Brent D. Yacobucci
Specialist in Energy and Environmental Policy
Higher gasoline prices in recent years and concerns over U.S. oil dependence have raised interest in natural gas vehicles (NGVs). Use of NGVs for personal transportation has focused on compressed natural gas (CNG) as an alternative to gasoline. Consumer interest has grown, both for new NGVs as well as for conversions of existing personal vehicles to run on CNG. This report finds that the market for natural gas passenger vehicles will likely remain limited unless the differential between natural gas and gasoline prices remains high in order to offset the higher purchase price for an NGV. Conversions of existing vehicles will also continue to be restricted unless the Clean Air Act (CAA) is amended or if the Environmental Protection Agency (EPA) makes changes to its enforcement of the CAA.
Congressional and consumer interest in natural gas vehicles (NGVs) for personal transportation has grown in recent years, especially in response to higher gasoline prices, concerns over the environmental impact of petroleum consumption for transportation, and policy proposals such as the "Pickens Plan."1 Although natural gas passenger vehicles have been available for years, they have been used mostly in government and private fleets; very few have been purchased and used by consumers. Larger NGVs—mainly transit buses and delivery trucks—also play a role in the transportation sector, especially due to various federal, state, and local incentives for their use. However, high up-front costs for new NGVs, as well as concerns over vehicle performance and limited fuel infrastructure, have led to only marginal penetration of these vehicles into the personal transportation market.
Date of Report: February 3, 2010
Number of Pages: 9
Order Number: RS22971
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Tuesday, February 16, 2010
Brent D. Yacobucci