BOARD MEETING DATE: February 7, 2003
AGENDA NO. 4

Execute Contract with FuelMaker Corporation to Upgrade CNG Fueling Stations at Various School Districts and Municipalities

SYNOPSIS:

School districts and municipalities have received funding awards to purchase natural gas vehicles and install refueling stations. It has been discovered that the natural gas supply in the San Gabriel Valley area has an unusually high water content which can lead to vehicle and refueling equipment breakdowns. To reduce the water content in the natural gas supplied to the vehicles, staff is recommending that high-capacity regenerative gas dryers be installed at sites impacted by this high water content. Total project cost is projected to be approximately $180,000; total AQMD cost will not exceed $90,000 and the Southern California Gas Company will provide matching funding.

COMMITTEE:

Technology, January 24, 2003, Recommended for Approval

RECOMMENDED ACTION:

Authorize the Executive Officer to execute a contract with FuelMaker Corporation to upgrade the CNG fueling systems at various school districts and municipalities, in an aggregate amount not to exceed $90,000 from the Clean Fuels Fund, with matching funding to be provided by the Southern California Gas Company.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

Air quality and health impacts of diesel exhaust have led the AQMD and others to focus attention on reducing diesel exhaust emissions from medium- and heavy-duty vehicles. Rule 1195 identifies the use of low emission, alternative fueled, school buses as a viable alternative to diesel. A state-funded, low-emission school bus program and the AQMD’s Adopt-a-School Bus Program provide incentives for the purchase of low-emission natural gas school buses. The implementation of several hundred natural gas vehicles in the near future requires establishment of fueling facilities to support these vehicles.

AQMD in partnership with the Southern California Gas Company has worked with Mountain View (MVSD) and El Monte Union High (EMU) School Districts to resolve problems of excessive water in the gas supply at each of their sites.

Proposal

The CNG fueling systems installed at school districts and municipalities were designed to meet normal conditions and water content. Due to some very unusual local conditions, the natural gas supplied to some of the AQMD-sponsored CNG projects contain an ex-tremely high water content. Normally, natural gas contains from one-half to six pounds of water per million cubic feet of gas; however, some sites have been found to have up to 100 pounds of water per million cubic feet of gas. The existing gas dryers at these sites are inadequate to remove the water from the supplied natural gas at those sites and must be replaced with larger units. As a further step to save expense, regenerative-type dryers are being recommended to allow for the recycling of the molecular sieve desiccant. This will extend the life of the desiccant by six to ten times. The Southern California Gas Company will be providing technical and financial assistance with this project. Staff an-ticipates that as many as six sites will require dryer upgrades at costs of $20,000 to $40,000 for each site. FuelMaker Corporation has provided the CNG fueling equipment for many of the smaller CNG fueling stations and they have demonstrated their ability to enhance the water removal systems if necessary. Staff recommends that a contract be executed with FuelMaker to allow for upgrades to be made, on a task order basis, at sites with extremely high water entrainment in the natural gas supply.

Some of the deficiencies experienced at these stations are:

• Existing gas dryers are unable to remove sufficient water from the natural gas stream to prevent carryover into the fueling system;
• In-line filters near the fueling posts must be manually discharged every few minutes during fueling operations, preventing overnight fueling;
• Current dryer design does not include the capability to regenerate the desiccant. Regeneration would allow the minimization of generated waste desiccant for disposal;
• Entrained water can have serious impacts on the operational life of the fueling equipment and buses and the cost of associated maintenance and repairs.

The proposed replacement dryers will correct these deficiencies so that the station is reliable, efficient and user friendly.

Benefits to AQMD

The AQMP relies on the expedited implementation of advanced technologies and clean burning fuels in Southern California to achieve air quality standards. The Clean Fuels Program has been active in funding the development and demonstration of low emission, alternative fuel technologies. The natural gas supplied to sites considered for upgrading, contains extremely high levels of water and, as such, could seriously damage the fueling compressor, fuel delivery system or the storage and fueling systems in the buses and other vehicles. The enhancements will include larger, regenerative-type dryers capable of removing the high levels of water found at these sites from the gas stream. The proper operation of existing stations must be ensured, and those designing future stations must have access to information that will facilitate their design, construction and operation. The primary benefit of this project will be to help resolve these refueling station challenges.

Sole Source Justification

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.d.: Other circumstances exist which in the determination of the Executive Officer require such waiver in the best interest of the AQMD. Specifically, these circumstances are B.2.d.(1): Projects involving cost sharing by multiple sponsors.

This project will be cofunded by the Southern California Gas Company at an amount not to exceed $90,000.

Southern California Gas Company is part of Sempra Energy Company, a utility and fuel producer that provides the natural gas used to fuel the school buses at these sites and has supported a variety of research, development and demonstration efforts for the development and commercialization of natural gas fueled engines and infrastructure.

Resource Impacts

The proposed project is included in the March 2000 update of the Technology Advancement Plan under Project 2000M3-1 Development of Advanced Natural Gas Compressors for Refueling Stations. Total aggregate cost for the proposed project will not exceed $180,000. Total AQMD cost will not exceed $90,000.

Sufficient funds are available from the Clean Fuels Fund, 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.

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