The Free Market Proves No Need for NAT GAS Act

The Hill reports on a little noticed study last week that observes the natural gas trucking industry is economically viable even though the NAT GAS Act failed as an amendment in the Senate earlier this year. The fact of the matter is that the fuel is cheaper than conventional diesel, so it makes economical sense for companies to make the switch, even without another round of government subsidies:

“Low natural-gas prices mean that it’s economical to power heavy trucks with the fuel even without federal incentives, according to a new report that finds up-front investment costs for the vehicles could be recovered in three years.

“The analysis by the consulting firm IHS CERA could be another blow to stalled legislation on Capitol Hill that would provide billions of dollars in federal tax credits to help convert trucking fleets to natural gas.

“The report says trucking is better poised than the passenger vehicle market to use liquefied natural gas as a fuel. IHS CERA expects major fleet operators to gradually increase their purchase of gas-powered vehicles in ‘small quantities’ over the next few years.”

You mean they’re going to do this without another round of taxpayer-funded subsidies? Shocking!

The natural gas industry is moving along because of market fundamentals: it’s cheaper than diesel, which makes it a good business decision. Contrary to the beliefs of the central planners, government incentives don’t really change minds or change the underlying fundamentals. In fact, many of those who would benefit from such subsidies were already planning on making the conversion anyway, further proving the NAT GAS Act is unnecessary.

The message for lawmakers is simple: get out of the way and allow the market to work.

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