Life-cycle costs of alternative fuels : is biodiesel cost competitive for urban buses?

14 Pages·1995·0.84 MB·English

by  Ahouissoussi, Nicolas B. C

Historic, Archive Document
Do not assume content reflects current
scientific knowledge, policies, or practices.

aTP319
Costs
.A36 Life-Cycle of
1995
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culture Alternative Fuels:
lomic
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Is
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IUS-5S Cost Competitive
November 1995
For Urban Buses
' U.S.OEF UlXOf'Ai-
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EstimatedTotal PresentValue Costs per Bus
Diesel Biodiesel Methanol
Note to readers: The special article reprinted here originally appeared in Industrial Uses of
Agricultural Materials Situation and Outlook, published in September 1995. The full contents
of that issue are shown below:
Contents
Page
Summary 3
Introduction 4
Current Macroeconomic and Industrial Outlook 8
Starches and Sugars 10
Fats and Oils 15
Natural Fibers 21
Animal Products 24
Forest Products 26
Specialty Plant Products 29
Special Article
Life-Cycle Costs of Alternative Fuels: Is Biodiesel Cost Competitive
for Urban Buses? 35
List of Tables 42
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2 Industrial Uses/IUS-5S/November 1995 USDA Economic Research Service
SpecialArticle
Life-Cycle Costs of Alternative Fuels:
Is Biodiesel Cost Competitive for Urban Buses?
by
Nicolas B.C. Ahouissoussi and Michael E. Wetzstein 1
Abstract: The purpose of this paper is to provide an expecte—d cost comparison for
operating a transit-bus fleet on three different alternative fuels biodiesel, com-
pressed natural gas (CNG), and methanol. Petroleum diesel is the base fuel. Infra-
structure, refueling, and maintenance costs are all part of running an urban transit
bus. Additional expenditures would be needed to change fuel storage and delivery
systems, as well as bus engines and fuel systems, to use methanol or CNG.
Using a 5-percent discount rate, the present value per bus per mile was calculated
for the total cost (the sum of infrastructure, bus-alteration, refueling, and mainte-
nance expenses) of a transit fleet over the estimated 30-year life cycle of a refuel-
ing infrastructure. Not surprisingly, diesel buses had the lowest cost at 24.7 cents
per mile. As biodiesel is blended with diesel, the cost per mile ranged from 27.9 to
47.5 cents, depending on the amount of biodiesel used and its estimated price.
CNG’s cost varied from 37.5 to 42 cents per mile, while methanol’s cost was 73.6
cents per mile. This analysis indicates that, although biodiesel and biodiesel
blends have higher total costs than diesel fuel, they have the potential to compete
with CNG and methanol as fuels for urban transit buses.
Keywords: Diesel fuel, biodiesel, compressed natural gas, methanol, transit
buses, life-cycle cost, present value.
Alternative fuels for urban mass-transit vehicles have been The industry is currently looking for least-cost methods to
receiving a lot of attention lately. This interest is generated meetthe newparticulate-matterstandards. Promisingoptions
by the necessity for cleaner emissions as mandated by the include retrofitting buses with emission-control equipment,
Clean AirActAmendments of 1990 (CAAA) and byconcern such as catalytic converters and particulate traps. There is
for reliable sources of energy. Under the CAAA, the U.S. also interestin usingalternativefuelsthatemitlessparticulate
Environmental ProtectionAgency(EPA)establishedNational mattercompared with petroleumdiesel. However, theequip-
Ambient AirQuality Standardsforseveral pollutants: carbon ment or fuel must first be tested and certified by EPA to
monoxide, inhalableparticulates, nitrogen oxides, ozone,sul- determine if it meets the new standards. EPA currently is
fur oxides, reactive hydrocarbons, and lead. These standards reviewing alternative fuel systems for the Urban Bus Retrofit
for heavy-duty urban buses (table A-l) have resulted in pro- Rebuild Program.
grams to lessen emissions ofthese pollutants.
