United Parcel Service on Wednesday said it would invest $70
million in propane infrastructure for its U.S. delivery fleet,
including 1,000 trucks powered by the fuel.
The package-delivery company also said it would install an
initial 50 fueling stations at UPS locations in the U.S.
"Propane meets those criteria as a clean-burning fuel that
lowers operating costs and is readily accessible, especially on
rural routes in the United States," UPS Chief Operating Officer
David Abney said. "States that attract this type of investment with
tax incentives and grants will factor into the UPS deployment
strategy."
The company said the propane fleet--whose vehicles can travel as
many as 200 miles on a tank of propane--will replace vehicles
fueled by gasoline and diesel in rural Louisiana and Oklahoma, with
other states pending. UPS said it already operates about 900
propane vehicles in Canada.
UPS expects propane operations to begin by the middle of this
year, with completion targeted early next year.
The company also announced its collaboration with the Propane
Education & Research Council, a nonprofit organization that has
worked with equipment makers to get certifications from the
California Air Resources Board and the U.S. Environmental
Protection Agency.
The move comes as UPS looks to improve its operations and
delivery performance, planning to boost modernization spending on
equipment and facilities this year by about $500 million to a total
of approximately $2.5 billion. The company's fourth-quarter results
were pressured by delays during the holiday season.
Write to Michael Calia at michael.calia@wsj.com
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