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HomeMy WebLinkAboutItem 2i - Purchase of Compressed Natrual Gax ("CNG") Fuel for City's Fleet Purchase Order for CNG Fuel June 6, 2017 Page 1 of 2 DATE: June 6, 2017 TO: Honorable Mayor and City Council FROM: Tom Tait, Public Works Services Director By: Jacquelyn Mercado, Management Analyst SUBJECT: PURCHASE ORDER WITH CLEAN ENERGY FOR THE PURCHASE OF COMPRESSED NATURAL GAS (“CNG”) FUEL FOR THE CITY’S FLEET IN AN AMOUNT NOT TO EXCEED $45,000 Recommendation: Approve SUMMARY The City primarily utilizes the Clean Energy compressed natural gas (“CNG”) fueling station located at the Foothill Transit Center to fuel CNG vehicles. The purchase order contract with Clean Energy expires on June 30, 2017. It is recommended that the City Council approve a sole source purchase order with Clean Energy for the purchase of CNG fuel for the City’s fleet in an amount not to exceed $45,000. BACKGROUND The Public Works Services Department (“PWSD”) has been strategically replacing vehicles that meet the City’s Vehicle Replacement Policy criteria with alternative fuel vehicles such as CNG, Hybrid, and Plug-in Electric. This has allowed the City to be compliant with the Air Quality Management District’s mandates that require heavy duty equipment to be replaced with alternative fuel vehicles, reduces the City’s overall fuel costs, and reduces the City’s greenhouse gas emissions footprint. The PWSD is responsible for the purchase of CNG fuel and currently operates a fleet of eight CNG vehicles. Three additional CNG vehicles purchased in Fiscal Year 2016-17 are presently being outfitted and will be placed into operation by September 2017. DISCUSSION The PWSD utilizes two local CNG public fueling stations to fuel all City CNG vehicles. The first station, owned and operated by Foothill Transit, is located less than a half a mile from the Public Works Service Center. The second station, owned and operated by the City of Pasadena, is located on Foothill Boulevard just west of the City limits. Clean Energy is the sole source CNG fuel and service provider for both these fueling stations. Purchase Order for CNG Fuel June 6, 2017 Page 2 of 2 The PWSD has vehicle fueling cards provided from Clean Energy and is invoiced monthly for fuel purchased at these two stations. Last year, the PWSD used a total of approximately 14,000 Gasoline Gallon Equivalents (“GGE”). This usage is anticipated to increase considerably as the PWSD will be placing three new CNG vehicles into operation by September 2017 and most recently placed into operation a heavy duty CNG Vactor sewer truck that is expected to utilize approximately 300 GGE per month. Based on the existing purchase order the City paid on average last year $2.25 per GGE. The price per GGE is subject to change based on market rates. Currently, the market rate in California is $2.40 per GGE. FISCAL IMPACT Sufficient funds are appropriated in the Department’s Fiscal Year 2017-18 Operating Budget for the purchase of CNG fuel. RECOMMENDATION It is recommended that the City Council approve a sole source purchase order with Clean Energy for the purchase of CNG fuel for the City’s fleet in an annual amount not to exceed $45,000.