Naturally, the question asked in the title is one of our larger and newer concerns. Here at Energie Fuel Group and Lakeview Petroleum, the fuel distribution via fuel cards is currently one of our main objectives. However, it would be irresponsible to not consider the potential possibilities of our future regarding the energies businesses use to power their fleets.
2020 has brought the issue of the future of fuel to my attention more than ever, triggered on April 20 when the price of crude was in the negative 40s. Although the question has little to do with the historical moment of crude reaching negatives, this was the trigger that is making me research and write about the future of fuel, with the intention of learning and to also deliver to our customers (and readers) a positive summary.
My educated intuition is that we are moving in the direction of several types of energies that are no longer primarily petroleum based, as we’ve been during the past 75 years; With this research I am intending to deliver a clarifying tone as to what the actual state of fuel is and its future to power our fleets.
A little bit about engineering and efficiency regarding Diesel Fuel in the USA. Let’s go back in time to 2010. Let’s say that there is a company with 20 power units (18-wheelers, years 2005 to 2010) that consume about 40,000 gallons per month. The same company in 2020, with the same routes and cargo but with newer power units (years 2016 to 2020) consumes around 33,000 gallons. In my limited experience and via simple fuel card metrics, this is a 15% improvement in fuel economy thanks to the newer diesel engines. (An additional 5% on 2018 and newer trucks). This is truly an amazing improvement in fuel economy.
A bit more context on what does the 15% improvement means for us; According to the Diesel Technology Forum’s analysis of 2018-2019, there are 11 million diesel-powered commercial vehicles on U.S. Roads, and, according to the Energy Information Administration of the U.S. during 2019 about 47.2 billion gallons of diesel fuel were consumed by the transportation sector. Meaning that the average consumption by diesel powered commercial vehicle was 4,290.91 gallons.
Of the 11 million diesel vehicles, about 20% or 2.2 million vehicles are newer models (2018 or newer). These 2.2 million are saving about 760 gallons (or 15%) versus an older model truck. Which means that on average, and thanks to new diesel engineering, refiners are selling 1.672 billion less gallons, less produced and less burned gallons.
We are moving in the right direction of being less petroleum dependent, slow for some, and fast enough for others.
About 81% of petroleum used to power vehicles and machinery in the USA; however, this number is decreasing day-by-day. New technology applied to machines, alternative energy, and chemicals are the cause of the increased independence from non-renewable fuels to renewable and/or sustainable sources.
Cases and political, governmental, and corporate structures like the Paris Climate Agreement, the Volkswagen Diesel Fiasco, Mr. Resch heading the Deutsche Umwelt Hilfe, Tesla Motors, and our very own California Gov. Newsom all promote (whether intentionally or unintentionally) the lowering of petroleum dependence based on scientific proven evidence relating to the improvement on human health, environmental preservation, and even a delayed positive financial outcome.
Technologies such as electric vehicles (EVs), hydrogen cells, and Renewable Diesel are the top alternative energies of the future. As time passes, technology will advance to make our future greener, safer, and financially stable, and solve some of the current limitations and issues:
- Batteries will get lighter and provide electrical power for longer miles driven.
The main impediment with electrical fleets is that the lithium-based batteries are too heavy. Battery and electrical technology is on the verge of completely changing the way electricity is transmitted and stored, mainly to more neutral temperatures (not too hot nor cold), quicker transmission times, and smaller build which also means a lighter battery.
- The infrastructure across America will grow for Hydrogen replenishment.
According to my findings, infrastructure is the top limitation. Several companies have added a few fuel cells powered by hydrogen or other energies to trucks in their fleets. The pros are that torque is not an issue and that sound pollution is dramatically lesser versus that of Diesel. The cons are: less mechanics, higher cost for parts, and extremely limited infrastructure to fuel hydrogen; there also seems to be a feeling of high hydrogen prices when fueling. However, the growth of hydrogen sites is being promoted and on the rise.
- Renewable Diesel will continue making its way through California and the rest of the States.
Made from vegetable oil, burns cleaner than Diesel, has more cetane power, works better in colder temperatures, last longer in case of storage and can be mixed with petroleum diesel. Like hydrogen, infrastructure and demand are two limitations for renewable diesel, but it’s still on the rise.
Finally, the question is: By When?
While there are many sources that differ on projected dates, the average is that our fleets will be renewable and fossil-free-fuel in about 30 years in America, by at least 90% (eta. year 2050). We’ll see gradual year-by-year changes as we have during the last 15 years; however, viewing our recent history and stats, we believe that by year 2034 we should be reaching 50% dependency to 10% dependency by 2050.
Fleets would continue to depend on some level on petroleum products as there are many plastic and rubber components that are petroleum-based, along with many of the greases and lubricants used.