Natural gas vehicles stall as cost advantage wanes
by Shain Gillet
01.08.09 - 11:54 pm
The rising price of compressed natural gas (CNG) has current and former CNG businesses in a quandary.

“My CNG business died,” said Dave Bell, owner of Dave’s Complete Auto Service in Centerville. “I haven’t had a call (to convert to natural gas) since the price of gas went below $2 a gallon.”

Bell said conversion to natural gas vehicles became popular after gasoline prices rose above $4 a gallon, which had residents in Davis County and elsewhere searching for alternative fuels.

“Mostly it’s the government,” he said. “They take advantage of the consumer until the consumer gets smarter, then they look for other ways to get around what the consumer already knows.”

Bell said when the price of gas was well over $4 a gallon, he couldn’t keep up with the number of phone calls he was receiving from consumers wanting to convert to natural gas.

“Now I can’t even get a single phone call,” he said. “That part of my business has practically died.”

While his CNG business also has struggled, Lucas Kjar, owner of Go Natural CNG in Woods Cross, said he will start to look elsewhere if Utah loses interest in natural gas.

“Right now it’s hurting our business,” he said. “We are able to offer the consumer a chance to put in their own fill-up station that they simply pay out of their own pocket rather than giving it to a CNG station, but they are not taking advantage of it because of the current price of gas.

“We are being affected, there’s no doubt right now, however, if the price of natural gas starts to compete with the price of regular gas in the next six months, we may have to start looking elsewhere.”

“Everybody had started talking about alternative fuels once gas prices were where they were,” said Bell. “If you look around now, where are those same people who were talking about alternative fuels?”

Late last month, the PSC issued an order requiring Questar Gas to sell the natural gas it supplies for vehicle use at a price that covers its cost of providing the fuel and operating its refuelling stations.

The ruling has upset Questar Gas, which in turn is seeking to appeal the ruling and will be asking commissioners to rethink the order. By doing so, they hope that owners of CNG vehicles will start to voice their concerns.

“We think the timing of the order was really poor,” said Questar spokesman Darren Shepherd. “With gasoline now selling for around $1.45 a gallon there will be little incentive for people to convert their vehicles to natural gas.

Shepherd added that the company is particularly upset at PSC because it barred the company from providing vehicle owner with natural gas produced from wells operated by its Wexpro subsidiary, since Questar also provides homes with heating fuel at the cost of production.

“I’m not benefiting from this at all,” said Rick Way, who was filling up his CNG vehicle at the Woods Cross CNG station. “Now I’m paying almost the same price for this gas than I am for regular fuel.

“This isn’t saving me anything now.”

Other residents around the station agreed, citing another report that stated the price of natural gas per gallon could go as high as $1.43 in some areas.

“The PSC’s order doesn’t allow our customers who drive natural gas vehicles to benefit from this,” said Shepherd. “We don’t feel this was a fair decision.”

Julie Orchard, PSC spokesperson, said that once Questar files for an appeal, commissioners Ted Boyer, Ric Campbell and Ron Allen have 20 days to make a decision.

“Or, because we’ve received so many letters from the public, commissioners may just decide to reopen the case on their own,” she said.

“We are encouraging those owners who have sent us comments to contact their legislators to see if they possibly can get the law changed.”
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