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Marcellus Coalition Proposing Pennsylvania NGV Hub

Following the Obama administration touting the potential of domestic natural gas, the Marcellus Shale Coalition (MSC) is proposing an aggressive expansion of natural gas transportation infrastructure across Pennsylvania that it believes could increase demand by as much as 5.4 Bcf over the next decade.

In a Natural Gas Vehicles Roadmap released Tuesday, the industry group pitched the idea of a Pennsylvania Clean Transportation Corridor (PCTC), a network of fueling stations connecting major urban areas across the state and serving as a foundation for a regional transportation system for natural gas vehicles (NGV).

The proposals calls for building up to 17 fueling stations and 850 natural gas vehicles at a cost of $208 million, paid for through various public-private partnership arrangements. (The report also includes a less aggressive development plan that cuts the buildout and cost of the project roughly in half.) That would build on the limited NGV infrastructure already in place in the state, including more than 20 fueling stations.

"The private sector is going to drive a tremendous amount of this and already has been," MSC President Kathryn Klaber said during a teleconference on Tuesday announcing the program.

Looking to avoid a "chicken and egg" situation between NGVs and the fueling stations to serve them, the road map envisions using heavy-duty fleets for public works, airport operations and public transit to justify initial construction, and allowing public access to fueling stations to expand the system. While the road map lays out a five-year timeline, the MSC said the program could be implemented in as little as 18 months.

The corridor would connect Philadelphia, Pittsburgh, Harrisburg, Allentown and Scranton, and serve the major interstates in Pennsylvania, like I-76, I-80 and I-81, forming the foundation of a regional hub in the Northeast.

At full buildout, the MSC believes the PCTC would displace 9.2 million gallons of diesel fuel with about1.4 Bcf of natural gas each year, saving fleet operators an estimated $9.2 million each year in fuel costs. The MSC also believes that the program could create as many as 1,350 jobs in Pennsylvania and improve air quality in a state with five urban areas ranked among the 25 most polluted in the country by the American Lung Association.

To help achieve the goal, the MSC is recommending policies such as incentive programs for the state and its municipalities to convert fleets and allowing single-passenger NGVs to use high-occupancy vehicle lanes, as well as revisions to existing policies, like aspects of the Clean Vehicles program that the MSC believes harms the economics of some NGVs, particularly those that run on compressed natural gas or more than one fuel.

While envisioning the PCTC as the foundation for a regional hub from Quebec to Chicago, Klaber said "it's important that we put together the right road map for the Commonwealth and its infrastructure needs."

From a transportation standpoint, the Keystone State is home to many distribution centers and significant truck traffic, and from a energy standpoint, Pennsylvania overlies the Marcellus Shale formation, believed to be the second largest natural gas field in the world but tempered by limited regional demand, the report said.

The MSC developed the report in partnership with member companies Chesapeake Energy Corp., EQT Corp., Range Resources Corp., three of the largest players in the basin, and UGI Utilities Inc.

Although months in the works, the report comes as support for NGVs is gaining momentum nationally, getting nods from both government and industry in recent months (see Daily GPI, April 4; April 1). The report comes one day before Pennsylvania House Republicans plan to re-introduce the Marcellus Works package of legislation, which includes a push to convert public vehicles to run on natural gas.

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