Fuel Costs Cut in Half After Switching Delivery Trucks to CNG

November 5, 2007

(Signal Hill, CA) -- As the owner of one of Southern California's most successful and well-known dessert bakeries, Rossmoor Pastries, www.rossmoorpastries.com, Charles Feder prides himself on being a savvy businessman. Like many businessmen, Feder watched in frustration in recent years as rising oil prices cut increasingly deeper into his company's bottom line.

At a recent auto auction Feder came across a compressed natural gas Dodge van with 14,000 miles selling for $4,300. Unfamiliar with natural gas-fueled vehicles but sensing a good bargain, the 72-year-old New York native bought the van on the spot in April 2006.

But it wasn't until he found a public CNG fueling station near his Redondo Avenue business that Feder realized the vehicle's cash-saving advantages.

While gasoline was retailing for more than $3 per gallon at the time, CNG fuel was selling for $1.50 or less. Feder told his business partner Janice Ahlgren, who together purchased Rossmoor Pastries in 1988, and they sat down to do the math.

Rossmoor's fleet was burning 70-plus gallons of gas per day delivering cakes, cookies and other sugary treats across the region. By converting the entire nine-vehicle fleet to CNG, monthly fuel bills could be cut in half overnight. Within a few months, Rossmoor Pastries had purchased seven more slightly used CNG vans and one passenger car.

The company's total cost for the fleet, after selling off the old gasoline fleet and making some minor alterations to the new vehicles, was $18,000. Feder's curiosity about CNG grew, and after doing some research into public grants and tax credits, he realized the savings could go much further.

A contractor was hired to build a compressor and pump that connected an existing municipal gas line to three fuel pumps Feder had installed in the bakery's parking lot. The private fuel station, known as a "slow-fill" station, cost about $50,000, but after taking advantage of a 30 percent tax write-off from the federal government, and collecting an $18,000 grant from the South Coast Air Quality Management District, Feder's total cost dipped to $15,000.

And that cost disappeared in a few months due to savings in fuel bills.