Southern California Gas Co. (SoCalGas) will lower the price of compressed natural gas at all of its 13 public access natural gas vehicle fueling stations by $0.26 per gallon beginning 1 April.
Through a California Public Utilities Commission approved program, the utility is able to offer a reduced price by returning revenue generated from the sale of Low Carbon Fuel Standard (LCFS) credits to customers.
The LCFS program is administered by the California Air Resources Board and seeks to reduce greenhouse gas emissions from transportation fuels by 20% through 2030. Under the program, fuels that help lower GHG emissions, such as natural gas, generate LCFS credits.
Natural gas costs significantly less than gasoline or diesel per GGE. For example, the average pump price at utility compressed natural gas stations was $2.37 per gallon in February, whereas the average cost of gasoline in California was $3.24 per gallon, and the average cost of diesel was $3.73 per gallon, according to the Energy Information Administration.
SoCalGas also recently announced it will soon begin using renewable natural gas, a fuel produced from waste sources, at its fueling stations. Because of its low or even negative carbon intensity, renewable natural gas can generate additional LCFS program credits.
The transportation sector is responsible for 41% of GHG emissions and 80% of smog forming pollution. The latest heavy-duty natural gas engines can cut smog-forming emissions by more than 90% compared to the cleanest heavy-duty diesel trucks on the road today. When these trucks are fueled with renewable natural gas, GHG emissions are reduced by at least 80%.
SoCalGas has worked with fleet owners to secure millions of dollars in incentive funding for the replacement of diesel trucks with cleaner, new near-zero natural gas trucks.
Renewable natural gas is produced from the methane generated in landfills, wastewater treatment plants, food processing, and dairies. It can be used to fuel trucks and buses, to generate electricity, to heat homes and businesses, and to cook. Capturing the methane from these waste sources and using it for fuel has two benefits: it keeps methane, a GHG, from entering the atmosphere and contributing to climate change, and it reduces the use of traditionally-sourced natural gas.
Already in California, close to 70% of natural gas fleets are fueled with renewable natural gas.