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CIty continues to mull options on compressed natural gas

COVINGTON -- City officials continue to mull over their options for opening a compressed natural gas station.

Following a work session Monday night, officials will need to decide whether to partner with the Municipal Gas Authority of Georgia or to go it alone as far as funding the facility. There was a consensus to approach MGAG to find out more about what the terms of an agreement with the authority would require. MGAG has appropriated $5 million toward CNG infrastructure for member cities.

"Our next step is to prepare a proposal for the Municipal Gas Authority with the end goal of acquiring use of Authority funds for the construction of our facility," said Randy Conner, the city's financial coordinator. "The less capital we need to use in infrastructure, the more we will have to invest in the fleet. We are hopeful of reaching a mutually acceptable arrangement to make this happen."

The city could also go the route of a public/private partnership, but council members were more supportive of a partnership with MGAG or the city having full ownership.

The station will be located at the corner of City Pond Road and Alcovy Road, with the main entrance being on City Pond Road.

The cost of construction could range from $800,000 to $2.3 million, but will likely be close to $1.2 million, Conner said. There would also be an additional cost to convert certain city vehicles to run on compressed natural gas, at between $120,000 and $250,000, but Conner said that will likely never come into play because it would be cheaper to replace than convert those vehicles. A one-time cost of around $150,000 would cover the cost of improvements to the city's present maintenance facility.

"Because CNG is a vapor, different lighting and exhaust equipment is recommended for service bays that are used for the maintenance of the vehicles," Conner said.

CNG vehicles are much safer to own, operate and maintain than gasoline and diesel vehicles, Conner said. The facility will not need to be manned 24-7 but will be manned by gas department staff. The maintenance of the facility as estimated by the city's consultant, will be $18,000 per year, which is figured into the cost of fuel at the pump, Conner said. The city may need to add additional staff, but that staff member would have additional duties as well as the maintenance of the CNG equipment, he said.

The city has set aside more than $800,000 in the budget -- with $500,000 set aside from the sale of city gas facilities no longer in use -- so far for the project. Benefits of having a CNG station include reduction in the city's fleet expense; reduction in fuel cost and maintenance; and increase in utility profitability.

A consultant with Florida-based company Wise Gas previously told the council that Covington is an ideal spot to open a CNG station, with its location along the I-20 corridor between Atlanta and the coast. Around 65,000 vehicles pass by Covington exits per day, including 18-wheelers with large fuel tanks that could utilize the station, he said.

Snapping Shoals EMC has a natural gas fueling station for its fleet, and pays $1.64 for the equivalent of a gallon of gasoline of CNG, Conner said. However, the city's cost could be less as the distributor, he said.

The Snapping Shoals figure is based on the total cost of operating their own facility and covers the cost of natural gas they purchase from Atlanta Gas Light and the repairs and maintenance cost of the facility itself, Conner said.

"Their numbers and ours are very similar and we appreciate their staff keeping such detailed records over the past 15 plus years on their facility. This give us a very clear picture of what it costs to maintain a facility," he said.

The city is also hoping to eventually service county and school system vehicles -- the three entities use 1.3 million gallons of gasoline each year.

Councilman Chris Smith, who has been a proponent of the city owning a CNG station since discussions began two years ago, said, "We have enough fuel for many generations to come as far as natural gas. I think the city is very smart to be forward thinking."

Councilman Keith Dalton said the demand is "going to explode from where we sit, between Atlanta and Athens and Augusta" and Conner noted that Covington is almost halfway between stations in Birmingham, Ala., and Columbia, S.C.

