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Big Green Machines

Nov. 14, 2011
While consumer interest in alternative-fuel vehicles has been lukewarm, the commercial-vehicle industry is shifting into high gear with green technology.

In October, the waste-management firm Republic Services announced plans to build a natural-gas fueling station in Indianapolis and add 60 natural-gas trucks to its fleet there next year.

Republic Services, which provides waste-collection services for customers in 40 states and Puerto Rico, noted that natural-gas vehicles cut greenhouse-gas emissions by nearly 30% compared with diesel trucks, while delivering a quieter ride.

Green technology is nothing new to Phoenix-based Republic Services. The company has been using natural-gas vehicles for at least 15 years in California, spurred by the state's tough emissions standards, explains Kevin Walbridge, executive vice president, operations.

While Republic's 700 natural-gas collection vehicles represent about 5% of its fleet, the company has "made the decision to aggressively pursue the use of compressed-natural-gas vehicles" as existing trucks reach the end of their service lives, he says.

"We're very comfortable with them. We think they're very reliable," Walbridge says of compressed-natural-gas (CNG) vehicles. "We have a very good repair history, we understand the vehicle and we understand the economics."

Republic Services has 700 natural-gas refuse vehicles in its fleet.Regarding the economics, Walbridge estimates that the company typically recoups its investment in a natural-gas vehicle in less than three years thanks to the fuel-cost savings. But Republic also takes into consideration some of the less tangible benefits of natural gas, such as improved "fuel-supply stability" by virtue of its reduced dependence on foreign oil.

"The other thing, from a closed-loop-environment standpoint, is our landfills generate methane gas that we can convert into CNG," Walbridge says. "That gives us a little bit of a natural hedge."

Driven by environmental regulations, growing customer and shareholder demand for greener products, and the specter of higher fuel prices, green technologies are steadily gaining traction in the commercial-vehicle market, says Elisa Durand of the fleet-management firm Automotive Resources International (ARI).

Durand, who is assistant manager of strategic services, environmental and fuel strategies at ARI, asserts that interest among commercial-vehicle users in green technologies has moved beyond being "a feel-good trend" that will come and go.

"This stuff is here to stay," Durand says. "It's not just, I'm gonna go out and hug some trees and pet a bunny.' [Fleet managers] really see this as an opportunity to diversify themselves, to save some money on fuel. The next time we get a 2008 where fuel spikes, if you have enough propane and natural-gas vehicles or even hybrids, you're not going to be sweating as much, because you prepared."

A Sustainable Business Model'

Commercial-vehicle OEMs and suppliers have hopped on board the green movement in recent years.

Warrenville, Ill.-based Navistar International boasts that it was the first company to produce hybrid commercial trucks on an assembly line, and in 2009 said it was the first OEM whose customers accumulated more than 5 million miles driving its hybrid trucks and buses.

Navistar's vehicle lineup includes hybrid versions of its commercial and school buses and medium-duty and severe-duty trucks. The CE-Series plug-in-hybrid school bus, for example, mates its MaxxForce diesel engine with an induction electric motor, lithium-ion batteries and power-management software to boost fuel efficiency by up to 65% and slash GHG emissions by up to 39%, according to the company.

Navistar recently introduced a CNG version of its International WorkStar work truck, and in March unveiled a prototype Class 8 semi truck that runs on a mixture of 15% diesel fuel and 85% liquefied natural gas.

The company began dabbling in hybrid technology in the mid-2000s, says Navistar communications manager Steve Schrier. But the eye-popping spikes in fuel prices in 2008 prompted fleet managers to take a serious look at alternative fuels, kicking hybrid development into high gear at Navistar.

"When you're looking at diesel fuel at $4, $4.50, $5, $5.50 a gallon, that's millions and millions of dollars to a large fleet's bottom line," Schrier says. "That's really what drove a lot of this. We're not green for the sake of being green. We're green because it makes sense to our customers."

Cleveland-based Eaton Corp. is in the same camp. In October, Eaton announced that users of its hybrid power systems had accumulated more than 200 million miles of service.

The company's hybrid electric and hybrid hydraulic systems are used on city and school buses, utility vehicles, refuse trucks and other commercial vehicles made by companies such as Daimler Trucks, Ford, Freightliner, Navistar, Peterbilt, India's Tata Motors and China's Yutong Group.

The company is "seeing global acceptance of hybrid technology among truck and bus manufacturers as well as fleet owners and operators," said John Ritter, vice president and general manager of Eaton's Hybrid Power Systems Division.

Another Cleveland-based company -- Parker Hannifin Corp. -- has been busy in the hybrid space as well. In September, the manufacturer of motion and control systems launched its new Hybrid Drive Systems Division, which will focus on "commercial-scale launch of its hydraulic hybrid technologies for use in heavy- and medium-duty vehicles," the company said.

Autocar LLC, a Hagerstown, Ind.-based manufacturer of Class 8 trucks, is using Parker's RunWise series-hybrid technology in its new E3 refuse vehicle, while FedEx and UPS have placed orders for a new hydraulic hybrid delivery truck being developed jointly by Parker and Freightliner Custom Chassis.

