Fuel purchase agreement for CNG station approved by commissioners

Station should be on line next January 

By Olivia Lueckemeyer

In a move that county facility and grounds director John Cattles described as “a long time coming,” a compressed natural gas (CNG) station is finally a reality in Gunnison County. On Monday, September 6, the Board of County Commissioners approved the fuel purchase agreement between Gunnison County and Trillium Transportation Fuels, LLC, for a commitment of $1,100,000 in fuel over the next ten years.

The agreement was broken into three three-year periods and one final year-long period over which the county is obliged to purchase fuel. For the first three-year period, the county is relying solely on its own commitments and the commitment from the Rural Transportation Authority to purchase CNG vehicles. The following periods will rely on commitments from outside entities.

“We have gone through projections of fleet development, and those first three years are dependent on the county and RTA,” Cattles explained. “After that, we are pulling in commitments from other people, such as national parks, state fleets and Western [State Colorado University].”

Cattles indicated that members of the private sector have also expressed interest in purchasing vehicles, but he hesitated to include those commitments in official fleet projections.

There is a slight risk associated with the purchase, since a penalty will be imposed if the county does not use the allotted fuel. The method by which the penalty is accrued is broken into two parts, Cattles explained. The first involves the cost of gas, which is tied to the index cost of the region’s natural gas market. The other piece accounts for Trillium’s compression fee, or the operational cost involved in running electricity to the station’s natural gas compressors.

“If we fall short of using the fuel we have agreed to buy, we pay 65 percent of the compression fee,” Cattles explained.

Cattles also explained that the county has agreed to provide engineering of the station infrastructure and to cover the cost of station development.

“We can move a lot faster than Trillium within our local market,” Cattles said. “They don’t have ties here, and they struggle with that. The main reason is we can ensure that the station can fit our needs, and especially the needs of the RTA—those buses will need a lot of fuel.

“Engineers who work for us will make sure the station can push enough fuel, fast enough,” he continued. “It gives us control over how that gets developed, so it’s within our interest to take on that responsibility.”

After title issues precluded the station from being built on the original site located off of Highway 50 adjacent to the Holiday Inn, the new plan is to add CNG fueling posts to the existing islands at Gunnison Tire. Board chairperson Paula Swenson expressed her enthusiasm about this idea, since this is where most of the county’s larger vehicles are fueled currently.

“It’s easy in, easy out, and it’s working with local businesses,” Swenson said. “That’s great.”

Trillium is currently working on a lease with Gunnison Tire, which should be in place by the end of the week, Cattles explained.

“Problems we had with the previous site made everybody go scramble and look,” he said. “It worked out in our favor. We literally drove a bus around town to see where we could get in and out of.”

This is especially important since the new RTA buses will be slightly larger than normal, Cattles said. RTA director Scott Truex said the plan is to purchase one CNG bus in 2017 and two in 2019. The RTA board of directors is expected to make a final decision on Friday.

The lead-time for compression equipment is four months, meaning that if all goes as planned, the new CNG station should be up and running by January.

“All we need to do as far as the site is concerned is upgrade power to the site,” Cattles said.

The motion to approve the fuel purchase agreement with Trillium was approved unanimously by the board.