(South Bend Tribune (IN) Via Acquire Media NewsEdge) Feb. 25--SOUTH BEND -- Transpo and the city of South Bend have agreed to develop a compressed natural gas fueling station at Transpo's operations center on South Lafayette Boulevard.
Transpo's Board of Directors approved the inter-local agreement a few weeks ago and the South Bend Common Council followed suit on Monday. The vote was 9-0.
The cost of the project will be split, with the city contributing $972,500 in county option income tax money and Transpo kicking in another $951,500 in Department of Energy grant money.
The "fast fill" station will be used to fill up the city's growing fleet of CNG vehicles, which includes four trash trucks and, soon, two more trash trucks and 36 duel-fuel police vehicles, as well as a new fleet of CNG-fueled Transpo buses.
The police department has been testing a couple of CNG police vehicles, Public Works Director Eric Horvath said. He said the vehicles have limited trunk space because of the CNG equipment but otherwise perform well.
He said the new duel-fuel vehicles should solve the trunk problem to a large extent.
Transpo, for its part, expects to take receipt of 16 new CNG buses before the end of the year, General Manager David Cangany said, replacing 16 older vehicles that are due for retirement.
The cost of the vehicles is expected to be about $425,000, Cangany said, or about $25,000 more than a regular bus. He said the federal government will pick up about 80 percent of the tab.
Eventually, Transpo plans to replace its entire fleet of 60 heavy-duty and paratransit buses and trolleys with CNG vehicles, Cangany said.
Currently, the city maintains a couple of slow-fill CNG pumps at the wastewater treatment plant on Riverside Drive. Trash trucks are connected to the pumps overnight, Horvath said, ending up about two-thirds full by morning.
The new pumps, by comparison, will be able to fill an entire tank in a matter of minutes.
Transpo will be responsible for operating and maintaining the new station under the agreement, General Manager David Cangany said, with profits from fuel sales used to offset those costs.
The station also will be available for use by the public on a 24-hour basis, with any profits split 50/50 between the city and Transpo, the agreement states. A separate pump will be installed for that purpose, Cangany said.
According to Horvath, many private sector companies are interested in converting to CNG but cannot afford the upfront cost of developing a fueling station. This solves that problem.
Currently, the closest fast-fill CNG station is in Lake County, Ind., Cangany said.
"It's kind of been the chicken and the egg, and ultimately we decided to make the move, and we feel it's a smart move," Cangany said. "It gives us the opportunity to reach out to the local business community."
Including the cost to develop the station and convert about 65 percent of its fleet to CNG, the city expects a return on investment in about five years, Horvath said. That's based on an estimated savings of about $13 million over 10 years.
Currently, CNG costs about 73 cents per diesel gallon equivalent, Horvath said, compared with about $3.59 for actual diesel fuel. The city also receives a 50-cent rebate per gallon on CNG fuel, he said, putting the actual price at about 23 cents per gallon.
CNG also produces fewer emissions than regular unleaded or diesel gasoline, Horvath said, so its better for the environment. And as a domestic fuel source, it supports American jobs and lessens the nation's dependence on foreign oil.
"It is a significant upfront capital investment, not just the station but the conversion of the vehicles, but as far as I'm concerned it's a no-brainer," Horvath said.
"I think it's a great opportunity for Transpo, an organization that is very reliant on tax dollars and has seen a steady decline in tax dollars over the years," Cangany said. "This is just one way to be less reliant on tax dollars moving forward."
Assuming all goes to plan, the station should be up and running sometime this fall, Cangany said.
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