Thanks but no thanks -- rejecting a grant

16 April 2004

Officials in the village of Northbrook, Illinois, have spurned a $315,000 federal grant to build a compressed natural gas station for compressed-gas cars because they believe the CNG technology will phase out, replaced by hybrids and hydrogen fuel cell vehicles.

Chevrolet has announced that it will soon stop producing a compressed-gas Cavalier, the auto maker’s only sedan that uses pressurized natural gas. And Ford recently informed its dealers that 2004 is the last year it will make any compressed gas cars. Sales of Ford’s compressed-gas Crown Victoria have always been light, but have plummeted in recent years. They rose from 168 cars in 1997 to 510 in 2002, then dropped back to 219 last year, according to industry figures.

The U.S. EPA in January rejected a measure that would have required private and municipal fleets of 10 vehicles or more to have some vehicles that burn cleaner fuels like compressed gas. Increasingly efficient gasoline engines, and, according to Northbrook Village Manager John Novinson, a weaker commitment to air quality, led the EPA to reject that measure.

With support in the market dissipating, the officials fear that they would have to shoulder any resultant additional costs.