The Case for Autogas

Is propane the motor fuel of the future?

By Maura Keller

Proponents of propane as a motor fuel, aka autogas, say it is “greener,” costs less than gasoline or diesel, is almost entirely domestically produced—and today’s vehicles can be designed or converted to use it.

Because the fuel burns efficiently and inflicts less wear and tear on engines than gasoline or diesel, it helps reduce maintenance costs, according to Alliance AutoGas, a network of distributors that provides autogas and autogas systems to medium and heavy-duty fleets. Members also provide autogas for lawn care companies like Collins Brooke Landscape.

Propane (C3H8), or liquefied petroleum gas, is called autogas when used as a motor fuel.

Alliance AutoGas comprises more than 120 independent propane marketers and conversion centers throughout North America. The Alliance was founded and is managed by Blossman Gas Inc., Ocean Springs, Miss., a privately-owned propane company. The goal of Alliance AutoGas is to convert fleets to run on autogas. Jessica Johnson, sales coordinator and member liaison for Alliance AutoGas, says autogas costs less than gasoline on any given day.

Alternative fuels appeal more to vehicle fleet managers and consumers as gasoline or diesel prices increase, says the U.S. Department of Energy on its Alternative Fuels Data Center website. Prices for alternative fuel, like prices for gasoline and diesel, can fluctuate based on location, time of year, and political climate, the Data Center notes. The Center’s Clean Cities Alternative Fuel Price Report provides regional alternative and conventional fuel prices for biodiesel, compressed natural gas, ethanol, hydrogen, propane, gasoline, and diesel. The report is a “snapshot in time of retail fuel prices,” the Data Center says. The Center also advises that alternative-fuel fleets can obtain “significantly lower fuel prices than those reported by entering into contracts directly with local fuel suppliers.”

Energy content—measured in British Thermal units—also varies among fuel types and needs to be accounted for, energy marketers say.

According to Bill Overbaugh, general manager at Ehrhart Energy in Trumansburg, N.Y., a member of Alliance AutoGas since its inception, autogas can be used to power cars, truck, buses, boats, lawn mowers, forklifts and more.

“It reduces our greenhouse gas emissions, reduces our dependence on foreign oil, and saves drivers money,” Overbaugh says. “While there are other fuels that can tout some or most of these benefits, propane autogas is the only one that gives you all those benefits with the same range as gasoline—completely seamlessly and with refueling infrastructure that costs a minimal amount.”

And Overbaugh should know. Ehrhart Energy has used autogas consistently since the 1950s. Overbaugh’s great uncle, the company’s founder, ran his 1938 Chevy on propane during gas shortages in World War II.

“We were one of the earliest companies to convert vehicles with the Prins system [a conversion kit], and we have done around 100 vehicles on that system,” Overbaugh says. Prins Autogassytemen BV, which provides the Prins system, is part of Westport Fuel Systems, headquartered in Vancouver, B.C., Canada.

“We currently operate 28 of our 31 trucks on propane. The other three were vehicles we purchased in a business acquisition and will be replaced with autogas or of a weight class that does not yet have a propane or gasoline engine available. So basically, we run every vehicle we can on autogas, from a Toyota Tacoma, to pickup trucks, service trucks, bobtails and even a heating oil bulk truck. We’ve converted a Mustang, a race car and a Zamboni. I calculate our annual cost savings for running propane at about $80,000.”

Alliance AutoGas provides a turnkey solution to its customers as well as support and guidance. Propane autogas bi-fuel vehicle conversions save Alliance AutoGas customers an average of 35% on fuel costs, Johnson says. “Autogas helps consumers save money and helps propane businesses sell propane year-round, all the while being better for the environment and never having to source from outside the U.S.,” she says.

There are two main components of the Alliance: the fuel portion and the equipment portion. On the fuel side, the Alliance gives members marketing materials and sales training for use in soliciting new autogas accounts, and the nationwide dealer network helps sign up accounts.

“They also prospect new autogas accounts on their own, and give the gas load to whatever dealers operate in that area, so in that way they can help you grow gallons with very little effort on your part,” Overbaugh says. On the conversion side, the Alliance is the official importer of the Prins conversion kit, Overbaugh says. “They import the kits, obtain EPA certification, and sell them to installers, as well as providing extensive training to those installers. We at Ehrhart Energy are both fuel and equipment members of the Alliance.”

Alliance AutoGas members receive special pricing as well as resources such as marketing materials and access to the organization’s member library.

“The more members we have, the more systems there are on the road, so yes, we are always looking for ways to grow our network and provide the opportunity for a cleaner burning more cost effective fuel,” Johnson says.