Because ofthese stricterenvironmental regulations, the mar-
The CAAA and the Energy Policy Act of 1992 have opened ketfordomesticalternativefuelsisbecomingmoreimportant.
the market for clean burning, nontoxic, biodegradable fuels. However, there is a gap in the literature comparing the costs
However, these laws control access to that market, requiring of these fuels. The purpose of this paper is to provide an
extensive testing and demonstrations for verifying perform- expected cost comparison for o—perating a transit-bus fleet on
ance and emission reductions compared with low-sulfur die- three different alternative fuels biodiesel, compressed natu-
CAAA
sel. For example, set tighter particulate-matter con-
trolsonpre-1994-model-yearurbanbusesinareaswitha 1980
population ofover 750,000. The standards become effective TableA-1--Emissionstandardsforheavydutyurban busengines
when engines are rebuilt or replaced after January 1, 1995. Pollutant 1991 1993 1994 1998
Gramsperhorsepowerhour
Hydrocarbons 1.3 1.3 1.3 1.3
Carbon monoxide 15.5 15.5 15.5 15.5
' Ahouissoussi is a research assistant, and Wetzstein is a professor, (706) Nitrogenoxides 5.0 5.0 5.0 4.0
542-0758, in the Department ofAgricultural and Applied Economics, Uni- Particulatematter 0.25 0.10 0.05 0.05 1/
versity ofGeorgia, Athens, Georgia. Some ofthis research was funded by 1/TheU.S.EnvironmentalProtectionAgencymayrelaxtheparticulate
USDA’s Office of Energy and New Uses under Cooperative Agreement standardto0.07if0.05isdeterminednottobetechnologicallyachievable.
43-3AES-3-80153.
3 Industrial Uses/IUS-5S/November 1995 USDA Economic Research Service
ral gas (CNG), and methanol. Petroleum diesel is the base Petroleum-deriveddiesel isused asthebasefuel in this study.
fuel. It is the most common fuel used in urban buses and other
heavy-dutyvehicles. About25billiongallonswereconsumed
OverviewofCompeting Fuels in the United States in 1994 for on-road use. In the past,
petroleum refiningwascontrolledprimarily forgasolineyield
Biodiesel is aclean-burning, renewable, nontoxic, and biode-
and quality; thus, the quality of diesel fuel varied widely
gradabletransportation fuelthatcan beusedaloneorin blends depending on the demand forgasoline</). This has changed
with petroleum-deriveddiesel(2). U.S. farmersare interested over the last few years. Diesel fuel now faces significant
in biodiesel because advanced agricultural practices and
fuel-quality and engine-emissions requirements. EPA regu-
changing dietary habits in the United States have put down- lations set a maximum limitof0.05 percent by weight on the
ward pressure on prices for vegetable oils and animal fats, sulfur content and a minimum cetane index of40 for diesel
the feedstocks for biodiesel. Greater dietary use of lighter,
fuel used in on-road vehicles.
more unsaturated vegetable oils is leading to lower demand
for saturated oils and fats in human and animal feeds, thus, Bus Refueling Facilities
increasing the availability of animal fats and vegetable oils
for conversion into biodiesel. Most urban transit authorities operate refueling facilities for
their buses. Often at a central location, these facilities are
From an environmental standpoint, biodiesel/diesel blends devoted exclusively to refueling buses and house sheltered
can reduce significantly emissions of particulates, carbon chassis lanes with eight to ten doors, fueling pumps, storage
monoxide, and unburned hydrocarbons. For economic and tanks, maintenance equipment, and emergency fire equip-
engine-compatibility reasons, biodiesel often is blended with ment. Achassis laneisadrivewaynexttotherefuelingpump.
