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The Good, the Bad, and the Ugly: Economic and Environmental Implications of Using Natural Gas to Power On-Road Vehicles in the United States

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posted on 01.12.2016, 00:00 by Fan Tong

Currently, in the United States, on-road vehicles are primarily powered by petroleum fuels (gasoline and diesel). These vehicles have caused serious climate change effects from emissions of greenhouse gas (GHG) and health and environmental impacts from criteria air pollutant (CAP). The recent success of shale gas development has brought industry interest in using natural gas to power on-road vehicles. In addition to low costs and wide availability of this national fuel source, natural gas is a common feedstock to produce alternative fuels. The question arises of whether using natural gas for transportation could help or hinder the environment. In this dissertation, I study the economic and environmental effects of a wide range of natural gas fuel pathways for a selection of light duty (LDV) and medium and heavy duty (MHDV) vehicle types. I choose to focus on two environmental metrics: GHGs and CAPs emitted over the life cycle of each potential pathway for natural gas use. First in Chapters 2 and 3, I use life-cycle analysis to understand the emissions of GHGs from different natural gas pathway for LDVs and MHDVs. Then in Chapter 4 I focus on the CAP emissions from these vehicles. Overall, I find that none of the natural gas pathways eliminate life cycle air emissions. In fact, only a few pathways reduce life cycle GHG emissions and/or life cycle air pollution damages compared to baseline petroleum fuels (gasoline for light-duty vehicles (LDVs) and diesel for heavy-duty vehicles (HDVs)). For the cases of light duty vehicles (LDVs) and transit buses, battery electric vehicles (BEVs) powered by natural gas-based electricity provide significant reduction in life cycle GHG emissions and life cycle air pollution damages (for almost all counties) compared to the baseline petroleum fuels. However, the actual electricity that charges BEVs may not be natural gas-based electricity in most parts of the U.S. When powered by U.S. grid electricity (using average emission factors for 2010 and 2014), BEVs reduce life cycle GHG emissions to a lesser extent but increase life cycle air pollution damages significantly. Compressed natural gas (CNG), while reducing GHG emissions and CAP emissions (except CO) at tailpipe, are more likely to increase life cycle GHG emissions and increase life cycle air pollution damages in the majority of U.S. counties. For heavy-duty trucks, CNG sparking-ignition (SI) trucks and liquefied natural gas (LNG) high-pressure direct ignition (HPDI) trucks have mixed environmental impacts. While they are unlikely to reduce life cycle GHG emissions compared to diesel, they reduce life cycle air pollution damages in 76-99% of U.S. counties for local-haul tractor-trailers and in 32-71% of U.S. counties for long-haul tractor-trailers. In Chapters 5 and 6, I examine the economic impacts of natural gas fuel pathways for two vehicle types, tractor-trailers and transit buses. I study the economic feasibility of a national natural gas refueling infrastructure for long-haul trucks in U.S., which is a prerequisite for natural gas tractor-trailers. I find that a transition to natural gas fuels in long-haul trucks is more expensive when the shares of natural gas trucks are below 5% because of low refueling demands and over-capacity of the refueling infrastructure to ensure network coverage. At higher shares of natural gas trucks, both the total refueling capacity and the net economic benefits of the national refueling infrastructure increase almost linearly as adoption increases. Finally, in Chapter 6, I provide an economic-technology assessment for transit buses by considering both life cycle ownership costs and life cycle social costs due to GHG emissions and CAP emissions. Transit buses are early adopters of alternative fuel technologies because of funding supports and operation characteristics (such as high fuel consumption and private refueling infrastructure). I find that the availability of external funding is crucial for transit agencies to adopt any alternative fuel option. Without external funding, only rapid-charging battery electric buses (BEBs) have lower ownership & social costs than conventional diesel buses. When external funding is available to reduce bus purchase costs by 80%, BEBs become much more cost-effective. In this case, life cycle ownership and social costs of BEBs are 37-43% lower than conventional diesel buses. Including life cycle social costs does not change the ranking of alternative fuel options. The findings in this dissertation suggest different strategies of using natural gas for different vehicle markets. Natural gas is best used in electric power generation than to produce gaseous or liquid fuels for powering on-road LDVs. The use of CNG and LNG for heavy-duty trucks may continue as there are less alternative fuel options but issues such as methane leakage should be addressed to avoid important climate change effect. Finally, natural gas-based transportation fuels can at best partially mitigate climate change or air pollution damages, so other mitigation strategies in the transportation sector are ultimately needed to achieve sustainable transportation.




Degree Type



Engineering and Public Policy

Degree Name

Doctor of Philosophy (PhD)


Paulina Jaramillo,Ines L. Azevedo