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The Growing Popularity of Compressed Natural Gas (CNG) as a Clean Energy Source

The Growing Popularity of Compressed Natural Gas (CNG) as a Clean Energy Source

The CNG tanks cylinders market reached US$ 1.7 billion in 2022. Demand for CNG tanks cylinders is estimated to surpass US$ 1.8 billion in 2023. During the forecast period, sales are poised to exhibit a 6.7% CAGR. Revenue is anticipated to cross around US$ 3.5 billion by 2033.

Key Market Highlights

The carbon fiber segment is likely to spearhead the material segment of the market. This segment is expected to expand at 6.6% CAGR during 2023 to 2033.

Growing concerns about environmental impact and emissions have led to an increased interest in CNG as a clean alternative to traditional fuels. This, in turn, is driving the demand for CNG cylinders.

CNG is becoming more popular as countries and companies move toward clean sources of energy to minimize carbon emissions. It will help reduce greenhouse gas emissions compared to traditional fossil fuels.

As per the data provided by the Department of Energy, in the United States, around 175,000 automobiles run on natural gas, while about 23 million vehicles do so globally. Compressed natural gas (CNG) fuelling is a consistent source in many regions.

High availability makes natural gas vehicles (NGVs) an excellent option for high-mileage, centrally fuelled fleets. NGVs might have applications that are confined to those areas with similar fuel range support. CNG is being utilized as a fuel for automobiles more often, particularly in fleets of public transit and commercial vehicles. This drives the demand for CNG tanks and cylinders for storing and transporting the fuel.

The expansion of CNG refueling infrastructure is crucial to support the adoption of CNG as a fuel. As a result, more CNG tanks and cylinders need to be produced and installed. CNG might be utilized to store energy, particularly when there is extra renewable energy that has to be kept for later use. This application calls for more CNG storage space. Clean energy sources such as CNG can also find applications in industries that require heat or power generation. This diversifies the demand for CNG tanks and cylinders beyond just transportation.

Strict environmental regulations on emissions can encourage companies to switch to clean fuels such as CNG. This drives demand for the necessary storage and transport infrastructure.

CNG can be a solution for reducing energy waste in situations where excess renewable energy is generated but cannot be immediately used. Storing this energy in the form of CNG can mitigate waste and bolster demand for storage solutions. As the global energy landscape evolves towards sustainability, CNG can play a role in reducing reliance on traditional fossil fuels. It will help in creating a sustained demand for CNG tanks cylinders.

Historical Performance of CNG Tanks Cylinders Market

The market experienced steady growth at 8.2% CAGR during the historical period from 2018 to 2022. In the forecast period, the CNG tanks cylinders industry is set to register 6.7% CAGR.

There has been a recent increase in the popularity of compressed natural gas (CNG) as a vehicle fuel, particularly in commercial fleets and public transit. This is likely to increase the demand for CNG tanks cylinders for storing the gas for usage in cars and buses. The growth of CNG as a transportation fuel necessitates the development of refueling infrastructure. This infrastructure expansion would require a greater number of CNG tanks and cylinders.

CNG is seen as a way to reduce carbon emissions in transportation. This will stimulate demand for CNG tanks and cylinders to support the growing fleet of vehicles running on CNG. Governments offer incentives and subsidies to encourage the adoption of clean fuels. These policies can increase the demand for CNG-powered vehicles and, subsequently, for CNG tanks and cylinders.

Apart from transportation, CNG is used in different industrial processes and power generation. The demand for CNG tanks and cylinders in industrial applications is likely to rise as businesses seek clean energy solutions. The diversification of energy sources for transportation and industrial sectors through CNG can enhance energy security. Thereby driving the demand for CNG tanks and cylinders.

The growth of the CNG market might lead to innovations in tank and cylinder design, material, and manufacturing processes, further contributing to market demand. Geopolitical considerations can influence energy transitions. Countries with ample natural gas resources might encourage CNG adoption, boosting the demand for associated tanks and cylinders. As the energy transition spreads to more regions globally, the demand for CNG tanks and cylinders could see increased adoption in previously untapped markets.

