ORD-2015-019 Budget Ordinance Amendment #10-B for propane vehicle conversion

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2 • Increased safety — Propane is less flammable than gasoline and the tanks are more puncture resistant • Energy security — According to the NC CETC, "92% of LPG used in the U.S. is produced domestically, whereas 56% of the U.S. petroleum demand was imported in 2012." • Increased range — If both the propane and gasoline tanks are full, these vehicles will have dramatically increased range with no loss of vehicle performance. The grant project period is April 30, 2015 through March 31, 2016. The vehicles involved would include the highest fuel users from the Sherriff's Office, Orange Public Transit, and Emergency Management departments. Written into the grant is a partnership with Alliance Autogas. Alliance, along with its parent company Blossman Gas, is the sole-source provider of this "turnkey" package of Environmental Protection Agency-certified "PRINS" brand vehicle conversion kits, a refueling system, and propane fuel. The County would purchase propane vehicle fuel from Alliance for the first 5 years of this project, and Alliance will guarantee the price relative to the wholesale (or "pipeline") price of propane. Once the project begins and the County is on-track to use a minimum of 20,000 gallons of propane each year, Alliance has agreed to match the state contract price of propane. The refueling station package would be provided free of charge to the County to use based on the projected fuel usage. Alliance would maintain ownership of the station and would take care of any necessary maintenance or upgrades. It would be located at the site of the County's former CNG station and interconnected into the current fuel management system for gasoline and diesel. The vehicle conversions would be done on-site at the County Motor Pool facility in order to speed up the conversion process and facilitate the training of the County's fleet maintenance staff in how to repair and maintain the systems. FINANCIAL IMPACT: The total project cost is $106,613 with grant funds of $84,840. The remaining 20% of the total project cost is "cost share" that is required to be paid by all applicants. The County's share of $21,773 will be paid from available funds within the Energy Bank Capital Project. With this appropriation, $37,006 remains available in the Energy Bank Capital Project. The Energy Bank project was established in FY 2012-13 and provides funding for projects that reduce energy/water demand at County facilities. The 5-year fuel purchase agreement with Alliance would entail no additional costs to the County as these funds would otherwise be spent on gasoline, and there are no early termination fees should the County decide to discontinue the program. Budget Amendment #10-B provides for the receipt of the grant funds of $84,840, provides for the use of Energy Bank Capital Project funds of $21,773 for the required County match, and establishes the following Grant Project Ordinance, as well as amends the following Energy Bank Capital Project Ordinance for the County match: