State shifting gears, exploring natural gas for vehicles

With gasoline prices again heading toward $4 per gallon, the state of Mississippi is looking to broaden its use of natural gas, viewing it as a cheaper and more environmentally friendly fuel source.

Forrest Berry hopes the movement can start near the water tower along Lakeland Drive in Flowood.

That's where Berry opened NGV Solutions, a compressed natural gas fueling center, in January.

For now, he'll pump the gas into the vehicles of his other company, Laurel Fuel Co. But he hopes one day there will be many stations like his that provide CNG fuel to school buses, waste-disposal trucks and other large, gasoline-guzzling vehicles.

"This isn't something that's dependent on a new technological breakthrough. We have an abundance of natural gas in this country," Berry said.

The state is pushing for more use of compressed, or nonliquified, natural gas, looking to slash fuel costs for its 7,400-vehicle fleet and in turn encourage private companies and motorists to consider using it.

The state Department of Finance and Administration plans to start a pilot program in which 10 of its vehicles will run on natural gas.

The agency, whose fuel costs have risen an average 5 percent since 2008, will examine the cost of converting the vehicles to run on natural gas through installation of new fuel-injection systems and fuel tanks and how that dovetails with the amount of money saved by regularly using natural gas instead of gasoline.

Most of the vehicles involved in the startup program typically are driven in Jackson, although others will be put on longer trips to state-supervised construction sites throughout Mississippi, said Kevin Upchurch, executive director of the Department of Finance and Administration.

The agency hopes to soon seek bids for the conversion systems.

Based on similar programs in other states, Upchurch estimates the state vehicle fleet can save an average of $2,000 per vehicle annually by using natural gas.

"The bottom line is to save money," says Gov. Phil Bryant, who is backing more CNG use in the state. "The more we can use natural gas, the less dependent we are on gasoline" and foreign oil.

Natural gas prices have largely fallen in recent years, and can be up to $2 cheaper per gallon than gasoline, Berry said. The gas, he added, typically doesn't have to be refined, as oil does, ultimately lowering what a consumer would pay.

But even the staunchest supporters of more natural gas-powered vehicles in Mississippi acknowledge there are many challenges.

Fuel stations like Berry's still are scarce in Mississippi. And they can be an expensive investment, costing at least $500,000 to $1 million to build, Berry says.

A major aspect of launching the DFA pilot program, Upchurch said, is simply finding a distribution center elsewhere for the fuel.

"You can't just pull up to a gas station (now) and fill your vehicle up on compressed natural gas," he said.

Bryant hopes he can engage private businesses in the gas industry to open fuel centers that can sell natural gas to government entities and larger businesses with sizeable vehicle fleets as well as to individual motorists.

It could take the form of a revolving fund where companies can utilize zero-percent-interest loans to upgrade their equipment to be able to provide natural gas.

The cost to convert a vehicle to run on natural gas can be as much as $12,000. And Bryant says the state must find ways to offset whatever revenue is lost from the state's gasoline tax if natural gas use grows.

It proved too costly for the U.S. Postal Service to keep five vehicles that used some type of alternative fuel source, such as ethanol or biodiesel, on the road in Mississippi, said agency spokesman Doug Kyle. Those vehicles were relocated elsewhere in the postal service network.

But the state's CNG push and USPS' goal to lower its petroleum use nationwide by 20 percent by 2015 could help such vehicles return to the streets, he said. The more vehicles that can run on alternative fuel sources, he said, the more savings.

Upchurch says maintenance costs could drop by 40 percent each year through natural gas use, in turn meaning longer life for his vehicles, which are replaced every five years on average.

Other states have stimulated natural gas growth by offering incentives to motorists who convert their vehicles to run on natural gas. Oklahoma, Berry says, reimburses its residents for up to 75 percent of that cost.

Bryant says he'll study similar incentives, too.

While there are challenges to expanding natural gas usage in Mississippi, a host of factors make it worth exploring, supporters say.

Steadily declining natural gas prices have been a key in Entergy Mississippi residential customers' power bills generally declining quarterly, on average, since 2008, said company spokeswoman Mara Hartmann.

She says natural gas prices have dropped by more than half in that time as more resources have been found domestically. Entergy, she adds, derives 60 percent of its electricity from natural gas.

What could sprout in the rest of the state in coming years has been the norm at Stennis Space Center, which has operated a CNG pumping station since 2004.

The center used natural gas and biodiesel to power backup generators during Hurricane Katrina, and its natural gas system never saw pressure disruptions as a result, says Don Griffith with Stennis' operations division.

The center has 22 vehicles that can operate on CNG, and 90 percent of Stennis' 296 vehicles can run on ethanol, Griffith said. It has an on-site ethanol fueling station, too.

"Environmental and presidential mandates require (Stennis Space Center) as well as other government agencies to increase usage of alternate fuel sources," Griffith said.

Alongside the CNG push, state lawmakers are considering bills that would task the Mississippi Development Authority with acting as the state's lead energy agency, including crafting plans for greater energy efficiency.​

This article was first published by Clarion Ledger.

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