More Airports Opening Compressed Natural Gas Stations to Public

Author: 
Dan Vnuk
Published in: 
May-June
2013

factsfigures


Project: Expansion of Compressed Natural Gas Station

Location: Lincoln (NE) Airport

Opened for Airport Use: Nov. 2011

Opened for Public Use: March 2012

Expansion: 2 additional tanks

Cost: $87,000

Funding: $59,000 federal stimulus grant

Anticipated Break-Even Point: 2 years

Installation Consultant: Midwest Energy Solutions

Users: Airport; local and municipal vehicles; transient drivers from nearby interstate

Benefits: Using compressed natural gas in 11
airport vehicles saves the airport $1,500/month
vs. gasoline & diesel

In the early days of automobiles, motorists had to seek out hardware stores, blacksmith shops and even pharmacies to fuel their tanks with a petrochemical product that was primarily used as a solvent. In fact, the nation's first drive-through gasoline station didn't open in Pittsburgh until 1913.  

One hundred years later, drivers of vehicles powered by compressed natural gas (CNG) face the same challenge. Motivated by lower fuel prices, tax incentives and a chance to "go green," they are often disappointed to find that CNG fueling stations are few and far between in most parts of the United States. For some, however, the answer may be as close as their local airport.

As more airports begin using CNG-powered vehicles to shuttle passengers between terminals and to/from rental car centers, an increasing number are also allowing public vehicles to use their filling stations. For some, the strategy is a break-even proposition that helps support their own CNG usage; others are leveraging their stations as a new profit center.  

Lincoln Airport (LNK) in Nebraska opened its existing single-tank CNG station to the public last March and soon found it needed more capacity to satisfy local demand. Before then, airport vehicles were the station's only customers. But with business increasing rapidly as local government agencies converted some of their vehicles to burn CNG, the airport decided to add two more tanks.

By June 2012, consumption by public vehicles outpaced LNK's own fleet for the first time. "We are seeing a consistent increase in other users of our station," reports Airport Director Bob McNally.

According to the U.S. Energy Information Administration, CNG use in vehicles nationwide grew by nearly one-third from 2007 to 2012. With abundant supplies of natural gas throughout North America, proponents encourage its consumption to help provide U.S. jobs. And because it burns far cleaner than gasoline, it is less harmful to the environment and costs less per gallon than gasoline.

In addition to attracting business from municipal work vehicles and the local Bookmobile, LNK's 24/7 station fuels the fleets of area contractors. The station also is seeing more use from what McNally calls "transient" users - buses, semis and private vehicles from nearby Interstate 80. Recently, the station fueled a fleet of CNG-powered garbage trucks on its way to California. Because public customers are required to use credit cards to purchase fuel, additional staff wasn't needed to support the new business. 

The airport itself is using the station more lately, too. When LNK opened the facility in November 2011, it had four CNG-powered vehicles; now it has 11.

The station's two additional tanks, which are scheduled to begin service by May, cost $87,000; but the airport received a $59,000 federal stimulus grant that covers more than two-thirds of the cost.

"Calling them 'storage tanks' is not entirely accurate," notes McNally, "as they hold only 35 GGEs (gasoline gallon equivalents) apiece and are programmed to automatically refill from a gas line once they drop below a certain level."

The new capacity, he adds, will help increase fueling speed: "When the tanks are full, the fueling process goes quickly, because the pressure stays high. As the level of CNG in the tanks drops, the pressure also drops, which makes it difficult to fuel vehicles one right after the other."

With the new tanks in place, the system will automatically switch to another tank when one gets low to maintain better pressure and fueling speeds, he explains.

At LNK, selling CNG to the public is typically a break-even proposition. "The real value to us is in our own fuel use," McNally explains, noting that the airport saves an average of $2 to $2.25 per GGE by using CNG instead of gasoline or diesel fuel. "(That) translates into $1,500 a month in fuel savings," he reports. "Based on our $28,000 share of the cost to install the two extra tanks, the installation should pay for itself in less than two years."

A New Airport Trend?

Midwest Energy Solutions served as consultants during the expansion of LNK's filling station. Company president Mike Batten reports that interest in public CNG stations has increased steadily since he started the business five years ago. Although the mainstay of the company's business is converting vehicles to run on propane and natural gas, it has installed about 25 CNG stations throughout the Midwest and Western United States. The station at LNK was its fourth installation in Nebraska.

"Airports are ideal potential sites for public CNG stations," Batten says. "They're typically in easily accessible locations, on well-traveled roads with good directions, and easy to find. They also have a lot of taxis, shuttle vans, rental car courtesy vehicles running or idling that can impact air quality in the immediate area, which can be improved through the use of clean-burning CNG over gasoline or diesel."

According to industry data, natural gas produces up to 30% less greenhouse gas emissions when used in light-duty vehicles and up to 23% lower greenhouse gas emissions in medium to heavy-duty applications.

Batten encourages airport managers to consider installing public CNG stations as part of being a good citizen because they help fight air pollution and are an important local convenience. And if they choose to mark up the wholesale cost of the natural gas, the station can be a profit center as well, he notes.

