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25 August 2008

The cost of Natural Gas

It is quite amusing sometimes to look at official statistics: 4 times more natural gas is lost in storage and in the natural gas pipe network than is used for transportation.
This means that they (Sempra etc) could in theory sell natural gas for use in transportation for free and write it off as 20% increase in network storage losses.
However, the cost of fuel to owners of natural gas vehicles in California is up to 3 times higher than the cost of fuel to vehicle owners in Utah. Given that the wholesale price of natural gas is prroximately $9.03 per 1000 cu.ft. and the retail price to CNG vehicle owners in California is around $2.89 / gge (1 gge = 127.77 cu.ft.), then the natural gas companies have a profit margin of approximately 150%. If California is really serious about reducing pollution, natural gas vehicles needs to be encouraged since natural gas is the source fuel used by all hydrogen fuel cell vehicles, whether the natural gas is cracked in a converter at home, within the vehicle itself (natural gas fuel cell) or done industrially at the filling station. Price gouging by the natural gas suppliers needs to stop - CNG vehicle owners should not have to have a home filling station fitted just to avoid the inflated prices at the filling stations.

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