The discovery of new sources of domestic natural gas from shale has given rise to new interest in using natural gas more extensively in transportation. This could occur in a number of ways. Natural gas (methane) can be burned directly in conventional diesel and gasoline engines that have been modified or retrofitted. Natural gas liquids such as propane and butane can also replace gasoline. As a petrochemical feedstock, methane can be used to produce synthetic diesel fuel and gasoline substitutes such as ethanol, methanol, and butanol. A reformation process can convert methane to hydrogen for fuel cell-powered vehicles. In addition, natural gas can be burned to generate electricity for charging electric vehicles. As natural gas supplies have increased and prices have dropped, automakers and truck manufacturers have begun taking steps to introduce new vehicle lines fueled by natural gas, principally compressed natural gas (CNG) and liquefied natural gas (LNG). Several factors have contributed to this interest: Price differential. On an energy-equivalent basis, oil has been more expensive than natural gas in recent years. Moreover, while oil prices are set in a global market, U.S. natural gas prices are largely determined domestically, and the discovery of large domestic reserves suggests that prices may remain relatively low. Environmental preference. Natural gas, while also a fossil fuel, generally produces lower emissions per vehicle mile than diesel and heavier oil. Energy diversity and security. Increased use of domestic natural gas for transportation may mean that less oil will be imported. The United States might be more insulated from global petroleum price volatility if more forms of transportation were based on natural gas. Growth potential. Only 2.9% of U.S, natural gas production is currently used in transportation, mainly to move gas through the pipelines, and expanded use of natural gas vehicles would likely lead to increased demand for natural gas. Technology improvements such as hydraulic fracturing and directional drilling have led to massive growth in natural gas production from shale formations. Annual natural gas production in the United States has increased by roughly one-fourth since 2006 ( Figure 1 ). Oil-based gasoline and diesel fuel continue to remain the fuels of choice in both the domestic and commercial transportation sectors. However, U.S. demand for finished petroleum products has fallen 12% from its all-time peak in 2005, due in part to greater use of natural gas for many purposes. Although natural gas consumption by vehicles grew 26% from 2008 through 2013, natural gas still represents less than 1% of the fuels used in the transportation sector. Among the key factors determining the attractiveness of natural gas as a transportation fuel is its price relative to diesel fuel. The energy content of a given volume of natural gas in compressed or liquefied form differs from that of refined petroleum products. For example, one gallon of LNG has 82,644 British thermal units (Btu) of energy compared to 139,000 Btu per gallon of diesel fuel and 114,000 Btu per gallon of gasoline. Prices can be compared by converting natural gas to its gasoline gallon equivalent (GGE) or diesel gallon equivalent (DGE). Measured by Btus, a barrel of oil has historically cost several times as much as a comparable unit of natural gas ( Figure 2 ). U.S. natural gas prices fell by half between 2008 and 2014 as increasing supplies from shale formations became available. The competitive price advantage that natural gas now demonstrates could be eroded if crude oil prices fall or natural gas prices rise. Several different technologies can be used to harness natural gas as a vehicle fuel. Some of them require pressurized systems to burn the fuel in a gaseous state, and others convert natural gas to a liquid. Still others process natural gas into a variety of liquid fuels suitable for powering internal-combustion engines. The increased use of natural gas as a transportation fuel in any form would require substantial changes in vehicles and fueling infrastructure. New vehicles would need to be developed on a large scale, in some cases requiring new technologies. New fueling stations would be required to make fuel widely available. Vehicle manufacturers, fleet owners, vehicle buyers, and service station operators would all need to make significant investments. The required investments differ with the type of technology employed. Under ambient temperatures and pressure, natural gas has a volumetric energy density of about only 1/1000 that of gasoline. In that state, it would not be able to function as a vehicle fuel. If natural gas is compressed to a pressure of 3,600 pounds per square inch (psi), however, it becomes suitable for use in a vehicle engine. As shown in Figure 3 , a CNG vehicle's fuel storage tank is mounted in the back of a vehicle and takes up about half of what