Post Independent: Bennet Gets Firsthand Look at CNG Potential

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By John Stroud

Compressed natural gas should be considered among the potential natural resource innovations to help wean the United States from its dependency on foreign oil, U.S. Sen. Michael Bennet observed Monday.

Economically, it can also help create jobs at home, he said during one of two stops in Garfield County as part of a West Slope tour this week focusing on Colorado energy and jobs.

"In my view, an incredibly strong economic case can be made for the use of natural gas in vehicles, especially in fleets," Bennet, D-Colo., said after a meeting with members of the West Slope Compressed Natural Gas Collaborative, and a visit to a compressed natural gas filling station in Rifle.

"It's something that can be very competitive with oil from the Persian Gulf," he said. "The problem is we don't have the infrastructure yet to get there."

Members of the CNG collaborative shared their experiences with Bennet on efforts locally to develop a market for the fuel in western Garfield County, one of the largest natural gas producing regions in the country.

The collaborative is made up of local governmental entities, elected officials, natural gas industry representatives and local business owners.

Earlier this year, Kirk Swallow, owner of Swallow Oil, opened the area's only compressed natural gas filling station at the Rifle Shell station.

After sinking $300,000 into the venture, he has grown the operation in just a few months from about 40 gallons a day to around 80 or 90 gallons a day.

But he's still operating at about a dollar-a-gallon loss, he said. Most of that is a result of the electricity required to run the compressor station, Swallow said.

"For a businessman to put up that kind of money for the infrastructure, he's going to have to get some help," said Swallow, who has been working with Xcel Energy on some type of incentive program for his and similar operations.

The other necessary component is volume. He said he would need to pump around 150 to 200 gallons a day to begin to make a serious go of it.

But that volume demand has been slow to come because of the cost for local governments and private businesses to convert their vehicle fleets over to natural gas.

"It is very expensive to convert a fleet," said Alexine Hazarian, an EnCana Oil and Gas representative who sits on the West Slope CNG Collaborative. "Colorado is definitely a leader in providing incentives, but there are a lot of other obstacles."

EnCana is working to convert its own vehicle fleet to natural gas, as are other energy companies. But one of the obstacles for any entity, private or public, is the upfront cost to either convert a vehicle to natural gas, or to purchase a CNG-ready vehicle brand new, Hazarian said.

"It really comes down to the cost, and the economies of scale involved," she said.

Scott Robinson, owner of Western Slope Trailer in Rifle, started a CNG conversion kit business. But he said he's had a hard time getting commitments from fleet operators.

"There is a lot of money that goes into setting these up," Robinson said. "But I do think it's the best way to get away from foreign oil, and something that comes right from our own backyard."

State Rep. Roger Wilson, D-Glenwood Springs, also sits on the CNG Collaborative. He said part of the solution is to locate more stations in areas where there are more potential users, as well as in convenient locations for travelers.

In addition to EnCana, Williams and Bill Barrett energy companies, local governments including Garfield County, the city of Rifle and others are working toward fleet conversions.

Bennet said the CNG Collaborative is the kind of public-private model needed to move new industries into the economic mainstream.

"It's not just a matter of tax and regulatory policy from a federal level, but also about investing in the private sector and a resource that we have right here in Colorado," he said.

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