MEMORANDUM

City of Lawrence

CENTRAL MAINTENANCE GARAGE

TO:	David L. Corliss
FROM:	Steve Stewart, Fleet Manager
CC:	Chuck Soules
DATE:	June 3,2011
RE:	Article about CNG trucking

Background

Vice Mayor Schumm has shared an article on natural gas vehicles and the potential for cost savings related to alternative fuels. This memo outlines previous City efforts, current analysis, projects and potential advantages and concerns related to alternative fuels.

Current Status:

Staff is currently researching a proposal from Clean Earth Fuels (Scott Zaremba) and Black Hills Energy. In the proposal they would own a CNG station capable of fast filling light duty vehicles. To make this station feasible they have asked if the City and County would be willing to fuel a few CNG vehicles. Staff is researching the cost of conversion and installation of equipment to make a couple of vehicles dual fuel (compressed natural gas or unleaded gasoline). If this shows the potential for a return on investment and environmental impact staff will put together detailed cost information and present the proposal for approval. Other alternative fuels projects have included E-85, bio-diesel, and electric vehicles.

The City began purchasing flex fuel vehicles (E-85 or unleaded gasoline) in 1997. Equipping vehicles for either fuel has been a no cost option for all the units purchased. The City currently has 64 capable of using either fuel. E-85 has been used in City staff cars, work trucks and patrol cars.  Pricing and infrastructure costs have prohibited continued use.

The City began purchasing a 2% blend of bio-diesel when ultra low sulphur diesel was introduced. Adding 2% bio to the fuel mix replaced the lubrication lost with the reduction of sulphur. Refineries have added more cost effective lubricity modifiers in the last few years so we no longer add the 2% bio-diesel. City staff participated in the Alternative Fuels Taskforce which was formed in conjunction with the community and staff from the University of Kansas to determine the most cost effective alternative fuel for use in the new buses to be purchased for KU on Wheels. Bio-diesel was found to be the most cost effective in part because it did not require additional infrastructure. Staff monitors fuel pricing weekly and bids each load of fuel. Bio-diesel is considered for purchase when it is cost effective.

Three Toyota Prius hybrids are currently in staff service with Codes Enforcement and Parking Control. In addition to the hybrids staff purchased a used Global Electric Motorcar (GEM) low speed neighborhood vehicle for evaluation in 2007. In 2010 with the assistance of ARRA grant funds staff purchased a Club Car LEV and replaced a full sized vehicle with it. These two units are the most cost effective vehicles in the fleet with fuel cost of ½ cent per mile.

Staff is currently working with the Electrical Power Research Institute (EPRI) and Azure Dynamics toward the purchase of a plug-in hybrid truck. The Department of Energy (DOE) and the South Coast Air Quality Management District (AQMD) have to approve the EPRI proposal. Once that process is complete then staff will need to determine if the approved truck configurations will be usable in the fleet. If all these components work out then staff would request approval to join this grant opportunity.

Concerns

With the exceptions of the low speed vehicles and bio-diesel everything else requires some investment in infrastructure or partnering with a vendor for a long term fuel contract.

The largest problem is the cost of the fueling infrastructure capable of fueling a small fleet of heavy duty vehicles. The secondary problem is the cost and length of time to convert these vehicles. The $10,000.00 cost for natural gas equipment mentioned in the article is a little low for heavy trucks. It currently costs near that amount to convert a pickup or sedan. Other infrastructure options have become available in the past few years. Most of these would require a large investment in fleet assets.

Funding: 

Funding for future projects would be through the normal budget process.

Action Request:

This memo is for information only no action is requested.

Summary

City staff continues to monitor all alternative fuels and funding opportunities that apply to fleet operations. Any developments that appear to be cost effective are examined and brought to the attention of management.

Thank you

Steve Stewart

Fleet Manager