In September, Troy, Mich.-based Altair Engineering unveiled what it called the world's first series-hybrid hydraulic transit bus -- the LCO-140H. The bus, which promises to lower the cost of ownership by $170,000 per bus compared with conventional diesel models, is powered by Parker's hydraulic hybrid technology.

Altair Engineering, a product design and development consulting firm best known for its proprietary computer-aided engineering software, hopes to partner with an OEM to commercialize the transit bus.

The initial plan would be to produce about 400 buses each year in a single-shift operation, Altair ProductDesign COO Mike Heskitt told IndustryWeek, noting that some 5,000 buses are purchased each year in the United States.

"It's a sustainable business model," Heskitt said. "If we can offer a very good product with a much better ROI, and lower [transit authorities'] dependency on fuel, we feel like there's a good space for us in the market."

Diesel Isn't Dead

The increased interest in alternative fuels shouldn't obscure the fact that diesel-powered vehicles are more efficient and cleaner than ever, asserts Brian Mormino, director of energy policy and emissions compliance for engine manufacturer Cummins.

"It's not your daddy's diesel," Mormino says.

The on-highway diesel engines of today emit 99% less particulate matter and nitrogen oxides (NOx) than they did 30 years ago, according to Cummins, thanks to technology such as exhaust-gas recirculation, diesel-particulate filters and selective catalytic reduction (SCR).

The real headliner going forward, Mormino says, will be SCR, which virtually eliminates NOx emissions while improving fuel efficiency by up to 6%. In an SCR system, a chemical reductant such as urea converts to ammonia in the exhaust stream and reacts with NOx over a catalyst, forming harmless nitrogen gas and water.

While filters have reduced particulate emissions to near-zero levels, SCR systems typically produce exhaust that is "cleaner than the ambient air around you," Mormino explains.

Dan Clark, general manager of GE Capital Solutions Transportation Finance, expects diesel technology to continue to get greener "over the next couple generations."

"From a diesel perspective, you don't see the black smoke anymore," Clark says. "I think the whole industry has substantially changed their image and perception and their intent to not be the polluters of the 60s and 70s."

That said, hybrids and other alternative-fuel commercial vehicles aren't going away, asserts ARI's Durand. But in terms of adoption, she doesn't see one particular green technology pulling away from the rest of the pack.

"If someone is driving 200 miles a day, electric is probably never going to be the No. 1 fuel choice," Durand says, unless advancements in battery technology enable electric vehicles to travel much farther on a single charge. "But if you're in the city, and you're doing a fixed route and you have the opportunity to recharge, electric is going to be the better choice. I think you're going to see people diversifying their fleets."

As examples, she notes that early adopters such as PepsiCo, Coca-Cola and UPS have a mix of electric, propane and natural-gas vehicles in their fleets.

"I think you're going to see people adopting more green technologies, but not necessarily putting all their eggs in one basket."

Working Together for the Greener Good The collaboration between truck manufacturers and the Obama administration on new GHG regulations shows that maybe, just maybe, government isn't completely broken. When the Obama administration in August unveiled the first-ever standards to regulate greenhouse-gas emissions and fuel efficiency in medium- and heavy-duty commercial vehicles, Cummins was ready.

So ready, in fact, that the company said its ubiquitous engines will meet the requirements of the new regulations on Jan. 1, 2013 -- one year before the rules begin kicking in.

Columbus, Ind.-based Cummins praised the Department of Transportation and EPA for including vehicle and engine manufacturers, suppliers, fleet managers and environmental groups in the rulemaking process -- and for listening to them. The end result, Cummins said in August, is "a workable regulatory structure that accommodates the diverse needs of the commercial-vehicle sector."

With support from the likes of Chrysler, Cummins, Daimler Trucks, Ford, General Motors and Navistar, the final rule brings to bear the expertise of government regulators and the industry, asserts Brian Mormino, director of energy policy and emissions compliance for Cummins.

"We understand our engines and the industry, and so does Daimler, so does Volvo, so does Navistar, so does the American Trucking Association," Mormino tells IndustryWeek. "And because of that widespread knowledge and involvement, EPA and DOT did a great job of saying, Let's go out and get this broad-based knowledge. Let's reach out to everybody, bring everybody in the tent, and really have a collaborative process to put together a rule.'

"And it's a model for how industry and government should work together."

The process drew praise from Navistar as well.

"I don't think we've always been brought in on the process in other regulations, but I think we felt that our voice was heard, and that at the end of the day the actual rules and regulations that came out reflected our input and our commitment to the customer," says Steve Schrier, communications manage for Navistar.

Navistar and Cummins are among a who's who of commercial-vehicle manufacturers and suppliers participating in the Department of Energy's Super Truck program. The program, which aims to create a Class 8 truck that is 50% more efficient than current models, is another example of a "robust public-private partnership," Mormino says.

Collaboration with the Department of Energy has been "absolutely critical" to the development of commercial-vehicle technology that has enabled the industry to comply with environmental standards, Mormino asserts.

"Without that collaboration, I think we would have a much more difficult time and a much costlier time getting there," Mormino says.

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