The “Golden Age” of Natural Gas
ACCA Presentation – Austin, TX October 2, 2012
What is a “Golden Age”?
• A “Golden age” is a period in a field of endeavor when great tasks were
accomplished...
Familiar Golden Ages …
The Golden age of Radio, 1920 to 1940’s
The Golden Age of Television, 1950’s
The Golden Age of Motion Pictures
The Golden Age of Oil , 1920’s and 1960 to 1970’s domestically.
The NEW Golden Age of Oil, 1980’s to present.
.
“Golden Age” of Natural Gas The Golden Age of Natural Gas, 2007 to present
– Abundant, 98% of the natural gas we use is domestic, estimated now well over 200 yrs
supply and growing
– Cheap there is an abundant supply at lower cost
 Decoupling of oil and gas prices
 2008 price in the $13.00-$15.00/Mcf range, today $3.80- $5.50 Mcf
– Clean burning
– Natural gas is driving change in transportation, currently 1,100 CNG stations nationwide
Texas Triangle Growth and Demand Impact
Texas Legislation Established Natural Gas Transportation Corridor
in the 2010 Legislature.
• Senate Bill 20 establishes a natural gas transportation corridor in the rapidly
expanding Texas Triangle, which encompasses Austin, Dallas/Fort Worth, Houston
and San Antonio, by increasing the number of natural gas-refueling stations,
supporting the use of natural gas-powered trucks across the state.
Texas Triangle Progress
Goals
Process
Results
• Advance the use of natural gas in transportation, develop a plan for public
access stations, help transform the transportation industry by deploying NGV’s
including heavy duty vehicles, and establish Texas as a leader on the
development of the NGV market
• Develop a market growth plan including policy, regulatory, legislative and
develop a fleet outreach program.
•Station growth since start of Texas Triangle work began has far
exceeded initial recommendations (52 new, planned or recently awarded
stations since 1/2010)
Source: American Natural Gas Association (ANGA)
2010-2012 Growth: NGVs in Texas
Number of CNG and LNG Vehicles Committed and/or
Deployed Since January 2010
Light Duty
1,545
Medium Duty
6
Heavy Duty
1,361
TOTAL
2,932
Natural Gas Fuel Volume Demand Growth Since
January 2010 (GGE/year)
Light Duty
1,762,600
Medium Duty
15,400
Heavy Duty
17,575,000
TOTAL
19,353,000
Source: American Natural Gas Association (ANGA)
2010-2012 Station Progress in Texas
Existing
Prior to
1/20101
Opened
since
1/20101
Planned
(as of
7/2012) 1
TCEQawarded in
8/2012
CNG
23
13
6
8
LNG
3
1
16
3
1
1
-
4
27
15
22
15
Number of
Stations
CNG & LNG
TOTAL
Scoping
Plan Goal
13
***As of September 16, 2012 there is a total of 1102 CNG stations nationwide with 59
existing LNG stations. Additional stations now planned 101 CNG stations and 96 LNG
stations.
1Source:
AFDC Data, July 2012 Report
Stations: Scoping Plan and Progress
Snapshot
2010 Scoping Plan
August 2012 Progress
Next Steps: Near-Term
Implementation
• Phase 3 Infrastructure Plans: Beyond
the Triangle


Connect West to El Paso, East to
Haynesville Shale, North to OKC (and
onward to Canada), South through
Laredo (and onward to Mexico City)
I-10 Connectivity from Houston to Los
Angeles and Houston to Atlanta
Texas Fleets Turning to NGVs
Texas-based fleets such as Central Freight (Waco), Sysco (Houston), Frito Lay (Plano), Waste
Management (Houston) and other Fortune 100 fleets like UPS are now investing in natural gas
vehicle programs in Texas. ANGA’s efforts spurred increased coordination for public infrastructure
sharing and directly led to grant submittals and NGV program growth. Texas fleets overall are
becoming leaders in NGV program efforts.
