A great many transit districts are operating with CNG powered buses. Apparently, the only drawback they have encountered is that that because that CNG has 75% of the BTU's of #2 diesel, that they have to equip the buses with V-8 engines instead of the V-6's that have been utilized in the past.

Few fuels in this world are less scary than LNG. Look at some of the tests of pool fires where the test engineer lights the pool by hand and then walks away after ignition. There is also 00.00% likelihood of a BLEVE with LNG, and no likelihood of the kind of boosted detonation that can occur with CNG.

I think you have the Ross Rowland story considerably bargled -- he was working (with a team of good engineers) on adapting CNG (compressed natural gas) to modern internal-combustion power. He may care to comment on the current state of his research, but I would not be surprised if he did not. There are a number of reasons why gaseous fuel for large steam locomotives is not an economically preferable idea -- invariably a synthesized liquid carrier fuel will be a wiser practical choice 'well-to-wheel'.

Properly treated WVO is 'chemically similar enough' to #2 diesel/gas-oil that it can be fired in pressure burners designed for that fuel. As an advantage, modern diesel fuel normally must be carefully filtered, and contain additives, for the precise components in many injectors; this is not necessary for an external-mix burner and unlikely to be necessary for pressure burners of the size appropriate for even fairly small steam locomotives. But, as noted, the street price of the "feedstock" has gone up dramatically following even relatively small increases in local demand, and much of the stock derived from restaurant sources can be contaminated with precisely the sort of material that makes for poor maintenance (silicon carbide powder from grill-cleaning, for example).

I think it is far likelier that biodiesel from a demonstrable 'renewable' source will be the political fuel of choice for locomotive projects; an astute operator will ensure that all the processing steps as well as the growing and pressing of the rapeseed or whatever are powered by renewable energy sources as well. This will keep the marginal cost of the fuel somewhat lower as less processing would be needed for an external-combustion-compliant product.

The other traditional source of 'recycled' fuel, waste lube oil, remains an option. Most of the weird contamination issues that make this fuel a misery can be solved fairly easily by centrifugal purification (there are plants of appropriate size for even very large locomotives that can be purchased relatively cheaply, or built by a competent shop, that get rid of the coolant and polar-solvent issues, and I think most difficulties with other forms of oil contaminant (transmission and power-steering fluid, etc.) are amenable to treatment in practice. There remains the issue of metal contamination (e.g. zinc), which of course goes into the 'emissions' unrecoverably if not treated, but I think the welfare economics of removing considerable stocks of these motor-vehicle wastes from the need for expensive and regulations-compliant treatment and disposal may well outweigh marginal issues of local stack pollution.

Something I would note here is that some forms of alternative fuel may become significant both for preservation and for 'tourist-railroad' operations, both diesel and steam. So it makes sense to keep the discussion here focused on those aspects, I think.