Pioneering the capability for the utilization of natural gas as the alternative transportation fuel

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2 Pioneering the capability for the utilization of natural gas as the alternative transportation fuel

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4 Weld County Smart Energy Plan Phase I Program Launch Develop initial infrastructure (3-5 CNG stations) Pilot programs with stakeholders for vehicle conversions (150 vehicles) Education and awareness program Phase II Program Growth Infrastructure expansion (7-10 CNG stations, 1 LNG station) NGV s increase to 1000 vehicles with pilot expansions and new stakeholders being added NGV and infrastructure certification programs ongoing at colleges Phase III Program Sustainability Infrastructure builds out with market demand (15-25 CNG stations and 3 LNG stations) NGV s growth is consumer oriented, count exceeds 10,000 vehicles

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6 Natural Gas The Solution Natural gas is an integral part of the solution to our nation s current economic, environmental and energy challenges. Weld County Drilling Location

7 Natural Gas is American About 97% of the natural gas we use comes from right here in North America. Conversely, over 70% of the oil we use is imported. American By using domestic natural gas, we strengthen both our nation s economy and energy security keeping jobs and revenues at home. We spend ~ $1 billion a day to pay for foreign oil, adding to our trade deficit and weakening the dollar.

8 Weld County s Buried Treasure Over 15,000 Active Oil and Gas Wells Nearly 40% of all active wells in Colorado $2.868B in assessed property value 50% of the total assessed value $48.2M in County property taxes 2200 employees residing in Weld Co 3622 Energy Industry jobs

9 Natural Gas is Abundant Worldwide, natural gas reserves are greater than petroleum Oil & Gas industry has been successful in finding new natural gas resources supply far exceeds government forecasts and storage levels assure reasonable prices for the foreseeable future. American Abundant North America has a year supply of natural gas contradicting the notion that America is running out. Because of its growing abundance, domestic natural gas will play a major role in meeting our 21 st -century energy needs.

10 Wattenberg Field 7 th largest field in the nation Daily Wattenberg production supplies 3X enough energy for the entire state of Colorado based on 4.3 million population assuming 3 people/household Average Wattenberg Well ½ acre of surface disturbance Supplies enough gas to heat or cool 600 homes for 10 years Equivalent energy from a wind farm will require 300 acres of surface disturbance Equivalent energy from solar will require 52 acres of surface disturbance Wind & solar only displace domestic energy they do NOT displace foreign oil

11 Natural Gas is Clean Cleanest commercially available fuel for transportation today Produces less overall emissions compared to gasoline or diesel vehicles Reduces GHG emissions compared to gasoline or diesel fueled vehicles Natural gas is the Lowest Carbon Fuel American Abundant Clean Converting one heavy-duty truck from diesel to natural gas is the pollution reduction equivalent of removing 325 cars from the road

12 WE NEED A DIVERSIFIED ENERGY PORTFOLIO SUPPLY SOURCES 37.1 OIL 23.8 NATURAL GAS 22.5 COAL 7.3 RENEWABLE ENERGY (Including hydro ~5%) 8.5 NUCLEAR % OF SOURCE % OF SECTOR DEMAND SECTORS 27.8 TRANSPORTATION 20.6 INDUSTRIAL 10.8 RESIDENTIAL & COMMERCIAL 40.1 ELECTRIC POWER ENERGY INFORMATION ADMINISTRATION, ANNUAL ENERGY REVIEW, 2008

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14 Emissions Benefits Exhaust Emissions Percent Reduced Carbon Monoxide (CO) 90-97% Non-Methane Organic Gas (NMOG) 87% Nitrogen Oxides (NOx) 35-60% Carbon Dioxide (CO2) 25% Particulate Matter 100% Evaporative Emissions 100% Source: Environmental Protection Agency