Often airports can tap into an existing natural gas line rather than installing storage tanks on site, he adds: "It's much more cost-effective over having liquefied natural gas delivered to a CNG fueling site, although some companies prefer to do this."

Midwest Energy Solutions helps airports and other entities obtain the permits necessary to build CNG stations. "We work on educating the fire marshals, local government officials and others who may not understand what CNG is all about," explains Batten. "They have to become comfortable about opening a station, which is part of our consultant role."

A basic commercial station typically costs about $8,000, and more complex facilities able to fuel four or five vehicles at a time cost $40,000 to $50,000, he reports. "It just depends on how many vehicles you want to service," he relates. "However, we're finding that the larger the station, the quicker the return on investment."

With natural gas prices at historic lows and abundant supplies within the United States, Batten encourages airports to consider the political implications of using and selling CNG: "It's smart business," he concludes. "We're relying on ourselves for energy - not on some countries that may not like us very much."

The Department of Energy estimates that 98% of the natural gas consumed in the United States is sourced in the United States or Canada.

Using CNG as motor fuel does, however, have drawbacks. Because it doesn't have as much inherent energy as gasoline or diesel fuel, vehicle performance and economy are typically compromised. It also takes up considerably more space per GGE in a vehicle than liquid gasoline, so capacity and range are limited.

For sellers, storage is a chief concern, as CNG often requires high-pressure, above-ground tanks. In addition, the fueling process itself is more cumbersome than simply pumping gasoline.

California Fuelin'

With its car-obsessed culture and unique set of state environmental rules, it's no surprise that California is a leader in CNG-fueled vehicles. Los Angeles International Airport (LAX), in fact, installed one of the nation's first private CNG fueling stations. After building the facility in 1997, the airport expanded it considerably four years later. Not open to the public, the station only fuels shuttle buses and other LAX vehicles. However, there are two public stations on Aviation Boulevard near the airport entrance: Hertz' decade-old station and new player on the block.
 
Many of the CNG stations that dot the Los Angeles basin are owned and operated by Clean Energy, North America's largest provider of natural gas fuel for transportation. The company has operations in CNG and liquefied natural gas (LNG) vehicle fueling, construction and operation of CNG and LNG fueling stations, biomethane production, vehicle conversion and compressor technology.

Southern California has the largest LNG and CNG infrastructure in the country, notes Steve McCarthy, western regional manager for Clean Energy. And it may be a predictor of natural gas as a vehicle fuel in coming years, he adds.

McCarthy considers the development of CNG as vehicle fuel a "chicken and egg" dilemma: Will the opening of more stations lead to more interest in natural gas vehicles; or will more CNG-powered vehicles on the road necessitate more stations?

Airports, it seems, could be an important part of the picture. "We're seeing a lot of interest by airports in public CNG fueling stations," he reports. "Most are being tasked with reducing their pollution levels. Since today's jets still don't have alternative fuel options, the airports are forced to look in other areas to reduce pollutants. Often times, they focus their efforts on ground support vehicles such as shuttle buses, taxis and shared ride vans."

Clean Energy comes into the picture by financing such CNG vehicles, seeking grant funding, encouraging legislation, etc. "Our goal is simply to sell more of this environmentally and economically favorable fuel," he relates. According to the company, CNG costs up to $1.50 less per gallon than gasoline or diesel, depending on local prices.

The actual construction phase of adding a CNG station usually lasts about four months, reports McCarthy. The preliminary process of leasing the land, obtaining permits and arranging financing often takes about six months. The permitting process to build a new CNG station may be easier than permitting a gasoline station because it doesn't require underground tanks, he adds.

Clean Energy delivers natural gas to airports and other locations by tapping into the natural gas grid. It compresses the pipeline gas to 3,600 psi and dispenses it into vehicle fuel tanks.

Typically, the company operates and maintains stations under a 10-year lease; and airports receive a set percentage of sales. Because the concept of natural gas as a vehicle fuel is still relatively new in the United States compared to other parts of the world, McCarthy and his counterparts do a lot of "missionary work" to interest airport managers and others in opening a public station. "Natural gas has a bright future as an alternative fuel source," he says. "Airport officials find that opening a public station helps clean up the environment, helps their image, provides additional CNG fueling infrastructure and adds to their bottom line." 

Fill'er Up

Clean Energy recently opened a company-owned CNG station at Baltimore/Washington International Thurgood Marshall Airport (BWI) in Maryland. In addition to servicing airport vehicles, private taxis and shuttles, the station will be open for public use 24/7. IMPARK, which recently added a fleet of new CNG-fueled airport parking shuttles, is expected to be a key customer.

Wayne Pennell, BWI's chief operating officer, characterizes the new station as the latest example of the airport's commitment to manage operations in an environmentally responsible manner.

At the station's ribbon-cutting ceremony in April, Clean Energy regional vice president Mark Riley characterized airport and allied ground transportation fleets as "magnets for natural gas vehicle usage."

Subcategory: 
Landside Development

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