The really true cost of converting to natural gas

By Bill Smith

Mr. Slone’s opinion piece (in last week’s Homer Tribune) purporting to calculate the true cost of converting to natural gas made some salient points about the need to understand conversion costs. Unfortunately, he missed the case studies I had presented to the Council months ago, and which are now posted on the City website for all to see.
I presented a detailed analysis of eight homes and two businesses in order to give a fair sample of how much conversion would cost in those specific buildings and then compared that cost to the savings that would accrue from conversion to natural gas. This approach was taken in order to give real world examples of the cost vs benefit of conversion.
A little about my background is in order to establish my perspective on these issues.
Early in my working career, I worked for Anchorage Natural Gas for four years, then moved to work for a propane company for another four years. I went on to become an Alaska registered mechanical administrator and ran my own mechanical contracting company for 29 years. In those years, I designed and installed a great many heating and ventilating systems, utilizing gas, oil, wood and coal systems with a very minor touch of solar. In short, I have a great deal of experience with the issues at hand.
I must take issue with Mr. Slone’s wildly inaccurate estimate and urge people to check out the Homer City website offering information on the details of main extensions and conversion. The salient page can be found here on the publications page under Supporting Documents:
I provided the case studies, the chart showing “savings to a typical home,” and the “savings to public buildings” charts. These compilations have been constructed with due diligence and they are as accurate as I can make them. Please review these items and use the accurate evaluations rather than the well intentioned, but misleading estimate of Mr. Slone.
After examining the benefits to our homes, businesses and government buildings, I felt compelled to work at bringing natural gas to our area. It took some years and some setbacks and I was only a small player, but with the work of a lot of people, we are on the verge of being able to supply a far less expensive fuel for our community.
While collecting data, I was greatly moved when the owners of small businesses downtown were telling me they were not taking a salary in order to remain open and pay their fuel bills. We must change this.
Natural gas will be the single biggest economic benefit we could ask for. Our businesses will hopefully be profitable in the winter, our cost of government will go down and, heck, you may be able to afford that winter vacation, or a new pair of shoes for the kiddies.
I recognize that there will be upfront costs involved in converting to natural gas, but I think of that as an investment. Even when adding the cost of the main in the street, the case study buildings had an average return on investment of less than 4.5 years. That is better than 22 percent ROI.
When it comes to environmental costs, our natural gas supply does not come from fracking processes, it is much less polluting than fuel oil or electricity generated by burning gas, and is needed to reduce our greenhouse gas emissions while we wait for alternative energy sources to become feasible and available.
To assess the cost of converting to natural gas, we must each do our own research to see what fits our own building. There is no way the City, or someone else, can hand you the answers on a platter. I have been impressed by the answers I found, and I think you will be as well.

Bill Smith is a Kenai Peninsula Borough Assemblyman representing Homer and an electrical construction manager working for Puffin Electric. He has worked on gasline issues for the past few years, assisting the City of Homer in a volunteer capacity.

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Posted by on Oct 24th, 2012 and filed under Point of View. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

2 Responses for “The really true cost of converting to natural gas”

  1. deb says:

    Thank you Bill for taking the time and doing the research to present the FACTS of the cost of conversion instead of the wild numbers and false rates.

    I agree, natural gas is going to save our community. It is essential to our well being. We need it and we are so close! thanks

  2. concerned sourdough says:

    If not fracking, what then is the process for extracting natural gas, Bill?

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