15 Natural Gas is Affordable Natural gas costs, on average, over onethird less than conventional gasoline at the pump Natural gas is less than half the cost of oil on an energy equivalent basis Natural gas has been 25-42% cheaper than diesel over the last 14 years American Abundant Clean Affordable

16 Be a Part of the Solution Join the Plan

17 Natural Gas Vehicles (NGV) Availability Currently the Honda Civic is the only CNG Dedicated vehicle off the assembly line available to the public in America. Many models can be converted Dedicated powered solely by natural gas Bi-fuel capable of running on gasoline or natural gas Maintenance Every 3 years inspections required to ensure all critical NGV components are secure and functioning Some routine maintenance requirements extended due to the cleaner burning nature of natural gas Performance Recent studies indicate comparable MPG to gasoline/diesel vehicles Increased engine life

18 CNG and Safety CNG, unlike gasoline, dissipates into the atmosphere in the event of an accident. Natural gas has a narrow range of flammability (concentrations below 5% and above 15% will not burn). CNG has a High ignition temperature: 1,000-1,100 F. Storage tanks do NOT leak into groundwater. Natural gas is a colorless & non-toxic gas. Comprehensive fuel tank, vehicle and station design and manufacturer codes & standards. Vehicle equipped with several automatic and manual shut-off valves. Natural Gas fuel tanks are much stronger than Gasoline fuel tanks and are subjected to the following tests: Puncture- Fire- Drop-

19 Cut your costs! Annual Fuel Savings when using Natural Gas Average Consumer Vehicle $1,000 F150 (Fleet Application) $3,000 Taxi $4,000 Shuttle $6,000 Transit Bus $8,000 Garbage Truck $10,000 Class 8 Tractor Trailer $15,000

20 CNG Refueling Stations Colorado / Denver Area 17 public and 3 private No options currently are west of Denver on the I-70 corridor

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22 QUESTIONS

23 Natural Gas Vehicles Fast Facts About NGV Over 120,000 NGVs on the U.S. roads today and over 10 million worldwide Over 1,100 NGV fueling stations in the U.S. 1/2 available for public use Over 50 different manufacturers produce 150 models of light, medium, and heavy-duty vehicles and engines Natural gas is sold in gasoline gallon equivalents (GGEs). A GGE has about the same energy content (124,800 BTUs) as a gallon of gasoline. Benefits of NGV Reduces Foreign Oil Dependency Lower Air Emissions Reduces Greenhouse Gases Safety Lower Fuel Costs

24 Federal -Vehicle Purchase Tax Incentive Current incentives Income tax credits for dedicated Alternative Fuel Vehicles (50-80% of incremental costs) with cap ranges from $2,500 to $32,000 depending upon size of vehicle Income tax credits for Alternative Fuel Infrastructure (50% of costs or $50,000 whichever is smaller) Nat Gas Act (Fueling America Act of 2009) Increases tax credits for dedicated NGVs to 80% of incremental costs with cap ranges from $50,000 to $100,000 depending upon the size of the vehicle Extends tax credits to bi-fuel vehicles at 50% of incremental costs with the same cap ranges as for dedicated vehicles Tax credits for infrastructure remains the same Extends these provisions through 2014

25 Federal - Fuel Station Equipment Tax Credit (IRS Form 8911) 50% of cost of alternative refueling equipment placed in service that year, up to $50,000 Incentive may be taken on multiple stations per company Up to $2,000 tax credit for home refueling appliances Credit may be taken by seller if buyer is tax exempt entity Price negotiation point (if seller has tax liability) Seller must disclose full value of potential credit Credit is effective for equipment placed in service after December 31, 2005 and now expires on December 31, legislation extended credit by one year, but The NAT GAS Act extends to 2027, increases cap to $100K or 50% of investment (whichever is less still pending legislation)

