Operational Cost of Propane

The initial costs of owning propane vehicles can be offset by reduced operating and maintenance expenses over the lifespan of the vehicle. The time required to realize the savings to offset the additional purchase price (payback period) depends on vehicle usage patterns, specifically, the type (highway vs. city) and number of miles driven in said vehicle. Some fleet vehicles for example, may endure a lot of stop and go type travel and have increased fuel consumption when compared to a vehicle that is used for mostly long distance, highway travel. So based on the typical usage, the payback period on propane fleet vehicles can be very reasonable but, will likely vary from one industry to another.

Fuel is the principal operating cost for most any vehicle and according to the US Department of Energy the average cost of a gasoline gallon equivalent (gge) of propane is generally less than that of gasoline. Federal excise taxes on propane are 13.6 cents/gallon, 8.4 cents/gallon on gas and 24.4 cents/gallon on diesel fuel.
Propane can deliver up to 90 percent of gasoline's miles per gallon and produces significantly less environmental pollutants. The fuel efficiency of propane relative to gasoline, surpasses those of other alternative fuels - 70 percent for ethanol, 54 percent for methanol, and 21 percent for compressed natural gas (see chart below).

This comparison uses identical vehicles optimized for a specific fuel. The baseline is a gasoline-fueled vehicle with enough fuel to travel 100 miles (160.6 km). Distance shown is based on the relative energy content (British Thermal Units - BTUs) of each fuel gallon.
If all vehicles were fitted with equal volume tanks, propane gas would provide the best economy when compared to ethanol, methanol and CNG. Source: Michigan Propane Gas Association

Along with the lower price per gallon, reduced maintenance costs are a major reason underlying propane's popularity for use in delivery trucks, taxis, and buses. Propane has a higher octane rating (104-112 compared with 87-92) than gasoline and lower carbon and oil contamination characteristics have resulted in documented engine life of up to three times that of fossil fuel engines. Many fleets have also reported extended intervals between required maintenance. Older technology spark plugs in gasoline engines typically had to be replaced after about 30,000 miles, but those in a propane vehicle can last 80,000-100,000 miles.