UPS (NYSE: UPS) purchased 170 million gallon equivalents of renewable natural gas (RNG) to use between 2020 and 2026. Since 2014, UPS ground fleets consumed 28 million gallons of RNG. In order to consume what was purchased, it must annually use close to the total consumed gallons of RNG from the last five years.
UPS' goal is to reduce greenhouse gas emissions by 12% in its ground fleets by 2025. Drivers will be able to get RNG from the following locations: Phoenix; Commerce City and Trinidad, CO; Atlanta and Tifton, GA; Kansas City, KS; New Orleans, Port Allen and Shreveport, LA; Omaha, NE; Sparks, NV; Oklahoma City; Chattanooga, TN; El Paso, Fort Worth and San Antonio, TX; and Salt Lake City.
This comes a year after a large purchase of compressed natural gas (CNG) vehicles — 400 tractors and 330 terminal trucks. The purchase occurred with the intention of converting the liquified natural gas (LNG) and CNG fleets to RNG, forcing the development of the infrastructure, including additional pipelines to increase pipeline capacity of natural gas.
Renewable natural gas can be carried the same way as CNG and LNG through the same pipelines. It also requires no change to any existing infrastructure.
Natural gas consumption (NGCON.TRAN) is on the rise as fleets begin driving change to reduce emissions and long-term costs since diesel costs more. Natural gas is more widely available than other alternative fuels, which means that despite the upfront costs of new vehicles that run on natural gas, it is far more convenient than retrofitting the fuel tank for biodiesel and having very few fueling options outside of California.
SONAR: NGCON.TRAN, TRANG.USA
Natural gas fleets are just one of the sustainability solutions being made by UPS. The sustainability solutions include electric-assist cargo bikes and tricycles, smart access devices to complete more first attempt deliveries, hybrid vehicles, electric vehicles and natural gas powered vehicles. UPS has invested more than $1 billion in sustainability efforts across the world since 2009.
LNG and CNG are extracted from fracking sites, especially in sites where oil is drilled. The decomposition of waste produces methane, which is used in RNG. When a landfill is sealed, it traps the methane gas, which is pumped out and transferred via pipeline. This is far more sustainable than allowing the gas to release into the atmosphere as it is 25 times more damaging to the ozone than carbon dioxide.
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