Como Oil & Propane in Duluth, Minn., is currently in its fourth year as an Alliance member. Donald Tetreault, Midwest regional vice president, says being part of the Alliance gives Como Oil & Propane the expertise and support of all the other members.

“We’re all working towards the common goal of increasing AutoGas awareness and sales,” Tetreault says. “We’re the sole distributors of the Alliance Engineered Fuel Systems, including parts, service and warranty.” Tetreault envisions school bus fleets, commuter bus fleets and, potentially, city police departments, as well as others converting to propane.

“In most cases we can establish the fueling station on the customer premises, allowing for better controls and less time required to travel to an offsite fueling station,” Tetreault says.

Kevin Froman, chief operating officer at Froman Propane Co. in Claremore, Okla., and current president of the Oklahoma Propane Gas Association in Oklahoma City, says many fleets are seeing the advantage of propane over CNG as an alternative fuel: a vehicle fueled by propane will go about three times farther than the same vehicle fueled by CNG, and refill times are about the same as gasoline, Froman says. Those benefits reduce labor costs, he says.

Froman Propane has been a part of Alliance AutoGas for about three years. “The Alliance allows dealers to network across the nation to assure the customer has a stable, affordable supply,” Froman says. “The Alliance has done a tremendous amount in the development of equipment for the industry and should be applauded for their efforts.”

In Oklahoma, incentives to convert vehicles to autogas include:

• a $50 flat-fee permit that exempts the operator from state road tax for annual driving
• a 45% state tax credit on conversion
• a 75 % state tax credit on new refueling infrastructure
• a 30% federal tax credit on new refueling infrastructure
• a 50-cent per gallon federal tax credit on autogas used annually.

“Once a company puts one [autogas vehicle on the road] and sees the benefits, they always add others,” Froman says. “But the upfront cost for something they are not real knowledgeable about is a challenge. However, with the alternative fuel tax credits it’s an obvious move for any fleet or industrial application.”

Another benefit is the reduced environmental impact of gasoline or diesel should there be a spill. With propane being a liquid that turns to vapor, there is little impact to the ground environment, Froman says.

Ehrhart Energy started to see success in the adoption of autogas when fuel prices were really high. At that time, the fuel marketer picked up half a dozen new fleet customers in a year or two.

“Since fuel prices have come down, the interest has fallen off a lot,” Overbaugh says.  “The financial benefits are still solidly there, but I think people just aren’t upset about fuel costs, so they aren’t motivated to change. However, we’ve been seeing some success lately with schools, whose incentive includes cost savings, but is primarily focused on environmental benefits: both reducing greenhouse gas emissions and improving air quality for the young lungs they transport.”

Because lower fuel prices are a good thing overall, Overbaugh doesn’t see that as an obstacle. Rather, he thinks, people are reluctant to change and try new things.

“There are always horror stories about trying new fuels, and old-timers can remember horror stories about propane AutoGas back in the 80s and 90s,” Overbaugh says. “Even though most of the problems are avoided with modern autogas systems, a few small problems in the past can greatly influence decisions about the future.”

Overbaugh likens it to the service technician who has to carry that one super rare gas valve on his truck because he needed one at midnight in 1997.

“I also think people are often concerned about the refueling, even though there is already a huge network, and you can install a state-of-the-art private refueling station for under $30,000—compared to 10 times that for natural gas,” Overbaugh says. “So when you look at all this together, I think the common thread is that we, in the industry, aren’t doing a great job at telling the story of autogas. We’re getting better at it. But we need to be more vocal about the benefits, and about countering inaccurate claims of the problems of autogas.”

Johnson says there are many benefits to converting a fleet to autogas. “Whether you want to help the environment, save on fuel and operating costs, double your vehicle’s range, or just want to rely on a domestically sourced fuel, once you understand the process, it is a no-brainer,” Johnson says.

To stimulate wider adoption of autogas, industry players agree that education is key.

As Tetreault explains, the greatest obstacle currently is awareness. “Because this is not widely known, most people are unsure of it, and thus, how it can fill their fuel needs,” Tetreault says. “Although there is an initial investment in converting a vehicle, the long-term benefits are well worth it.”

That said, being able to get the end user to see those benefits can be a challenge at times.

“Autogas is not a new thing, but what is new is our technology and the great experiences our customers are having,” Johnson says. “We offer the solutions that weren’t available twenty, ten, even five years ago.” Autogas is “the fuel of the future,” Johnson says. “The more we grow our network, more infrastructure will be available, and as a result, more vehicles will be running on propane.”