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Q2 2015 Earnings

July 28, 2015
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UPS Alternative Fuels - Propane

Alternative Fuels Drive UPS to Innovative Solutions

  • UPS operates one of the largest private alternative fuel fleets in the industry with more than 3,150 alternative fuel and advanced technology vehicles. This includes all-electric, hybrid electric, hydraulic hybrid, CNG, LNG, liquid propane gas (LPG), biomethane, and light-weight fuel-saving composite body vehicles.
  • By the end of 2017, the company's goal is for its alternative fuel and advanced technology fleet to drive one billion miles.
  • Between 2000 and the end of 2013, the UPS alternative fuel and advanced technology fleet logged 350 million miles. In 2013, the growing fleet drove 55 million miles, a 13 percent increase over last year.

Alternative Fuel Fleet Specifics

  • UPS’s 386 hybrid electric vehicles (HEVs) promise a 35 percent improvement in fuel economy over vehicles they are replacing.
  • With more than 965 package delivery vehicles, UPS has one of the largest private fleets of compressed natural gas which offer impressive results:
  • UPS operates roughly 900 propane-powered vehicles in Canada.
  • UPS deployed 50 ethanol-powered delivery vehicles in Brazil, where production of this alternative fuel is plentiful.
  • UPS operates 41 hydraulic hybrid vehicles (HHVs) which can achieve up to 35 percent improved fuel economy and up to 30 percent CO2 emissions reduction over traditional diesel-powered vehicles that use automatic transmissions in stop-and-go applications.
  • With more than 158 electric vehicles, UPS utilizes this technology to reduce noise, emissions and motor fuel.
  • A first of its kind in UPS’s global fleet, biomethane dual-fuel vehicles expanded the company’s alternative fuel vehicle fleet delivering to official London 2012 Olympic venues and leave an important legacy in the UK, following the games.

Propane-Fueled Operations Expansion

  • One of most extensive private propane fleets in U.S. by end of 2014:
  • UPS to purchase 1,000 propane technology package cars
  • UPS to build an initial 50 onsite fueling stations in Oklahoma and Louisiana with an investment of approximately $70 million
  • Nearly 900 propane vehicles in Canada

Propane Benefits

  • Growing domestic supply, insulated from market volatility.
  • Propane does not compromise package car’s abilities, fuel economy or drivability, and meets the criteria for UPS’s clean fuel technology standard.
  • Package cars have 200-mile range and no route limitations.
  • Viability of propane as a “bridge” fuel toward energy independence.
  • Propane vehicles meet UPS criteria to deploy alternative fuel technologies

How the propane technology works

  • The propane vehicle technology functions in very similar fashion to a conventional gasoline package car. The standard, six-liter, GM V8 gasoline package car is convertible to propane fuel. The propane is in a liquid state (LPI) when it is delivered to the fuel injectors via an electric fuel pump. The fuel injects into the intake manifold in the same manner as a gasoline model. Like its gasoline counterpart, the propane vehicle’s engine also uses a spark ignition. This makes operation of the propane vehicle virtually identical to a standard gasoline model.

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