Seal Beach, CA-based Clean Energy Fuels Corp. said Wednesday it has contracted with AT&T to build, operate and supply compressed natural gas (CNG) for the communication giant’s plan to deploy up to 8,000 CNG-powered fleet vehicles.

The deal is part of the $565 million, multi-year alternative fuel effort AT&T announced a year ago (see Daily GPI, March 16, 2009). Under a multi-year master agreement, Clean Fuels will develop the infrastructure and provide the CNG fuel for AT&T’s proposed effort to deploy more than 15,000 alternative fuel vehicles through 2018. The telecommunication company estimated it will spend up to $350 million during the next five years purchasing the 8,000 CNG-powered vehicles.

“This represents the largest corporate commitment to CNG vehicles to date,” a Clean Energy spokesperson said.

CNG advocates contend that fleet operators can realize what they say are significant savings in their fuel costs since natural gas is typically cheaper than gasoline or diesel fuel. And in terms of emissions benefits, natural gas produces up to 30% lower greenhouse gas emissions than gasoline in light- and medium-duty vehicles.

The U.S. Department of Energy data estimates that 98% of the natural gas consumed in the United States is sourced in North America, and domestic supplies are projected to last another 120 years based on current consumption levels, the Clean Energy spokesperson said.

AT&T Vice President Jerome Webber, its head of fleet operations, said natural gas as a transportation fuel “makes good sense for the environment, and it makes good business sense as well. CNG provides a strong economic advantage compared to gasoline and diesel powered-vehicles.”

Clean Energy’s James Harger, chief marketing officer, called AT&T decision to move to an alternative-fuel fleet “a giant step forward by American business to address the new energy needs of our nation, particularly for deploying natural gas vehicles.”

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