A nickel for every gallon

City didn't charge company to open compressed natural gas fueling station, but will see dividends.

May 20, 2010|By Rachel Terrazas

Newport Beach opened its first natural gas fueling station Wednesday.

The $1-million facility at the General Services Corporation Yard, 592 Superior Ave., allows the city to power its fleet of vehicles with cleaner-burning compressed natural gas, officials said.

The station, which will be open to the public and operate at all hours, was made possible through a partnership between Newport Beach and Clean Energy, an alternative energy transportation company. Newport Beach let Clean Energy build the gas station on city land, rent free. In return, the city will receive a nickel for every gallon sold there, according to Mayor Keith Curry.


The city paid nothing for the station, officials said.

"All California cities are required to convert their fleets [from diesel gasoline to CNG]," Curry said. "It's a deal at $1.85. It's 28% less than diesel. Fiscally it's the right thing to do."

Businesses that use CNG vehicles — including AT&T, Yellow Cab, airport shuttles and Athens Street Sweeping — can refuel at the Newport station, said Peter Grace, vice president of leasing and finance for Clean Energy.

"The major benefit is for the environment," Grace said. "It is much, much cleaner than diesel fuel, and considerably cleaner than unleaded."

As a part of its transition from diesel to compressed natural gas, the city received a grant from the South Coast Air Quality Management District to replace its old sanitation trucks with new CNG-fueled ones. The cost of replacing the city's diesel vehicles shouldn't stop the fiscal plan from immediately benefiting the city, according to Mark Harmon, the city's general services director.

The money saved from the cheaper cost to fill up the vehicles' gas tanks, and the revenue from each gallon sold will go back into the city's budget.

"It will benefit the parks, police and everything else," Curry said.

Compressed natural gas is the same gas used in homes for heaters and stoves, but is compressed to fuel vehicles. All of the gas comes from the United, which has a 200-year supply, according to Grace.

"We aren't getting it from countries that hate us," he said.

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