diesel at a 20/80 rate. Research results indicate that power, In a lane, maintenance equipment is used to clean one bus
torque, and fuel economy with a 20-percent biodiesel blend while another one is being fueled. The regional transport
are comparable with petroleum diesel (5). districtrefuelingstation in Denver,Colorado, which wasused
to gatherthe datafor this analysis, refuels approximately 280
Producing biodiesel is a relatively simple process. Typically, buses per night in a three-lane system. The three lanes can
it is made by esterifying vegetable oil, such as soybean or service 360 buses at full capacity. Diesel fuel is stored in
rapeseed oil, and/oranimal fat. This process involves mixing underground tanks, with a capacity of 20,000 gallons each.
the oil or fat with an alcohol in the presence of a catalyst
(potassium or sodium hydroxide) and allowing them to react. No infrastructure changes orengine modifications are needed
Ifmethanol isused, theprocessproducesamethylestercalled for using biodiesel. Only the fuel is modified by blending
methyl soyate from soybean oil or methyl tallowate from diesel fuel with biodiesel. In this analysis, fuels using 20,
animal fat. As the methyl soyate/tallowate is formed, glyc- 35, 60, and 100 percent (neat) biodiesel were considered.
erine, which can be sold as a valuable coproduct, separates However, the level of BTU’s associated with biodiesel-
out and sinks. Once degummed, the methyl soyate/tallowate blended fuels is lower than with diesel, which results in a
is decanted off, and can be used in most diesel engines with lowerlevel offuelefficiency. TheColoradoInstituteforFuels
no modification. and High-Altitude Engine Research has estimated the fuel
efficiency ofbiodiesel blends compared with diesel at 99.16,
CNG is another fuel that can meet tighter vehicle-emission 97.66,92.97,and 88.87percentfor20,35,60,and 100percent
requirements. Extractedfrom underground reservoirs, natural biodiesel, respectively.
gas isafossil fuel composedprimarily ofmethane,along with
otherhydrocarbons,suchasethane,propane,butane,andinert To handle methanol or CNG, a diesel refueling station would
gases, such as carbon dioxide, nitrogen, and helium. Interest need to be modified. For methanol, alcohol-compatible fuel
in using CNG as a transportation fuel has increased in recent tanks, new dispensers, and safety equipment would need to
years,particularly in urbanareasbecauseitoffersthepotential be added. Also, additional fuel storage capacity would be
for reducing exhaust emissions. Also, the United States has necessary because methanol buses require, on average, 2.5
large resources of natural gas, so this fuel could help reduce times as much fuel asdiesel buses. Toservice dual CNG/die-
dependence on foreign oil at a competitive price. sel buses, additional equipment to handle CNG would be
necessary, includinggassupply equipment,compressors,con-
Methanol isanotheralternativefuelthatcanbeproduced from trol valves, piping, gas conditioners, dispensers, and safety
domestic resources. Itcan be used in neat (100 percent) form equipment. The compressors condense the gas to 3,000
as a diesel substitute or potentially blended with diesel. Very pounds persquare inch. Also, aCNG fuel system would need
little methanol in the United States is used to fuel diesel eight lanes instead of three to service the same number of
engines. Significant amounts are used to produce methyl buses. It takes longer to refuel with CNG because the refu-
tertiary butyl ether (MTBE). Originally developed in the eling rate slows as the tank fills and the pressure increases.
1970’s as an octane enhancer, MTBE is now blended with
gasoline to helpcities meet the oxygenate requirements man- In addition to new facilities,the buses themselves would have
dated by the CAAA. The majority of the methanol made in to be modified to use methanol orCNG. To run on methanol,
the United States is produced from natural gas. Othersources buses would need a newengine and fuel system. CNG buses
of methanol include coal and residual oil. would use a modified diesel engine with a new fuel system.
