Diesel, gas or electricity: what commercial transport to choose and why?

2020-12-21

With higher environmental standards in Europe, vehicle fleets will face an inevitable turning point – the vast majority of vehicles will be running on sustainable energy in the future. However, the number of electric vehicles on the streets has been increasing at a slow pace due to the high initial costs, therefore those looking for alternatives are opting for gas-powered vehicles.This is particularly relevant to users of commercial vehicles. Compressed natural gas (CNG) (which is different from the conventional LPG [liquefied petroleum gas] sold at petrol stations) is one of the most effective alternatives to diesel fuel for domestic passenger and freight transport.

A representative of the manufacturers of the CNG-powered vehicles took part in the elections for the 2020 Lithuanian Commercial Vehicle competition, so the jury of the competition had an opportunity to fully test Iveco Daily van on our roads. It is equipped with a 3-liter compressed-gas engine that reaches the capacity of 100 kW (136 hp) and a braking torque of 350 Nm transmitted to the wheels via an 8-speed automated gearbox.

According to Iveco, fuel costs for the SGN model are already lower than those of diesel vans, and with the incentives of producers the difference in costs is around 20% in favour of CGN-powered engines. In Iveco Daily model gas undergoes complete combustion leaving no soot particles, furthermore, such engines emit 5% less carbon dioxide (CO2) than ordinary engines.

Using biomethane, these emissions can be reduced by as many as 95%. In addition, the engine of the van powered by compressed natural gas is about 4 decibels quieter than that powered by diesel. The overall concept of this model particularly strongly reflects the current phase in the market transformation. In addition to the CGN-fuelled Daily, manufacturers offer its electric and diesel versions.

According to Karolis Šimkus, sales manager of UAB Altas Komercinis Transportas, and a member of the jury for the 2020 Lithuanian Commercial Vehicle competition, the world is intensively looking for a method of transition from internal combustion to electric engines, but the process is long-lasting. Therefore, there is a greater incentive today to focus on gas-powered vehicles due to the changing legal regulations resulting from the general consensus of the EU states to move towards cleaner transport and to reduce harmful emissions.

“The fundamental principle that the global passenger car industry aims at – to shift from internal combustion engines to non-polluting electric transport – also applies to commercial transport. However, the approach of making all market players abandon diesel vehicles and switch to electricity is unrealistic in the short-time and will require considerable costs. Therefore, such an intermediate decision to use more environmentally friendly gas-fuelled vehicle options already available in the market may be not a bad solution in the transition towards tighter requirements,” Šimkus said.

According to the specialist, the main advantages of the gas-powered light-duty commercial vehicles are less expensive and polluting fuel than petrol or diesel, quieter engines, which is particularly important in cities where the majority of such vehicles operate, and the load capacity of gas-powered Iveco Daily is almost the same as that of the equivalent diesel van. The disadvantage is poorly developed infrastructure, therefore its development could also be a serious incentive for businesses to consider alternatives. “Basically, the enthusiasts of electric vehicles also face similar problems. Therefore, we look at national governments that regulate this area asking how much they are willing to take the subsidy route in order to increase interest in the alternative, the development of infrastructure and other required processes,” Šimkus added.

The countries searching for already available solutions are not wasting their time. The focus on the issues of the gas refuelling infrastructure has gained momentum in recent years in Europe, including Lithuania. Last year, the number of CNG filling stations in Europe increased to over 37,000, and over 70,000 passenger and 9,000 commercial vehicles were registered.

The Natural and Bio Gas Vehicle Association, NGVA Europe, plans to increase the number of CNG stations in the old continent to 10,000 in the next decade. In Lithuania, there were just under a dozen CNG filling stations until recently, but alternative solutions are emerging on the market. For example, larger fleets have a possibility of installing mobile or even stationary CNG filling stations.

Marius Čižas, the manager of the startup Dvire, which promotes CNG-fuelled vehicles, says that this type of fuel has every opportunity to replace diesel. This can be achieved not only because of tightening legal regulation, but also on a practical basis. “Of course, the first and the most important factor in many choices will be the price. CNG could already cost about 20% less than diesel, and in the future, when the green fuel policy is fully operational in the EU, choices will be made for the benefit of gas. In addition, in some countries, no road charge or a lower charge applies to CNG vehicles.

Also sufficient mileage with one filling – 600 km and more – is ensured,” Čižas added. With three green alternatives the EU aim to reduce CO2 emissions by 30% by 2030 compared to the average indicators of H2 2019 and H1 2020. Freight transport emits around a quarter of the total carbon emissions. New CO2 taxation regulations are due to take effect in 2022. Therefore, models such as CNG-powered Iveco Daily van or Iveco S-Way truck will become even more attractive, because diesel-powered models will become more expensive and their residual value will decrease.

Čižas notes that the total cost of ownership (TCO) of currently available three alternatives in the green commercial transport sector – electric vehicles, hydrogen-powered vehicles and internal combustion engines fuelled with gas, where natural gas is slowly replaced with biomethane and its blends with green hydrogen – can be calculated and compared.

“The purchase price of electric and hydrogen vehicles is three times as high as that of diesel alternatives. Therefore, we believe that CNG-powered vehicles are the most realistic alternative to diesel, because such vehicles are only marginally more expensive. The purchase price of the vehicle and fuel costs account for the major part of the TCO. The purchase price of CNG is and will about one fifth lower than that of diesel. This will be ensured by attracting subsidies and adapting them to the local market and, in the future, through the use of green certificates,” said Čižas.

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