City of Wentzville Compressed Natural Gas (CNG) Project March 16, 2011

Compressed natural gas, or CNG, is natural gas under pressure which remains clear, odorless, and non-corrosive. Although vehicles can use natural gas as either a liquid or a gas, most vehicles use the gaseous form compressed to pressures above 3,100 pounds per square inch. March 16, 2011 What is Compressed Natural Gas?

Most natural gas comes from three types of wells: natural gas-and- condensate wells, oil wells, and coal bed methane wells. Well-extracted natural gas requires a cleanup process before it can be used in vehicles or residences. March 16, 2011 How is Natural Gas Produced?

In smaller fueling locations and on vehicles, CNG is stored in thick-walled steel, aluminum, or composite tanks built to last more than 20 years. March 16, 2011 How is Natural Gas Stored?

When released, compressed natural gas will mix with air and become flammable only when the mixture is within 5 to 15 percent natural gas. When the mixture is less than 5 percent natural gas, it doesn't burn. When the mixture is more than 15 percent natural gas, there is not enough oxygen to allow it to burn. Because natural gas is lighter than air, it quickly dissipates when released from tanks. March 16, 2011 Is Natural Gas Flammable?

Natural gas is produced both worldwide and domestically at a relatively low cost and is cleaner burning than gasoline or diesel fuel. Natural gas vehicles show an average reduction in ozone-forming emissions of 80 percent compared to gasoline vehicles. March 16, 2011 What are the benefits of using Natural Gas in Transportation?

CNG vehicles have been introduced in a wide variety of commercial applications, from light-duty trucks and sedans - like taxi cabs, to medium-duty trucks - like UPS delivery vans and postal vehicles, to heavy- duty vehicles like transit buses, street sweepers (pictured above) and school buses. In some states, transit agency buses are some of the most visible CNG vehicles. March 16, 2011 What vehicles use Natural Gas?

Nine years ago the City started the pursuit of utilizing CNG as an alternative fuel to operate a proposed citywide Bus System and construct the needed infrastructure to produce CNG. Since this time the Bus System has not moved forward and the CNG infrastructure project has not been fully implemented. March 16, 2011 A Brief Discussion…..

In 2002 the City initiated a study to provide a local Bus System within the City limits. To be environmentally friendly by keeping diesel odors/emission low an alternative fuel was discussed resulting in the use of CNG to operate the Bus System. Analysis indicated that the cost of constructing the needed CNG infrastructure was cost prohibited, however, to make this a break-even project other users would need to be identified. March 16, 2011 A Brief History…..

The City was able to identify two other users in the immediate area; one was General Motors (GM) and the other was GFI Teleflex. GM produced a CNG alternative fuel option for their fleet vans at the Wentzville Plant. This option was installed by GFI Teleflex located in the M & B Sachs Business Park. In addition to these two companies interest grew with Ameren UE and the St. Charles County Parks Department. With these interested parties the City moved forward with planning the construction of the CNG fueling station. March 16, 2011 A Brief History Continued…..

From 2002 through 2004 the City obtained financial support from Ameren, secured a land lease with Ameren, initiated production of the CNG station and developed the site to its current condition. March 16, 2011 A Brief History Continued…..

During this time period two events occurred: First GM stopped producing CNG vehicles at the Wentzville Plant which lead to GFI Teleflex leaving the City. By these two users leaving it placed the financial feasibility of the project in jeopardy. The second event was the passing of the owner of Bowgen Fuel Systems which was constructing the CNG Station in Springfield, Missouri. With Mr. Bowgen’s passing, the company was sold to Clean Air Concepts of Indiana which shortly went out of business. Due to these two events, the project was placed on hold and the CNG equipment has been warehoused in Springfield, Missouri. March 16, 2011 A Brief History Continued…..

From the City attempted to revive the project by seeking grants. Unsuccessful with grant awards and without any potential users the project is rendered not financially feasible. Therefore, the administration is now seeking direction on how to best complete or terminate this project. March 16, 2011 A Brief History Continued…..

Based on current estimates it would cost the City $170,500 to make the CNG station operational. In addition, it is estimated that the monthly operation of this station would cost $3,124 (service agreement, utilities, miscellaneous maintenance). March 16, 2011 To Make the CNG Project Operational

The City has been working towards identifying potential buyers of the CNG Station over the last five years. In this time period three local and two out-state users have been identified which expressed interest in purchasing the CNG equipment. For this to occur, the Board of Alderman would have to declare the equipment as excess property. The staff would then put together bidding documents and attempt to sell the CNG equipment to the best bid. This option would relieve the City of any future operational cost and the estimated $170,500 to complete the project. March 16, 2011 To Declare Excess Property

Estimated cost to convert: Pickup / Police sedan - $10,000/vehicle Yearly average fuel use: Pickup - 1,020 gallons Police sedan – 3,000 gallons March 16, 2011 Fleet Conversion

Pickups: Cost/gallon gasTotalCost/gallon CNGTotalDifference $3.85 $3,927.00$1.60$1,632.00$2, $2.29 $2,335.80$1.60$1,632.00$ Police Sedans: Cost/gallonTotalCost/gallon CNGTotalDifference $3.85$11,550.00$1.60$4,800.00$6, $2.29$6,870.00$1.60$4,800.00$2, March 16, 2011 Conversion Costs Comparisons

Completing the project coupled with converting the City’s vehicle fleet would be the highest financial risk. This is based on expending additional funds to complete the project, cost of converting fleet vehicles and facility modifications. One cost beyond the City’s control is the fluctuating cost of gasoline. This year in the St. Louis area gas has been averaging $3.85/gallon and is anticipated to reach $4.00 +/gallon by this summer. The price of gasoline fuel directly affects the financial feasibility of this project. March 16, 2011 Conclusion……….

What is known is that the option of doing nothing cannot continue. Since January 1, 2009, The Bowgen Company has been charging the City $500/month for storage, ($13, in rental charges to date). March 16, 2011 Conclusion Continued……….

Please Reference Spreadsheet Handout. Comments/Questions March 16, 2011 Years to Recover Costs…….