4 Industrial Uses/IUS-5S/November 1995 USDA Economic Research Service
CostAnalysis Procedures andData Most experiments on alternative fuels have been mainly for
demonstration purposes, resulting in shortduration times and
The economic performance of alternative fuels for urban
little, ifany,collecteddata. Oneexception wasanexperiment
transit buses can be measured by estimating and comparing
by the Denver, Colorado, regional transportation district. As
ttihceipeaxtpeedcotpeedrattoitanlgcloifsetuosfinrgundnififnegreantbfuuselsf.leeTthdeurcionmgpairtsisaonn- part of its commitment to meet Clean Air regulations, the
district has conducted research on alternative fuels using
oftotal costs is enhanced by considering the present value of transit buses. The experiment, which lasted from June 1989
total fleet costs over the fleet’s life cycle. Present value to December 1993, used five diesel buses, which could use
explicitly incorporatesthe time valueofmoney bycomparing
both diesel and biodiesel fuel, and five methanol buses (table
thecosts in one time period, say agiven month, with thecosts A-2). Five dual CNG/diesel buses, which are diesel buses
dinolalanrotfhoerrthpecroimoidn.g Tahyeeatrifmreovmalnuoewofismnoontewyoratshsuasmemsucthhatasa converted so they can also use CNG, were added in 1991.
a dollar today. Thus, future costs are reduced by a discount
The three fleets of buses were exposed to similar operating
rate so they are comparable with current costs. The present
conditions such as scheduled speeds, stops per mile, traffic
value ofcosts is then the sum ofall discounted costs over the conditions, and passenger loading. They were also main-
total number of years a fleet is in operation by a transit tained underthe samepreventive maintenanceprogram. This
authority.
unique data set allows a cost comparison ofalternative fuels
based not only on fuel cost and usage, but also on mainte-
Infrastructure, refueling, and maintenance costs are all part
nance, repair, engine-rebuild, and in-service failure costs for
ofrunning a bus. Infrastructure costs represent lane building
the total operational life ofthe transit buses.
and tankage installation expenditures. Changing fuel storage
anddeliverysystems,aswell asbusenginesandfuel systems,
CNG In this experiment, the variation of mileage at rebuild was
to use methanol or will requireadditional expenditures.
large, particularly for diesel and methanol buses. This indi-
Refuelingcosts includeactual fuelexpendituresandrefueling
cates that rebuild decisions are based upon other information
laborcharges. Maintenanceexpenses include repair, rebuild,
besides the odometer value. CNG/diesel buses were rebuilt
and insurance costs, and costs associated with the loss of
in approximately half the time and mileage of diesel and
ridership and good will due to unexpected breakdowns.
methanol buses, which resulted in higher maintenance costs.
However, these higher costs are potentially offset by the
Generally, the purchase prices for engines that run on diesel, CNG/diesel buses’ considerably lower standard deviation. A
biodiesel, CNG, and methanol are comparable. However,
lower standard deviation implies less uncertainty regarding
engine-rebuild and fuel-system costs differ by fuel type and
timing ofrebuilds and, thus, possibly lower costs in terms of
the number of miles between rebuilds. Calculating engine-
less unexpected rebuilds.
rebuild costs for alternatively fueled buses is at present a
tricky proposition. The date when an engine was rebuilt and
The transportation district’sdatasuggestthatasettimeframe
monthly mileage since the last rebuild are key bits of infor- or mileage may not be a good indicator for when engines
mation. Unfortunately, data on monthly mileage and time of
need toberebuilt. Inthiscase,Rustproposestakingobserved
rebuilds for alternatively fueled buses are still quite limited.
engine rebuilds as optimal and infer the total maintenance
costs leading to these rebuilds (4). Basically, this method
TableA-2-Experimentstatistics
Item Diesei Methanol CNG/Diesel
NumberofBuses 5 5 5
Buscharacteristics
Engine 6V-92TA DDEC 6V-92TAM DDEC 6V-92TA DDEC
1 II II
Transmission Allison HTB-748ATEC Allison V-731 ATEC Allison HTB-748ATEC
Purchaseprice(1991 model) $217,400 $188,500 $252,400
Grossweight(pounds) 35,130 34,970 38,000
Fueltank(gallons) 125 285 1/
Mileageatrebuild
Maximum 89,600 110,100 34,500
Minimum 12,150 14,590 20,200
Mean 55,271 53,432 26,833
Standarddeviation 28,861 27,016 5,901
Elapsedtimebetween rebuilds Months
Maximum 28 34 10
Minimum 3 5 6
Mean 17.57 17.33 8.33
Standarddeviation 9.93 8.79 1.63
1/8,084cubicfeetofcompressednaturalgas(CNG)and62.5gallonsofdiesel.
