Seal Beach, CA-based Clean Energy Fuels Corp. said Wednesday it remains skeptical of plans for a more robust gas transportation fueling network that were approved by the Georgia Public Service Commission (PSC). The regulators went against a staff recommendation, opening some of the network to individual consumers with compressed natural gas (CNG) vehicles.
Clean Energy argues that utility-driven CNG initiatives have all failed in the past.
The PSC’s 4-1 vote Tuesday cleared the way for the utility to invest $11.7 million to stimulate private investment in the construction of as many as 10 stations, depending on the size of the station and level of investment (see Daily GPI, Nov. 2). Private retailers would be the owner/operators of the stations. Atlanta Gas Light’s (AGL) proposal would have required those retailers to invest at least 50% of station costs. The PSC removed that stipulation but amended the resolution to require retailers to pay for much of the equipment at their stations, including underground piping needed to connect to AGL.
Last month PSC staff recommended that only commercial vehicle fleets be permitted to fill up at the CNG stations. The PSC voted down that recommendation, voting instead to allow access to both commercial fleets and individually owned CNG vehicles.
Separately, Atlanta-based PS Energy Group earlier in the year signed a long-term contract with Clean Energy Fuels to expand the use of natural gas for transportation in Georgia as part of the larger Clean Cities Atlanta Petroleum Reduction Program. Both fleet and individual vehicles were identified as potential beneficiaries of the deal (see Daily GPI, March 30).
Clean Energy contends that there is no need for utilities to build gas transportation fueling stations and their monopoly customers should not be forced to pay for them. The natural gas vehicle (NGV) fueling business is competitive and already scaling up in various parts of the country, Clean Energy argued in opposing the AGL program before the PSC.
Clean Energy, which was founded by oil billionaire T. Boone Pickens, who sits on the company’s board, has taken over at least nine failed utility NGV fueling operations, running, upgrading and rebranding them during the past 15 years. Another half-dozen major utilities have public fueling stations that have failed and/or had to be subsidized by utility ratepayers.
“Policymakers should prohibit utilities from using ratepayer funds to compete and should enforce strong codes of conduct and affiliate transaction rules that prevent unregulated affiliates from enjoying an unfair advantage in the refueling market,” a Clean Energy spokesperson said.
Georgia regulators approved a program in which natural gas is to be purchased by retailers from state-certificated marketers and resold as CNG. Initial station locations will be largely determined based on proximity to commercial fleet customers that contract for service. After five years, AGL would end its funding of the stations.
Under its 15-year agreement with PS Energy, Clean Energy is supposed to develop and operate CNG facilities at PS metropolitan Atlanta fueling stations, or “unattended fuel outlets.” Construction was originally targeted to begin in the second quarter of 2012 at PS Energy Group’s fueling stations. Clean Energy agreed to increase the dispensing capacity for CNG at PS Energy’s existing Whitehall Street facility in downtown Atlanta and add natural gas fueling facilities at three other locations (East Point, Lithonia and Tucker, GA).
“The sites in Lithonia and East Point are in startup right now,” said a California-based Clean Energy spokesperson. “Tucker is nearly completed, and the Whitehall [Atlanta] upgrade should be complete by the end of December.”
PS Energy and Clean Energy are working on part of the $39.5 million Clean Cities Atlanta effort, which is a public-private partnership co-funded by the U.S. Department of Energy’s National Clean Cities initiative supporting clean transportation fuels, vehicles and infrastructure development.
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