It’s fair to say that natural gas is truly the darling of U.S. energy sources these days, thanks to its abundance, cheap price and relatively clean (lower emission) image when standing next to coal or oil. President Obama certainly sees natural gas as a key piece of his energy agenda. So after spending heavily on electric car tech development and manufacturing for a few years, the government is now beginning to focus its attention on natural gas-powered cars with the announcement on Thursday of a $30 million R&D fund for natural gas vehicles.
The money will come from the Department of Energy’s early-stage technology program called ARPA-E. The DOE is targeting the gas tank as a key area for innovation. It wants to help deliver a lighter gas tank for holding pressurized natural gas because the bulky tanks that exist today work for buses, but not so much for passenger cars. The goal is to support technologies that make it cheaper and safer for consumers to refuel their natural gas cars at home, and that will require technologies that can lower the pressure of natural gas inside tanks, the DOE said. So the projects that the DOE will consider include innovative compressor designs and “absorbing materials that are able to hold gas, similar to how a sponge holds water.”
Popularizing natural gas cars isn’t a novel concept. Remember T. Boone Pickens, who made his fortunes in oil and carved fame from his push for wind power and natural gas cars? We took a look at the market for natural gas vehicles back in 2008, and the benefits and challenges we analyzed remain true today. Honda’s Civic GX is probably the best known natural gas-powered passenger car, and it also remains relatively unpopular, though that’s partly because there isn’t a good fueling network to support it.
The DOE actually closed a $50 million loan to The Vehicle Production Group in March 2011 to develop a 6-passenger, wheelchair-accessible van that can run on compressed natural gas, but the same program that provided that loan gave way more money for electric car manufacturing to Tesla Motors (s TSLA) ($465 million), Fisker Automotive ($529 million) and Nissan ($1.45 billion). The Vehicle Production Group, by the way, is backed by Pickens through his own investment funds and a natural gas distribution company called Clean Energy Fuels.
Building a market for a new set of car technologies will take billions, not millions of dollars, so the new funding from the DOE is good for a short-term boost. Obama has made domestic natural gas development a priority, so we will likely see more money for building natural gas cars and fueling stations , especially if he’s re-elected.
Aside from setting aside money for natural gas vehicles, the DOE also announced a $14 million fund for creating transportation fuels from algae. The DOE already supports more than 30 algae biofuel projects.
Photo courtesy of Honda