Houston-based WM announced it
will convert 100% of its nationwide
fleet to CNG (18,342 trucks). It
recently opened a public-access
full retail station in Conroe, TX
along the CTT.
UPS was awarded two natural
gas stations in Texas (Houston
and San Antonio) through SB
375 funding, and is coordinating
with a partner for another station
project in the Dallas area
Source: American Natural Gas Association (ANGA)
Small Business Conversions
Dealership uses
Emissions Reduction Incentive Grant - TCEQ
The Texas Commission on Environmental Quality (TCEQ) offers a
variety grants periodically to help offset first dollar costs of
conversion from gasoline or diesel fuels to CNG. One particularly of
interest to this group is:
• Emissions Reduction Incentive Grant (ERIG) was released the first week in
September. Under this program, the customer can submit any number of vehicles
for replacement, there is no limit. Some of the requirements are that trucks must
have a minimum gross vehicle weight rating of 8,500 lbs and could go as high
as 80,000 lbs, i.e., haul trucks, dump trucks (registered up to 80,000 lbs), street
sweepers, garbage trucks, delivery trucks, you name it! This program is not only
limited to On-Road vehicles, but it includes Non-Road equipment, from agricultural
tractors to heavy construction vehicles.
• Contact www.terpgrants.org for details.
Source: Texas Commission on Environmental Quality
Single Pump CNG Station
Clean Energy Station – Bush International - Houston
CNG Storage Tanks
Clean Energy Station – Bush International - Houston
CNG Compressor
Clean Energy Station – Bush International - Houston
Bold 10 Year NGV Adoption Goals:
Demand Growth Projection
45
40
35
30
25
Annual BCF
20
15
10
5
0
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
TOTAL 2012-2022 Projected BCF Creation: 226.63
Source: American Natural Gas Association (ANGA)
Local Financial Help
• Texas Gas Service
– $3000.00 Rebate for a conversion
– $2000.00 Rebate for an OEM like Honda Civic
 Contact www.texasgasservice.com for more details.
For qualified customers.
• Clean Energy has potential vehicle and conversion financing.
Texas Gas Service Payback
Calculator
GASOLINE VEHICLE
Make:
Model:
Capacity spec:
Cost of replacement:
Fuel economy:
Gasoline cost:
Type of gasoline:
Miles driven (1 vehicle):
How many of this vehicle are there?
Operating days per week:
Total miles driven (fleet):
THE NUMBERS
Chevy
Express Van
3/4
Ton
$ 40,000
14
MPG
per gallon
$ 3.650
Unleaded - 87
22,000
per year
10
6
220,000 miles per year
Cost difference per gallon:
Times 220,000 miles driven per year @ 14 mpg:
Times 10 vehicles:
Rebate (per each):
Total rebate:
$
$
$
$
$
2.65
4,164.29
41,642.86
3,000
30,000
YOUR INVESTMENT OF $135,000 IN
10 NATURAL GAS POWERED CHEVY S
COULD PAY FOR ITSELF IN APPROXIMATELY
3 YEARS AND 2 MONTHS.
Simple Payback Period
$700,000
NATURAL GAS VEHICLE
Natural gas cost
What is the cost to upgrade?
Other costs (fueling equipment):
Total investment:
$600,000
$
$
$
$
1.000
10,500
60,000
165,000
per gallon equivalent
conversion kit
fueling equipment
10 vehicles + fuelstation
$500,000
$400,000
Savings
$300,000
$200,000
Investment
$100,000
$0
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16
Years
* Make and models provided solely for demonstration purposes.
Texas Gas Service does not endorse any particular brand or model of equipment.
This calculator provides a simple payback period estimate.
These calculations do NOT take into account inflation, interest on savings, or interest paid on loans.
Service, maintenance, price fluctuations, and many other variables may affect actual savings.
Texas Gas Service Payback
Calculator
Questions?
Contact
Wayne Snead
Texas Gas Service
5613 Avenue F.
Austin, TX 78751
512-407-2014
512-276-0215 Cell
wsnead@txgas.com