Compressed Natural Gas (CNG) Infrastructure Update. Ian Skelton Director, Natural Gas Vehicles

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1 Compressed Natural Gas (CNG) Infrastructure Update Ian Skelton Director, Natural Gas Vehicles

2 The CNG Value Chain Southern Company Gas companies serving the market Natural Gas Supply Utility Marketer Asset Manager Local Distribution Delivery Service CNG Station Construction & Maintenance Market 2 2

3 Market Drivers for NGVs Abundant Domestic Energy Supply 98% produced in North America Development of shale has increased supply to > 100 years Reduced Emissions Reduces emissions up to 90% over diesel and gasoline Meets EPA requirements without Diesel Particulate Filters (DPF), Diesel Exhaust Fluid (DEF), etc. Reduced Greenhouse Gases NGVs emit 13-21% less GHG than diesel and gasoline 90% less if using Renewable Natural Gas (from landfills, etc.) Cost Savings Last 12 months NYMEX settlement price = $0.31/therm $0.31 x 1.25 therms/gasoline Gallon Equivalent = $0.38/GGE Underlying commodity is $0.38/Gallon! 3

4 Natural Gas Provides Fuel Price Stability Natural Gas: Decades of affordable domestic reserves Natural gas sourced from North America Commodity cost makes up 23% of sales price Diesel: History of volatile price swings Crude oil sourced fuel from high-conflict regions Commodity cost makes up 60% 4 of sales price 4

5 Renewable Natural Gas (RNG) Reduces GHG emissions up to 90% compared to diesel Some anaerobic digesters reduce GHG by 115% (carbon negative!) RNG production expected to be 500M DGE/year by % of natural gas used in vehicles is now RNG 5

6 AGL Rates for Bio-Methane Delivery TS-1 rate to transport pipeline quality bio-methane TS-2 rate to transport medium Btu biogas RINS credits under RF2 program if used for transportation Landfill Gas now qualifies for D3 (cellulosic) RINS 6

7 Recent Developments Taking CNG Mainstream Gilbarco, a major manufacturer of gasoline/diesel dispensers, has purchased ANGI, a leading CNG compressor packager Rush Enterprises, the country s largest truck dealer network, has formed Momentum, a new CNG fuel systems company Loves Truckstops is installing CNG at their stations and recently purchased CNG company Trillium. Love s now has 65 retail CNG stations. Agility, a leading manufacturer of CNG fuel systems, has introduced Blue IQ Smart Gauge - displays temperature compensated fuel level, distance to empty, etc. 7 7

8 Cummins Westport s Low-NOx Engines 6.7-liter B6.7N 8.9-liter L9N 11.9-liter ISX12N The latter two will be CARB certified to just 0.02 grams of NOx per brake-horsepower-hour, 90% cleaner than the current standard The B6.7N is to be certified to 0.1 g/bhp-hr 50% cleaner 8

9 Advances in CNG Tank Packages Agility Fuel Systems Launches High-Capacity Behind-the-Cab CNG Fuel System The updated system from Agility Hexagon joint venture now holds 160 Diesel Gallon Equivalent (DGE) and weighs 500 lbs. less than previously. New Tailgate CNG Tanks for Refuse Trucks Companies like Heil and McNeilus have developed rearmounted CNG tanks allowing for a lower vehicle profile and improved weight distribution. Mainstay to Use All-composite Type IV Cylinders Mainstay Fuel Technologies will source exclusively from Luxfer Gas Cylinders to reduce weight and help meet industry price points. 9

10 SUUPS adding New LNG and CNG Vehicles In 2014, UPS added 900 new LNG trucks to its existing fleet of 1,000 natural gas vehicles (Pivotal LNG is supplying the LNG for their private stations in Knoxville, Nashville, and Jacksonville) In 2015, UPS added 1,400 CNG Class 8 tractors and package cars, and built 15 new CNG stations In 2016, UPS invested another $100 million to add 380 more CNG Class 8 trucks in the U.S. and building 12 more new CNG stations UPS is now the largest user of Renewable Natural Gas (RNG) in U.S. 10

11 MARTA MARTA operates 435 CNG buses and two large CNG fueling stations MARTA is replacing their remaining 160 buses with CNG by 2018 Building a third CNG fueling station at their Hamilton Blvd. garage 11

12 Albany Transit CNG Station The City of Albany s Transit System officially unveiled their new CNG transit buses in December 2016 AGL Energy Services built a new CNG station at their bus maintenance facility on Flint Ave. Two Bauer C-26 X-Fill Compressors 12

13 Waste Management s Milestone Waste Management (WM) recently celebrated the opening of its 100th CNG station in Oklahoma City They now operate 6,000 CNG trucks, the largest heavy duty CNG fleet in US WM has two CNG stations in Atlanta area (Lilburn and Smyrna) Currently building a third location in Lake City (South Atlanta ) 13

14 Virginia Transportation CNG Car Haulers Operating 35 car haulers in Talladega, AL delivering new Honda cars to CSX rail yard GTM storage trailers back up fuel supply 14

15 AGL CNG Fueling Infrastructure Rates Atlanta Gas Light (AGL) installs, owns and maintains the equipment Customer provides the land and operates the station V-52 Rate Public access or private station No minimum required volume AGL recovers cost of providing and maintaining the station through a 1.5% per month facilities charge CNG-1 Rate Public access required Minimum required volume Initial round of stations funded by $11.6M from Universal Service Fund Usage and maintenance fees 15

16 AGL USF CNG Program Update Seven stations were funded: 1 st to open was Langdale Fuel Co. in Valdosta, August 2013 Ribbon Cutting at Langdale Fuel Co. 2 nd was Premier Transportation in Forest Park, April rd was Flint River Fuels in Oglethorpe, Fall 2014 City of Atlanta Time-Fill Station Two (private) stations for City of Atlanta completed Feb 2016 DeKalb County station in Decatur completed March 2016 Premier Transportation 16

17 Enmarket Truck Stop Savannah, GA Hwy 21, Savannah, GA The 7 th station to be built under AGL s USF CNG Infrastructure Program Two 600 cfm compressors 72,000 scf of storage Two 2-hose dispensers Under construction, to open in early

18 City of Augusta 2 nd CNG Station Opening soon! Located just off I-20/Bobby Jones Expy. Primarily for the City s refuse haulers but also public access AGL will provide CNG station maintenance 18

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20 FHWA National Alternative Fuel Network Federal Highway Administration (FHWA) unveiled a National Alternative Fuel Network Corridors designated for Natural Gas, Propane, Hydrogen, and Electric Eligible for signs alerting drivers where they can find fuel for alternative fuel vehicles Initially includes 55 corridors spanning 35 states and nearly 85,000 miles Next round of nominations planned for later this year 20

21 NGVAmerica Road Rally 21

22 For More Information Ian Skelton Director, Natural Gas Vehicles AGL Resources or See Atlanta Gas Light s CNG homepage: 22