26 Colorado Incentives Alternative Fuel Incentive Description Expiration Vehicles Infrastructure Light-duty passenger vehicle, light-duty truck, or medium-duty truck natural gas conversions. Dedicated or bi-fuel. Owned or leased. Starts at 75% of ICC and decreases annually to 25% for NGV. A rebate for State of Colorado or tax exempt organization. $350k cap per year. 35% of Cost % of the costing the 2010 or 2011 ($400k cap) If public, the percentages can be multiplied by /31/2015 7/01/ /31/2011 Other Incentives Free HOV use Low Emission Vehicle (LEV) Sales Tax Exemption 2/28/2010 Reference House Bill 1331, 2009, and Colorado Revised Statutes to ) Source: Department of Energy Alternative Fuel Data Center

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28 Why Natural Gas Now? Natural Gas Vehicle (NGV) technology has progressed in the last decade and is ready now. As a transportation fuel (CNG or LNG), it offers the same performance as gasoline and diesel vehicles Provides more advantages as a clean, affordable American fuel Creates U.S. jobs and lessens our country s dependence on foreign oil.

29 U.S. Average Retail Fuel Prices The B s are different blends of Bio-diesel

30 NATURAL GAS PRODUCING STATES 32 OF 50 STATES HAVE PRODUCTION 85% SUPPLY FROM U.S. 97% SUPPLY FROM NO. AMERICA U.S. ENERGY INFORMATION ADMINISTRATION

31 NATURAL GAS STRENGTHENS THE U.S. ECONOMY 2.8 MILLION 2008 TOTAL EMPLOYMENT 2.6 MILLION 2007 TOTAL EMPLOYMENT 2.4 MILLION 2006 TOTAL EMPLOYMENT

32 Natural Gas Production from Colorado Bcf/d Gas Production Actuals Estimated Bcf/d 1.8 Bcf/d Jan-01 Jan-03 Jan-05 Jan-07 Jan-09 Jan-11 Local Consumption Exported CAGR= Compound Annual Growth Rate Sources: EIA Natural Gas Production Summary, Consumption by End Use

33 NGV History s WW II Today

34 NGV in the World Market Country No. of NGV Pakistan 2,000,000 Argentina 1,700,000 Brazil 1,600,000 Iran 1,216,000 Italy 580,000 China 400,000 United States 120,000 Germany 65,000 Source:

35 NGV Availability Every major car manufacturer is making NGVs for some market somewhere - GM/Opel - Chevrolet - Ford - Mercedes - Volkswagon - Fiat - Citroen - Hyundai - Renault - Peugeot - Tata - Mitsubishi - Toyota - Honda - Nissan - Isuzu - Skoda - Volvo - Geely - Lifan Domestic Manufacturers alone make more than 18 natural gas models (no vehicles currently offered in USA)

36 The Mechanics Compressed Natural Gas (CNG) To provide the same driving distance as gasoline, CNG must be stored onboard a vehicle in tanks at high pressure up to 3,600 psi. A CNG-powered vehicle gets about the same fuel economy as a conventional gasoline vehicle on a gasoline gallon equivalent (GGE) basis. Fuel Flammability Energy Content Natural Gas (CNG) (BTUs/gallon) 1,100 o F 121,000 Gasoline 630 o F 114,194 Diesel 125 o F 125,881 A GGE is the amount of alternative fuel that contains the same amount of energy as a gallon of gasoline. CNG has octane fuel rating 117

37 Colorado CNG Vehicles State CNG Ranking Colorado Ranks #12 (1,310) OK is #8 (2,829) Utah is #9 (2,756) WY is #31 (354) Federal Agencies, 136 State Agencies, 7 Electric Fuel Providers, 21 Other Private & Municipal Gov., 951 Natural Gas Fuel Providers, 150 Transit Agencies, 45 Source: US Department of Energy 1,310 Natural Gas Vehicles in Colorado

38 Resources Natural Gas Vehicles for America DOE Alternative Fuels and Advanced Vehicles Data Center Clean Vehicle Education Foundation (CVEF) CNGNOW America s Natural Gas Alliance

39 Questions