Would you pay $2.10 for a gallon of gas?
I know I would. According to AAA, the nationwide average for a
gallon of gasoline is $3.59... Diesel is even more expensive at
Yet despite high fuel costs across the country, a select group
of drivers are paying only $2.10 a gallon... about $1.50 below
the national average.
What's the catch?
To be honest, there isn't one. These drivers aren't getting
some "special deal," and this isn't some publicity stunt that's
only available to a select few. They're simply filling up their
tanks with a different kind of transportation fuel -- one that
could make early investors alot ofmoney .
Let me explain...
Over the past decade, new technologies like horizontal
drilling and hydraulic fracturing have unlockedwaves of natural
gas reserves that were previously thought inaccessible. As a
result, gas prices have plummeted to $4.11 per million British
thermal units... well below the 10-year high of $10.79 hit in
With natural gas prices hovering near record lows, companies
across the board are looking for ways to take advantage of the
new cheap energy source... and who better to benefit than the
All over the nation, companies with heavy transportation costs
are introducing vehicles that run off natural gas into their
regular operations. In 2011,
United Parcel Service (
added 48 trucks that run off natural gas to its shipping fleet,
bringing the total number of vehicles in its fleet running on
natural gas to 1,100.
Right now, the average compressed natural gas (CNG) equivalent
to a gallon of gasoline costs $2.10. With roughly 250,000
natural-gas vehicles already diving on U.S. roads -- and CNG
prices roughly $1.50 per gallon cheaper than gasoline -- the
number of CNG vehicles on the road is going nowhere but up.
But while there's ample incentive for truck owners to switch
from diesel to CNG, there's still one big obstacle: lack of
After all, you wouldn't want to be on a lonely stretch of
highway somewhere on the outskirts of Omaha running on 'E'
without a CNG station in sight.
Clean Energy Fuels (Nasdaq: CLNE)
is in the middle of a bold initiative to install hundreds of
natural gas-based fueling stations along the nation's most
Clean Energy Fuels operates an interesting business. It's one
of the few companies focusing on putting natural gas fueling
stations along America's busiest corridors.
Judging by the pace at which the company continues to land new
customers, the plan appears to be working.
Since Clean Energy unveiled its plan lastyear to add fueling
stations to existing Pilot-Flying J truck stops in more than 30
states, the company has picked up more than 100
More and more of the nation's largest freight delivery firms
are willing to at least test-drive CNG powered trucks. Some are
making the full transition and converting their entire
And with fueling stations along the nation's busiest routes --
such as Los Angeles and Chicago to Atlanta, the Texas Triangle,
and major corridors in the Midwest and Northeast -- Clean Energy
is well-positioned to maintain its dominant lead in the
The company already fills up 25,000 vehicles at 273 locations
each week -- and I fully expect that number to continue
Risks to Consider:
There are, of course, a few things that could go wrong. If
the price of natural gas rallies, it could be a deterrent for
companies considering making the switch from traditional
gasoline-burning vehicles to those that run off
Action to Take -->
But seeing as America now has as much natural gas as Saudi Arabia
has oil, I think the trend of "cheap" natural gas is here to
stay. And with the price of CNG about $1.50 less than a gallon of
gasoline... this looks like a huge opportunity for investors in
Clean Energy Fuels.
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