Legislature(2009 - 2010)BUTROVICH 205

04/07/2009 01:00 PM TRANSPORTATION


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Recessed to a Call of the Chair --
+ SB 14 EXTEND MOTOR FUEL TAX SUSPENSION TELECONFERENCED
Moved SB 14 Out of Committee
+ HJR 9 CENTENNIAL OF FLIGHT CELEBRATION TELECONFERENCED
Moved SCS HJR 9(TRA) Out of Committee
*+ SB 34 COMPRESSED NATURAL GAS FOR STATE VEHICLES TELECONFERENCED
Moved SB 34 Out of Committee
        SB  34-COMPRESSED NATURAL GAS FOR STATE VEHICLES                                                                    
                                                                                                                                
2:11:20 PM                                                                                                                    
SENATOR KOOKESH announced the consideration of SB 34.                                                                           
                                                                                                                                
SENATOR FRED  DYSON, sponsor  of SB  34, said  compressed natural                                                               
gas (CNG)  often is  overlooked as an  energy source,  and anyone                                                               
paying attention  to energy  needs realizes  that almost  none of                                                               
the  alternative  sources  work for  the  transportation  sector.                                                               
Technology  for  battery-powered   and  hydrogen-fueled  vehicles                                                               
hasn't  come as  far  as  everyone hoped  it  would  when it  was                                                               
initially  considered  10-15 years  ago,  but  CNG is  making  an                                                               
impact in  the transportation industry.  In Argentina  85 percent                                                               
of the  public vehicles are CNG  powered and the states  of Texas                                                               
and Utah are  currently running fleets of buses  that are powered                                                               
by CNG.                                                                                                                         
                                                                                                                                
SENATOR DYSON said his professional  experience is that virtually                                                               
all diesel engines can be converted  to run on some derivative of                                                               
natural gas, which is hopeful  for generator use in rural Alaska.                                                               
It's an  open argument as  to whether  propane or natural  gas is                                                               
more efficient,  but he  surmises that CNG  is more  economic for                                                               
industrial users.                                                                                                               
                                                                                                                                
2:14:00 PM                                                                                                                    
SENATOR  DYSON  said that  Anchorage  had  quite  a few  CNG  and                                                               
propane-powered vehicles  10-15 years ago, but  there weren't any                                                               
filling  stations for  those  vehicles.  Anchorage gas  companies                                                               
have said they will build the  stations just as soon as there's a                                                               
market, and  the market  is waiting  for filling  stations before                                                               
buying  CNG or  propane-powered vehicles.  He noted  that in  his                                                               
community quite  a few  folks have  connected their  generator to                                                               
their  house  natural gas  supply  for  use when  the  commercial                                                               
electric power goes down. Some  folks have also tapped into their                                                               
natural gas  line and put in  a compressor to fill  their private                                                               
vehicles   using   what's   called  a   slow   fill.   Commercial                                                               
applications provide a high pressure  quick fill, which is needed                                                               
for buses  and other commercial  vehicles. He related that  he is                                                               
trying  to push  the Municipality  of Anchorage  to purchase  CNG                                                               
powered buses  as it replaces  the current fleet, but  they argue                                                               
that there  isn't a filling station.  He asked Enstar to  make it                                                               
work but thus far there is no resolution.                                                                                       
                                                                                                                                
The advantage  of CNG for  the transportation sector  is apparent                                                               
even at today's  prices. As those prices go up  with the expected                                                               
surge in  crude oil prices,  the economics tilt further  in favor                                                               
of  CNG.   Also,  the  difference   in  emissions   is  profound,                                                               
particularly for  diesel. Nitrogen  oxide from diesel  engines is                                                               
difficult to deal  with and converting diesel  engines to natural                                                               
gas  will not  only affect  emissions,  it will  also affect  the                                                               
regulatory environment in which  they operate. As carbon trapping                                                               
and  trading  becomes  more  common, using  natural  gas  in  the                                                               
transportation sector will become more significant.                                                                             
                                                                                                                                
