Sen. Hendren to push CNG, energy policy research

Sen. Jim Hendren, R-Gravette, is eager to push plans and ideas he says could result in greatly reduced energy costs for state and local governments and state residents.

Speaking Saturday morning (Jan. 26) during a legislative forum held in Bentonville, Hendren briefly outlined two broad legislative energy proposals he plans to introduce during the 2013 General Assembly.

The first is a plan that would establish a process to select and convert a school district bus fleet to use compressed natural gas (CNG). With the price of CNG now at or below $1 per gasoline gallon equivalent (GGE) the savings could be significant for a school district.

“If we don’t start doing that (using CNG for bus fleets), we’re going to miss a real opportunity,” Hendren told the crowd.

He said his legislation would ask the Arkansas Department of Education to work with other groups to determine which school district fleet would be the best fit for a conversion test.

Hendren said having school fleets using CNG would also serve to “help kickstart” the construction of CNG fueling stations. In an interview after the Saturday forum, Hendren said he plans to file legislation “in a week or two.”

A November 2012 feasibility study conducted by the Wyoming Department of Administration & Information points to some of the difficulties in converting to CNG.

“The primary impediment is the incremental purchase price premium. With weak economic conditions, school district transportation budgets are often underfunded, resulting in deferred equipment replacement and extension of vehicle life,” noted the report, which was presented to the Wyoming Legislature and Wyoming Gov. Matt Mead.

The report also cited in rural Wyoming the lack of fueling stations and “limitations imposed by cruising range and storage space on the buses to accommodate the CNG tanks.” The report concluded that widespread conversion for Wyoming schools is “not feasible due to the high cost.”

However, the Wyoming study noted that more than 140 school districts in 17 states use more than 3,000 CNG school buses. (Link here for a PDF of the report.)

BROADER CNG ADOPTION
Nationwide, there is a growing movement to convert private and public fleet vehicles to use CNG.

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. Service and maintenance facilities are also being upgraded to handle natural gas engine operation and repair.

Oklahoma Gov. Mary Fallin (R) and Colorado Gov. John Hickenlooper (D) were leaders in 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.

Oklahoma officials have also worked with the private sector to encourage construction of CNG stations. The state is expected to have 100 CNG fueling stations by the end of 2013, well ahead of the 31 stations in 2010. According to the industry, 100 stations would allow CNG users to travel anywhere in the state.

THE ARKANSAS EFFORT
In Arkansas, one of the first adopters in using and promoting CNG is Fort Smith-based Arkansas Oklahoma Gas Corp., a natural gas utility with roughly 60,000 customers in western Arkansas and eastern Oklahoma. AOG President Mike Callan recently said the more than $2 difference per gallon between gasoline and CNG “certainly accelerates a pay-back” on the upfront costs of conversion. Conversion costs can be has much as $30,000 for school buses. Some school districts are able to use state or federal matching grants to offset the costs.

Callan said AOG has 53 CNG vehicles and plans to add eight more in 2013. The public fueling station operated by AOG – the first in Arkansas – is also seeing more use. He and other alternative fuel advocates also have plans during the 2013 General Assembly to pass legislation providing further incentives for CNG use and for building CNG fueling stations.

Hendren also wants the University of Arkansas research program to work with state officials to develop a state energy plan that could include more use of CNG and investigate other energy resources.

“There are major decisions, energy policy decisions, we legislators are going to try to make over the next decade,” Hendren said, adding that the UA research would ideally provide “data collection and proposed solutions.”

Hendren said Arkansas Department of Higher Education Interim Director Shane Broadway and University of Arkansas Chancellor David Gearhart are “receptive” to the idea.

UA research is preferred by Hendren instead of “hiring an out-of-state consulting firm.”

BENTON COUNTY PUSH
Benton County Judge Bob Clinard, who attended the Saturday forum, lobbied for Bentonville Public School District to be the test fleet. He said Christopher DeWitt, transportation services director for Bentonville Public Schools, worked in Missouri for a school district that operated CNG buses.

According to the Bentonville Public Schools’ website, the district has 118 buses that transport more than 5,000 students a day.

Clinard also asked Hendren about the state possibly providing grants to county governments to help convert their fleets to CNG. He said Benton County should have up to six CNG fuel stations in the next 2-3 years, making it practical for a CNG fleet.

“If we can get some grants to convert, we’ll start saving money on day one,” Clinard said.