City Council Meeting: June 14, 2011

Agenda Item: 3-F

To:†††††††††††††† Mayor and City Council 

From:†††††††††† Stephanie Negriff, Director of Transit Services

Subject:††††††† Supply and Deliver LNG Fuel to the Big Blue Bus

 

 

Recommended Action

Staff recommends that City Council:

  1. Award Bid No. 3024 to Clean Energy, a California based company, for the purchase and delivery of Liquefied Natural Gas (LNG) fuel.
  2. Authorize the City Manager to negotiate and execute a contract with Clean Energy in the amount of $12,500,000, for a term of one year with four additional one year renewal options.

 

Executive Summary

The purchase of LNG fuel supports Santa Monicaís Sustainable City Plan for reduced emissions and sustainability. Staff recommends that Clean Energy provide LNG fuel for the Big Blue Bus (BBB) at specific unit prices plus applicable sales tax. The bid award is for a one year period with four additional one year renewal options. The total expenditure for the five year term would be $12,500,000.††††††

 

Background

 

The BBB currently operates a fleet of 125 natural gas transit coaches which run 100% on domestically produced natural gas. An additional 15 coaches powered by natural gas will be added by December 2011. The BBB currently consumes approximately 270,000 gallons of LNG a month. As transit coaches are replaced, the BBB will continue to expand its natural gas fleet, which requires a reliable supply of fuel from a proven and qualified LNG provider.

 

Discussion

On March 9, 2011, the City published Notices Inviting Bids to supply and deliver LNG fuel for the Big Blue Bus in accordance with City specifications. Bids were received and publicly opened and read on March 23, 2011, per Attachment A. Bids were evaluated based on competitive pricing, bid response time, vendor experience and references. Based upon these criteria Clean Energy is recommended as the best bidder.

 

Clean Energy has been delivering LNG fuel to the BBB since 2006. The fuel will be produced locally in Boron, California and be delivered by LNG-powered tanker trucks.

 

Financial Impacts & Budget Actions

The contract amount to be awarded to Clean Energy for this five-year term is $12,500,000.Funds in the amount of $2,500,000 have been included in the proposed budget in account number 41654.522975 for FY 2011-13.Future funding for additional years will be requested in future yearís budgets and will be contingent upon Councilís approval.All monies expended for the purchase of LNG fuel will be from transit specific funding sources.

 

Prepared by: Ralph Merced, Transit Maintenance Manager

Attached:†††† Attachment A

 

Approved:

 

Forwarded to Council:

 

 

 

 

 

 

Stephanie Negriff

Director of Transit Services

 

Rod Gould

City Manager