Kwik Trip counting on boom in CNG business

​Kwik Trip is banking on natural gas to be the new alternative fuel of choice.

The convenience store chain opened a compressed natural gas option at one of its locations in La Crosse a year ago and started offering the fuel in Minnesota City in December, bringing the total number of Kwik Trip locations offering CNG to nine.

Kwik Trip already has 12 new locations planned, with a goal of offering the fuel at 30 locations in Minnesota, Wisconsin and Iowa by the end of the year.

Natural gas technology for vehicles has been around for more than a decade, but the market for the fuel has really taken off in the past year due to high and volatile gasoline prices, combined with a push by companies like Kwik Trip to market the alternative fuel. As a result, 2012 was a good year for growth for businesses involved in the technology, like Allstate Peterbilt of Winona.

Peterbilt general manager John Bush has become a leading proponent of the fuel, selling a variety of trucks that run on it including milk trucks, semis, concrete mixers and garbage trucks. Last year, the company sold about 25 CNG trucks and is planning on tripling its sales this year.

“There is a tremendous amount of interest in natural gas,” Bush said. “It’s really taken off.”

The biggest reason for the boom, said both Bush and Kwik Trip’s superintendent of alternative fuel, Joel Hirschboeck, is price.

With prices for CNG about $2 a gallon, the fuel is half the price of diesel — but gets similar mileage. For fleets that put on lots of miles every year, those savings add up. But proponents of the new fuel cautioned that companies should do their own math before switching.

The fuel is also produced domestically and has fewer emissions than diesel or gasoline, which makes it desirable for companies that are environmentally conscious or patriotically motivated. People like to go green, Bush said.

Hirschboeck said Kwik Trip is prepared to bet on natural gas for the long haul. There are other alternative fuels out there he said, but the company believes natural gas is the only real contender. It doesn’t have subsidies supporting it, so it has proved it can be profitable on its own.

“It’s a simple technology and a simple fuel, and that bodes well for its success,” he said.

There are costs for adopting CNG. Bush said vehicles that run on the fuel can cost between $40,000 to $60,000 more than traditional vehicles. But despite the challenges, Bush is firmly behind it.

“It’s a trend that is not going away,” Bush said. “It’s here to stay. We see growth in most markets.”

This article was first published by Winona Daily News.


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