Legislature(1993 - 1994)

04/07/1993 05:00 PM House O&G

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
  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.                                         
                                                                               

Document Name Date/Time Subjects