HomeMy WebLinkAboutItem 10p - Purchase of Compressed Natural Gas FuelPurchase Order for CNG Fuel
June 6, 2023
Page 1 of 3
DATE: June 6, 2023
TO: Honorable Mayor and City Council
FROM: Paul Cranmer, Public Works Services Director
By: Daniel Vargas, 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 $184,000
CEQA: Not a project
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, 2023. 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 $184,000 for Fiscal Year 2023-
24.
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, Hybrids, and Electric vehicles. 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 13 heavy duty
CNG vehicles, which includes three street sweepers, one aerial lift truck, a dump truck, a
water tanker truck, a sewer jetter vacuum truck, a hydro-excavator truck, and five one-ton
pickup trucks.
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 one-half
mile from the Public Works Service Center. The second station, owned and operated by
Purchase Order for CNG Fuel
June 6, 2023
Page 2 of 3
the City of Pasadena, is located on Foothill Boulevard just west of City limits. Clean
Energy is the sole source CNG fuel and service provider for both of these fueling stations.
There are no other viable CNG fueling stations in the immediate area. Therefore, utilizing
a sole source purchase order is necessary.
The PWSD has vehicle fueling cards provided by Clean Energy and is invoiced monthly
for fuel purchased at these two stations. It is estimated that the PWSD will use
approximately 25,300 Gasoline Gallon Equivalents (“GGE”) by the end of Fiscal Year
2022-23. This usage reflects a 5% increase from the previous fiscal year. Based on
month-to-month changes in CNG usage during Fiscal Year 2022-23, a similar 5% annual
increase is projected for Fiscal Year 2023-24. The total expected usage of CNG for Fiscal
Year 2023-24 is 26,600 GGEs.
Although CNG fuel prices are typically less volatile than other fuels, the price per GGE
has progressively increased in the last couple of years. During the past year, the City paid
on average $5.51 per GGE, which includes state fuel tax fees, as compared to $4.35 in
FY 2021-22. The cost of CNG fuel is expected to continue to increase in FY 2023-24 and
is projected to hold an average cost of $6.89 per GGE. It is recommended that the Fiscal
Year 2023-24 purchase order reflect the estimated total cost of 26,600 GGEs of CNG at
an average cost of $6.89 per GGE. Given that, at least $183,274 will be needed to cover
the expected costs.
ENVIRONMENTAL ANALYSIS
The proposed action does not constitute a project under the California Environmental
Quality Act (“CEQA”), and it can be seen with certainty that it will have no impact on the
environment. Thus, this matter is exempt under CEQA.
FISCAL IMPACT
The request is for the purchase of CNG fuel for the City’s fleet in an amount not to exceed
$184,000. Sufficient funds will be appropriated in the Department’s proposed Fiscal Year
2023-24 Operating Budget for the purchase of CNG fuel.
RECOMMENDATION
It is recommended that the City Council determine that this action does not constitute a
project and is, therefore, exempt under the California Environmental Quality Act
(“CEQA”); and approve a 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
$184,000.
Purchase Order for CNG Fuel
June 6, 2023
Page 3 of 3