AusIndustry grant to WA engine technology company

Malaga-based Advanced Engine Component Ltd (ACE) has been awarded a $236,466 AusIndustry research and development grant, to develop components for natural gas vehicle engines that will help cut carbon emissions in the heavy vehicle industry.

Since the start of the year, all new heavy duty vehicles in Australia have to comply with Euro 4 exhaust emission standards which require stringent limits to be attained for nitrous oxides, hydrocarbons, carbon monoxide and particulates.

ACE current development program will enable the 295 and 510hp Isuzu vehicle operators to convert their diesel engines to compressed natural gas or liquefied natural gas engines through the incorporation of ACE's natural gas vehicle systems.

Once converted the vehicle will comply with the new emission standards and maintain the same performance.

The Australian Government grant represents 50 per cent of ACE's proposed eligible developemnt expenditure on the programme.

The company said that the balance of 50 per cent will be provided by ACE or "in kind" of contributions by other interested parties.

Full announcement pasted below

COMMERCIAL READY PLUS GRANT APPROVAL
The Australian Government, through AusIndustry, has approved a Commercial Ready Plus
Grant to assist Advanced Engine Components Limited ("ACE") develop natural gas ("NG")
engine and vehicle technology for the Isuzu 295 and 510hp engines.
In 2007, ACE successfully completed the development, commissioning and testing of
compressed natural gas ("CNG") and liquefied natural gas ("LNG") versions of the Isuzu
190, 220 and 225hp 7.8 litre engines to Euro 3 emission standard. ACE is selling these
ACE/Isuzu natural gas vehicle systems ("NGVS") throughout Australia.
As of 1 January 2008 all new heavy duty vehicles in Australia must comply with Euro 4
emission standards. To comply, Isuzu has released a new range of 295 and 510hp, Euro
4, diesel powered trucks.
ACE's current development programme will enable the 295 and 510hp Isuzu vehicle
operators to convert their diesel engines to CNG or LNG engines through the incorporation
of ACE's NGVS. Once converted, the vehicles operating on NG will comply with Euro 4
emission standards and maintain the same performance as the diesel equivalent.
45% of the $236,466 AusIndustry grant will be received by 30 June 2008, 50% in FY09 and
the balance, for any redesign work, in FY10. The grant remains subject to execution of the
formal agreement.
The AusIndustry grant represents 50% of ACE's proposed eligible development
expenditure on the programme. The balance of 50% will be provided by ACE or "in kind"
contributions by other interested parties.
Engine development has commenced with the first of the new Isuzu vehicles delivered to
ACE in February 2008. Costs incurred to date form eligible expenditure for ACE's required
contribution. On-road testing will commence in July 2008 with the full programme
completed by the third quarter of FY09.
Isuzu has approximately 40% of Australia's urban return-to-base truck market. The Isuzu
295hp vehicles, used for refuse collection, concrete delivery, urban delivery and general
transport, represent approximately 17% of Australia's total truck market.
The 510hp engine, for the longer-haul intercity and interstate truck and trailer-unit market,
is a relatively new but significant market for Isuzu.
ISO 9001 Lic.13705
SAI Global
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ADVANCED ENGINE COMPONENTS LIMITED
ACN: 009 081 770
Energy and environmental legislation, together with increased freight and transport costs,
are key drivers for heavy duty engine vehicle operators seeking viable, alternative fuel
solutions.
Compared to alternative NG engines available in Australia the ACE/Isuzu NG engines
provide the vehicle operator with significant initial cost savings, ongoing fuel efficiency and
Euro 4 compliance.
Approval of the grant is recognition of ACE's status as a world leader in NG
technology and systems for heavy duty engines. Factors considered by the
AusIndustry Board included: Australia's abundant NG reserves; the price of
oil; environmental concerns; the cost and performance competitive edge of
the ACE/Isuzu engines; major Australian companies investing in NG
refuelling infrastructure; the potential for the ACE/Isuzu development
programme to obtain a significant share of the Australian commercial vehicle
market within a relatively short period; and the potential for future export
opportunities to other countries using equivalent Isuzu vehicles.