Source: TheDenver,Colorado,regionaltransportationdistrict.
5 Industrial Uses/IUS-5S/November 1995 USDA Economic Research Service
assumes that transit authorities have developed a procedure equivalent gallons of CNG.) The price of natural gas is set
for optimally determining when a bus should be rebuilt. A by local utilities and approved by state public utility commis-
computerprogramdevelopedby Rustwasusedinthisanalysis sions. Thus, fleet operators around the country face different
to calculate engine-rebuild and monthly maintenance costs. prices for CNG.
Actual rebuild expenses were used for scaling these parame-
ters and estimating maintenance costs. Annual refueling costs are $21,102 per bus for methanol
buses, which isabouttwicetherefuelingcost fordiesel buses.
Comparing Life Cycle Costs The 2.5-times higher fuel consumption for methanol buses
requires 4.5 times more labor for refueling. The additional
The Denver transportation district scaled up their data to
labor needed fortheextra five refueling lanes forCNG/diesel
estimate the costs for running a fleet of 300 buses on diesel,
biodiesel, methanol, and CNG. The costs of alternatively buses account for most of its 37 percent higher annual refu-
eling cost per bus compared with diesel buses. Conversely,
fueled buses are based on the assumption that regional trans-
mostoftheadditional costforbiodiesel was forthefuel itself,
portation districts already have diesel-bus refueling facilities.
73 percent of the $14,795 annual refueling costs.
Therefore, the fixed costs for alternative-fuel facilities are
incremental to diesel-facility fixed costs. This assumption
Major maintenance costs involve engine rebuilds and general
may favordiesel and biodiesel, but it is realistic given current bus maintenance and repair. Rebuild costs are $6,500 per
transit operations.
engine for diesel, biodiesel, and CNG/diesel and $9,500 for
methanol buses. In this analysis, rebuilds were estimated to
Total infrastructure cost per bus is only $1,461 for diesel and
occur every 20, 21, and 10 months for diesel and biodiesel,
biodiesel (tables A-3 and A-4) compared with about $10,000 methanol, and CNG, respectively. These rebuild cycles were
per bus for methanol and CNG/diesel buses (tables A-5 and
derived by dividing average mileage at rebuild by monthly
A-6). Not only are six more storage tanks needed for metha-
travelled mileage.
nol, they are approximately 6.5 times more expensive than
diesel storagetanks. The infrastructure forCNG/diesel buses
Given monthly mileage and considering marginal mainte-
also are significantly more expensive than diesel due to the
nance cost changes every 5,000 miles, maintenance cost es-
requirementofeightfueling lanes instead ofthreeand storing
timates are used in calculating average monthly maintenance
pressurized fuel. In addition, the cost to change a bus so it costs over a rebuild cycle, which are then used to calculate
will run on methanol insteadCoNfGdiesel is $29,900 and the cost the present value oftotal costs. Because regional transporta-
ofalteringadieselbustouse is$35,000. Inthisanalysis, tion districts expect average monthly maintenance costs to
theseexpenses accrueevery 10years forreplacing theengine
rise over time, they were increased every 5,000 miles in this
and fuel system.
analysis. The estimated maintenance cost per month, based
on Rust’s model, for diesel and biodiesel, $4.34, is quite low
In addition to infrastructure and bus expenses, transit opera-
compared with the cost for methanol of $31.84 (table A-7).
tors also face refueling and maintenance costs. Refueling
However, this marginal maintenance cost permonth is higher
laborcosts are based on one supervisorand three laborers per
than the $1.80 cost for CNG/diesel.
