CleanFuel propane engines certified

• By GARY PERLLOUX
• Advocate business writer
• Published: Jun 24, 2008 - UPDATED: 12:05 a.m.

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CleanFuel USA, a company chaired by Lake Charles businessman Oliver “Rick” Richard, has gained certification from the federal government and California for commercial truck and bus engines that run on propane, rather than more costly diesel and gasoline.

The 8.1-liter engines run medium-duty vehicles on liquid propane injection systems with a fuel that’s now about $1.50 a gallon cheaper than gasoline and $2 a gallon cheaper than diesel. A 6.1-liter model is slated soon for lighter-duty vehicles.

There is a catch: The original equipment engines are adapted to GM commercial vehicles at a GM supplier in Flint, Mich., and represent an $11,000 add-on cost. But it’s not a Catch-22, CleanFuel President Curtis Donaldson said.

Those who buy the propane engines qualify for an 80 percent federal tax credit for use of an alternative fuel vehicle — bringing $9,000 back — and the savings on fuel mount rapidly to offset the purchase, he said.

There’s also a 50-cent-per-gallon credit on using the propane that further lowers cost. So the buyer of $68,000 GM medium-duty vehicle could quickly recoup the price of the $11,000 propane system that’s included in the $68,000 purchase price, Donaldson said.

“The customer sees a very seamless system,” he said. “He sends in an order from us that he wants an LPI (liquid propane injection) system, and the truck literally rolls across the street and the contractor puts the LPI system on.”

Though the propane distribution system and the engine cost aren’t yet practical for passenger car drivers who might save $1,300 a year, they can pay off handsomely for fleet owners who log major miles on heavy vehicles, he said.

In addition to selling engine systems, CleanFuel USA markets ethanol, sells dispensers for ethanol and helps both ethanol and propane customers find distribution solutions.

Rather than buy small quantities of propane off a bobtail truck, a school district in Texas is buying large truck transport loads and having them delivered to the school bus yard directly. After receiving the propane fuel credit, the district is paying a mere $1.85 a gallon for fuel in today’s $4-plus environment, Donaldson said.

CleanFuel USA has 40 employees with offices in Michigan, Lake Charles and Georgetown, Texas, where Donaldson and the company’s manufacturing and research and development operations are based.

The 15-year-old company isn’t changing the world overnight. But it’s making inroads, said Donaldson, who said the company has cracked open a 5 percent share of the medium-duty truck market.

The company is installing about 700 medium-duty GM systems a year and 400 propane systems a year at Blue Bird Corp.’s Georgia school bus factory.

“Within five years, we could be doing 4,000 or 5,000 school buses and the medium-duty trucks,” Donaldson said. “But most important is that 6.1-liter market size that’s 13 times larger.”