Wisconsin Natural Gas Roundtable: Developments in Surrounding States

Ted Barnes

Gas Technology Institute

October 2014

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Objectives

1. GTI Background

2. What’s Already Here - Locating Current Stations

3. What’s Coming and When?

4. Grants/Upcoming Developments

5. Contact your local Clean Cities Coordinator

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ESTABLISHED 1941

GTI: Company Overview

> Staff of 250

> 350 active projects

> 1,200 patents; 500 products

Energy & Environmental Technology Center

Office & Labs Pilot-Scale Gasification Campus

Training

Natural Gas Research and

Development Focus

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GTI – Barrier Reduction Grant

Webinar Series

I. Inspection Guidelines for CNG/LPG Vehicle Conversions

II. Considerations for Garage & Maintenance Shops When Using CNG/LPG

III. Station Installation Guidelines for CNG

IV. Station Installation Guidelines for LPG

V. Best Practices for End Users for CNG, LPG & Electric Vehicles

The webinars and slides are available online at www.wicleancities.org/webinars.php

Barriers Survey

Survey to gather barriers for adoption of alternative fuels

Please complete the survey at:

www.wicleancities.org

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What’s Available Now?

Locating Current CNG Fueling Stations

• Use AFDC Station Locator

(http://www.afdc.energy.gov/locator/stations/)

• Access through all local Clean Cities websites

• Shows stations that are planned to be available soon

• Shows public and private stations

• Gives details on each facility

• Other websites include: CNGnow.com; station provider

websites; fuel management card websites; utility websites

• Often incomplete because of regional or proprietary nature

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AFDC Station Locator Details

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Local Public CNG Station Count

Public Stations Existing Planned Total

Wisconsin 47 3 50

Minnesota 9 4 13

Iowa 5 2 7

Illinois 16 2 18

Indiana 19 3 22

Michigan 12 0 12

Totals 108 14 122

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What’s Coming and When?

• List from AFDC – incomplete but still promising

Provider City State Date

Barnes Inc - US Oil Madison WI 4/15/2015

GAIN Clean Fuel Middleton WI 10/24/2014

Kwik Trip Windsor WI 12/1/2014

Clean Energy Chicago IL 12/1/2014

WM Rockdale IL 12/1/2014

CNG Source Indianapolis IN 7/15/2014

GAIN Clean Fuel Indianapolis IN 11/15/2014

CNG Fuel Inc Fort Wayne IN 4/1/2015

South Bend South Bend IN Mid 2015

Great River Energy West Burlington IA 4/15/2014

GAIN Clean Fuel Des Moines IA 1/1/2015

CHS Inc Fairmont MN 9/15/2014

Kwik Trip Austin MN 11/20/2014

Kwik Trip Albert Lea MN 10/30/2014

Saint Cloud Metro Bus Saint Cloud MN 12/31/2014

DTE Energy Grand Rapids MI TBD

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Grants / Upcoming Developments

• Drive Clean Chicago – CNG Stations (6 county area)

• CMAQ IL – Two vehicle programs (Taxi and HD)

• IL DCEO – ~$1 million per year for CNG stations

• DieselWise Indiana – awards in early November

• CMAQ IN – Lake, Porter, LaPorte Counties

• SSCC Webinar – Oct. 27th at 1 PM (CST)

• US EPA DERA Grants for IN Ports

• RNG – Biogas from anaerobic digesters or landfills

• Dane County and Fair Oaks

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Private Developments

• Many companies will support development of new stations for fleets/municipalities

• Guaranteed load (>100,000 GGEs per year), guaranteed pricing, volumetric discounts

• Grant funding

• Capital investment

• More than ten major providers across the country

• Companies can build and operate stations themselves

• Flexibility on components/size but most upfront capital

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Resources

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Acknowledgement of Support

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Backup Slides

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Estimated Component Costs

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Estimated Station Costs

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Estimated Station Costs

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$0.00

$1.00

$2.00

$3.00

$4.00

$5.00

$4.00 Diesel($86 WTI)

$2.00Natural Gas

$3.50Natural Gas

$7.00Natural Gas

Retail Markup

Refining/Compression,Distribution, Taxes

Raw Commodity

$4.002%

40%

58%

$1.5022%

60%

18%

$1.7420%

52%

28%

$2.30

19%

39%

42%

Ratio of raw commodity contributions to pump prices

Components of CNG Fuel Price

$/G

GE

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Components of CNG

Fuel Price

> Gas Commodity (.55/GGE @ “weighted average” cost of $4.40/MCF)

> Pipeline transportation/services to utility “city gate” and then delivered under regulated tariff by your local utility to your meter uncompressed ($.10 - .25)

> Compression - Rule of thumb: One fully-loaded kWh/GGE ($.10-15/GGE)

> Station Maintenance - Normal PM, repair/replace parts, rebuild ($.15-.30/GGE)

> Equipment amortization ($.35 - .65/GGE)

─ Cost of equipment or cost of capital factored into each

GGE over life of station equipment (typically10 years)

> Station operator profit (if a retail provider)

> Add federal motor fuels excise tax & State/Local tax

─ FEET = $.183/gallon; State of IL $0.19/gallon = $0.373/GGE

> Bottom line: approximately $1.52 to $2.02 (without profit margin or any incentives)

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Natural Gas Station Development and

Ownership-Operations Options: #1

> Fleet owns & operates station ─ Fleet takes responsibility for building and

then operating its own station. Fleet works with vendors or design consultant, manages build-out and takes responsibility for PM (parts, etc).

─ Applies to small-to-mid sized fleets that do not have offsite options nearby, b/c their fuel use does not meet the threshold required by most LDCs or independent developers to invest in developing, owning and operating station for them.

─ Some large fleets also opt for this but many do not have experience nor want responsibility for station operations and maintenance

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Natural Gas Station Development and

Ownership-Operations Options: #2

> Outsource station development, ownership, O&M to independent fuel provider

─ Fleet serves as anchor for independent operator’s station, contracts long term fuel agreement with set price(s) and expected throughput for duration.

─ One stop shop. All capital investment and O&M risks are borne by independent fuel provider while fleet focuses on core competencies.

─ Fleet usually provides low-cost lease for property – important to making deal work - land is costly!

─ Often allows fuel provider option to create public access as well – sometimes a “royalty” paid back to fleet for retail sales from premises

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Natural Gas Station Development and

Ownership-Operations Options: #3

> Fleet owns/leases station but contracts out operations for a fee (e.g., monthly fee or GGE basis)

─ Option used by many large fleets that need/desire ownership of their own station equipment but want to reduce risk, assure best O&M practices, etc

─ Contract is often (but not always) awarded to the firm that builds station; usually a 5-7yr contract.

─ Some fleets that initially Own & Operate their own stations decide that they want to delegate to others – put out RFP for O&M contract

─ Decision weighs pros/cons of “leaving $ on table” versus potential downtime risks, maintaining parts inventories, updated training of techs, etc

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References

> References for previous slides