Alternative Fuel Vehicles Gain Momentum Amid Climate Push and Policy Support
Alternative fuel vehicles is experiencing rapid growth with increasing awareness of climate change and air pollution has pushed governments to implement stringent emission regulations and offer incentives such as zero emission zones, tax benefits and government subsidies. Other growth factors consist of growing fuel prices, charging and refueling infrastructure expansion and active funding by automotive manufacturers in electric and hybrid vehicle lines.
Key Growth Drivers and Opportunities
Infrastructure Expansion: The factors responsible for growth consist of charging infrastructure expansion for electric vehicles (EVs) and refueling stations for other alternative fuels crucial for enabling large scale adoption of alternative fuel vehicles. Given refueling points and accessible and reliable network of charging supports shifting from traditional internal combustion engine vehicles. Major investments are growing in public and fast-charging stations, hydrogen refueling infrastructure, and biofuel distribution hubs meeting the growing need.
Challenges
Raw materials such as lithium and cobalt are majorly disrupting the EV production and elevating the cost with global shortages and geopolitical tensions. The manufacturers and automakers are facing challenges with export restrictions on key materials such as rare earth elements and battery components with China dominating in processing these material-refining approximately around 70% of global supplies.
Innovation and Expansion
RFA Showcases Ethanol-Powered Hybrid at D.C. Auto Show
In January 2024, the Renewable Fuels Association showcased the Plug-in Hybrid Electric Flex Fuel Vehicle (PHEFFV) at the Washington, D.C. Auto Show. RFA conducted various tests for the converted 2022 Ford Escape, including tailpipe emissions analysis, life cycle greenhouse gas assessment, cost of ownership analysis, and convenience testing.
Findings indicated that, in comparison with standard gasoline-powered cars, the PHEFFV operating on high-level ethanol blends considerably reduced lifecycle greenhouse gas emissions. In terms of fuel economy and total cost of ownership the vehicle also showed competitive performance.
National Fuel Launches ANG Pilot to Cut Fleet Emissions
In June 2023, an alternative fuel vehicle pilot program was initiated by National Fuel Gas Distribution Corporation (National Fuel) officials. The program utilizes an Adsorbed Natural Gas (ANG) platform developed by Ingevity Corporation, known as NeuFuel. This platform has the potential to reduce greenhouse gas emissions by up to 125 percent, according to the Natural Gas Vehicles of America (NGVA), when combined with renewable natural gas (RNG).
National Fuel aims to contribute for decarbonizing transportation sector and accelerate operations for broader fleet adoption. Relative to traditional compressed natural gas systems, early testing suggests gains in fuel economy and ease of refilling.
Alternative Fuel Shift in Global Market
The key players operating in the alternative fuel vehicles manufacturing include, Honda Motor Co., Ltd, Toyota Motor Corporation, BYD Company Ltd., VERRA, Daimler AG, and others. To meet the demands of changing consumers, the companies aim to boost the transition to low-emission mobility by expanding their electric and hybrid product portfolios. Vehicle affordability, enhancing fuel efficiency and reliable infrastructure are major aims for given key players.
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