Let’s get gassed

by Michael Tilley (mtilley@talkbusiness.net) 11 views 

There are a few points to make about Fort Smith officials taking a close look at using compressed natural gas (CNG) as a fuel alternative in a portion of its 359 vehicles – not including police, fire or sanitation vehicles.

Point 1: This review is long overdue.
During the past several years, private and public fleet operators around the country have discovered the benefits of using CNG instead of diesel or gasoline. During a November natural gas summit held in Alexandria, Va., several speakers said the savings was more than enough to justify switching to natural gas. Even counting the cost of engine conversion from diesel to natural gas, the return on investment could be counted in months instead of years, was the broad sentiment expressed at the summit.

Trucking company C.R. England said it was experiencing savings of 70 cents per diesel gallon equivalent (DGE) on its test vehicles. A UPS spokesman said then that the company was realizing a savings of $1.50 per DGE on its fleet of nearly 50 LNG tractors.

Truck manufacturers like Navistar, Volvo and Kenworth have greater displacement natural gas engines which will be rolled-out in 2014 and 2015, thereby permitting natural gas carriers to carry heavier and longer loads than is now available.

Point 2: The cost savings could be significant.
Sure, there will be some upfront capital costs required, but in less than five years (if not sooner), fuel savings for the city could balloon to impressive levels.

Fort Smith-based Arkansas Oklahoma Gas Corp. has 60 CNG vehicles. In July, fuel cost savings were roughly $15,000, or about $250 per AOG vehicle. If Fort Smith converts 100 of its vehicles to CNG, the annual savings could be at or above $300,000. If 200 vehicles are converted or purchased, the annual savings could reach $600,000. A city fleet with 300 vehicles actively using CNG would see savings of near $1 million a year. Even if it costs around $10,000 more per vehicle to convert (that includes extra vehicle costs, new pump stations, new maintenance tools, etc.), the payoff would be under four years. However, that doesn’t include lower maintenance costs with CNG use compared to diesel or gasoline use.

Point 3: This ain’t a fad.
Oklahoma Gov. Mary Fallin (R) and Colorado Gov. John Hickenlooper (D) recently championed what became a 22-state “bipartisan” effort to convince major automakers to build more affordable compressed natural gas vehicles. Arkansas joined the effort in late 2012.

The effort resulted in bids from Ford, Chrysler, General Motors and Honda that resulted in a range of savings between 4% and 16% for CNG vehicles sold to state fleets.

In late 2012 and early 2013, Oklahoma’s Department of Transportation added 160 compressed natural gas vehicles to its fleet. The state buys about 700 vehicles a year, and Fallin said she wants more of those to be CNG. The 160 CNG vehicles cost $5 million, and state officials estimate savings of about $20,000 over the life of the vehicle in fuel and maintenance costs. ODOT officials say they want to replace more than 90% of the department’s fleet vehicles with CNG vehicles in the next three years.

Point 4: The city could be its own energy provider.
The Fort Smith Landfill produces approximately 1,000 MMBtu’s of gas each day into the system of Arkansas Oklahoma Gas Corp. This is the energy equivalent of approximately 8,000 gallons of gasoline. Yes, 8,000 gallons.

Point 5: It could clear the air.
Burning CNG instead of gasoline reduces carbon dioxide emissions by 20% to 30%; reduced carbon monoxide emissions by 70% to 90%; and reduces particulate matter emissions by up to 90%.

Point 6: it won’t be easy.
Change is difficult. It can be a pain in the ass. It will require more work by several people on the front end. There will extra costs on the front end. There’ll be bureaucratic decision-making and paperwork and this will change and that will change and we’ll need a new set of tools for this, and a different training regimen for maintenance and, well, gosh, let’s just call the whole thing off.

The many positives of using CNG will be hard to overcome, but it will be a surprise if there is no opposition from folks who benefit from the status quo.

Point 7: There could be a positive publicity angle.
A Fort Smith fleet conversion has the potential to positively position Fort Smith in terms of public relations. At some point many municipalities in Arkansas and around the country will use CNG in a portion or all of their fleet. But wouldn’t it be nice if for a few years we could brag about being ahead of the Arkansas curve in terms of cutting costs and reducing harmful emissions?

This positive publicity also could come in the form of helping Arkansas catch up with neighboring states. Texas is second in the nation with 45,431 alternative fuel vehicles, Oklahoma is fifth with 18,567, Tennessee is 16th with 10,427, Missouri is 17th with 9,574 Mississippi is 27th with 5,608 and Louisiana is 31st with 4,857. Arkansas has just 2,098.

Point 8: Let’s hope the Board of Directors stays focused and moves fast.
Time is literally money. We might already be money ahead if three years ago we’d focused on effective CNG use instead of leash laws, trash service shifts and other unnecessary drama.