Latest CNG Tanks Cylinders Market Trends Listed by Future Market Insights (FMI)

Government Regulations

Strict emissions regulations and incentives to promote the use of alternative fuels are encouraging the adoption of CNG vehicles, thereby boosting the CNG cylinder market.

Advancements in Composite Materials

The development of lightweight and durable composite materials for CNG cylinders enhances their safety, capacity, and efficiency, making them more attractive to consumers.

Increased Adoption in Transportation

CNG is gaining traction in commercial fleets and public transportation due to its cost-effectiveness and lower emissions, driving the need for more CNG cylinders.

Infrastructure Expansion

Expanding CNG refueling infrastructure supports the growth of the CNG market and encourages fleet operators to invest in CNG vehicles and cylinders.

Urbanization and Air Quality Concerns

Increasing urbanization and air quality concerns in cities are pushing for clean transportation solutions, which in turn drives the demand for CNG tank cylinders.

Growing Popularity of Renewable Energy Pushing Sales of CNG Tanks Cylinders in the United States

According to Future Market Insights (FMI) analysis, the United States market for CNG tanks cylinders is set to hold a total of around US$ 632.7 million by 2033. It is predicted to expand at 6.6% CAGR during the forecast period (2023 to 2033).

Growing popularity of vehicles that operate with CNG gas is likely to drive demand in the United States. The demand for more affordable and sustainable fuel choices is what’s fueling growth.

Government regulations aimed at reducing emissions and promoting clean transportation have played a role in the growth of the CNG tanks cylinders market. The use of CNG and other alternative fuels is encouraged by these policies. Several commercial fleets, including taxis, buses, and delivery trucks, have started switching to CNG-powered vehicles. This has led to increased demand for CNG tanks cylinders to store the fuel.

Compressed natural gas, which produces fewer toxins and particles than gasoline or diesel, is seen to be a safer fuel than those two. It is a more enticing choice for consumers and businesses because it is less costly than conventional fuels.

The expansion of CNG refueling infrastructure is critical for the growth of the CNG tanks cylinders market. As more refueling stations are built across the country, the demand for CNG tanks cylinders is likely to increase.

Several companies are involved in the manufacturing and distribution of CNG tanks cylinders in the United States. These companies compete in terms of technology, design, and safety features. The CNG tanks cylinders market is also influenced by global energy trends and geopolitical factors that impact natural gas supply and demand.

Increasing Adoption of Natural Gas to Boost CNG Tanks Cylinders Market in China

China CNG tanks cylinders industry is poised to exhibit a CAGR of 6.6% during the assessment period. By 2033, China market size is expected to reach US$ 795.6 million.

The CNG tanks cylinders market in China is expected to witness decent growth during the forecast period. This is due to the increasing adoption of natural gas as a clean alternative to traditional fuels. China government’s focus on reducing air pollution and carbon emissions has driven the demand for CNG-powered vehicles. This is consequently boosting the CNG tanks cylinders industry in the country. China has been investing in the expansion of CNG refueling infrastructure, encouraging the use of CNG-powered vehicles across various regions.

Government policies, such as subsidies for CNG vehicles and refueling stations, have played a role in promoting the growth of the CNG tanks cylinders market. Several domestic and international companies are engaged in manufacturing CNG tanks cylinders in China to cater to the increasing demand.

Ensuring the safety of CNG storage and transportation is crucial, leading to the implementation of stringent safety standards and regulations for CNG tanks cylinders. Ongoing research and development efforts aim to improve the efficiency, capacity, and safety of CNG tanks cylinders, driving innovation in the market.

Competitive Landscape

To satisfy consumer requests and safety regulations, leading companies concentrate on producing lightweight, strong, and high-capacity CNG cylinders. To improve the effectiveness, safety, and performance of CNG cylinders, they are merging cutting-edge materials and production procedures.

Leading manufacturers seeking to expand into new markets by forming alliances, distribution networks, and partnerships with regional players.

For instance,

In April 2023, The Altroz iCNG, Tata Motors’ much-anticipated premium hatchback, made its formal debut. This design now boasts a new twin-cylinder CNG tank technology, making it the first vehicle in India.

