Transportation represents major energy consumption where fuel is considered as a primary energy source. Recent development in the vehicle technology revealed possible economical improvements when using natural gas as a fuel source instead of traditional gasoline. There are several fuel alternatives such as electricity, which showed potential for future long-term transportation. However, the move from current situation where gasoline vehicle is dominating shows high cost compared to compressed natural gas vehicle. This paper presents modeling and simulation methodology to optimize performance of transportation based on quantitative study of the risk-based performance of regional transportation. Emission estimation method is demonstrated and used to optimize transportation strategies based on life cycle costing. Different fuel supply scenarios are synthesized and evaluated, which showed strategic use of natural gas as a fuel supply.