The propane alternative for motorists

From our friend Levente Mady, who tracks and recommends bonds for Bob Hoye’s Institutional Advisors, here’s a tactic you can use to beat the high cost of gasoline. (He is responding to a post in the forum by a concerned reader):

“If you are worried about the price of gasoline, you should convert your car to run on propane.  If you look at the price relationship between crude oil and natural gas, it should cost you about 3.5 times less to fill up with propane than with gasoline these days.  In other words, if it costs you $100 to fill up your car with gas, you can get the same amount of mileage for less than $30 of propane.  There is hundreds of years’ worth of natural gas supply in North America.  It is dirt cheap!  It is clean!  Why not put it to good use?  

“A bit of background in terms of practicality:  the technology is there and it costs $3,000 to $5,000 to convert a larger automobile (SUV or truck) to run on propane.  Obviously, natural gas is the cleaner fuel and there is a massive abundance in North America — that is why it is so cheap.  As a matter of fact, some states – Arizona, for example – provide tax credits for the conversion expense as well as for running the car on propane instead of gas.  Uunfortunately right now there just does not seem to be much talk about using natural gas as transportation fuel.  Natural gas is supposed to be used more or less exclusively for heating.  The choice fuels for transportation are crude oil derivatives (diesel, gasoline, jet fuel, etc.). 

“The silly thing is that there is a ton of money spent on non starters that are decades away from making economic sense for the average driver, such as electric and fuel cell technology.  Meanwhile, America’s energy dependence on shady foreign powers could very easily be cut in half by utilizing existing technology to replace crude oil with natural gas in the transport sector.  But that is just too simple, so there is no way the government would ever make a real push for it.  Cash for clunkers – yessss!  Cash for propane conversion – it makes sense, so not likely!”