Interim Joint Committee on Natural Resources and Environment


Minutes of the<MeetNo1> 1st Meeting

of the 2014 Interim


<MeetMDY1> June 5, 2014


Call to Order and Roll Call

The<MeetNo2> 1st meeting of the Interim Joint Committee on Natural Resources and Environment was held jointly with the Special Subcommittee on Energy on<Day> Thursday,<MeetMDY2> June 5, 2014, at<MeetTime> 10:00 AM, in<Room> the West Ballroom of the Owensboro Convention Center in Owensboro, Kentucky. Senator Jared Carpenter, Chair, called the meeting to order, and the secretary called the roll.


Present were:


Members:<Members> Senator Jared Carpenter, Co-Chair; Representative Jim Gooch Jr., Co-Chair; Senators Joe Bowen, Ray S. Jones II, Jerry P. Rhoads, Brandon Smith, and Whitney Westerfield; Representatives Tim Couch, Keith Hall, Tim Moore, Jim Stewart III, and Jill York.


Guests: Matt Tackett, Kentucky Gas Association; Mark Satkamp, Louisville Gas and Electric; Don Cartwright, Delta Natural Gas Company, Inc.; Melissa Howell, Kentucky Clean Fuels Coalition; and Dr. James Klauber, Owensboro Community and Technical College.


LRC Staff: Tanya Monsanto, D. Todd Littlefield, Janine Coy-Geeslin, and Susan Spoonamore, Committee Assistant.


The Natural Gas Industry in the Commonwealth

Matt Tackett, Executive Director, Kentucky Gas Association (KGA) explained that the membership and function of the KGA board is to set the mission for the association.


Natural Gas as a Transportation Fuel

 Melissa Howell, Kentucky Clean Fuels Coalition, stated that the coalition is a nonprofit organization that supports the use of clean transportation. Ms. Howell discussed using natural gas as a transportation fuel, specifically touching on expansion of the natural gas fleets, infrastructure, policy, and education.


Ms. Howell stated that freight transportation is the investment focus for natural gas because of higher returns. Infrastructure investment continues for compressed natural gas refueling stations and some for liquefied natural gas. Educational initiatives and workforce training are two new trends. She said that the Owensboro Community and Technical College is working with several partners to provide the next generation of auto technicians the expertise for different fuels and new technologies. There are few technicians with expertise in clean fuels technologies such as natural gas, propane, fuel cells and plug-in hybrids.


Technician Training for the 21st Century

Dr. James Klauber explained the three year history of the clean fuels education project at Owensboro Community and Technical College. He said that the program started with renovating the automotive and diesel programs. Because of financial assistance from a multicounty coal severance grant, the college has been able to leverage an $800,000 dollar National Science Foundation grant. The National Science Foundation has also given notice of its intent to help fund the program. The Owensboro Community and Technical College hopes to develop a curriculum on renewable/alternative fuels and offer statewide training. This program, the first of its kind, will be a model for the nation. Corporations have already expressed a desire to switch their fleets to compressed natural gas and the college will work to train existing workforces and provide a certification for graduates.


Legislators commended the use of coal severance money for educational initiatives.


In response to questions, Dr. Klauber said that most schools offer automotive training but do not offer training in alternative fuels. He said that approximately one-third of the nation’s schools offer a component in alternative fuels but not a complete program.


In response to questions regarding access to private fueling stations for alternative fuels like natural gas, Ms. Howell said that Louisville, Lexington, Carrollton utilities, and Somerset have refueling stations open to the public. She said that in the 1990s, public refueling stations were closed due to the high costs. Refueling stations are a major investment, which is why there is more interest in investing in fleet stations and freight. The Clean Fuel Coalition is working with a firm in Chicago to use methane from an abandoned coal site to do refueling in Western Kentucky.


In response to comments, Ms. Howell said that creating natural gas from coal is not economically feasible. Natural gas works for aviation ground support vehicles because of the size of their fleets.


In response to questions about refueling school buses, Ms. Howell stated that after the Carrollton bus crash, buses were prohibited from using anything other than gasoline and diesel. However, Crittenden County is conducting a pilot program using propane for school buses which has already demonstrated cost savings to the school system. In the future, school systems will be able to order propane buses, and hopefully the rule will also allow for natural gas usage.


Natural Gas Reliability

            Mark Satkamp, Louisville Gas & Electric, described the company gas system and planning process under the duress of winter 2013-2014, which was Kentucky’s sixth coldest winter on record. The systems performed adequately given the duration of the extreme cold temperatures


            In response to questions, Mr. Satkamp explained that an adequate supply is defined by use for traditional customers, but does not include gas supply for electric generation. Future natural gas use for electric generation will likely be connected to the interstate pipeline, and supply will be predicated on pipeline capacity.


            Dan Cartwright, Delta Natural Gas (DNG), provided an update on the Delta gas system, located in central and eastern Kentucky. DNG is supplied by companies such as Columbia Gulf, Kinder Morgan, and Texas Gas. DNG has not seen a change in supply capacities, and there is an adequate supply for electric generation. The company has the ability to tap onto other pipeline systems, and it has backup equipment, both of which improve the reliability of the system. DNG has examined high pressure storage facilities that would allow for the free flow of natural gas throughout the system. It monitors the pipeline system twenty-four hours each day of the year, and the employees who maintain the system are trained and skilled.


            In response to questions, Mr. Cartwright said that even though DNG was slightly behind its goal for storing gas, it should be fully restored by winter.


            Senator Carpenter, Co-Chair, discussed the United States Environmental Protection Agency’s proposed regulation of greenhouse gases. Kentucky continues to push for affordable energy without devastating the economies of the eastern and western Kentucky coal fields.


            As general information to the committee, Chairman Carpenter identified a statement, provided by a constituent, which pertained to an administrative regulation on catfish harvesting from the Ohio River.


            Senator Harris commented that there was a bill in this year’s 2014 session that would have given the legislature more authority over administrative regulations, but the bill did not pass.


The committee adjourned at 11:30 AM (CDT).