Remanufactured DT466 CNG Engine Solution to Dedicated CNG Cost Barrier

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Ariel Kelly
7 years ago
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1 Remanufactured DT466 CNG Engine Solution to Dedicated CNG Cost Barrier 6 May 2015

2 2 2 How Did Cambrian Energy Become Involved? Renewable Natural Gas ( RNG ) is pipeline quality gas derived from renewable organic waste sources (landfills, WWTP, digesters). RNG has lowest carbon intensity of any transportation fuel, including electric power. RNG producer receives higher value for the sale of RNG to vehicle fuel marketer, while transportation fuel customer pays same price as fossil CNG.

3 Contacted by Founders of North American Repower North American Repower developed: Unique lean-burn natural gas fueling technology to convert existing diesel engines to operate on natural gas Relationship with large engine remanufacturing company that could remanufacture to start-of-life condition an existing diesel engine modified to operate on CNG using North American Repower technology Combination provided two essential elements for widespread adoption of the technology The first element was the financial strength and experience of the remanufacturing company that allowed remanufactured CNG engines to meet requirements for financing 3

4 Single Greatest Barrier to Adoption of CNG COST -- Most important element met by incorporation of CNG technology of North American Repower 4

5 The Business Plan an Alliance Cost effective CNG remanufactured engine with advanced leanburn CNG fueling system Offered with major U.S. remanufacturing company National base warranty with optional extended warranties Installation engineered process required Reduces installation time and provides consistency of installs Fueling Station stationary and mobile with experienced companies Fuel Supply major natural gas marketers and suppliers Financing for both municipal and private fleets 5

6 The Two Most Important People in our Business Plan Truck Fleet Owner By providing a cost-effective, durable and reliable CNG repower of existing vehicles With no loss of fuel economy while operating on lower cost, clean-burning natural gas Truck Driver By providing an improved driving experience with reduced engine noise but no loss of performance vs. the original diesel engine Runs just like a diesel only quieter! 6

7 Current CNG Engine Offered by RePowered NGV Alliance Navistar DT 466 i308 MY 2004 and older CNG engine is EPA compliant for OUL engines Application to CARB filed - expected by 4 th quarter ,000 Navistar DT 466 i308 engines in operation 4000/4700 Pre /4400 Series 2002-present 3800 Cowl Pre Cowl 2002-present 7

8 Low Cost High Quality How is this Achieved? Use of remanufactured engine converted to lean-burn CNG fueling technology Price of CNG reman engine is less than 50% of a new CNG engine Lifecycle is comparable to, or better than, new diesel engine Fuel system engineered by North American Repower Quality, availability, cost, engineered installation, fuel-range Lean-burn CNG runs cooler than stoichiometric CNG engine Emission compliance met without use of catalyst Engine and fueling system delivered in preassembled kits Selected Installers follow step-by-step installation process Reman DT466 engines supplied by SRC to as-new specifications Leading $450 million per year reman supplier to OEMs Customer assurance with standard 1 year/50,000 mile warranty Extended warranties up to 48 months/200,000 miles Repurposing of existing vehicle avoids cost of new vehicles 8

9 Durability and Manufacturing Validation Complete Extensive OEM-style durability testing McLaren Performance Technologies completed two 500-hour development/durability dyno tests Each of CNG test engines was disassembled each 100 hours of testing for inspection, measurement and trending of wear of key components On-road-testing to validate durability, reliability and driveability In temperature, altitude and humidity extremes In on-highway and stop-and-go driving Beta testing with California customer Engines built on line by SRC underwent rigorous PPAP (Production Parts Approval Process) 9

10 Who is SRC? Founded 1983 in Springfield, Missouri Strong Balance Sheet, more than $450 million in annual sales, and more than 30 straight years of profitable operation Occupies more than 2,000,000 square feet of buildings Has more than 1,400 employees Remanufactures engines for major OEMs Has remanufactured Navistar DT 466 diesel engines for more than 20 years Remanufacturing process, through complete disassembly of engine, restoring existing parts to OEM approved specifications and use of new parts when old parts can t meet OEM approved specifications, restores engine to start-of-life, like-new condition 10

11 Cost Advantages of CNG Engine Offered by RePowered NGV Alliance All-in installed cost of vehicle conversion from diesel to CNG is less than cost of new diesel vehicle of same class and substantially less than cost of new CNG vehicle of same class Costs include CNG engine and fuel system, CNG tanks, CNG tank covers, CNG fill panel, costs of installation and Base Warranty Extends Vehicle Lifecycle at lower capital cost and access to lower CNG fuel cost Result: Cost barrier to convert to dedicated CNG is overcome 11

12 Future Engines Detroit Diesel Series L engine North American Repower has received from the California Energy Commission a $750,000 grant to demonstrate two advanced ignition systems on a Detroit Diesel Series 60 CNG engine that will incorporate the advanced North American Repower CNG fueling system Expected availability of Detroit Diesel Series 60 CNG engine from RePowered NGV is estimated at mid DT 466 i313 and i326 CNG engines (4 valve heads) Utilizing the development work already done by North American Repower on the DT 466 i308 CNG engine, the conversion of the DT 466 i313 and i326 diesel engine to CNG is expected to occur during the next 9 months Intense market demand already known due to problems with EGR system on diesel version of this engine ThermoKing CNG Trailer Refrigeration Units (4 th Quarter 2015) 12

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