LNG locomotives gaining traction in US on cheap gas

The wide and seemingly persistent differential between oil and natural prices in the US continues to encourage new uses of natural gas in transportation applications. A particularly interesting example is in locomotives, most of which currently run on diesel.

According to the Energy Information Administration (EIA): “Taken together, the 7 major US freight railroads consumed more than 3.6 billion gallons of diesel fuel in 2012, or 7% of all diesel fuel consumed in the United States. The fuel cost more than $11 billion in 2012 and accounted for 23% of total operating expenses.”

The EIA believes that “continued growth in domestic natural gas production and substantially lower natural gas prices compared to crude oil prices could result in significant cost savings for locomotives that use LNG as a fuel source”. It says that some major railroad operators view the potential of LNG-fuelled trains as similar to the switch from steam propulsion to diesel in the 1940s and 1950s, a revolution in freight rail known as “dieselisation”.

The message has not been lost on manufacturers of locomotives, most of which have been working on developing the appropriate technologies for some time.

Last month, Motive Power & Equipment Solutions (MP&ES), a provider of new and remanufactured locomotives, said it had introduced an ultra-low emissions gen set locomotive – dubbed the Greenville (see picture above) – fuelled by a combination of natural gas and diesel.

“Natural gas offers our customers an opportunity to greatly reduce their operating fuel costs while cutting emissions at the same time,” said the company’s CEO David Wilkerson. “The availability of low-cost, US-sourced natural gas provides an unprecedented opportunity for green locomotives. MP&ES has invested heavily in technology, research and staffing to be at the forefront of delivering highly affordable, natural gas-powered locomotives for switcher and short-line operations.”

Chart showing comparison for freight rail using diesel and LNG from 2015 to 2040According to the EIA, LNG shows significant potential as a freight locomotive fuel. (Source: EIA Annual Energy Outlook 2014)

MP&ES says it has been evaluating technology options and developing system designs for natural gas locomotives for more than two years so that it can provide “a cost-effective system that can meet the high reliability and durability requirements of the railroad industry”.

An assessment was made of the full range of dual-fuel and dedicated, 100% natural gas technologies. MP&ES, along with technology partner OptiFuel Systems, is now conducting final power system testing and calibration as well as full emissions certification.

The company expects to begin taking orders on its Greenville MP1500 (1500Hp) dual-fuel locomotives later in 2014, with other models to follow. Recently, the company was selected by the Indiana Harbor Belt Railroad Company as one of a limited number of qualified vendors being considered for the conversion of 31 locomotives to natural gas.

EIA’s Annual Energy Outlook (AEO) 2014 includes three cases – the Reference, High Rail LNG and Low Rail LNG cases – that examine the potential effect of LNG in freight rail (see chart above).

In the Reference case, LNG fuel use increases from just over 1 trillion Btu in 2017 to 148 trillion Btu in 2040, or 35% of total freight rail energy consumption. In the High Rail LNG case, LNG fuel consumption increases to 392 trillion Btu in 2040, or 95% of freight rail energy consumption. LNG consumption in the Low Rail LNG case increases to just 64 trillion Btu, or 16% of total freight energy consumption.

“Even under the High Rail LNG case,” says the EIA, “a switch to LNG would increase overall demand for natural gas by less than 1%, resulting in a minimal effect on natural gas prices.”