lane. Two laborers drive the buses to the lane and a third
laborer refuels the buses. The hourly wage rate for supervi-
Present value per bus per mile was calculated for the total
sors and laborers is $16.00 and $13.95, respectively. Adding cost (the sum of infrastructure, bus-alteration, refueling, and
in benefits of29 percent, 15 days ofpaid vacation, and 8 days
maintenance expenses) of a transit fleet over the estimated
of paid sick leave results in actual wage rates of $22.89 per
30-year lifecycleofthe refueling infrastructure. Considering
hour for supervisors and $19.95 for laborers.
a 5-percent discount rate, it is not surprising that diesel buses
resultinthelowestper-milecost,24.7cents(tableA-8).Diesel
The wholesale, pretax price of diesel used in the study was
and biodiesel buses have the lowest infrastructure cost per
67 cents per gallon, and the price for methanol was 59 cents
bus compared with methanol and CNG/diesel buses. Also,
per gallon. Given the current thin market for biodiesel, the
diesel and biodiesel buses do not incur the added cost of
long-run equilibrium price has yet to be determined. There-
engine and fuel-system conversion required every 10 years.
fore, three prices for biodiesel were used: $1.75, $2.50, and
Another reason for this relatively low cost per mile fordiesel
$3.00 pergallon. The $2.50 pergallon represents theaverage
price of biodiesel. The $1.75 represents an optimistic near- is that the estimated increase in maintenancecosts per month
term scenario and assumes that some lower cost feedstocks is quite lowcompared with the maintenancecosts formethanol.
are used, while the $3 price reflects higher production costs.
As biodiesel is blended with diesel, the cost per mile ranges
T42h.re18ecpernitcsespeforreCquNivGalaelnstogwaelrleonc.onTshiedseerepdr:ic1e4s.0a6r,e2a8s.so1c2i,aatnedd fbbiiroooddmiiee2sse7ell.9ursacneegdntesasntfdorio4tms7.p45r3i.cc8ee.ntcseT,nhtdesepppererensdmeinintlgevaotlonu6et4ho.e5faucmseinotnusgn.tnAelao-tf
CwiNtGh.$1,(A$n2,eqaunidva$l3e,ntregsaplelcotnivieslyt,hepenrum1bemirlloifonBTBUT’Us’sinoaf though thisis 1.8- to2.6-timeshigherthandiesel’s 24.7 cents,
gallon ofdiesel fuel. One million BTU’s ofCNG divided by it is still lower than methanol’s cost of 73.6 cents per mile.
However, methanol blended with diesel should have cost
140,600 BTU’s per gallon of low-sulfur diesel yields 7.1 123
6 Industrial Uses/IUS-5S/November 1995 USDA Economic Research Service
TableA-3--Estimated infrastructureandrefuelingcostsforafleetof300diesel buses
Item Unitcost Units Totalcost
Infrastructurecostperlane 1/
Buildingcost2J $92,000perlane 3 $276,000
Tankage3/ $40,600pertank 4 162,400
Total 438,400
Infrastructurecost perbus 300 1,461
Refuelinglaborcostsperlaneperday4/
Supervisor5/ $22.89perhour 1/3 61
Labor6/ $19.95perhour 3 479
Total 540
Annual refueling laborcosts7/ $3,240perday 365 1,182,600
Annual refuelingcostsperbus
Laborcosts 300 3,942
Fuel usage8/ 67centspergallon 10,392 6,963
Total 10,905
Annualcostpermile9/ 0.298
1/Threelanescanservice360busesatfullcapacity. TheDistrictrefuelsapproximately280busespernightinathree-lanesystem. 21$1,000persquarefoot.
