ATLANTA – Georgia utility regulators approved a plan developed by Atlanta Gas Light (AGL) that would provide $11.57 million in funds for CNG fueling infrastructure for constructing up to 10 stations during the next five years. The funds, approved by the Georgia Public Service Commission (PSC), are designed to incentivize the private sector to invest in CNG fueling stations.
The program allows AGL to invest in CNG equipment at each new station using proceeds from Georgia's Universal Service Fund (USF).
To qualify for funding, applicants must demonstrate they can secure real estate for a station, develop the site so it meets local zoning requirements, fund 100 percent of the CNG station costs, and hold contracts with fleet customers to utilize approximately 30 percent of a proposed station's capacity.
Retailers would purchase natural gas from certificated marketers and resell it as CNG to the public. The initial station locations will be determined based on proximity to commercial fleet customers who would use the stations, according to the release.
Publicly accessible stations will allow any customer to obtain CNG refueling services using fleet cards or regular credit cards. The funding also allows organizations to set up "limited access stations" for municipal, county, state, or other government fleets when public access isn't practical.
Firm ratepayers, including commercial customers, are not at risk for paying for the program, according to AGL. The capital used to seed the market would be appropriated from the USF. The USF funds come from rates paid by industrial customers, proceeds shared by energy asset management firms, and refunds from pipeline suppliers.
AGL annually requests funds from the USF for line extensions to serve new customers and new regions in Georgia. The slow economy has stalled normal USF line extensions that come with growth, according to AGL, leaving proceeds in the fund for natural gas market development.
AGL said it will own and maintain the CNG equipment that’s connected to its traditional natural gas distribution system. It will also provide utility services to station owners. AGL will collect transportation delivery charges and fees associated with operation and maintenance of these fueling stations from retailers. It will place revenue it collects from a separate equipment utilization fee in a reserve account to fund part of the costs of leasing home refueling appliances, constructing additional CNG facilities, and replacing major CNG equipment components.
AGL said contracts between it and potential CNG retailers can be set up following a request for proposal (RFP) process that will begin in early 2012. The RFP process should last into the third quarter of 2012 with construction proceeding later in the year, according to the utility.