Purchase Order for CNG Fuel
June 3, 2025
DATE: June 3, 2025
TO: Honorable Mayor and City Council
FROM: Paul Cranmer, Public Works Services Director
By: Daniel Vargas, Management Analyst
SUBJECT: PURCHASE ORDER WITH CLEAN ENERGY FOR THE PURCHASE OF COMPRESSED NATURAL GAS (“CNG”) FUEL FOR THE CITY’S FLEET, IN AN AMOUNT NOT TO EXCEED $150,000
CEQA: Not a Project
Recommendation: Approve
SUMMARY
The City primarily utilizes the Compressed Natural Gas (“CNG”) fueling station located at the Foothill Transit Center, operated by Clean Energy, to fuel its CNG vehicles. The Purchase Order with Clean Energy expires on June 30, 2025. It is recommended that the City Council approve a sole source Purchase Order with Clean Energy to purchase CNG fuel for the City’s fleet, in an amount not to exceed $150,000 for Fiscal Year 2025-26.
BACKGROUND
The Public Works Services Department (“PWSD”) has been strategically replacing vehicles that meet the City’s Vehicle Replacement Policy with alternative fuel vehicles such as CNG, Hybrid, and Electric vehicles. This approach has allowed the City to meet the Air Quality Management District’s mandates that heavy duty equipment be replaced with alternative fuel vehicles, as well as reducing Arcadia’s overall fuel costs and greenhouse gas emissions. The PWSD is responsible for the purchase of CNG fuel and currently operates a fleet of 16 heavy-duty CNG vehicles, which includes five one-ton pickup trucks, three street sweepers, three dump trucks, two sewer jetter vacuum trucks, one water tanker truck, one aerial lift truck, and one hydro-excavator truck.
DISCUSSION
The PWSD utilizes two local CNG public fueling stations to fuel all City CNG vehicles.
The first station, owned by Foothill Transit, is located less than 0.5 miles from the Public Works Service Center. The second station, owned by the City of Pasadena, is located on Foothill Boulevard, west of City limits. Clean Energy is the sole source of CNG fuel and the service provider for both of these fueling stations. There are no other viable CNG fueling stations in the immediate area. Therefore, utilizing a sole source purchase order is necessary.
Purchase Order for CNG Fuel
June 3, 2025
The PWSD has vehicle fueling cards provided by Clean Energy and is invoiced monthly for fuel purchased at these two stations. It is estimated that the PWSD will use approximately 27,400 Gasoline Gallon Equivalents (“GGE”) of CNG by the end of Fiscal Year 2024-25. This usage reflects a 0.48% decrease from the previous fiscal year. It is anticipated that an additional 400 GGEs of CNG will be utilized in Fiscal Year 2025-26 with the recent purchase of a new CNG dump truck, which replaced an existing petroleum gasoline dump truck. The total expected usage of CNG for Fiscal Year 2025-26 is 27,800 GGEs.
In recent years, the price per GGE of CNG has steadily decreased. During FY 2024-25, the City paid on average $5.02 per GGE, which includes state fuel tax fees, as compared to $5.08 in FY 2023-24, and $5.51 in FY 2022-23. CNG fuel prices are projected to remain relatively stable throughout FY 2025-26, as reflected in monthly transaction trends; however, price spikes can occur and are not uncommon. It is recommended that the Fiscal Year 2025-26 Purchase Order reflect the estimated average cost of $5.02 per GGE for the expected 27,800 GGEs of CNG, plus an additional $10,000 for unforeseen price increases or extra demands. Based on these projections, at least $149,556 will be needed to cover the expected costs in FY 2025-26.
ENVIRONMENTAL ANALYSIS
The proposed action does not constitute a project under the California Environmental Quality Act (“CEQA”), as it can be seen with certainty that it will have no impact on the environment.
FISCAL IMPACT
The request is to purchase CNG fuel for the City’s fleet in an amount not to exceed $150,000. Sufficient funds have been budgeted in the Department’s proposed Fiscal Year 2025-26 Operating Budget for the purchase of CNG fuel.
RECOMMENDATION
It is recommended that the City Council determine that this action does not constitute a project under the California Environmental Quality Act (“CEQA”); and approve a Purchase Order with Clean Energy for the purchase of Compressed Natural Gas (“CNG”) fuel for the City’s fleet, in an amount not to exceed $150,000.