State eyes more alternative-fuel vehicles
CHARLESTON, W.Va. -- The state is hoping to solve the chicken-or-egg problem for natural gas as a fuel (how can you use it to run vehicles when there aren't any fueling stations?) by converting a portion of the state's fleet to compressed natural gas as fueling stations are built.
Paul Mattox, secretary of the state Department of Transportation, said Gov. Earl Ray Tomblin's Natural Gas Vehicle Task Force has recommended the state convert 25 percent or 1,952 of the state's 7,811 fleet vehicles to compressed natural gas in four years.
T.J. Meadows, West Virginia operations manager for IGS Energy, noted that IGS announced in January that it is building three natural gas filling stations along Interstate 79 in West Virginia. One will be in Charleston.
Mattox said the state is looking at ordering 20 vehicles this year that will burn either regular gasoline or compressed natural gas.
"As we get more stations, more of the fleet will be converted — that's the governor's goal," he said.
Mattox and Meadows spoke at a University of Charleston forum Monday evening titled, "Natural Gas: The Future." Also speaking were Henry Harmon, president and chief executive officer of Triana Energy, and Mary Beth Anderson, director of corporate development at Chesapeake Energy Corp. Scott Bellamy, dean of the university's School of Business, was moderator.
"We're looking at improving the air quality," Mattox said. "We're also looking at saving the taxpayers money since compressed natural gas is a cheaper fuel. Those are two benefits the task force has looked at."
Mattox said all of the vehicle manufacturers are moving toward making vehicles that operate on compressed natural gas.
"On the upcoming state purchase order there will be 10 different types of vehicles we'll be able to choose from," he said.
Also, in conjunction with the governor's task force, the West Virginia Department of Education last year approved a policy allowing the use of propane as an alternative fuel for school buses, Mattox said.
As a result, a specification for propane-fueled vehicles was included in the request for bids for the statewide purchase of school buses after July 1.
About 3,000 school buses run every school day in West Virginia, according to the task force's report. The buses travel more than 46 million miles a year. "The adoption of propane could save an average of $3,100 per bus annually," the task force said.
Meadows said that with current market prices, consumers who use vehicles that run on compressed natural gas could save 30 to 50 percent over conventional fuel. "In addition, compressed natural gas is very clean," he said.
"About $1.25 billion is spent daily in America on foreign oil," Meadows said. "Why send all of those dollars offshore when we can use a cheap, abundant resources produced right here in West Virginia?"
Harmon said the abundance of natural gas in the Appalachian Basin is "a wonderful thing" and "it has changed our community and state in a lot of different ways."
The state is looking to recoup severance taxes on natural gas to make up for declining severance tax revenues generated by coal. Also, "there's been a shift in employment and location," as the center of natural gas production in the region has moved from Charleston to Pittsburgh, Pa., Harmon said.
In addition, the multi-million dollar cost to drill horizontal wells with hydraulic fracturing "has made the small family producer a thing of the past," he said.
Also, development of the natural gas in the Marcellus Shale has resulted in the industrialization of some rural areas.
"The industry is working hard to mitigate that," Harmon said. "We have a job ahead of us but we are making strides. It is a great growth industry — something West Virginia doesn't have enough of."
Harmon's company has invested in a company that focuses on using liquid propane as a fuel. Liquid propane isn't stored under nearly as much pressure as compressed natural gas and a liquid propane fueling station costs about $40,000, compared to $1 million or more for a compressed natural gas fueling station, he said.
"We're also invested in a company that blends propane into diesel engines," he said. "I think if we look at all of the fuels and their right use, we have a lot of options."
Anderson said that in 2005, people knew there was natural gas in the Marcellus Shale but nobody knew how to economically extract it.
"Now it's the largest gas-producing shale in the country," she said.
Asked about challenges facing alternative fuels, Meadows said the cost of conversion kits is an issue. Mattox said the payback time for conversions could be an issue.
Harmon said West Virginians must find a way to add value to natural gas and related products.
"Just exporting is not going to create the really good jobs," he said. "The governor has the Marcellus-to-Manufacturing Task Force looking at this. We have to find a way to rebuild our chemical processing industry."
Concerns have been raised about the impact new drilling techniques have on water quality. Harmon noted that New York has a moratorium on drilling and the industry there has been shut down for nearly five years.
Anderson said, "The industry does listen and evolve and react to concerns."