Economic Feasibility of CNG Fueled Vehicles for a Small City

Bruce Clark, P.E.July, 2014.

Outline

• Scope of Study• City Background• Background NGV’s• Analysis & Conclusions• Funding• Q&A

Introduction• Feasibility study conducted in 2013 as part of major

Public Works & Solid Waste facilities upgrade.

• SCS worked with the City’s Environmental Services Division.

Household Garbage Bagged & Yard Wastes

Loose Yard / Used Appliances

2 per week – Rear loaders 1 per week 1 per week

Waste Pick-Up Snapshot

Background City of Edgewater, FL

• Population 21,000• On the famous Indian River Lagoon• Located in Volusia County

Edgewater

Industry Snapshot – Why CNG?

• Availability of low-cost natural gas• Large price increases in diesel fuel• Major advancements in CNG engines - Several

major companies make CNG-ready engines for light duty trucks, vans, buses, and heavy trucks

CNG Truck Growth

Time-Fill CNG Station(vehicle parked overnight)

Quick-Fill CNG Stations(vehicles fuel in 8 to 10 minutes)

Clearwater Natural Gas (used by City of Clearwater Sanitation) Tampa International Airport

Quick-Fill CNG Stations

Compressor Station

CNG Storage Vessels

Card Readers – Public and Municipal

Comparison of CNG to Diesel Fueled Fleets

Advantages Disadvantages

Lower fuel costs compared to diesel on an equivalent energy basis

Increased capital costs for fueling station and maintenance facilities and fleet vehicles.

Reduced reliance on imported fossil fuels.

Increased O&M costs for fill station operation.

Less emissions / odors compared to diesel fuel vehicles.

Slight reduced fuel economy

Severe cold weather operation More frequent routine engine maintenance

Lower engine noise – better public relations

Increased vehicle weight

Engine durability & ease of servicing compared to diesel

Initial capital investment for fleet conversionRefuse truck premium $30,000 - 50,000

Decision Criteria

• Existing or new fueling infrastructure will be used and, if a new station is needed,

• Station located on site or offsite,• What type of station(s) is needed, • What development, ownership and operations

models best suit the agency’s criteria, and• Operational characteristics of the fleet that

will affect all of the above.

Fuel Station Cost Factors• Number of vehicles, total daily fuel volume and

maximum hourly rate.• Whether time-fill, fast-fill or both capabilities are

needed.• Level of remote station equipment monitoring and

diagnostics.• Type of dispenser including flow meter accuracy, data

collection and payment processing needs• Real estate space required.• Availability, quality and pressure of gas service.• Availability of back-up fueling or, the required system

redundancy.• Traffic access/road improvements, sound attenuation.

Modifications to Existing Maintenance Facilities

Factors include; • Major or minor repair /maintenance facility, types of fuels

Modification Elements• Gas detection system may be required. • Overall ventilation may have to be increased. Code requires 5

ACH (12 ft. ceiling).• Ventilation rate within 18 inches of ceiling subject to electrical

classification. • Fire-rated wall separation for dual type (minor/major) • Written safety procedures and employee training

Vehicle Summary

Vehicle Type No. of Vehicles

Annual Mileage (miles per

vehicle)

Annual Fuel Use (gals. per vehicle)

Gas Fuel Cost ($/gal.)

Diesel Fuel Cost ($/gal.)

Annual Fuel Cost ($)

Small P.U. Truck 8 10,000 970 3.10 3,007 Med. P.U. Truck 15 15,000 1,500 3.10 4,650 Stake Truck 4 4,000 1,000 3.50 3,500 Rear Loaders 5 10,000 2,800 3.50 9,800 Rear Loaders 5 8,000 2,000 3.50 7,000 Grapple Truck 2 18,000 3,500 3.50 12,250 Semi Tractors 2 13,000 3,000 3.50 10,500

Semi tractors (standby) 2 4,000 1,000 3.50

3,500

Totals 39,000

Source: City of Edgewater

Diesel & CNG Price Projections

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

$4.00

$4.50

$5.00

$5.50

$6.00

$6.50

$7.00

$7.50

$8.00

$8.50

$9.00

$9.50

$10.00

$10.50

CNG-2%

CNG-3%

Diesel-3%

Diesel-5%

Diesel-7%

Year

$/DG

E

Source: U.S. Energy Information Administration (EIA)

Capital Purchase Breakout

Item Cost

New CNG Vehicles (5 rear loader refuse, 2 grapple, and 2 semi-tractors)

$273,000 *

CNG Fueling Station $750,000

CNG Supply Pipeline 100,000

* Average of the different vehicles

Economic Summary

Factor Diesel CNGFuel Usage (DGE/Yr.) 39,000 41,935

Fuel Costs ($/DGE) 3.60 0.51

Capital Purchases ($) 2,100,000 3,300,000

Fuel Costs ($/ Yr.) 140,297 21,179

Fuel Station O&M ($/Yr.) 5,000 49,000*

*electrical demand (if not CNG fueled ), compressor overhaul and other systems maintenance

Results & Recommendation

Net Savings ($/ Yr.) 75,000

Simple Payback on Capital Investment 14.1 years

Simple Payback after CNG station is paid for (i.e. vehicles)

5.4 years

Open up the CNG fueling facility to other paying customers, including other City fleet vehicles, vehicles from other cities and/or counties, private companies, and other governmental agencies

Natural Gas Fuel Fleet Vehicle Rebate Program Rule 50-4.001, Florida Administrative Code

• An applicant is eligible to receive a maximum rebate of $25,000 per purchased, leased, or converted vehicle, not to exceed 50 percent of eligible costs.

• Each applicant may receive up to a total of $250,000 per fiscal year on a first come, first serve basis.

• Applications accepted starting July 1.

THANK YOU FOR COMING

You can reach me at;

bclark@scsengineers.com813-621-0080