BOARD MEETING DATE: September 21, 2001 AGENDA NO. 5

Air quality and health impacts of diesel exhaust have led the AQMD and others to focus attention on reducing diesel exhaust emissions from heavy-duty vehicles. The AQMP has identified the use of low-emission alternative-fuel engines in these vehicles as a control strategy. Alternative fuel vehicles, such as natural gas vehicles (NGVs), have demonstrated significantly lower NOx, PM and toxic emissions than diesel and gasoline vehicles Rules 1192, 1193, 1194, 1195 and 1186.1 require the introduction of low emission, alternative fueled transit buses, shuttles, refuse trucks and street sweepers.

While these important programs have set the stage for broader use of clean fuel, low emission technologies, a major challenge to the entry of NGVs is the need for increased availability of NGV refueling stations. Currently, AQMD’s compressed natural gas fleet fueling equipment is nearing the end of its useful life; in addition, there is a need for additional publicly accessible CNG fueling infrastructure in the eastern L.A. County region near the 60 and 57 Freeway corridors. Introducing hundreds of natural gas vehicles in the near future will require establishing fueling facilities in this and other areas to support these vehicles.

AQMD proposes to build and operate a new natural gas fueling station at its Diamond Bar facility. This station will be designed to incorporate advanced gas metering technology as it is proven in the field. The project will provide a turnkey fast fill compressed natural gas fueling station. AQMD has filed an application and received notification of award of $169,560 from CEC under its Public Alternative Fuel Infrastructure Funding Program. Proposals from an Invitation to Bid (ITB), issued in April 2001, were reviewed by an evaluation panel and the qualified low bidder was selected for recommendation.

At the bid closing date of June 1, 2001, AQMD received five bids (Table 1). The in-house evaluation panel, consisting of the Plant Engineer, Assistant DEO of Planning, Rules and Area Sources, a Manager for Special Assignments with the Office of Science and Technology and a Program Supervisor in the Technology Advancement group evaluated the five proposals and based upon submitted cost, selected three of the proposals as being most cost effective (all five submitted proposals were considered technically viable). From those three lowest bids, the lowest bid was selected after review of the technical content and bidder qualifications. Pinnacle CNG Company submitted the lowest cost responsive bid of all submittals responding to ITB 2001-01. Their bid of $704,800 was based on the performance and equipment specifications appearing in the ITB. In addition, Pinnacle submitted a lower cost option of $565,200 that would result in an even lower cost system to the AQMD. This lower cost option incorporates advanced technology that Pinnacle has patented and is unique in the industry. Since the lower cost option provided is patented technology, it is not possible to solicit competitive bids for this alternative. The lower cost system would provide the same performance required by the AQMD in the ITB with savings on installation costs resulting from the incorporation of advanced technology from their standard design package. These advancements are currently in use by the UPS facility in San Ramon, California and have proven to be very reliable. As a result, since this lower cost option is only available from one source, further competitive bidding is not required under AQMD’s Procurement Policy, Section VI B4.

Staff recommends that the Board approve a contract with Pinnacle CNG Company (Pinnacle) for the permitting and construction of a new compressed natural gas vehicle fueling station. The contractor will be completely responsible for the turnkey installation of the facility through a contract based on the performance specifications, project conditions, and scoping documents listed within the ITB. An eight-month project cycle is planned resulting in an operational station in mid-2002. The fast fill dispenser station will be 24-hour accessible by the AQMD’s internal fleet; public access hours will be determined based upon security decisions. Access will be provided by a card reader system designed to accept multiple cards including credit cards. Metering design will accommodate tie-in of advanced metering systems in parallel with the commercial system employed by the facility.

At staff’s request, Pinnacle has tendered a quote to the AQMD for upgrading and testing the equipment to make the fast fill CNG site hydrogen compatible. These upgrades require additional AQMD funding of $140,000 for equipment (with equal matching from Pinnacle) as well as up to $700,000 for high pressure testing and system demonstration. Staff proposes to scope and design a stand-alone on-site advanced hydrogen fueling system. Adequate space has been planned for potential addition of such a system which would offer the possibility of a multifuel fueling station for CNG, hydrogen and hythane. However, due to the time required to develop and test this hydrogen-conversion option and the significant cost for this option, this will be deferred and addressed at a later date as a separate project so that the CNG fueling station construction will not be delayed.

