It has long been known that F-T diesel (PAL) when run in a properly equipped diesel engine will have emissions levels as low as or even lower than CNG. In fact tests run in Europe would indicate that F-T diesel (PAL) has a lower level of PM_¹⁰ than CNG.

It would seem natural that F-T diesel (PAL) would be a competing fuel in the market place. If this is true, what are the relative costs of CNG vs F-T diesel (PAL) vehicles that operators need to consider.
Typically CNG vehicles (trucks and buses) cost between $30k to $60K more than a diesel unit, the CNG refueling stations typically cost between $22k to$26k per unit, maintenance costs have been shown to range between $3.5k to $7k per year higher due to higher part costs and the lower power of CNG buses can limit them to less hilly routes. Finally, CNG fuel has become considerably more expensive in recent years and is project to stay at this elevated levels for the foreseeable future. As an example:

If natural gas is selling for $6.00/mmbtu (at the refueling station) and F-T diesel was selling for $1.20/gallon (wholesale), a school bus operator could pay an additional 46¢/gal for the diesel to avoid the cost of CNG. A city bus operator could pay an additional 28¢/gal. The price for natural gas in Long Beach, California in June 2001, was over $14.00/mmbtu and diesel was 90¢/gal so the bus operators could pay considerably more to avoid the higher up front capital costs and the higher operating costs. The chart below show the potential premium that an operator can pay for F-T diesel (PAL) in order to avoid the higher costs of CNG at various costs for natural gas and
F-T diesel (PAL). This next graph courtesy of the California Energy Commission (CEC) clearly illustrates the extra cost involved with using CNG vs F-T diesel (over $1.30/gal) Click here to see CEC graph in a PDF format !