UPS is ramping up its use of renewable natural gas (RNG), signing a new agreement with Big Ox Energy, a subsidiary of Environmental Energy Capital (LLC), to purchase 10 million gallon equivalents of RNG per year until 2024 — the largest investment in RNG to date for the company. Compared to convention diesel, RNG yields up to a 90 percent reduction in lifecycle greenhouse gas emissions.
Earlier this year, UPS signed a five-year agreement with AMP energy for 1.5 million gallon equivalents of RNG per year from the Fair Oaks dairy farm in Indiana. The RNG agreements will help UPS reach its goal of fueling 40 percent of its ground transportation fleet from sources other than conventional gasoline and diesel by 2025.
“Natural gas is a proven alternative fuel to gasoline and diesel and is a key building block for our goal to reduce greenhouse gas emissions in our ground fleet,” said Mike Casteel, Director of Fleet Procurement at UPS. “These agreements add significantly to our investment in the use of RNG and will help put us on track to nearly triple our annual use of RNG. They are also a direct reflection of our ongoing commitment to help shape the renewable natural gas industry.”
Also known as biomethane, RNG can be derived from many abundant and renewable resources, including decomposing organic waste in landfills, wastewater treatment and agriculture. It is then distributed through the natural gas pipeline system, making it available for use as liquefied natural gas (LNG) or compressed natural gas (CNG).
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UPS fueling stations in Lexington, Ky.; Louisville, Ky.; New Stanton, Penn.; Richmond, Va.; Roanoke, Va.; West Columbia, S.C.; Horsham, Pa. and Doraville, Ga. will use Big Ox RNG to fuel UPS delivery vehicles and tractors.
“UPS continues to make investments in renewable natural gas that help move the industry forward,” said Rob Larsen, CEO of Big Ox Energy. “Our agreement with UPS is one of the largest contracts we have signed to date and among the largest ever in the RNG market.”
Since 2009, UPS has invested more than $750 million in alternative fuel and advanced technology vehicles and fueling stations globally. In 2016, UPS used 61 million gallons of natural gas in its ground fleet, which included 4.6 million gallons of RNG and is on track to use 14 million gallons in 2017. UPS drives more than 5,200 CNG and LNG vehicles in its fleet of alternative fuel and advanced technology vehicles. Earlier this year, the company announced a more than $90 million investment in natural gas vehicles and infrastructure. This investment included an additional six compressed natural gas fueling stations, 390 new CNG tractors and terminal trucks and 250 liquefied natural gas vehicles.