Below is an email Q&A conducted with Josh Stull of the Municipal Gas Authority of Georgia:
1. Do you have the current exact figure for how much it costs for the CNG equivalent of one gallon of gasoline? (I've read varying reports ranging from $1 to more than $2.)
The answer depends on a number of factors including the owner of the station, the location, and the commodity price that month. So, there is no exact figure but I believe a good range for retail rates in the southeast would be $1.50 to $2.50. Here is a link to a site that posts a map showing CNG prices across the US at stations where pricing is available (www.cngprices.com)
2. You mentioned currently that the only consumer CNG-powered vehicle available is the Honda Civic. Why aren't more consumer CNG vehicles available and what does the industry have in store for the next year? (It was mentioned that GM and Ford are both planning to roll out CNG pick-up trucks.)
I believe that more manufacturers have not yet entered the CNG market simply because the demand has not yet justified mass production of CNG models. Though I believe that you will see more manufacturers coming to the table with original equipment in the coming years. I don't know the specific schedule for any Ford or GM releases.
3. When a vehicle is retrofitted, is it completely converted over to CNG or does it become a CNG/gasoline hybrid? If either conversion is possible, is there any benefit to a full conversion versus a hybrid conversion?
A vehicle can be converted as a dedicated CNG vehicle or a hybrid. I think the main advantage of a dedicated CNG vehicle is the opportunity to take full advantage of the low CNG rates mentioned above, as well as the benefit of the "clean fuel". The advantage of the hybrid is primarily that you are able to drive it longer distances and to areas where you might not be able to find a CNG station, thereby eliminating "range anxiety". The hybrids are recommended in a lot of cases for passenger type vehicles because the fueling infrastructure is still very limited.
4. What is the range of costs for consumer vehicle conversions?
The new Honda Civic GX is around a $7,000 to $8,000 premium, and to convert other types of passenger cars and trucks you are looking at $10k to $15k depending on fuel capacity (the fuel tanks are a large part of the expense).
5. Are CNG-powered vehicles significantly cheaper to operate than electric-powered vehicles? How do they compare in building costs?
Most equipment/appliances are less expensive to operate on natural gas. The primary reason is the cost to generate a unit of electricity far exceeds the cost of producing an equivalent amount of natural gas. In fact, over 70% of the original electricity is lost in the production and transmission process which means only 30% gets delivered to the appliance. On the contrary, 92% of the natural gas that is produced is delivered to the appliance. So, most gas applications including vehicles are more efficient and less expensive to operate.
Concerning the initial vehicle cost, the electric Nissan Leaf has an MSRP of $35k while the 2011 Honda Civic GX retails for around $25k.
6. I assume it's because of access to infrastructure that electric vehicles seem to be more popular on the consumer side. Are there any other reasons for this?
I think that is one of the reasons for the interest in the electric vehicle. It is certainly not initial price (mentioned above) or the mileage range of the vehicles. The range of the Nissan Leaf has been tested around 80 miles vs. 200 miles or more for the natural gas Civic. I think one of the main reasons for the popularity of the electric vehicle is the perceived "zero emissions" and the belief that it is a "clean vehicle" that is better for the environment. While the vehicle itself may not emit any pollutants, one must consider the emissions from the coal which is typically how electricity is generated, and also the inefficiency in the process mentioned above.
7. CNG is currently very cheap compared to gasoline, but if demand for CNG increases, will this negate at least some of the price benefit? Realistically, how many CNG vehicles can our country support and for how long?
It is certainly possible for Natural Gas prices to increase however we have reason to believe that prices which remain low and stable for many years to come. In the past couple years we have increased our current reserves of natural gas from a projected 60 years to around 100 years. This is primarily due to drilling technology that has become cost effective in the past few years to capture gas from Shale Rock formations found all over the United States. We've always known this gas was there, but it has only been cost effective to drill for it in the past few years. The EIA projects we will get almost half of our natural gas as a country from these plentiful formations within 25 years. As the demand for CNG vehicles grow so does our gas supply as a nation, so without providing an exact number the US can support many, many vehicles for a very long time.
8. Are CNG-powered trucks a better fit for large commercial fleets like Covington's? Is yes, why?
They are often a better fit, but it depends on the individual situation. In Covington's case we feel like it is a good application because they have access to a very low CNG price. Since they are a retail provider of natural gas, they will essentially sell it to themselves at cost. So, they have opportunity to save significant amount of money each year across their fleet. Building a station for their fleets also provides an opportunity to make the station available to their community and the general public.
9. Did the Georgia Public Service Commission decide whether to provide funding to Atlanta Gas Light to build public fueling stations? Is this limited to the metro area or could Covington be eligible for any funding?
The PSC has not yet decided whether it will allow AGL to utilize its Universal Service Fund to build CNG stations in the metro area. I believe the hearing will be in the next few weeks. Since the USF came from a surcharge on AGL's industrial customer bills, if approved, this money would only be available to build stations on AGL's gas system. So, other providers like the City of Covington would not be able to access the funds.
