Regulation changes to encourage LNG use

The government of British Columbia (B.C.) has announced changes to the greenhouse gas reduction regulation to encourage fleet operators to switch to LNG and CNG.

The changes will allow utilities to expand incentives to fleet operators to convert to natural gas as their primary or secondary fuel, and advance the development of more natural gas fuelling stations.

Clean investments

The greenhouse gas reduction regulation under the Clean Energy Act was introduced in 2012 and allows utilities to make investments in clean-energy transportation and infrastructure. These include the following:

• Offer incentives (grants or zero interest loans) for transportation fleets to purchase CNG or LNG vehicles, buses, trucks or ferries.
• Offer incentives for fleets to upgrade their vehicle maintenance facilities to be natural gas safe.
• Build, own and operate CNG or LNG fuelling stations.

To date, the incentive programme has resulted in commitments for more than 500 natural gas vehicles.

Regulation updates

The updates to the regulation will allow for shifts in the allocation of incentives and investments within the previously approved total spending caps to promote continued development of a domestic market for natural gas in the transportation sector.

Specifically, the updates will enable the following:

• Extend the existing incentive programs by one year to 31 March 2018.
• Allow a utility to spend up to CAN$5 million on pilot programmes to convert diesel engines in medium and heavy-duty vehicles to also use natural gas.
• Remove the existing cap of CAN$11 million on expenditures for LNG powered marine engines to allow the incentive amounts to be applied to all eligible vehicles.
• Make the eligibility criteria and grant and loan structure for replacement of diesel engines more flexible to encourage greater use of natural gas powered engines.
• Facilitate the construction of natural gas fuelling station infrastructure.

Comments

Bill Bennett, Minister of Energy and Mines

“Natural gas is cheaper and cleaner than traditional fuels, reducing transportation costs and greenhouse gas emissions. We’re updating the greenhouse gas reduction regulation to give utilities like FortisBC more flexibility to expand incentives to fleet operators to convert their trucks, buses and ferries to natural gas.”

Rich Coleman, Minister of Natural Gas Development

“Developing a market for natural gas transportation in B.C. using our abundant supply of resources makes economic sense for the province. We are creating jobs and economic development by making it easier for the transportation sector to use natural gas.”

Michael Mulcahy, President and CEO, FortisBC

“FortisBC is committed to growing the natural gas for transportation market in British Columbia. Natural gas vehicles can save between 25 – 50% in fuel costs compared to diesel. Natural gas also burns cleaner, helping B.C. meet its carbon reduction goals.”

Adapted from press release by Katie Woodward

Read the article online at: https://www.lngindustry.com/small-scale-lng/04062015/bc-changes-to-greenhouse-gas-regulation-894/