Natural Gas Vehicles Outlook Driven by RNG Growth, Heavy-Duty Fleet Demand
R. NEMEC, Contributing Editor, North America
(P&GJ) — Using natural gas for vehicular transportation has been debated, engineered and marketed for as long as the post-World War II Baby Boomer generation has been around. Although it is unlikely there will ever be a natural gas vehicle (NGV) equivalent to electric vehicles like Tesla, natural gas remains the cleanest fossil fuel and a key part of the transportation fuel sector today. This is likely to remain that far into the future, and the growing development of both renewable natural gas (RNG) and the needs of the heavy-duty vehicle fleet market should ensure this happens.
Various pundits and NGV transportation advocates support natural gas as the so-called “bridge fuel,” and they continue to characterize its market as growing—particularly globally, outside of North America. They stress RNG/compressed natural gas (CNG) is a “transitional, cleaner fuel, especially for high-mileage fleets, driven by lower fuel costs, emissions regulations and government support,” particularly in the Asia-Pacific nations. As the time of this publication, CNG dominates, but liquefied natural gas (LNG) is gaining ground.
A composite conclusion is that the NGV market is expanding strategically, leveraging the economic and environmental advantages of natural gas for fleet-focused applications, as the broader energy transition unfolds with a continuing degree of uncertainty. Global researchers describe the NGV sector as being in a state of heightened transformation, underpinned by innovation and technological progress. This transition, the analysts say, has contributed to the development of natural gas as a more efficient and high-performance fuel for vehicles.
Some of these technological breakthroughs include the adoption of advanced turbocharging, direct injection systems and electronic engine management systems. Another significant advancement is the global move towards cleaner energy sources, resulting in a wider acceptance of CNG, due to its lower carbon footprint and economic viability.
“There’s no question the policy environment shifted with pull back on electric vehicle [EV] incentives and mandates, at not only the federal level but at the state level as well, particularly in California,” said Chad Lindholm, senior vice president with California-based Clean Energy Fuels Corp., which was originally founded by the late Oklahoma oil and gas tycoon T. Boone Pickens more than two decades ago.
“That said, clean fuel progress has not stopped, and demand by heavy-duty truck carriers, and particularly their shipper customers that still have direct and indirect [Scope 1 and Scope 3] emissions reduction goals, has not waned.
“If anything, fleets have become even more focused on technologies that can stand on their own economics, and RNG fits that mold perfectly. So, while some of the future regulatory areas are somewhat uncertain, the market forces driving cleaner transportation are still very much in motion,” Lindholm added.
The vast majority of natural gas being transported is done through CNG, which Lindholm notes has multiple fuel tank packages available for long range and easy fueling. He describes a very robust CNG/RNG fueling infrastructure across the U.S. and Canada, as well. In 2024, 89% of the fuel the company delivered to on-road vehicle customers was RNG, and according to the Transport Project, 86% of natural gas motor fuel dispensed for transportation use in the U.S. was RNG.1
Even with some Trump administration cutbacks in federal programs, the U.S. Department of Energy (DOE) continues to spread optimism regarding natural gas as a transportation fuel. “Natural gas powers more than 175,000 vehicles in the United States and roughly 23 million vehicles worldwide,” according to the DOE.2 “NGVs are good choices for high-mileage, centrally fueled fleets because they can provide similar fuel range support for applications that stay within a region supported by reliable CNG fueling.
“For vehicles that travel long distances, LNG offers a greater energy density than CNG, meaning the fuel range is more comparable to conventional fuel. The advantages of natural gas as a transportation fuel include its domestic availability, widespread distribution infrastructure and reduced greenhouse gas (GHG) emissions over conventional gasoline and diesel fuels. The horsepower, acceleration and cruise speed of NGVs are comparable with those of equivalent, conventionally fueled vehicles. Also, compared with conventional diesel and gasoline vehicles, NGVs offer other air quality benefits beyond GHG emissions,” according to the DOE.
