Fuel of the future: Could compressed natural gas be the next big fuel source?

By Adam Armour/The Itawamba County Times

Although nearly non-existent in Mississippi, the number of municipalities and businesses converting their fleets of vehicles to run on compressed natural gas — CNG — is growing nationwide. It’s a move that has the potential to save thousands of dollars annually, although the price to convert is high.

Compressed natural gas is, essentially, the very same natural gas people use to warm their homes or light their stoves or heat their tap water. It is now being used to power motor vehicles.

The advantages of this are many: Natural gas is cheap, abundant and clean. Many believe it’s the ideal successor to gasoline, especially in Mississippi where it’s especially abundant. During a public address last year, Gov. Phil Bryant called for Mississippi “to capitalize on our position and dominate the natural gas stage at the national level.”

So far, very few fleets in Mississippi have made the conversion to CNG. The Stennis Space Center in Hancock County is the most notable; it’s been running vehicles on compressed natural gas since 2004. In Itawamba County, Mantachie-based Northeast Mississippi Natural Gas recently converted its small fleet of trucks to CNG, a move that manager Mike Horton said saves the company thousands each year.

A local example

So, could a switch to compressed natural gas really save a municipality money? Let’s take a hypothetical look at the City of Fulton.

According to Fulton City Clerk Lisa Russell, the city spent a total of $158,877 fueling its fleet of vehicles last year. The average amount paid per gallon is approximately $3.11.

For simplicity, let’s use that average cost to determine an approximate amount the city would have spent if its fleet of vehicles were burning natural gas instead of traditional gasoline. If the city spent $3.11 per gallon of gasoline last year, that means city vehicles burned approximately 51,086 gallons of gasoline throughout the year.

Whereas gasoline is purchased in gallons, natural gas is purchased in units of measurements called BTUs, or British Thermal Units. In order to make an apples-to-apples comparison between natural gas and gasoline, a conversion called GGE — gas gallons equivalent — is used. Although this number fluctuates slightly, approximately 114,000 BTUs are the equivalent to a gallon of gasoline. That may seem like a lot, but it’s not. Natural gas is purchased in millions of BTUs at a time.

Because Fulton sells its own natural gas to its customers, the city purchases natural gas at lower, dealer rates. Currently, the city is paying approximately $4.24 per MMBTU, or one-million BTUs.

Using all of these estimates, the city could have saved a bundle last year by burning natural gas instead of gasoline. There are some caveats to that, of course, but those will come later.

First, let’s do some simple math: If the city is currently spending $4.24 per million BTUs and 114,000 BTUs equal a gallon of gasoline, then that same $4.24 equals approximately 8.77 gallons of gasoline. Broken down into an amount per gallon, vehicles burning natural gas would have been filling up for approximately $0.49 per gallon, as compared to $3.11 per gallon. If the city had been paying that amount last year, it would have cost a total of $25,032 to fill municipal vehicles — $133,845 less than was actually spent, or a savings of 84 percent.

Of course, while those kinds of savings sound great, none of the city’s 30 or so vehicles have been converted to run on natural gas. The cost to convert a vehicle can vary pretty widely, although just about any type of gas burning vehicle can be converted. This includes cars, forklifts, buses, large machinery, dump trucks, etc. Depending on the type of engine the vehicle has, it can cost anywhere between $6,500 and $12,000 to convert a vehicle. Let’s meet in the middle and estimate the cost for converting each vehicle is $9,000. The total cost to convert all of the city’s 30 vehicles would be in the neighborhood of $270,000.

The plus side to all of this is that more and more vehicles are being sold that already burn natural gas. These are more expensive than standard, gasoline burning vehicles, of course, but cost less overall than a new vehicle that needs conversion. Plus, there are federal and state grants available for municipalities that switch to using “green” fuel sources like natural gas.

The future of fuel?

When, if ever, will the change from gasoline to compressed natural gas occur? It’s not certain, at least in Fulton. According to Mayor Paul Walker, switching the city’s fleet of vehicles to run off natural gas isn’t outside the realm of possibility; it’s just not a priority right now.

“We’re waiting to see if other municipalities are going to make the switch before looking at changing over,” Walker said.

He added that city officials have, at least in passing, discussed the idea of switching to compressed natural gas, but have never really researched the costs and savings.