Sainsbury's expands biogas-vehicle trial

The UK's third largest supermarket chain, Sainsbury's Supermarkets, announced plans today to outfit five more trucks with hybrid systems that use a combination of biogas and diesel fuel.

The biomethane, made from landfill waste, has been powering one of the chain's Mercedes-Benz Axor trucks, which was retrofitted in August with the dual-fuel technology developed by High Wycombe, UK-based Clean Air Power (AIM:CAP). Shares of Clean Air Power were up 9.8 percent at the close of trading today.

Clean Air Power says its technology allows up to 50 percent of a vehicle's diesel to be replaced by natural gas or biogas, cutting emissions by about 30 percent and significantly saving of fuel costs.

"We are pleased that such a respected and well known group has been impressed with the trial of our technology over the past few years and we hope that this order will lead to further orders in the future with our new products," said John Pettitt, CEO of Clean Air Power, in a release.

Warwick-based Gasrec has supplied the trial's biogas from a landfill in Surrey run by
waste firm SITA UK, which is part of Paris-based Suez (OTC: SZEZY) (see Gasrec starts fuel production at U.K. biomethane project). Gasrec has said the Surrey plant is expected to produce approximately 5,000 tonnes of liquid biomethane per year, recovering over 85 percent of the methane contained in the raw gas produced from the landfill site. The initial target for the use of liquid biomethane is commercial vehicles operating in the haulage and waste management sectors, according to Gasrec.

Clean Air Power has invested around £40 million to develop its technology since it was founded in 1991. The company has 62 patents granted or pending.

Last month, Clean Air Power signed a letter of intent with Volvo Powertrain to develop new vehicles that incorporate the company's Dual-Fuel system. Clean Air Power said it expects the agreement to be formalized in the middl eof this year, with products to market in late 2009 or early 2010.

Sainsbury's has dubbed the program using Clean Air Power's technology 'Running on Rubbish.' Just last month, Sainsbury's said it would use its unsold food in Scotland to power a biomass plant near Motherwell, about 15 miles southeast of Glasgow (see Sainsbury's to send unsold food to UK biomass plant).The chain plans to expand the effort in all its stores, with a goal to stop sending food waste to landfills by summer and any waste by the end of the year.

Last year, Cheshunt, England-based Tesco (LON: TSCO), the world's third largest grocer, said it planed to power one of its UK distribution centers using straw power (see Tesco to build straw-powered CHP plant). The £12 million combined heat and power plant was expected to have a capacity of 5 megawatts. 

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