In harmony with the current NGV commercial sector, the DOE stresses that medium- and heavy-duty NGVs are available from original equipment manufacturers (OEMs), as well as through qualified system retrofitters. The DOE has also concluded that “qualified system retrofitters can economically, safely and reliably” convert many vehicles for natural gas operation with aftermarket conversion systems.3 CNG and LNG continue to be considered “alternative fuels” under the 1992 Energy Policy Act.4
At the other end of the spectrum, Edward Emmett, a transportation and energy fellow at Rice University’s Baker Institute, focuses on the intersection of fuels, transportation and climate policy. He noted in a 2025 energy briefing paper that transitioning away from petroleum-based fuels presents “economic and technical challenges, including high capital costs, fuel infrastructure replacement and uncertainty in the economic and technical efficiency of alternatives like hydrogen (H₂) and biofuels.”5 For H₂, fuel infrastructure replacement is a key. In the white paper, Emmett stressed the importance of “coordinated policy, supply chain development and global standards,” and he concluded that the future of fuels in transportation will have broad ramifications.
In the fall of 2025, an international market research firm, Research and Markets (R&M), examined key market opportunities in the automotive natural gas vehicle sector, calling out the “increasing demand for eco-friendly fuels” as an important market stimulator. It cited the stimulants coming from (a) environmental regulations, (b) advancements in technology enhancing vehicle efficiency and (c) the rising adoption in regions like Asia. “The shift towards sustainable alternatives like CNG and LNG fuels further drives growth,” analysts concluded.6
“The global automotive natural gas vehicle market size is estimated to grow from $13.52 B in 2025 to $25.88 B by 2035, at a compound annual growth rate (CAGR) of 6.08% during the forecast period until 2035. In 2024, India witnessed a significant rise in the adoption of CNG vehicles, with sales increasing by 33% compared to the previous year. The growth of the global automotive natural gas market can be attributed to several factors, one of which is its lower emissions and reduced carbon footprints, making it a good choice for environmentally conscious consumers and businesses. Similar to green ammonia, natural gas has also established itself as a key alternative fuel,” analysists added.
R&M’s analysis notes that NGVs provide a smaller carbon footprint compared to conventional gasoline or diesel vehicles, making it an appealing option for cutting GHG emissions and complying with stricter environmental standards. “It is important to emphasize that advancements in natural gas vehicle technology, such as enhanced engine efficiency and extended range, make them more attractive.”
In recent years, the Washington, DC-based lobbying/marketing arm of the NGV sector, NGVAmerica, broadened into a renamed coalition, The Transport Project (TTP), which kept its headquarters in the nation’s capital after forming. TTP noted early in 2026 that 1,400 NGV fueling stations now dot the nation. As a national coalition, TTP includes roughly 200 fleets, vehicle and engine manufacturers and dealers, servicers and suppliers, and fuel producers and providers dedicated to the decarbonization of North America’s transportation sector.
“Through the increased use of gaseous motor fuels including RNG and H₂, the United States and Canada can help achieve ambitious climate goals and greatly improve air quality safely, reliably and effectively without delay and without compromising existing commercial business operations,” according to TTP President Daniel Gage, who previously headed the NGVAmerica trade organization.
Gage says in the current political landscape in early 2026 he sees “a brightening regulatory outlook” for ultra-low-carbon compressed RNG (C/RNG) trucking, although incentives have been phased out. Through the Congressional Review Act (CRA), actions by Congress have all but effectively ended California’s Advanced Clean Truck program, along with Advanced Clean Fleet and CA Omnibus, he says.
“CA Clean Truck Partnership is in question, and it looks like the U.S. Environmental Protection Agency [EPA] Low NOx [nitrous oxide] program will remain at 35 mg for 2027. Natural gas will easily meet that threshold without added costly new emissions systems added,” he noted.
Gage maintains the future is still bright because there has been renewed interest and investment from the refuse and transit sectors, along with growing interest in the freight sector, especially in larger Class 8 fleets with fixed routes.
“I can say we are pretty bullish on the North American commercial trucking market,” he noted. “Between a more encouraging U.S. regulatory environment; the early successes of the new Cummins 15-liter engine and investments by the global NGV technology leaders PACCAR and Daimler AG to offer that product; and struggles that other clean tech options continue to discover, C/RNG looks like a pretty good bet and long-term fleet investment.”
From his years of recent experience in the NGV space, Gage readily acknowledges the what he calls the “era of countless free government money” is over for now, but he thinks natural gas as a vehicle fuel can continue to move forward without government handouts—unlike the heavy duty zero-emissions (HD-ZEV) sector.
“Nevertheless, it is important that federal and state jurisdictions interested in new truck investments on their roads have some incentives for fleets that want to get cleaner and reduce their footprint…things like tax credits, reasonable purchase grants, HOV lane access and other incentives for low-carbon operators,” Gage said.
He is optimistic about future investment in the NGV sector continuing, citing the ongoing support from traditional global energy giants such as Chevron, Shell and bp Plc. This trio of energy giants—along with others—remain important parts of this industry, with bp holding the largest portfolio of RNG projects in the U.S. alongside Vanguard Renewables, according to RNG Coalition spokesperson Dylan Chase, although he concedes that 2025 was “less than a robust year” in terms of RNG financial growth in North America. “Many operators were struggling amid cost and political uncertainties, but we remain optimistic for calmer waters in 2026 and booming investment from 2028 onward.”
A lot of the optimism, Chase says, is tied to the technology advances envisioned with the Cummins X15N; additionally, artificial intelligence (AI) is beginning to be leveraged upstream at RNG facilities, such as with “Rimba”—an evolving tool for controlling and acquiring data. In the RNG sector, a production facility has applied Rimba to address a problem where staff were stuck with an ineffective supervisory control and data acquisition (SCADA) system, other inefficient tools and siloed data, in one operating unit.7
With Rimba, the RNG operator unlocked data access, simplified analysis and made it possible to have historical data at staff’s fingertips so an internal team could identify subtle declines in key parameters. “This allowed them to schedule maintenance proactively, preventing breakdowns before they happened,” a staff report noted.
In the U.S., there are still strong state and federal programs that incentivize the use of cleaner transportation fuels, and the economics of RNG are compelling on their own, according to Clean Energy’s Lindholm. “A lot has changed, especially in the last few years,” he says, citing the biggest technology breakthrough as the Cummins X15N, a 15liter naturalgas engine that now gives heavyduty trucks the same power and performance they are used to with diesel. To Lindholm this has been a “gamechanger” for the industry.
“Five or ten years ago, we simply didn’t have an engine that could reliably handle Class 8 loads, range, torque and power on natural gas, and now we do. If you compare the NGV experience today with five or ten years ago, we’re in a whole different world. Better engines, better fueling infrastructure, available affordable fuel and the ability to run on ultraclean, negative carbon-intensity RNG,” Lindholm says.
In addition, NGV proponents stress there is a growing global market for RNG/CNG in fleet transportation. Europe, in particular, could be a growing market for American-produced fuel. “Europe remains an important growth area for clean fuels over the next several decades,” says the RNG Coalition’s Chase. “And its move away from unstable sources of energy (e.g., Russia)will likely require it to eventually adopt increasing volumes of American fuels.”
RICHARD NEMEC is a long-time contributing editor to P&GJ, based in Los Angeles. He can be contacted at rnemec@ca.rr.com.
Literature Cited:
- Gage, D., “Close to 1,400 Natural Gas Stations Set to Service Clean Transport Industry in 2026,” The Transport Project, 2025. Link: https://transportproject.org/2025/12/15/close-to-1400-natural-gas-stations-set-to-service-clean-transport-industry-in-2026/
- The Transport Project, “Vehicles,” 2026. https://www.ngvamerica.org/vehicles/
- Alternative Fuels Data Center, “Vehicle Conversions,” DOE, 2026. https://afdc.energy.gov/vehicles/conversions
- Alternative Fuels Data Center, “Energy Policy Act of 1992,” DOE, 2026. https://afdc.energy.gov/laws/key_legislation#epact92
- Medlock III, Kenneth B., Hartley, Peter R., Buenestado, Raúl B., et al, “Energy Insights 2025,” Baker Institute, 2025. https://www.bakerinstitute.org/research/energy-insights-2025
- Rimba, “Customer Spotlight: How Novilla Increased Data Accuracy in Compliance Reporting with Rimba,” 2025. https://www.rimba.ai/post/carbon-management-case-study-5