UPS to Use Renewable Natural Gas for Part of Delivery Fleet

United Parcel Service Inc. agreed to use renewable natural gas from Clean Energy Fuels Corp. for some of its delivery fleet, as part of its plan to drive one billion miles using alternative fuel by the end of 2017.

Clean Energy Fuels produces a product called Redeem, which is the first renewable natural gas available in commercial quantities.

The RNG will be used in stations across California beginning this month to fuel tractors and delivery vehicles. The stations in Sacramento, Los Angeles and Fresno will provide about 1.5 million gallon equivalents of RNG fuel to about 400 vehicles in the state.

The company already uses natural gas on tractors in the U.K.

RNG, or biomethane, can be created from sources such as decomposing organic waste in landfills.

"Renewable natural gas is critical to our effort to minimize UPS's environmental impact while meeting the growing demand for our services," said Mitch Nichols, UPS senior vice president of transportation and engineering.

The Atlanta-based delivery giant said in April that revenue for U.S. ground packages grew 5.3% to $6.36 billion in the first quarter. That helped buoy total U.S. domestic-package operating profit, which rose 10.5% to $1.02 billion. Overall revenue rose by 1.4%.

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