
Natural gas, coal and biomass can all be converted to gasoline and diesel to be used in conventional petrol engines and Australia has plentiful supplies of these resources. Gas and coal are fossil fuels like crude oil and are non-renewable.
Liquefied petroleum gas (LPG) is the most commonly used form of gas for transport in Australia (LPG is used in almost all Sydney taxis and NRMA patrol vehicles). LPG is produced as a by-product of the oil refining process and during the production of natural gas. Australia has a comprehensive LPG network and, currently, LPG is cheaper than conventional fuels as it is not subject to excise. Even after the introduction of excise from 2011-2015 LPG should still be substantially cheaper than petrol.
LPG requires a pressurised tank to store the fuel. Most conventional cars can be converted to accept LPG as well as petrol. Many car manufacturers offer several new models with dual fuel LPG systems and Ford offers a dedicated LPG system on several Falcon models i.e. there is no petrol system in the vehicle at all.
Natural Gas is currently in plentiful supply in which can be used in the form of compressed (CNG) natural gas or liquefied (LNG) natural gas to fuel vehicles. It is what we use to cook with at home and is similar to LPG in that it requires pressurised storage tanks. Unlike LPG, there is not a wide distribution network and so natural gas is best suited to vehicles that return to base regularly, such as urban delivery vehicles, which can refuel with Compressed Natural Gas (CNG) overnight, or for long haul transport in its liquefied form as LNG. Some 1200 buses will be powered by CNG in Australia by 2011.
Similar modifications to fuel systems as required for LPG are needed to make natural gas suitable for cars.
Coal seam gas that escapes from coal seams can also be captured to use as fuel and this is already occurring at some sites.
Using LPG does slightly reduce CO2 emissions and also reduces tail-pipe pollutants harmful to our health and so improves air quality.
Using natural gas also improves air quality. However, CO2 and methane emissions are higher from the processing of natural gas than for oil derived fuels. (p. 75 Jamison Report)
Using coal seam gas significantly reduces the CO2 emissions associated with related mining activities as this gas is a significant contributor to greenhouse gases and would otherwise be lost to the atmosphere. Using it also reduces other fossil fuel that would otherwise be needed.
For more detail on gas use in vehicles and production processes see the 2010 Jamison Group Report from page 34 onwards and page 72.