Cost-Effectiveness Analysis of CNG Urban Taxi Operations
Mark A. Euritt, October, 1993
Increased emphasis on energy efficiency and air quality has resulted in a number of state and federal initiatives examining the use of alternative fuels for motor vehicles. Texas’ program for alternate fuels includes compressed natural gas (CNG). Based on an analysis of 30-year life-cycle costs, CNG is a cost-effective option for high-mileage taxi operations. High mileage is defined as at least 83,586 miles (134,573 km) for a fleet of 5 taxis, 35,769 miles (57,588 km) for a fleet of 25 taxis, and 30,193 miles
(48,611 km) for a fleet of 50 taxis. The largest fleet (50) generates an Internal Rate of Return on investment of 30 percent; 22.5 percent is realized for the medium (25) fleet, and 11 percent for the small (5) fleet. Availability of original equipment manufacturer (OEM) dedicated natural gas vehicles is vital to the future success of CNG taxi operations. OEM vehicles offer important efficiency gains needed to justify the purchase of CNG vehicles.
Keywords: Alternate Fuels, Energy Efficiency, Air Quality, Compressed Natural Gas (CNG), Vehicles, Life- Cycle Costs, Cost-Effective, High-Mileage (Urban) Taxi Operations, Fleet, Original Equipment Manufacturer (OEM), Analysis, Internal Rate of Return, Public Refueling
ENTIRE REPORT (Adobe Acrobat File – 5.7 MB)