Growth in LPG vehicles seen

BOULDER, Colo. (Feb. 20, 2013) — The market for vehicles powered by liquefied petroleum gas (LPG), otherwise known as propane or autogas, seems poised for growth, according to a new report from Pike Research.

The selling points for autogas, Pike said, include a cost per gallon significantly lower than gasoline or diesel in many countries, and at least an initial existing LPG infrastructure. "However, increasing interest in compressed natural gas as a vehicle fuel, along with hesitation by both biofuel producers and auto manufacturers to make a significant investment in autogas, will most likely limit future growth in this sector to a slow and steady pace," said Pike, a part of Navigant's Energy Practice.

The number of autogas vehicles sold worldwide each year will surpass 1.4 million by 2020, the Pike report said.

"Autogas is relatively clean burning, easy to store and transport, has high energy content, and is widely available in many countries," said David Alexander, Pike senior research analyst. "In countries with government incentives, a commitment to limiting fuel taxes, infrastructure to make the fuel easy to obtain, and the availability of vehicles, this market will accelerate. That's unlikely to happen, though, in countries where autogas is not already established."

Turkey, for instance, where more than 200,000 autogas vehicles are sold each year, is by far the largest market in the world for these vehicles, Pike's report stated. "Because most applications for LPG have the fuel delivered to on-site storage tanks, the most popular automotive use in many countries is for fleet operations, where vehicles return to a central depot every day."

The report—"Propane Autogas Vehicles"—analyzes the opportunities and challenges in the market for autogas vehicle conversions, providing an examination of autogas use in vehicles and highlighting countries where such conversions are most popular. The study includes forecasts through 2020 for component sales and installation labor cost by world region, along with a detailed analysis of the benefits, drivers and market barriers for autogas vehicles. Key market players also are profiled.

Pike Research is providing an executive summary of the report for free download on its website.

According to data on the U.S. Department of Energy's (DOE) website, LPG has both advantages and disadvantages. On the plus side:

• 90 percent of propane used in the U.S. comes from domestic sources;

• LPG is less expensive than gasoline; and

• It offers potentially lower toxic, carbon dioxide (CO2), carbon monoxide (CO), and non-methane hydrocarbon (NMHC) emissions.

On the negative side, the DOE said LPG:

• Has limited availability (a few large trucks and vans can be special-ordered from manufacturers; other vehicles can be converted by certified installers);

• Is less readily available than gasoline and diesel; and

• Offers fewer miles on a tank of fuel.