Servicelifeforthebuildingis30years. 3/Atankcapacityof26,666gallonsisrequiredperlane. FourFTP-3fueltanks,withacapacityof20,000gallons
each,wereusedtomeetthisrequirement. Materialandinstallationcostsequal$40,600pertank. 4/Refuelinglaborincludesonesupervisorperthreelanes
andthreelaborersforeachlane. Twolaborersdrivethebusestothelaneandathirdlaborerrefuelsthebuses. 5/Thewagerateforsupervisorsis$16.00
perhour,plusbenefitsof29percent. A40-hourworkweekequals2,080hoursperyear. Subtracting 15daysofpaidvacation,9paidholidays,and8paid
sick-leavedaysyields1,824hoursperyear. Therefore,theactualhourlyrateis$16.00[(2,080/1,824)+0.29]=$22.89. 6/Thesameformulayieldsanactual
wagerateof$19.95perhourforlaborersbasedonanhourlyrateof$13.95. 7/Threelanesat$540perlanetimesanoverheadmultiplieroftwoequals$3,240.
8/Withbusesusinganaverageof866gallonspermonth. 9/With36,578milesdrivenperbusperyear.
Source: TheDenver,Colorado,regionaltransportationdistrict.
TableA-4--Estimated infrastructureand refueling costsforafleetof300Dusesrunningona20-percentbiodiesel blend
Item Unitcost Units Totalcost
Infrastructurecostperlane 1/
Building cost2/ $92,000perlane 3 $276,000
Tankage3/ $40,600pertank 4 162,400
Total 438,400
Infrastructurecostperbus 300 1,461
Refueling laborcosts perlaneperday4/
Supervisor5/ $22.89 perhour 1/3 61
Labor6/ $19.95 perhour 3 479
Total 540
Annual refueling laborcosts7/ $3,240perday 365 1,182,600
Annual refuelingcostsperbus
Laborcosts 300 3,942
Fuel usage8/ $1.036pergallon 10,476 10,853
Total 14,795
Annualcostpermile9/ 0.404
1/Threelanescanservice360busesatfullcapacity. TheDistrictrefuelsapproximately280busespernightinathree-lanesystem. 21$1,000persquarefoot.
Servicelifeforthebuildingis30years. 3/Atankcapacityof26,666gallonsisrequiredperlane. FourFTP-3fueltanks,withacapacityof20,000gallons
each,wereusedtomeetthisrequirement. Materialandinstallationcostsequal$40,600pertank. 4/Refuelinglaborincludesonesupervisorperthreelanes
andthreelaborersforeachlane. Twolaborersdrivethebusestothelaneandathirdlaborerrefuelsthebuses. 5/Thewagerateforsupervisorsis$16.00
perhour,plusbenefitsof29percent. A40-hourworkweekequals2,080hoursperyear. Subtracting 15daysofpaidvacation,9paidholidays,and8paid
sick-leavedaysyields 1,824hoursperyear Therefore,theactualhourlyrateis$16.00[(2,080/1,824)+0.29]=$22.89. 6/Thesameformulayieldsanactual
wagerateof$19.95perhourforlaborersbasedonanhourlyrateof$13.95. 7/Threelanesat$540perlanetimesanoverheadmultiplieroftwoequals$3,240.
8/Withbusesusinganaverageof873gallonspermonth. Thefuelisa20-percentbiodieselblend,withbiodieselat$2.50pergallon. 9/With36,578miles
drivenperbusperyear.
Source: TheDenver,Colorado,regionaltransportationdistrict.
7 Industrial Uses/IUS-5S/November 1995 USDA Economic Research Service
TableA-5-Estimated infrastructureand refuelingcostsfora fleetof300jnethanol buses
Item Unitcost Units Totalcost
Infrastructurecostperlane 1/
Buildingcost21 $92,000perlane 3 $276,000
Tankage3/ $268,148pertank 10 2,681,480
Total 2,957,480
Infrastructurecostperbus 300 9,858
Fuelalterationcostsperbus4/ 29,900
Refueling laborcosts perlaneperday5/
Supervisor6/ $22.89perhour 1/3 61
Labor7/ $19.95perhour 7.5 1,197
Total 1,258
Annual refueling laborcosts8/ $7,550perday 365 2,755,546
Annualrefuelingcostsperbus
Laborcosts 300 9,185
Fuel usage 59centspergallon 19,867 11,722
Lubrizol9/ $15.69 pergallon 12.42 195
Total 21,102
Annualcostpermile 10/ 0.708
1/Threelanescanservice360busesatfullcapacity. TheDistrictrefuelsapproximately280busespernightinathree-lanesystem. 2/$1,000persquarefoot.