The new CNG station facility will be located as indicated on the attached project plot plans in Attachment A. The CNG station will consist of major components such as an enclosed compressor skid with electric or motor driver dryer and dial out modem, ASME storage vessels, priority/sequential panel, electrical switchgear and panel, and dispensers. The attached schematic in Attachment A describes the alignment and configuration of the above components. Detailed requirements for the design, engineering, permitting, and construction are covered in the ITB.

The contractor will follow a standard project schedule including primary phases and milestones as follows:

The proposed project is included in the March 2001 update of the Technology Advancement Plan under Project 2001 CFM3-1 "Development and Demonstration of Advanced Natural Gas Systems for Refueling Stations." The AQMP relies on the expedited implementation of advanced technologies and clean–burning fuels in Southern California to achieve air quality standards. The proposed station will assist in the commercialization of natural gas light- and heavy-duty vehicles by providing a reliable source of fuel. For the Carl Moyer Program, and other programs, to be successful, fleets and other vehicle users must be able to rely on dependable and efficient refueling facilities.

In accordance with the AQMD’s consulting and contracting policies, a public notice advertising the ITB and inviting bids was published in the following publications:

1.	Antelope Valley Press	10.	La Opinion	19.	Precinct Reporter
2.	Black Voice News	11.	La Voz	20.	Rafu Shimpo
3.	Chinese Daily News	12.	Los Angeles Daily News	21.	Press Enterprise
4.	Eastern Group Publications	13.	Los Angeles Sentinel	22.	San Bernardino Sun
5.	El Chicano	14.	Los Angeles Times	23.	Santa Clarita Signal
6.	Excelsior, The	15.	M/W/DVBE Source	24.	State of California Contracts
7.	Inland Empire Hispanic News	16.	Orange County Register		Register
8.	Inland Valley Daily Bulletin	17.	Palm Springs Desert Sun	25.	Wave
9.	Korea Central Daily	18.	Philippine News

Additionally, potential bidders were notified utilizing the Los Angeles County MTA and Cal Trans Directories of Certified Minority, Women, Disadvantaged and Disabled Veterans Business Enterprises; the Inland Area Opportunity Pages Ethnic/Women Business & Professional Directory; AQMD’s own electronic listing of certified minority vendors; and AQMD Purchasing’s mailing list. Notice of the ITB was mailed to the Black and Latino Legislative Caucuses and various minority chambers of commerce and business associations; and placed on the Internet at AQMD’s Web site [http://www.aqmd.gov, "Business and Job Opportunities" icon] and AQMD’s bidder’s 24-hour telephone message line (909) 396-2724.

Section VIII.B.2. of the Procurement Policy and Procedure identifies four major provisions under which a sole source award may be justified. This request for a sole source award is made under provision B.2.c.(2): The project involves the use of proprietary technology exclusive to Pinnacle CNG Company. Specifically, this contract is for the construction of a fast-fill compressed natural gas vehicle fueling station. The lower cost bid option provided by Pinnacle employs unique, proprietary technology currently under patent to Pinnacle. The award of this contract to Pinnacle as the sole source is justified due to their exclusive rights to this technology.

Sufficient funds are available from the Clean Fuels Fund (CFM3: Alternative Fuels – Infrastructure), established as a special revenue fund resulting from the state-mandated Clean Fuels Program. The Clean Fuels Program, under Health and Safety Code Sections 40448.5 and 40512 and Vehicle Code Section 9250.11, establishes mechanisms to collect revenues from mobile sources to support projects to increase the utilization of clean fuels, including the development of the necessary advanced enabling technologies. Funds collected from motor vehicles are restricted, by statute, to be used for projects and program activities related to mobile sources that support the objectives of the Clean Fuels Program.

Table 1 - Bids Received in Response to ITB 2001-01
Attachment A - Technical Specification and Drawings (the drawings are not accessible electronically but are available upon request)

Name	Address	Amount
Pinnacle CNG Systems LLC	300 N. Marienfield, Suite 950 Midland, TX 79701	$565,200
Allsup Corp	1848 W. 11^th Street, Suite K Upland, CA 91786	$736,000
Aese	8100 Balboa Place Van Nuys, CA 91406	$718,858
CDM Engineers & Constructors Inc.	2030 W. 17^th Street Long Beach, CA 90812	$1,049,817
Weaver Inc.	4210 E. La Palma Ave Anaheim, CA 92807	$1,053,653

South Coast Air Quality Management District