don’t have favorites,” Hollander said. “What we want is a supermarket.”

L-NGV conf banner

Natural gas center of attention at L-NGV2015

We’re headed to the L-NGV2015 conference in San Diego, where natural gas will be in the spotlight.

Natural gas has been getting a lot of attention lately, because the United States is producing so much of it. As Jude Clemente wrote in Forbes earlier this month:

U.S. proven natural gas reserves continue to soar to record highs. We now have some 360 Tcf [trillion cubic feet] of proven gas in the ground, recoverable under current market conditions, experiencing increases of 5-8% per year. Driven by the Marcellus shale play in the Appalachian Basin, Pennsylvania and West Virginia have registered the largest gains, with both state reserve totals more than quadrupling since 2010. In fact, Pennsylvania and West Virginia have accounted for about 60% of new U.S. gas reserves since 2008, although mighty Texas continues to plug along, upping its reserves by 20% since then.

The surge has occurred despite a steady decline in prices. Henry Hub spot prices are about $2.80 per million British Thermal Units, down from an average of $8.86 per MMBtu in 2008, as Clemente notes.

NG is running about 70 percent lower in price than the equivalent amount of oil, even with oil’s precipitous drop from last summer. That’s what makes natural gas an attractive alternative for transportation fuel.

Much of the discussion at L-NGV2015 will center on compressed natural gas (CNG) and liquefied natural gas (LNG), which is being used in municipal fleets (official vehicles and transit buses) and industrial trucking (delivery, garbage-hauling) around the country. These fuels not only cost less than gasoline and diesel, they burn much cleaner, which is better for air quality and the environment.

Natural gas can also be converted into alcohol fuels to run in the cars, trucks and SUVs driven by the rest of us.

NG is “very, very cheap, and we need to take advantage of that,” Fuel Freedom co-founder and chairman Yossie Hollander said recently during a discussion about energy in Israel. “The greatest opportunity is a transportation one. Using a natural-gas product, whether compressed natural gas, liquid natural gas, ethanol from natural gas – you can make ethanol from natural gas, and another fuel called methanol – if we use all of them in transportation to replace oil, this will replace a $3 trillion industry around the world.”

We’ll be presenting more about this topic at L-NGV2015. Check out our Twitter feed (@fuelfreedomnow) for regular updates.

Energy conf-backdrop

Economist touts natural gas at Utah energy summit

The natural-gas industry and people who promote gas as a cleaner fuel alternative need to “manage” environmental concerns about fracking, a key economist said at the fourth annual Governor’s Utah Energy Development Summit.

Dan North, chief economist for the credit-insurance company Euler Hermes North America, said Wednesday that despite the abundance and cheapness of natural gas compared with oil, only 3 percent of natural gas is used in transportation.

He said there are 17 million passenger vehicles around the world that run on natural gas (primarily CNG and LNG), but only 100,000 such vehicles in the United States. “This is an enormous opportunity going forward,” North said. “It’s terrific that we have this cheap natural gas.”

But, he added, “WE do have to manage one thing, which is the environmental concerns about fracking.” After listing all the countries, states and municipalities that have banned the oil-and-gas drilling technique also known as hydraulic fracturing, North said: “Environmental concerns have not been addressed well enough.”


10 people who turned anger into solutions for high gas prices

So we’ve heard from Americans who say high gas prices have disrupted their lives and their work. Let’s shift to the people who are more than mad as hell. They’re mad enough to turn their energy into action.

Among these 10 ideas, what’s the most practical for your life?


“I just ditched my old 1998 Volvo S70 for a used Prius, and it is so much more fun to fill a 10-gallon tank than an 18-gallon one. And have it last more than a week of heavy Los Angeles commuting. It’s still new to me, so I still kind of giggle every time I fill up the tank. I’m thrilled to put the money I save toward better things.”
— Jennifer

“We save a lot of money in the summer because my wife takes the bus to the south side of Madison to go to work, and I pick her up in the afternoon, about 4 miles south of our home. If I was to take her to work and pick her up, it would be 48 miles round-trip, morning and afternoon. The bus is cheaper.”
— Laverne F., Madison, Wisconsin

“As gasoline was so high for so long, I made a bio-diesel processor from a old electric water heater and made my own fuel for the oil furnace and my old 1984 GMC van with a diesel engine. I still received 21 mpg. Begging for grease was the hard part.”
— Willis W.

