The New York State Public Service Commission (PSC) has approved a $3.5 million partnership with the National Fuel Gas Distribution Corporation to develop a natural gas vehicles pilot program.
The PSC said the program will help demonstrate the economic feasibility of natural gas-powered vehicles (NGVs) and evaluate their impact on the utility infrastructure.
National Fuel claims the development of NGVs would enhance the environment and national energy security, as well as benefit the commercial and industrial customers by reducing overall energy costs. Nationally, there are about 112,000 NGVs, mainly trucks. In the United States, about 30 different manufacturers produce 100 models of light, medium and heavy-duty natural gas vehicles and engines. Natural gas costs, on average, one-third less than conventional gasoline, according to National Fuel, which did not address the environmental costs of fracking and climate change.
In its petition, National Fuel said that upfront costs to develop a customer-owned NGV project can be substantial.
A customer’s refueling station can cost from $100,000 to $1.5 million depending on the type of station (fast fill or time fill) and the number of vehicles in the fleet. The incremental cost of purchasing new NGVs vs. traditional gasoline or diesel vehicles can range from $7,000 to $22,000 per vehicle.
The program will provide a onetime credit for a refueling station and/or the purchase of NGVs. The financial assistance would be recovered through the future sales paid by the customer.
National Fuel said the customer payback to switch to NGVs falls between four and eight years. The $3.5 million program was developed by National Fuel, with input provided by truck fleet customers, to encourage the installation of NGV and/or associated facilities. The program will run through March 31, 2015.