10. Please feel free to point me in the direction of any other resources that you recommend.
Would you prefer to pay current pump prices or $2 for a gallon of gas? The $2 price of course. But what if you had to pay $8,000 to $15,000 up front to get that discount.
That's the dilemma facing consumers considering buying or converting to a compressed natural gas-powered car. The numbers are better for electric vehicles as price per gallon equivalent is cheaper, but new vehicle costs are higher.
Using some rough math and given current gasoline prices, if a driver had to pay $10,000 to convert his current vehicle to compressed natural gas (CNG), he would have to use 7,692 gallons before he would break even on his investment. For a car that got exactly 26 miles per gallon that would work out to 200,000 miles of driving.
For many consumers the numbers don't work out quite yet, though they're a little better for electric. According to a 2007 study by the non-profit Electric Power Research Institute (EPRI), as reported by emagazine.com's Earth Talk section, the price per gallon for electric-powered cars is around 75 cents per gallon (assuming an electricity cost of 8.5 cents per kilowatt hour; Covington's rates are fairly close).
General Motors' new Chevy Volt has been in Covington for the past several weeks. The Volt is an electric-gasoline hybrid, allowing it to run on either. The manufactured suggested retail price for the Volt is $39,145 (there are federal tax credits available, up to $7,500), which is $17,150 more than a Chevy Malibu.
Using the same process as above, the Volt would pay for itself after 174,862 miles. Of course, tax credits would help, and existing vehicles can be converted to run on electricity for $10,000 or less.
The other benefit to driving either a CNG or electric-powered car is that they run much more cleanly than gasoline powered cars.
In any case, the majority of Covington News readers weren't interested in the vehicles given the current economy. In The News' weekly online, unscientific poll, nearly 59 percent (138 votes) of readers said they didn't want to spend the additional money required to own an alternative energy vehicle.
Of the 41 percent who said they were interested, 25 percent said they would only be interested if a public fueling facility existed. This is particularly important for CNG-vehicle owners, because home CNG-fueling units cost around $4,500, according to Scott Tolleson with the Municipal Gas Authority of Georgia.
Tolleson's colleague, Josh Stull told The News Friday that he expects to see an increase in consumer options in the CNG-field in the coming years.
"I believe that more manufacturers have not yet entered the CNG market simply because the demand has not yet justified mass production of CNG models," Stull said.
CNG more feasible for large corporate, public fleets
On the other hand we've already seen several larger companies and governments move toward partial CNG-powered fleets.
Snapping Shoals EMC has had CNG trucks for more than a decade, and the company has its own fueling station at its Brown Bridge Road facility. The company now has 28 CNG-powered trucks and is planning to add more. Fleet Services Director Jeff Morgan said previously that Snapping Shoals saved around $280,000 by using CNG vehicles between 1999 and 2007, based on his calculations.
Covington is planning to follow in Snapping Shoals footsteps and approved paying around $50,000 for a fueling facility design. The facility itself would likely cost between $500,000 and $1.1 million to build, but Covington would hope to make it available to the county, school board and even the public.
The city applied for a $2.7 million federal grant in early 2010 to build a facility and purchase CNG vehicles, but did not receive it, grant writer Randy Conner.
City Manager Steve Horton said the city wants to diversify its fleet.
"What I mean is that we would like to have a certain number of vehicles that run on petroleum products, some that run on natural gas, and others that run on either electricity or ethanol. The purpose would be to insulate the city from very high prices that may affect any one of the fuel sources, as it is believed such impact would not affect all sources of fuel...at the same time," Horton said in an email.
Conner said the city was gathering information on both CNG and electric vehicles.
Neither the county nor the school system have the financial resources at the moment to pursue diversification of their fleets, but if Covington leads the charge, they may be able to follow later.
"Given the cost to retrofit vehicles for this purpose we have not really looked at this to a large degree," said Dennis Carpenter, school system deputy superintendent for operations. "If some grant monies were available and secured (for retrofitting) this would be somewhat attractive in terms of diversifying our fleet fueling options as a means of taking some of the sting out of a price hike in the areas of diesel fuel and/or unleaded gasoline."
Stull said a CNG fueling station will be particularly attractive for Covington because the city provides its own natural gas and could essentially fuel their vehicles at cost, avoiding any markup. He said deposits of natural gas deposits continue to be found in the U.S. and best estimates say the U.S. will have a stable supply of natural gas for between 60 and 100 years.
Atlanta unveiled its first public charging station in August, and the Atlanta Gas Light company is currently lobbying for funding to build 10 to 15 public CNG-fueling stations around Atlanta and along major corridors throughout the state during the next five years. The Georgia Public Service Commission is expected to vote Nov. 1 on whether to provide $12 million of funding for the project.
While it may not be feasible in 2011, Covington residents may soon see the day when driving an alternative energy vehicle makes sense both environmentally and financially.
For a full Q&A with Josh Stull of the Municipal Gas Authority of Georgia read "Related Content."