is the trunk in a traditional vehicle. It contains about eight gasoline gallons equivalent, which give it a driving range of over 150 miles. The CNG fuel system transfers the highly pressurized natural gas from the storage tank to the engine, reducing pressure during the transfer to equate to the operating pressure of the engine's fuel-management system. A CNG engine functions like a gasoline engine: The fuel and air mixture are compressed and then ignited by a spark plug, expanding gases to drive pistons to propel the vehicle. Certain changes are required to accommodate the pressurized, gaseous CNG, such as new valves and fuel injectors and a pressure regulator. While much of a natural gas vehicle's composition is similar to that of gasoline-powered internal combustion engine vehicle, modifications required for CNG use currently add up to $11,000 to the price of a passenger vehicle. Some current models of CNG vehicles are bifuel, with tanks for both CNG and gasoline, thereby allowing for extended driving range. When a bifuel vehicle runs out of CNG, it automatically shifts into gasoline mode. Drivers can also shift from one fuel to another by selecting a dashboard button. In addition to passenger vehicles, CNG has been adopted as a fuel for taxis; regional-haul trucks used in local freight and package delivery; construction, residential refuse pickup, and municipal fleets; and transit buses. The vehicles return each day to a central garage or maintenance yard, where refueling infrastructure may be installed. In some cases, government subsidies have been required to make CNG competitive with diesel fuel. In September 2014, for example, the brewer Anheuser-Busch announced that it would replace 66 heavy-duty delivery trucks in Houston with CNG-powered vehicles after the Texas Commission on Environmental Quality approved a $45,000 grant for each vehicle. There are about 150,000 CNG vehicles on the road today in the United States. About 88,000 are cars, SUVs, and vans, and the rest are commercial vehicles, refuse trucks, and buses. Among passenger vehicles, and in addition to the Honda Civic natural gas sedan and the Chevrolet Impala sedan, automakers offer bifuel Chevrolet Silverado and Sierra pickup trucks and a Chrysler Dodge Ram 2500 Dual Cab pickup truck. General Motors also offers Express and Savana cargo and passenger vans with dedicated CNG engines. Further, several companies offer natural gas conversions of new vehicles. LNG is produced when natural gas is cooled to -260 degrees Fahrenheit, turning it into a liquid fuel that takes up 1/600 of the volume of the fuel in a gaseous state. Long-haul trucks are a target market for use of LNG because of the fuel's price advantage and environmental benefits over diesel fuel. It is preferred over CNG for long-haul trucking because it requires only 30% of the space to store the same amount of energy and has a higher energy density per unit of volume. Range is also important, as long-haul truck drivers seek to reduce down-time in refueling. According to trucking company J. B. Hunt Transport Services, a diesel tractor with: a 100-gallon diesel tank has a range of 640 miles, two 100-gallon LNG tanks (110 DGE) has a range of 605 miles, and four 25-gallon CNG tanks (100 DGE) has a range of 467 miles. When a truck engine is started, it warms the LNG, converting it into a compressed gas. While about 80% of an LNG truck engine is similar to a diesel truck engine, LNG-related components add about $50,000 to the price of a truck that might otherwise sell for $150,000. According to truck manufacturer Freightliner, an LNG-fueled truck driven 50,000 miles per year could save $85,000 in annual fuel costs, recouping the additional capital cost of the vehicle in seven months. LNG is not ideal for passenger vehicles because of the large insulated tanks needed to keep the fuel cold. In addition, LNG is most effective when the vehicle it fuels is used regularly, such as long-haul trucks. When LNG is not being used on a regular basis, it is slowly heated by the surrounding temperatures and eventually escapes into the air. There are 4,000-5,000 LNG trucks operating on U.S. highways. Fleet operators—including Waste Management, United Parcel Service, and AT&T—have shown an interest in LNG trucks. In some cases, they have installed conversion kits that enable trucks to run on either LNG or diesel, allowing owners to take advantage of changing prices. The market for truck fuel is large. Approximately 3.2 million big-rig trucks use about 25 billion gallons of diesel annually, accounting for about 9% of U.S. oil consumption. Methanol is a form of alcohol that can be made from plant material or anything that was once a plant. About 15 billion gallons of methanol are produced worldwide annually, most of it from natural gas. It is used to make a wide range of chemicals that form the basis of acetic acid, formaldehyde, and other industrial products.