Waste Management, Inc. (WM) recently announced the launch of a new fleet of 25 compressed natural gas (CNG) trucks and unveiled the first public-access, 24-hour CNG fueling station in Louisville, KY.
The new fleet of state-of-the-art vehicles will replace the existing heavy-duty collection trucks and will run on CNG, a cleaner fuel compared with to conventional gasoline or diesel fuel. The new fueling station will provide first-of-its-kind infrastructure to supply CNG fuel in Louisville. Waste Management will likely add up to 25 CNG-powered collection vehicles in Louisville and plans to roll out additional CNG-powered collection vehicles in the area in the future. The public fueling station will serve Waste Management's local fleet as well as other corporate fleets and other vehicles running on CNG,
Waste Management, with its current fleet of approximately 1,700 CNG vehicles is the largest owner and operator of clean-running, heavy duty refuse trucks in North America. The company's goal is to develop the cleanest fleet of heavy duty trucks in the industry.
In 2012, natural gas vehicles are expected to represent 80% of Waste Management's new truck purchases and intends to sustain this trend for the next five years. Each of the natural gas fueled collection vehicle is expected to reduce diesel usage by 8,000 gallons annually and also reduce greenhouse gas emissions by an average of 22 metric tons.
Waste Management has opened 13 CNG stations across the country in the first half of 2012, of which 9 have public accessible fueling stations. Waste Management currently operates 31 fueling stations in North America and expects to bring an additional 17 fueling stations online by the end of the year.
Waste Management owns the stations, purchases the fuel and finances the construction of the stations. It also enters into maintenance contracts with third party companies. This strategy allows the company to secure better natural gas prices in the long run.
CNG is one of the cleanest fuels currently available for use in heavy-duty trucks and also offers cost savings and runs quieter than diesel trucks. Its helps reduce particulate matter emissions to approximately 86%, carbon monoxide emissions by 80%, nitrogen oxide emissions by up to 32% and carbon dioxide emissions by 25%.
The natural gas fleet is part of the company's environmental sustainability initiative to reduce its fleet emissions by 15% and increase the fuel efficiency of its fleet by 15% by 2020. We appreciate Waste Management's commitment to reducing greenhouse gas emissions through increased recycling, use of alternative transportation fuels, and beneficial use of landfill gas.
Houston, Texas-based Waste Management provides collection, transfer, recycling and resource recovery, and disposal services to nearly 20 million residential, commercial, industrial and municipal customers. The company is also a leading developer, operator and owner of waste-to-energy and landfill gas-to-energy facilities in the U.S.
Waste Management competes in niches with Casella Waste Systems Inc. (CWST) and Republic Services Inc. (RSG). The shares of Waste Management currently retain a Zacks #4 Rank (short-term Sell recommendation).