SENATOR DYSON  related that  in his area  a local  contractor has                                                               
proposed to  use the methane  that's produced from  the municipal                                                               
landfill to supply hundreds of  vehicles with fuel each day. It's                                                               
a marriage made  in heaven when you can  solve somebody's problem                                                               
and make money doing so, he said                                                                                                
                                                                                                                                
2:18:53 PM                                                                                                                    
SB 34  proposes a Department  of Transportation (DOT)  task force                                                               
to study  the feasibility of using  CNG to power vehicles  in the                                                               
state.  He said  he thinks  municipal  and state  fleets are  the                                                               
logical test.  In the last  15 years the technology  for storage,                                                               
conversions,  and  compressors  has  come  forward  an  order  of                                                               
magnitude making it very practical.                                                                                             
                                                                                                                                
SENATOR MENARD noted the fiscal note is $75,000.                                                                                
                                                                                                                                
LUCKY SCHULTZ, Staff  to Senator Dyson, explained  that DOT wants                                                               
to hire a consultant to do a proper study.                                                                                      
                                                                                                                                
SENATOR DYSON  added that the  original intention was for  DOT to                                                               
do  this  in-house,   but  they  were  reluctant   to  take  this                                                               
additional project on with their existing staff.                                                                                
                                                                                                                                
2:21:18 PM                                                                                                                    
                                                                                                                                
SENATOR  KOOKESH noted  that  Aaron Bunker  from  CNG Alaska  and                                                               
Diana Rotkis from DOT are online to answer questions.                                                                           
                                                                                                                                
MR.  SCHULTZ reported  that  CNG Alaska  has  estimated that  the                                                               
quantity  of  methane coming  from  the  Anchorage land  fill  is                                                               
equivalent to 4,000 to 5,000 gallons of gasoline per day.                                                                       
                                                                                                                                
2:22:36 PM                                                                                                                    
SENATOR MEYER  recalled that MOA  was buying natural  gas powered                                                               
cars and trucks  in the 1990s and there was  talk about extending                                                               
that to buses. He asked if  that effort petered out because there                                                               
weren't any filling stations.                                                                                                   
                                                                                                                                
MR.  SCHULTZ  said  the  major  problem  was  getting  people  to                                                               
participate. There was cost associated  with converting a vehicle                                                               
and  natural gas  powered vehicles  were  more expensive.  Things                                                               
have changed dramatically in the  last 10 to 15 years; technology                                                               
has improved  and gas and diesel  prices are much higher  than in                                                               
the 1990s.                                                                                                                      
                                                                                                                                
2:23:58 PM                                                                                                                    
SENATOR  MEYER   questioned  why  state  vehicles   shouldn't  be                                                               
required to convert to natural gas.                                                                                             
                                                                                                                                
MR.  SCHULTZ  said  that's  the  goal,  but  before  making  that                                                               
commitment he'd like  to hear from an expert about  the costs and                                                               
benefits.                                                                                                                       
                                                                                                                                
SENATOR KOOKESH said thus the request for a study.                                                                              
                                                                                                                                
SENATOR DYSON added  that somebody has to make  the investment in                                                               
the  vehicles to  create a  market  to put  filling stations  out                                                               
there. The  state is the logical  one to do that  with short-haul                                                               
vehicles. The big  difference now as compared to 15  years ago is                                                               
the  fuel cost  differential, but  engines that  run on  CNG also                                                               
last longer and  have lower emissions. This appears to  be a win-                                                               
win but somebody needs to break the logjam, he said.                                                                            
                                                                                                                                
2:25:47 PM                                                                                                                    
SENATOR PASKVAN commented that he  hopes the study will look into                                                               
the  pollution issue  that's  related to  air  inversion. It's  a                                                               
health issue for significant areas of Alaska.                                                                                   
                                                                                                                                
SENATOR  KOOKESH,  finding  no  further  comments  or  questions,                                                               
closed public testimony and asked the will of the committee.                                                                    
                                                                                                                                
SENATOR  MENARD  moved  to  report  SB  34  from  committee  with                                                               
individual  recommendations and  attached  fiscal note(s).  There                                                               
being no  objection, SB 34  moved from the  Senate Transportation                                                               
Standing Committee.                                                                                                             

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