“I wish I had a good story for you, but my wife and I drive a plug-in Chevy Volt. We hardly ever stop at a gas station, except perhaps once every 6 weeks or while on an occasional trip. When we top the tank, it seldom takes more than 5 1/2 gallons, i.e. less than $20 worth of premium fuel. The main reason that we stop at gas stations these days is to get an automatic car wash.”
— David and Barbara G., Gaithersburg, Maryland

“Still wondering how to convert my 99 Ford Expedition to NG?”
— Gary S., Laguna Woods, California

(We’re checking around to find a SoCal CNG conversion business. Will update later.)

“I have not visited a gas station since September 2014, when I took delivery of my Tesla. However, I still pay for my daughter’s gasoline, suffer the financial cost, and contribute to the oil industry’s wanton environmental degradation. Savings at the pump could help me fund her college education.”
— Dr. George

“Go electric. I did and am receiving my Tesla next week. No more gas at all.”
— Bob

“Today we bought a 2014 Ford Focus, a flex-fuel vehicle which enables us to use E85 for fuel. A small contribution to energy independence.”
— David

“We need a blender pump [for ethanol] in every station.”
— Melvin M.

“I top off my cars with E85 when I can. I fill up once a month with a discount at Kroger. I am really pushing to get Kroger to provide ETHANOL pumps and shop at the same place!”
— Gerard R., Stone Mountain, Georgia


Incidentally, here’s a handy guide to flex-fuel vehicles on the market.


This Oklahoma mechanic helped us out. Now it’s our turn

When director Josh Tickell went looking for a true believer about compressed natural gas for the 2014 documentary PUMP, he rang up about 50 CNG-conversion businesses all over the country. Todd Bradshaw stepped up and offered to help.

The owner of Bradshaw Automotive Repair & CNG in Owasso, Oklahoma, just outside of Tulsa, “was totally honest and invited us to come into his shop right away,” Tickell says. “He just seemed like a really great and genuine person.”

Todd turned out to be one of the most endearing stars of PUMP, extolling the benefits of CNG as a cleaner, cheaper alternative to gasoline for cars and trucks. In the film, he notes that the fuel is produced with domestic resources. “I believe in this. I believe in CNG with all my heart. … It’s cleaner, it’s better, it’s abundant. It’s right here in America. It’s American.”

Dana2Now Todd and his family need some help from his fellow man. He says his wife Dana has a tumor in her brain, wrapped around her pituitary gland. She’s scheduled to have surgery to try to remove it next month, but she only recently started a new job, and doesn’t qualify for the family leave she needs to recover. The Bradshaws created a GoFundMe page, where they’re asking for donations to help pay the bills while she takes a few months off to convalesce from surgery.

“Honestly, I wish I was well-to-do, where she could just stay at home and rest her head until she has the surgery,” he said. “But I’m not, so she’s doing the best she can.”

Todd, 46, started with CNG conversions in 1999, “before it was cool,” he said. But the price swoon in gasoline that started last summer has reduced demand for installing the systems, which start at about $5,000.

“We’re just treading water,” he said. “We do automotive work too, but CNG was our bread and butter. So we’re hanging in there, but it’s really tough. If it was strong obviously, I never would have asked for help. ‘Cause that’s just not me. I’ve never asked for a dollar. But my wife’s important to me.

“She’s awesome, and she deserves to rest and get this thing fixed, and get back to where she was.”

Dana, 45, started showing symptoms several months ago: She’d forget to shut the door of her SUV when she’d returned to their home in Collinsville. Such memory lapses were unusual, because “Man, she can remember stuff like you wouldn’t believe,” Todd said. He and their two children — Dylan, 21, and Ashley, 17 — grew increasingly worried when Dana’s headaches, which started about a year ago, steadily worsened.

Doctors discovered the mass around her pituitary gland, a pea-sized gland at the base of the brain, behind the bridge of the nose. It not only promotes growth, but controls other hormonal glands as well, including the thyroid and adrenal glands. The surgeon will go through Dana’s nose to reach the tumor. Only after analyzing it will doctors be able to tell whether it’s benign or cancerous.

The procedure is scheduled for spring break, in late March, so Dana won’t have to miss any time from work: She’s a cafeteria cook for schoolchildren in the nearby town of Sperry.

“The doctor said she needed to be off a long time, and there’s no way her bills and our bills are gonna allow that,” Todd said.

Many people in the alternative-fuel industry, including some of the contributors to PUMP, have been hit hard by the volatility in the oil market. So we felt compelled to share Todd’s story and spread the word about his dilemma. Please help him if you can.