Hailing A Green Taxi

New York cabs are testing natural gas. Next, Chicago?

New York's 12,000 meter cabs account for 25% of the Big Apple's air pollution. No wonder they've become a target as the city strives to comply with federal air-quality laws. It's also why Ford Motor Co. sees a golden opportunity in turning yellow cabs into "green" ones. If it can do that in New York, other cities may follow.

Ford has designed a brand-new taxi specifically to run on compressed natural gas, the cleanest of all fossil fuels. On Aug. 21, it planned to present the keys of its first NGV (natural-gas vehicle) Crown Victoria taxi to owner Silvio Martinez. He's no natural-gas newbie. He has been driving an NGV cab for two years--one of 133 converted to gas under a government-business initiative that basically picks up the $7,500 tab for such conversions. The incentives also make Ford's NGV Crown Vic only $200 more expensive than a gasoline taxi.

That will be recovered quickly from lower fuel costs. On a mileage basis, says cabbie Martinez, "gas is at least 20% to 25% cheaper than gasoline." Since New York cabs typically rack up fuel bills of more than $6,000, the savings would top $1,000 a year. In the Midwest, closer to abundant supplies, gas can be as much as 45% cheaper. Ford believes Chicago could be the next big market for NGVs.

FEW PUMPS. Given the economic and environmental benefits of gas, cabbies ought to be beating down the doors for NGVs. One reason they haven't: Natural gas isn't commonly available at service stations.

Removing this obstacle is the goal of Christopher R. Lynn, chief of New York's Transportation Dept. He lined up gas supplies in Texas, worked with Brooklyn Union Gas Co. on building more refueling stations, then created a market by converting city-owned vehicles. Some 1,110 cars and vans, 80% of the city's fleet, now run on gas. The NGV fleets of Brooklyn Union and others lift the total to more than 3,000 vehicles--5% of all NGVs in the U.S. If taxi fleets can be persuaded to sign on, the project will be cooking with gas.

Before it's here, it's on the Bloomberg Terminal.