Glenwood Springs CNG station backers seek fuel purchase pledges
November 15, 2013
GLENWOOD SPRINGS — Trillium CNG, the company that plans to build a compressed natural gas (CNG) fueling station here, is offering discounted fuel to vehicle fleets that sign multi-year fuel purchase agreements.
"We are excited to have a public station in Glenwood, and we're willing to give attractive pricing to those who come in the door first and help make the project happen," said Jennifer de Tapia, Market Development Director for Trillium CNG in Salt Lake City. "Our program includes volumetric pricing, so the more fuel you buy, the lower the cost per GGE [gasoline gallon equivalent] will be."
Trillium CNG has been selected for a $100,000 grant by Garfield County and the City of Glenwood Springs that will offset about 10 percent of the $1 million cost of installing a 24/7 public fueling station in Glenwood Springs. Fueling stations are costly because they require multi-stage compressors that pressurize natural gas to 3,600 pounds per square inch.
In addition, Trillium CNG would install a Hy-C unit, the company's patented hydraulic intensifier. "We make sure that the next-in-line customer gets the same fast fill time as the vehicle in front of them," de Tapia said.
The CNG station will be located close to I-70 to capture local and through traffic. One possible site is the Shell station at the corner of Highway 6 and Mel Ray Road in West Glenwood. In 2012, Trillium installed a CNG fueling station for RFTA's CNG-powered buses.
If enough fleets step forward in the coming weeks to make fuel purchase agreements, de Tapia said, the company would move forward with station design and permitting this winter, construction in the spring, and an opening date in summer 2014.
"Our strategy this year is to establish additional stations in geographic areas where we are currently located, to provide excellent fueling performance, and to create local jobs," de Tapia said.
Lower fuel costs
Now Trillium CNG is looking for commitments from Glenwood Springs-area fleet owners willing to trade out trucks and heavy-duty vehicles for CNG or bi-fuel models. The company is seeking fuel commitments in November and December for vehicles that would be purchased over the next couple of years.
CNG offers three main advantages over conventional fuels: it's $1 to $1.50 cheaper than gasoline or diesel, it offers long-term price stability and it's produced in North America. The downsides are that CNG vehicles cost more and require larger fuel storage tanks.
"Even though a natural gas vehicle is more expensive, the fuel cost is so much less that you can pay back that differential in a few years," said Peter Tijm, a former Shell Oil refinery manager now working as an oil and gas consultant in Glenwood Springs.
For private sector fleets, a state tax credit will offset 35 percent of the CNG cost premium for new vehicles purchased this year. In 2014, the credit formula changes to 12 percent of the total vehicle MSRP for the base model equipped with CNG or CNG bi-fuel.
U.S. auto manufacturers are rolling out light, medium and heavy duty trucks, vans and buses that will run on CNG alone or CNG-bifuel that includes a gasoline tank as backup, with on-the-fly fuel switching when the CNG tank runs out. Berthod Motors in Glenwood Springs and Columbine Ford in Rifle have CNG-certified service technicians and CNG-ready service bays, and public fueling stations are already running in Rifle, Parachute and Grand Junction.
"We've come a long way with CNG in the past three years," said Garfield County Commissioner Tom Jankovsky. "The next step is to get this station in Glenwood Springs."
Free fleet analysis
At the same time that Trillium CNG is looking for fleets to make a CNG purchase pledge, Garfield Clean Energy is offering free fleet analysis to fleet owners through its Refuel Colorado Fleets program.
"We are working with fleet managers to help them decide the best plan for switching vehicles in their fleet to alternative fuels. In Garfield and Mesa counties, that means CNG or CNG bi-fuel," said Mike Ogburn, energy engineer for CLEER: Clean Energy Economy for the Region, the organization that manages the programs and services of Garfield Clean Energy.
"Not every fleet vehicle is ideal for CNG, but for those that are suitable, the cost savings are truly impressive," Ogburn said. "There is a strong business case and emergency-preparedness case for using alternative fuels that fleet owners will want to consider."
Minimum sales threshold
The Glenwood Springs station would need to sell at least 100,000 GGE of natural gas per year, de Tapia said, and prices would be lower once sales climb above 200,000 GGE per year.
GGE is a standardized measure of CNG based on its energy content at pressure. Drivers can expect to travel the same number of miles per gallon on CNG as on gasoline.
Ogburn said a rough analysis of public and private sector fleets in the Glenwood Springs area shows that sales could readily hit 180,000 GGE per year.
"Just with a few participants, we can get to 15,000 GGE per month. If we can get the a few key fleets involved, including the county government, waste haulers, service companies and contractors in the area, we are there," he said.
— Clean Energy Economy for the Region is based in Carbondale and can be reached at 970-704-9200.