New Compressed Natural Gas Filling Station Opens in Pittsburgh – How Does $1.85 per Gallon (Gas Equivalent) Sound?

Giant Eagle, a grocery and convenience store chain with 222 stores in western PA, Ohio and West Virginia, has just opened the first of three compressed natural gas (CNG) filling stations in the Pittsburgh area. The company is planning to replace its entire truck fleet (over 200 trucks) with CNG trucks in the coming years. The best part: How does paying $1.85 a gasoline-equivalent gallon grab you? Yes, CNG vehicles cost more (and right now only Honda in the U.S. makes one), but as the infrastructure is built, more auto manufacturers are likely to start making CNG vehicles.

Giant Eagle’s station, the first of three expected in the region, is just one example of a growing focus on CNG, which can sell for at least $1 less per gallon than gasoline or diesel fuel. A major producer of natural gas announced this week that it plans to invest $1 billion over 10 years to expand the use of CNG as a vehicle fuel. And Honda, which produces the only CNG-powered car in the United States, is expanding production.

Giant Eagle Inc. of O’Hara spent an undisclosed sum on two CNG filling stations — one public and one only for its fleet of commercial vehicles — plus 10 new Volvo heavy-duty trucks powered by CNG. The company expects to reduce its consumption of diesel fuel by 100,000 gallons in its first year, said Bill Parry, Giant Eagle’s vice president of logistics.

The company plans to replace its 220-truck fleet as older trucks are taken out of service, Parry said. The CNG trucks cost about $45,000 more than a typical big rig, he said. The company predicts it will recoup its investment in about three years.

The state provided Giant Eagle with a $900,000 grant to help offset the costs of the new filling station. It also has provided $700,000 to EQT Corp., a Downtown-based natural gas producer and utility that plans to open a public CNG station next week in the Strip District.

"We’re standing on a vast resource of natural gas," EQT spokeswoman Karla Olsen said. "And one of the really good uses is in transportation."

A gasoline-equivalent gallon of CNG is selling for about $1.85, Olsen said. The U.S. Environmental Protection Agency has said that CNG-powered vehicles have the lowest-emission internal combustion engines available.*

*Pittsburgh Tribune-Review (Jul 15, 2011) – Giant Eagle opens natural gas fueling station for vehicles