Maybe it takes a certain type of person to be excited about refuse haulers. If so, I guess that describes us at Change Energy.
It’s not about what is under the hood (or in the trash compactor, as the case may be). Instead, it is about the fuel in the tank – compressed natural gas, or CNG. And it’s not because CNG is something new on the scene, because it’s not.
No, our excitement comes from the fact that there is finally a stake in the ground to say that this cleaner fuelling option is the new normal for refuse haulers. Looking ahead, it also comes from knowing that refuse haulers are likely just the first vehicle to hit this milestone ahead of other return-to-base fleets that stand to reap similar benefits.
Why do we call it the new normal? We are not market analysts, so we don’t point to such phenomena as tipping points, critical mass, or established trends, etc. Rather, our view at Change Energy comes from being Canada’s engineering designer and builder with the longest standing participation in serving the CNG fuelling business. In 2012, we were approached to assist with the first CNG fleet installations in Ontario, undertaken by Green For Life (GFL) in Stoney Creek and Orangeville to serve approximately 50 trucks. Since then, working with a range of partners and clients we have had the opportunity to design/develop CNG refuse hauler facilities to serve an additional three fleets that were all previously fuelled with diesel.
Looking at the bigger worldwide picture, about 15.2 million natural gas vehicles are on the road. Refuse hauler sales currently capture more than 50% of the market as the largest waste management fleets, some having operations in Canada, transition to natural gas. We see all of this as a definite sign that CNG-fuelled haulers are now the new normal in Canada and around the world.
But market-growth numbers don’t answer the ‘why’ question. Exactly why is CNG fuelling regarded as the new normal for refuse haulers? In a nutshell, CNG has become a fuel of choice by doing what any alternative fuel must do to become mainstream – by proving that it can do the job better. In this case, doing the job better translates to doing it ‘cleaner at the right cost’ and being able to validate it.
Whether it is to fight climate change or to reduce urban pollution (many diesel haulers consume 2-2.5 liters per km!), a municipality’s commitment to clean operation of its vehicle fleets is past being a nice-to-have. It is an imperative. This is evidenced by non-negotiable CNG requirements in many requests for tender that we see issued today. Hence it is the inherently competitive tender process for desirable municipal contracts that is driving the rate of market adoption for CNG refuse haulers. Naturally, there are many municipalities that continue to own and operate their own fleets. The reality is, however, that when industry leaders adopt a way to better serve municipal needs, other providers – including internal providers – soon see the merits of adopting as well.
The City of Toronto is a good example of this. With outsourced contractors currently operating CNG-fuelled haulers in designated neighbourhoods, Change Energy was engaged by the City and recently completed CNG facilities at two City depots to serve a total of 150 new CNG vehicles.
Greenhouse gas reduction isn’t the only reason for specifying CNG waste haulers – there are few, if any, jurisdictions where simply being cleaner will warrant a sign-off from the management team. A clear requirement for this kind of fuel switch is a solid long-term business case showing reduced operating costs that deliver a reasonable rate of return on the upfront investment. The proof is in the numbers in many municipalities today – plainly put, natural gas is cleaning up refuse collection operations with significant overall cost savings. As a result, some operators are even transitioning their fleets more aggressively than originally planned.
Closing the waste-to-fuel circle
The other interesting matter in the mix is.….well, matter. Organic matter that is – tons and tons of it – that cause never-ending disposal challenges for municipalities. But wait! Compressed Natural Gas (CNG) engines can also run on Renewable Natural Gas (RNG), made from bio-waste. (I think we saw it first in Back to the Future).
Change Energy has been engaged by municipalities who see RNG or a CNG/RNG blend, with its multiple win-wins, as the end game for the adoption of natural gas vehicles. Depending on the municipality’s operations, there are varying approaches – some are transitioning through the adoption of CNG today, others are positioning for a full-scale RNG opportunity. Either way, it is coming closer and closer to reality that we can ‘close the circle’ so that the waste that these vehicles haul is ultimately used to fuel the vehicles!
When is the time right?
The most common question is… When is the right time to switch? We know that refuse haulers are fleet-based workhorses with predictable attrition rates. As such, the transitioning of a fleet to vehicles that run on CNG and/or RNG must be exactly that – a transition that makes practical, bottom line sense in all regards of purchasing, operating, servicing and maintaining the vehicles.
This is where comprehensive modelling and assessment comes in to define and validate the full case – financial, technical and operational. It is the only way to set the right expectations of what is achievable, and it is one of things we do a lot of at Change Energy.
Let us know if you would like to know more about ‘the new normal’ and what it can mean for your organization. Call 905-829-5756 and speak to Ry Smith, or email email@example.com.