Alternative Fuel Users Help Their Wallets and the Earth as Gas Costs Rise August 2004

PBS Engineering & Environmental, whose expertise is cleaning up polluted sites and hazardous materials, bought six Toyota Prius hybrid cars for its fleet two years ago as a way of practicing what it preaches.

As gas prices rose to $2.05 a gallon this week, the ecologically oriented business and others who took the dive into alternative fuel are looking downright savvy.

"Right now the maintenance costs are the same, maybe even less because when it's downtown driving you're not even having to use the gas part of the system," says Lisa Utz, PBS marketing coordinator.

Leading the alternative pack are Portland's public agencies, which, because of federal mandates, have been systematically replacing fleet vehicles with transportation that is more environmentally friendly.

Now, they say, they're laughing all the way to their savings accounts.

Portland Public Schools, which began converting its school bus fleet in 1983 to propane, a cleaner-running fuel that at the time was more expensive than diesel but now is less than half the price per gallon, is feeling particularly prescient. Most of the district's own buses and 90 percent of the Laidlaw buses the district uses on contract are fueled by propane.

Savings this year: about $1 million, according to Bryan Winchester, head of the school systems' student transportation. "I've been reading industry rags about how other districts are taking some serious hits on gas. I'm not feeling it. Right now I'm paying 70 cents per gallon for propane, and I'm loving it."

Moreover, the state's motor pool gradually has increased the number of "green" vehicles in its fleet over the past decade. Now, 8 percent of the state's nearly 4,000 vehicles are hybrid gas-electric or cars that run on compressed natural gas. While cost savings was not the goal when the process began, and, in fact, many of the new technologies are more expensive than traditional diesel, the high price of gas is making for net savings - at least for now, said Kent Fretwell, acting state fleet manager.

Pizza by electric

Hot Lips Pizza, a small Portland chain that prides itself on organic ingredients and energy-saving ovens, extended its environmental sensibilities last year with two alternative delivery transports - one electric car and a hybrid vehicle.

Owner Dave Yudkin says that while sustainability was on his mind, he also thought, and still does, that gas prices would continue to rise.

"We started looking at this three or four years ago, and we knew gas prices were going to go up. In the future, I think we'll be looking at, easily, $3 to $4 per gallon."

While the hybrid, a Toyota Prius, retails for about $19,000, the electric car, a Chrysler GEM which Yudkin describes as looking like a bubble, cost him about $4,000 on eBay. The GEM's uses, he says, are limited by the fact that it "tops out at 27 miles per hour" and the fact that it can't handle hills. "It's perfect for the Hawthorne area, but it doesn't have enough oomph to get up Pill Hill."

Yudkin will dabble in biodiesel next - a fuel derived from plant oils - to power a trailer with pizza ovens that would be used at the Portland farmers market.

Private businesses that run large fleets, especially trucking companies, have yet to embrace wholesale conversions to hybrid vehicles.

Jerry Bouear, director of maintenance for USF Reddaway Freight in Clackamas, said 58 of the company's yard vehicles run on compressed natural gas and that the company seven years ago spent $300,000 to buy an on-site CNG station to fuel them. But the freight fleet, some 4,000 trucks strong, remains diesel powered for now because there are no CNG stations available to refuel trucks once they leave the metro area.

Hybrid trucks might be an option for the future, but Bouear said they'd have to be as good for the business - in price and performance - as they are for the environment.

Challenges ahead

Jim Mattix, manager of supply side operations for Bonneville Power Administration, is familiar with the complications of going alternative. BPA's 1,000-vehicle fleet contains 182 alternative fuel cars - most of those ethanol-run.

The agency expected ethanol to become more available and less expensive over time. Instead, the market has shifted its focus to hybrid vehicles and ethanol has remained both costly - even compared with the inflated price of diesel - and elusive. Currently, BPA's supply is being shipped from California.

BPA is considering building its own ethanol-fueling station, one that would serve federal agencies and private vehicles. Mattix is hopeful that as alternative vehicles become more popular, fuel supplies will increase to meet demand and prices will drop.

It's already happened with biodiesel, he says. The outlook for compressed natural gas could improve as well. Officials from Bretthauer Oil Co., which built Oregon's first public-access CNG fueling station, said gas prices over the past year caused a spike in inquiries.

But until some of the complications are worked out of the alternatives, some managers of large fleets say they'll stick with gas and fasten their seatbelts through the high-cost times.

SOURCE: PDXTimes

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