Imagine a future where Americans can drive coast-to-coast on a fuel that's made in America. It's clean, affordable, and fueling an economic competitive advantage that's the envy of the whole world. That future isn't some dream. It's available to us today if we only embrace it.
Thanks to one little-known company, we now hold the key to the explosive power of the coming "no choice fuel revolution." Curiously, that fuel is not what you might expect. More complete details on that fuel and the company that is unlocking its power is available in an exclusive report from The Motley Fool, which is available for free by clicking here.
Instead of rehashing what's in that report, what I'd like to do instead is to debunk the thought many have that electric vehicles are what will take our nation to the promised land of energy independence. Sure, last month Tesla Motors (NASDAQ:TSLA) was able to sell 1,470 of its award-winning Model S electric cars. Meanwhile, that same month General Motors (NYSE:GM) sold 1,788 of its plug-in hybrid Chevy Volts. The problem is that this is just a tiny slice of the overall U.S. auto market, where Detroit's Big Three alone sold more than half a million units last month. Clearly, there's a market for electric vehicles as the technology behind them becomes more than just a dream. The problem is that an EV future is still a long way from becoming a reality.
The battery packs required to fuel EVs are incredibly heavy and expensive. Tesla's Model S weighs in at a fairly hefty 4,560 pounds, with what's estimated to be a battery pack in excess of 1,000 pounds. The weight is one reason the body of the Model S is aluminum, which weighs about a third less than steel. It really is a tricky proposition, because less weight increases the range, but not to the same degree as adding more batteries. That's why Tesla has opted for the higher end of the market, where its customers can afford to pay up for the battery power required for the longer range that really has set Tesla apart from the rest of the smaller-sized EVs on the market.
Currently, there's a big enough gap in the battery technology to keep the EV market pretty much relegated to city driving. Despite Tesla's Supercharger stations and battery swap options, the system won't be nationwide until 2015, and even then, Tesla owners would need to stop for a half-hour every 200 miles by going with the Supercharger option. While the charge is free, it's not exactly convenient.
On the other hand, one company has already built the highway of the future. Clean Energy Fuels (NASDAQ:CLNE) expects to have 150 natural gas refueling stations open by the end of the year as part of its plan to build America's Natural Gas Highway. These stations would refuel a truck in the same amount of time as conventional gasoline. So when compared with Tesla, which currently has only about two dozen Supercharger stations open, natural gas is faster and more readily available.
In addition, natural gas has two critical advantages over electric. First, it's cheap. Even spending the $10,000 to get the next-generation Ford (NYSE:F) F-150 equipped for natural gas, consumers who drive 1,000 miles per month would enjoy a five-year return on that investment of 98% at current prices, thanks to a $2.17-gallon-of -gasoline equivalent savings enjoyed by switching to natural gas.
The other clear advantage to natural gas is that it's powerful. The battery power necessary to power a Ford F-150, let alone an 18-wheeler, would be astronomically expensive and take up important towing space. On the other hand, towing and hauling ratings aren't reduced when a truck is powered by natural gas.
The final consideration is the sheer abundance of natural gas. We have an estimated 100-year supply, though more of it is being found each and every day. It's cleaner than gasoline or diesel, and it's in abundance in America. The bottom line is clear: Natural gas is our "no choice fuel." To learn more details on the fuel and the company that's unlocking its power, just click here.
Matt DiLallo has long January 2014 $10 calls and short January 2014 $10 puts on Ford. The Motley Fool recommends Clean Energy Fuels, Ford, General Motors, and Tesla Motors and owns shares of Ford and Tesla Motors. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.