Servicelifeforthebuildingis30years. 3/Tenfueltanksarerequiredinsteadoffourbecausemethanolbusesuse,onaverage,2.5timesmorefuel. 4/The
additionalcostperbusforamethanolengineandfuelsystem. 5/Refuelinglaborincludesonesupervisorperthreelanesand7.5laborersforeachlane. Since
2.5timesmorefuelisused,itisassumedthat2.5timesmorelaborisneededtorefuelthebuses. 6/Thewagerateforsupervisorsis$16.00perhour,plus
benefitsof29percent. A40-hourworkweekequals2,080hoursperyear. Subtracting 15daysofpaidvacation,9paidholidays,and8paidsick-leavedays
yields1,824hoursperyear. Therefore,theactualhourlyrateis$16.00[(2,080/1,824)+0.29]=$22.89. 7/Thesameformulayieldsanactualwagerateof$19.95
perhourforlaborersbasedonanhourlyrateof$13.95. 8/Threelanesat$1,258.24perlanetimesanoverheadmultiplieroftwoequals$7,550. 9/Lubrizolis
addedat6.25gallonsper10,000gallonsofmethanol. 10/With29,801 milesdrivenperbusperyear.
Source: TheDenver,Colorado,regionaltransportationdistrict.
TableA-6-Estimated infrastructureand refueling costsforafleetof300 Dual CNG/diesei buses
Item Unitcost Units Totalcost
Infrastructurecostperlane 1/
Buildingcost21 $92,000perlane 8 $736,000
Fuelingfacility3/ 2,320,500
Total 3,056,500
Infrastructurecost perbus 300 10,188
Fuelalterationcosts perbus4/ 35,000
Refueling laborcostsperlaneperday5/
Supervisor6/ $22.89perhour 1/8 23
Labor7/ $19.95 perhour 3 479
Total 502
Annual refueling laborcosts8/ $8,028perday 365 2,930,337
Annualrefuelingcosts perbus
Laborcosts 300 9,768
Fuel usage9/ 40centspergallon 10,764 4,306
Maintenancecosts 400
Compressorenergycosts $1.28perday 365 467
Total 14,941
Annualcostpermile 10/ 0.431
1/Eightlanescanservice300buses. 2/$1,000persquarefoot. Servicelifeforthebuildingis30years. 3/Estimatedinstallationcostsare$1 7million;plus
10percentforcontractor’smarkup; 10percentforengineering;5percentfordevelopmentandpermitting;and 10percentofthe$1.7million,engineering,
development,andpermittingcostsforcontingency. 4/Theadditionalcostperbusforacompressednaturalgas(CNG)engineandfuelsystem. 51Refueling
laborincludesonesupervisorpereightlanesandthreelaborersforeachlane. 6/Thewagerateforsupervisorsis$16.00perhour,plusbenefitsof29percent.
A40-hourworkweekequals2,080hoursperyear. Subtracting 15daysofpaidvacation,9paidholidays,and8paidsick-leavedaysyields 1,824hoursper
year. Therefore,theactualhourlyrateis$16.00[(2,080/1,824)+0.29]=$22.89. 7/Thesameformulayieldsanactualwagerateof$19.95perhourforlaborers
basedonanhourlyrateof$13.95. 8/Eightlanesat$501.77perlanetimesanoverheadmultiplieroftwoequals$8,028. 9/Equivalentgallons. 10/With34,691
milesdrivenperbusperyear.
Source: TheDenver,Colorado,regionaltransportationdistrict.
8 Industrial Uses/IUS-5S/November 1995 USDA Economic Research Service