In August 2023, The Tiago and Tigor upgraded CNG vehicles, which now have the upgraded twin-cylinder CNG tank layout, have been released by Tata Motors.

IKEA ‘Powers Up’ Pennsylvania Distribution Center

Conshohocken, PA –IKEA has plugged-in an expansion of the solar array atop its Perryville, Maryland distribution center, the state’s largest such solar energy system.

Installation of the new panels began Fall 2013, and since then have nearly doubled the size of the original project, which already was the state’s largest rooftop array.

The 467,618-square-foot solar addition consists of a 2.2-MW system, built with 7,337 modules, and will produce 2.7 kWh of electricity annually.

Including the existing system, the 1.7 million-square foot distribution center’s total 4.9-MW solar installation of 25,913 panels now generating enough electricity to power 591 homes.

For the development, design and installation of the Perryville distribution center’s original and expanded solar power system, IKEA contracted with Indiana-based Inovateus Solar LLC, a distributor and integrator specializing in large-scale solar installations.

IKEA US has solar arrays atop 90% of its locations, has announced plans to purchase 49 wind turbines in Illinois, and has rolled-out EV charging stations at 13 stores.

In 2014, IKEA achieved its goal of completing solar installations atop nearly 90 percent of its US buildings (39 out of 44 locations), with a generation goal of 38 MW.

The Swedish company owns and operates each of its solar PV energy systems – as opposed to a solar lease or PPA (power purchase agreement) – and globally has allocated $1.8 billion to invest in renewable energy through 2015.

IKEA’s corporate strategy includes the goal of being energy independent by 2020. The company has installed more than 550,000 solar panels on buildings across the world and owns/operates approximately 157 wind turbines in Europe and Canada.

There are currently more than 350 IKEA stores in 44 countries, including 38 in the US.


POLA, Shanghai Cooperate on ‘Shore Power’ Use

Los Angeles, CA – The Port of Los Angeles and the Port of Shanghai have signed a formal agreement to exchange information, technical expertise and best practices to expand use of shore power at the Port of Shanghai.

Chris Cannon, Director of Environmental Management for the Port of Los Angeles, signed the EcoPartnership Statement of Intent in Beijing with Director-General Jianping Sun of the Shanghai Municipal Transportation Commission (SMTC).

The Commission, which oversees the Port of Shanghai, said the EcoPartnership builds on the collaborative work of the two ports to advance sustainable practices throughout the maritime industry, including creation of the Pacific Ports Clean Air Collaborative in 2006.

The US-China EcoPartnership Program advances the goals of the Ten-Year Framework for Cooperation on Energy and the Environment established in 2008. The Los Angeles-Shanghai agreement is one of six new EcoPartnerships signed today, adding to 24 partnerships previously created under the Framework to foster collaboration on electricity, water, air, transportation, wetlands, nature reserves and protected areas, and energy efficiency.

Specifically, the Port of Los Angeles will share knowledge with the Port of Shanghai on topics that include regulations, rules, standards, policies, electricity rates and incentive programs to promote shore power. Los Angeles’ technical expertise and more than a decade of experience will help Shanghai build on its pilot program at selected large container terminals or cruise terminals in Shanghai.

The parties will begin by developing a plan within the next 30 days to implement the three-year initiative.

“Ensuring consistent equipment and practices will accelerate emission reductions at both ports. Uniform standards and compatible infrastructure that allow ocean carriers to maximize their investment in clean ships could lead to green shipping routes that increase trade at both ports,” according to a statement issued by the Port of Los Angeles.

Shore power – also called “Alternative Maritime Power,” or AMP – allows ships at berth to turn off auxiliary engines and run on clean energy to power vital onboard systems. Ports must have the necessary infrastructure and ships must be equipped to connect to shore-side power sources.

Plugging into shore-side electricity reduces engine emissions of diesel particulate matter (DPM), nitrogen oxides (NOx) and sulfur oxides (SOx) by up to 95 percent per vessel call, the port said.