MILLVILLE — South Jersey Gas on Monday opened a $2 million natural gas fueling station at its North Second Street divisional office, the latest in a slowly growing infrastructure to support the cheaper-than-gasoline fuel.
The Folsom-based company — a utility that predominantly brings natural gas into homes — has started stretching into this business segment of compressed natural gas stations for trucks and cars.
South Jersey Gas opened one last year at its Glassboro, Gloucester County office, and may build another five in the next five years, President Jeffrey DuBois said.
“A lot will depend on the demand. We’re in the process of evaluating how many stations we need for our fleets,” he said.
A subsidiary of energy services holding company South Jersey Industries, South Jersey Gas will gradually replace its entire fleet of 170 with natural gas powered vehicles in the next decade, spokesman Dan Lockwood said. The company will be using 35 such vehicles by the end of 2013.
The Millville station is one of about 30 in New Jersey, but among only seven that are fully open to the public, said Chuck Feinberg, the founder of New Jersey Clean Cities Coalition, a Rockaway, Morris County-based nonprofit that promotes alternative fuels.
Fully public natural gas stations in South Jersey are now in Millville, Glassboro, Camden, and two in Egg Harbor Township (for the Atlantic City Jitney Association and the Atlantic County Municipal Utilities Authority), he said.
Compressed natural gas, or CNG, currently has some competitive advantages against gasoline, as well as some major shortcomings.
The Millville station on Monday was charging about $1.97 for the equivalent of a gallon of gas, compared to an average of $3.43 for regular gasoline and $3.63 for diesel in Atlantic and Cape May counties, according to AAA’s Daily Fuel Gauge Report.
DuBois estimated the company will save $1 million on fuel when all its vehicles run on natural gas.
The dropping cost of natural gas has made the alternative fuel practical, where it was not five years ago, South Jersey Industries CEO Edward Graham said.
Heavy-duty fleet vehicles such as trash trucks are driving most of the market — fleet vehicles often return to the same spot every day to fuel up.
But owners of regular passenger vehicles may struggle to find natural gas stations on longer trips, a hindrance also shared by today’s electric cars.
And the natural gas vehicles themselves are much costlier — about $25,000 more for South Jersey Gas work trucks and $7,000 more for the natural gas-powered Honda Civic, DuBois said.
“CNG has always been a chicken and the egg. I don’t want to pay to convert my car to CNG because there’s no place to fill it up. Nobody wants to build a station because there are not enough cars to use them. That’s when we made the decision to build a station for us and start converting our fleet in a 10-year process,” he said.
“It’s a whole new avenue for us as far as potential for serving a new customer base and it’s going to take a long time to build,” he said.
South Jersey Gas opened its first compressed natural gas fueling station in March 2012 in Glassboro and has sold the natural gas equivalent of 100,000 gallons since then, Lockwood said.
DuBois said 44 percent of the gas distributed at that station powered South Jersey Gas-owned vehicles. The majority was sold to other fleet vehicles, with Waste Management of South Jersey its biggest customer.
The trash and recycling hauler is using the Glassboro and Millville facilities, said Eric Wakefield, a Millville resident and district manager for Waste Management of South Jersey.
In the region, the hauler currently has 11 compressed natural gas vehicles, about 15 percent of its local fleet, Wakefield said.
DuBois said the company has not decided where South Jersey Gas will build its next station, although it is looking at possible locations in Woodbine and in Middle Township, he said.
The pumps look like ones at traditional gas stations and take a similar amount of time to fuel. They are all self-service.
Contact Brian Ianieri: