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Alternative Fuels Slowly Rolling into Alaska’s Trucking Fleets

by | Sep 28, 2022 | Energy, Featured, News, Transportation

Tractor Trailer in Alaska

Earlier this year, Alaska CNG received a Kenworth powered by compressed natural gas, which hauls North Slope gas to the utility’s customers.

Alaska CNG

Earlier this year, Alaska CNG accepted delivery of a Kenworth T800 to haul compressed natural gas to customers in the Deadhorse area. The fuel doesn’t simply ride in the tanker trailer, though; compressed natural gas (CNG) powers the truck. Alaska CNG hopes to become a model for alternative energy in ground transport.

Numbers Make Sense

Alaska CNG is the distributor for Norgasco, the Deadhorse-based utility that puts North Slope natural gas to use. “Natural gas is seen as this terrible byproduct of producing oil,” says Lauren Latchem, a project engineer for Alaska CNG and Norgasco. Thus, it makes sense for the utility’s own fleet of light-duty and heavy vehicles to tap it as a fuel.

Latchem was invited to a panel discussion this week hosted by the technology accelerator Launch Alaska and the Center for Transportation and the Environment, an Atlanta-based nonprofit. She described how her company is pioneering CNG for ground transport in Alaska, hoping to convince larger fleets, like Lynden or Matson, to make the switch.

“We actually painted [an Alaska CNG truck] to look a lot like Lynden’s, and we were trying to sneak it into their fleet,” Latchem quipped.

The goal of the 2022 Clean Transportation Leadership Roundtable, according to Launch Alaska, was to accelerate adoption of alternative energy in medium- and heavy-duty trucking. Those alternatives include CNG, biofuel, hydrogen, or battery-electric motors to cut down on burning gasoline or diesel. By examining alternative fuels used elsewhere, the lessons learned could be applied to fleets in Alaska.

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Each of the alternatives has the advantage over gasoline and diesel in terms of lower emissions, both carbon dioxide and particulates. Latchem notes that a predictable fuel cost is another benefit: natural gas has been consistently $2.50 per gallon of gasoline equivalent for decades, although she notes that the market in Deadhorse is economically isolated.

Even in California, though, natural gas pays off for large fleets, like UPS. “What we found at UPS when we went the route of CNG is that, when we started scaling, the numbers made sense,” says Ryan Bankerd, UPS corporate director of automotive sustainability. “It became a very profitable solution for us to run CNG, even though the maintenance is higher than diesel.”

Bankerd says price stability makes up for maintenance cost, especially with the alternative fuel tax credit. Furthermore, new diesel regulations will require cutting nitrogen oxide emissions by 90 percent, and the scrubbers to achieve that are an additional cost. Natural gas already meets that emissions standard, so the cost is comparable.

UPS in California also buys biofuel from FirstEnergy, which is sourced from agriculture waste.

Obstacles and Recommendations

Fueling Station in Alaska

A pilot program CNG station was installed in 2019 at Conam Construction Company in Prudhoe Bay.

Alaska CNG

Latchem says Alaska CNG has operated in a harsh environment with “no hiccups,” but she still sees hesitancy among the state’s truckers about switching from diesel to natural gas. “It’s not the liquid fuel that everyone’s used to,” she says. “Everyone’s concerned about temperatures and will it run.”

Joe Michel, executive director of the Alaska Trucking Association, says drivers are open to using new fuel, but not if it’s unproven. “It’s cost prohibitive, and the technology’s not there,” he says. “Everybody is actively paying attention to it… We’re just those three or four breakthroughs away from being able to adopt it.”

Obstacles to adoption include not just the startup costs of procuring new rolling stock but the lack of infrastructure for any given alternative. For electric vehicles, a strategy is in the works to install charging stations along the Railbelt corridor, but north of Fairbanks is still out of bounds. When Launch Alaska sent a convoy of electric vehicles to the North Slope this summer as a demonstration, the charging stations along the route were only temporary.

For CNG, Latchem notes that Anchorage has only one public filling station, at Ditch Witch of Alaska, and the company set it up on their own initiative.

Katherine Keith, Change Management Director at the Alaska Department of Transportation and Public Facilities, says public funds will be available for some new hardware. “We’re doing what we can to invest in the capital infrastructure that allows us to reduce expenditures on the operating side in years to come,” she says.

Until then, Bankerd recommends that fleets pick whichever alternative fuel suits their operating needs, depending on range, weight, idle time, et cetera. Transport companies can also collaborate, dividing the costs of infrastructure. They can also contact manufacturers for samples of new technology that can be tested in Alaska conditions.

“If I was an Alaskan with that challenging environment,” Bankerd suggests, “I would look more toward the renewables standpoint right now and allow some of these other states, like California, to figure out some of these zero-emission electric solutions. Take advantage of that stuff down the road.”

Michel agrees that’s what Alaska truckers are watching for. “It’s got to be proven on those beautiful, easily marked Arizona highways long before it’s ever going to be able survive heading up to Fairbanks or Deadhorse,” he says. “We’re waiting for that next generation to come along.”

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The track of oil and gas development in Alaska shows the footprints of bold companies and hard-working individuals who shaped the industry in the past and continue to innovate today. The May 2024 issue of Alaska Business explores that history while looking forward to new product development, the energy transition for the fishing fleet, and the ethics of AI tools in business.

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