Legislature(1993 - 1994)
04/07/1993 05:00 PM House O&G
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HCR 12: USE OF NATURAL GAS IN MOTOR VEHICLES Number 207 REPRESENTATIVE DAVID FINKELSTEIN, PRIME SPONSOR OF HCR 12, stated the idea of HCR 12 is to promote the use of natural gas to fuel vehicles in Alaska. He felt this would help deal with air pollution problems. Number 241 BERNIE KARL stated he was in favor of HCR 12, but was in hope of an amendment that would add propane. He stated propane comes from California to Fairbanks and he did not feel this was necessary since we have the fuel here in Alaska. He felt using propane would help the air pollution problems. Number 310 VICE CHAIRMAN KOTT asked what it would cost for a pump price for using propane in Alaskan's vehicles. MR. KARL said the total cost would be approximately $1.00 per gallon. Number 322 VICE CHAIRMAN KOTT asked if there were advantages of using propane over natural gas. Number 325 MR. KARL said propane has been used longer in vehicles than natural gas. A disadvantage of propane is a fuel pump has to be put on the vehicle in cold climates, and with natural gas fuel pumps are not necessary. He also stated that propane is more dangerous in accidents than natural gas, although it is safer than gasoline. The advantage that propane has is that it is a liquid and it only has to have 20 pounds of pressure on it so a small tank will hold the same amount as a fuel tank, and if the vehicle is run strictly on propane and not duel-fuel, it will run at the same gas mileage. With natural gas there is about a 10% difference and you do not get the distance you do with propane. Number 414 GRANT DOYLE said he supported HCR 12, but would like to see it amended to include propane. Advantages of propane he mentioned were that it is safer than gasoline, and that vehicles run cleaner with propane so it would help with the air pollution problem. Number 452 MEAD TREADWELL, DEPUTY COMMISSIONER, DEPARTMENT OF ENVIRONMENTAL CONSERVATION (DEC), introduced Ron King, Mobile Sources Programer for the DEC, Jeff Ottesen with Department of Transportation (DOT), and Barbara Sheppard, Alternative Fuels Coordinator and stated they were here to answer any questions that the committee might have. MR. TREADWELL supported HCR 12 and suggested a few changes. He said the DEC and the DOT with support of many private sponsors held a major conference on compressed natural gas vehicles. He said if HCR 12 passed, a task force would be put together to try to figure out a way to make the program work, including municipalities, gas utilities, and gasoline retailers. Number 500 MR. TREADWELL suggested that a lot more people be added to HCR 12 like the mayor of Fairbanks, Commissioner Campbell of the DOT, Mapco, Tesoro, Chevron, Phillips, Ray Lachem, mayor of the North Slope Borough, presidents of Ford, Chrysler, and G.M., along with other independent gasoline retailers. Number 550 RON KING, AIR POLLUTION SAFETY, DEC, showed a map of transmission lines, and where certain stations were located. He said there were stations at this time that could possibly be encouraged to shift to natural gas. Number 588 MR. TREADWELL hoped to have the above-mentioned task force off the ground by spring of 1993. CHAIRMAN GREEN asked if Mr. Treadwell envisioned this being useful in Alaska rather than a metropolitan area. Number 609 MR. TREADWELL felt if this fuel alternative was to prove up over time it could get the DEC out of the oil spill business and help clean things up. It will have to be made to have it work so there is a supply where people are going to drive. Number 632 VICE CHAIRMAN KOTT asked Representative Finkelstein if he would be willing to include propane in HCR 12. REPRESENTATIVE FINKELSTEIN said it was more a drafting question as to whether HCR 12 could include both, because of the way it is written. Possibly a Fairbanks representative would introduce a propane resolution, he added. Number 647 CHAIRMAN GREEN's only concern with HCR 12 is being able to have filling stations in appropriate places. REPRESENTATIVE FINKELSTEIN appreciated all the DEC's suggestions and said he would work to incorporate a new version of HCR 12. Number 653 VICE CHAIRMAN KOTT asked, since the DEC was coming up with a task force, that HCR 12 be pushed through rather quickly. Number 662 REPRESENTATIVE SANDERS asked if the retail price of natural gas would be approximately $.60 per gallon. MR. KING said that the $.60 was the current estimate that he has been given. Number 665 REPRESENTATIVE SANDERS then asked Mr. Karl if the propane would be approximately $1.00 per gallon. MR. KARL said he estimates $1.00, but as the volume increases the price would decrease. Number 669 REPRESENTATIVE SANDERS asked if the price of natural gas would go down also. MR. KING said probably not. Number 671 REPRESENTATIVE SANDERS asked if one alternative is $.60 and one is $1.00, why push the $1.00 alternative. MR. KING said he did not think they could deliver natural gas for $.60 in Fairbanks. Number 676 MR. KARL said one of the major problems with liquified natural gas is to keep it liquified. He said a reason for the higher expense is that the propane trucks go to Prudhoe Bay empty. The price of propane currently in Fairbanks is $1.28, he added. TAPE 93-12, SIDE B Number 000 MR. KARL further stated that he could not think of anywhere in the state one could not go and buy propane. He said 90% of Fairbanks' gas stations have propane. Number 046 REPRESENTATIVE SANDERS asked if the price would get down to $.60. Number 051 MR. KARL said he could not guarantee that the price for propane would get down to $.60. Number 061 REPRESENTATIVE SANDERS asked if he thought it might get down to $.60. Number 062 MR. KARL felt that was a good possibility. He said he knows there is a good possibility if the tax would give up their $.08 per gallon in road tax. Number 070 REPRESENTATIVE SANDERS said if the state was to give up their $.08 that would affect natural gas also. Number 073 MR. KARL wished he could say it would be $.50 or $.52, but in good conscience he felt it would be right at a $1.00 per gallon. Number 076 REPRESENTATIVE SANDERS asked if propane would be viable at $1.00 trying to compete with natural gas at $.60. Number 083 MR. KARL said it would be viable and is cheaper than people are paying for fuel in Fairbanks now. He said natural gas would not be sold in Fairbanks for $.60. Number 100 JEFF OTTESEN, CHIEF, RIGHT-OF-WAY AND ENVIRONMENT, DIVISION OF ENGINEERING AND OPERATIONS, DEPARTMENT OF TRANSPORTATION, said Mr. Karl was correct, natural gas could not be sold in Fairbanks for $.60. He stated the fuel itself is very inexpensive, it is the storing and cleaning of the natural gas that is expensive. Number 135 REPRESENTATIVE SANDERS asked if there was a difference in the price. Number 140 MR. OTTESEN said in the Fairbanks situation you would be looking at equivalent costs to propane, but he felt two alternative products would not be as strong as just one. Number 150 REPRESENTATIVE SANDERS asked if it would be better to push just one over the other. Number 153 MR. OTTESEN thought it would be easier for the public to understand that there is a single choice and it is available statewide. Number 173 REPRESENTATIVE SANDERS said he is not arguing with the concept or picking either alternative, but he felt pushing two things at one time would not be as beneficial as one thing. Number 183 MR. OTTESEN said when the DOT was looking at both propane and natural gas they chose natural gas over propane because there are problems with propane in cold weather. There are also problems with natural gas, like distribution and storage problems, but it is cheaper.
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