AOG able to sell natural gas for use in vehicles

The Arkansas Public Service Commission has approved a plan by Fort Smith-based Arkansas Oklahoma Gas Corp. to sell natural gas “for the exclusive purpose of fueling natural gas powered vehicles.”

On Oct. 22, AOG asked for PSC approval to sell natural gas to car owners from an AOG facility or a customer-owned site. The plan approved by the PSC allows the customers to be billed monthly or pay at the point of purchase.

The gasoline equivalent cost of compressed natural gas, based on recent natural gas commodity costs, ranges from $1.90 to $1.60 a gallon. However, the costs of natural gas vehicles are higher, and retrofitting an engine can cost between $4,000 and $8,000, said AOG President Mike Callan. The Civic GX, a new car by Honda built to burn natural gas, costs about $7,000 more than the standard Civic. Federal tax credits are available for most who buy natural gas vehicles.

In its earlier filing, AOG said it had only one customer ready to use the new service. About 20 percent of AOG’s fleet uses compressed natural gas.

PSC officials not only approved the plan, but were complimentary of AOG’s effort.

“The Commission commends AOG’s initiative in proposing the NGV tariff in an effort to meet the existing and potential needs of its customers for natural gas-powered vehicle fueling options,” noted the Friday approval letter signed by Commissioners Daryl Bassett, Colette Honorable and Paul Suskie.

Continuing, the PSC letter noted, “Further, AOG is commended for its efforts to facilitate and encourage the use of natural gas as an alternative to fueling vehicles by gasoline and diesel.”

Callan said AOG will begin to market the new service and hopes to have the systems in place to begin selling compressed natural gas to vehicles in early December.

Link here for more perspective on natural gas vehicles.