Map

CNG station location

CNG station location

Comments

John 1 year ago

Is the city or country ready to to take on the expense of staffing a facility 24 hous per day/7 days a week 365/366 day per year to take full advantage of some of those 65,000 vehicles that pass buy every day. If & when, it all catches on for the big rigs - all those truck stops along any interstate with truck washes, greasy spoons, showers for drivers they will continue to be a full service stop for the over the road drivers.. Remember the Studebaker & Edsel were autos that were well ahead of their time too! Oh by the way what is the percentage of those 65K vehicles that are currently running on CNG adn how many of thsoe will be clsoe to refuel as they pass our 3 exits. CNG powered engines is not new technology but it has never caught on except for large city & county fleets. And C of C NC fleets are small or maybe tiny by comparison to Atlanta, Seattle, Los Angeles now & will be in the future. If I recall the first report I read on this project stated annual maintenance was projected at $80K/year (ref. March 8, 2012 article in the Newton Citizen)- now it is up to $150K and it ain't yet been built - which is right? - I'm confused or do we already have almost a 200% inflation rate that I slept through this last year. What about the cost of additonal staffing to run the facility (salary & total benefits)? and work stations to keep track of usage by users? what about the loss in residual values (resale) of CNG powered equipment? - the second hand market for "a special fuel system with a very special fuel tank" equipment is limited - expect a signicicant loss in used equipment sales revenue on units that are retired. What is the "extra price" of new CNG powered vehicles vs similar gasoline or diesel powered equipment tims how many will be replaced vs converted? What is was the current plan to retire current fleet? vs buying new to take advantage of some projected fuel savings which says high fossil fuels will continue to rise but CNG will remain stable (about 4 years ago Natural gas price were very much higher than they are now or have been for the last two+ years - hint no very cold long winters in a while - supply & demand economics will change the direction of both - look at where the price of an IBM think pad (cutting edge technology at the time) was 18 years ago vs today - same with those big screen HD TV Flat Screens. There is a lot more not mentioned or hidden costs that go with this project - like may be PL insurance costs especially if you plan to service the general public with a volitale product that is dispensed at high pressures for faster fueling. I my opinion there is no "real" costs savings to the people of of Newton County or C of C with this undertaking - I stated that back on March, 2012

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John 1 year ago

Reading comments made about the opportunties of having a CNG fill station here in Newton County it seems those involved need to look at the "potential" from a practical 7 total cost viewpoint with soem real projections vs. words like "great potentional" quantify that meaning and total costs vs an emotional appeal and pop corn talk. It is stated in this article that this location is ideal because Covington is located 1/2 way between Columbia SC & Birmingham, AL. I say so what. That distance is 360 miles per Mapquest. Currently, big rigs ,fully loaded (40K lbs of load) get 5-7 miles per gallon and have a minimum 200 gallon fuel tank capacity(some are greater . That means the can travel 1080 miles (drivers can only go 550 miles w/o rest)and still have fuel in the tank My modest full sized American made vehicle w/6 cylinder gets 29 mpg on the highway traveling into the wind and has a fuel tank capacity of 14.7 mpg or a practical fuel range of 370 miles. When time is important and it is with over the road truckers and sales people - time is money, there is no need to stop at a halfway point. Plus, I have observed I-20 big rig traffic moves a lot of containers from & to the port of Savannah and/or Charleston. Not certain what comes out of Columbia SC other than it is the capital but it is something for sure. Certainly, in time & well into the future there will be a need for CNG filling stations to service those vehicles that are CNG powered. IMHO the demand will not be that dramatic, it will be a trickle. My rational is this, the fuel range for CNG fueled vehicles is greatly diminished as the fuel tank capacity is greatly diminished from what we have today. The tanks have to have very thick walls to safely contain the pressurized fuel and certainly the tanks can be enlarger but what space to you give up (trunks, back seat space) or do larger vehicles need to be designed. The American public will not be opting in like gang busters into the program as some want us to believe. Case in point the hybrid car has not taken off like some thought - there are issues that have been discovered - like higher initial price, very costly battery replacement (up to $7K) and lower trade-in values, smaller trunk space - the full cost savings are more than offset by these factors. Add to that the taxpayer funded rebate program Chevy Volt some got really excited about and it is dieing the death of a rag doll. CNG has its own but similar issues.

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