ATTACHMENT 1

There are essentially six fuel types available to, and used by, the Town:  kerosene; diesel; two biodiesel blends, B-20 biodiesel (80% diesel, 20% biodiesel) and B-20 biokerosene (80% kerosene, 20% biodiesel); gasoline; and compressed natural gas (CNG).  The majority of our heavy municipal fleet (trash trucks, dumps, fire trucks, etc.) can run on either regular diesel fuel or the B-20 blend.  Our buses can run on kerosene (ideal, given engine design) or regular diesel, and our police cars and most transport vehicles use unleaded gasoline.  A small number of vehicles use CNG. 

In fiscal year 2002-2003, biodiesel fuel became available for purchase via the State of North Carolina Division of Purchasing and Contracting.  The Town of Chapel Hill began using B-20 biodiesel as primary fuel for the diesel-burning municipal fleet, excluding transit buses, during the fourth quarter of fiscal year 2002-2003. Since that time we have used B-20 biodiesel exclusively for our municipal fleet except for short periods of time when the market price of biodiesel exceeded our budgeted price for fuel. 

We considered the possibility of using B-20 biodiesel in our transit bus fleet at the same time we made the transition to biodiesel in the general municipal fleet; however, we decided against it for reasons related to cost and air quality.  At that time, the cost of B-20 biodiesel was consistently higher than kerosene bus fuel.  Based on our research at that time, we concluded that kerosene was also a cleaner burning fuel than B-20 biodiesel.  The only way to achieve air quality improvements over kerosene would have been to blend a mixture of 80% kerosene and 20% biodiesel; however, the cost of this blend was higher than pure kerosene and the air quality improvement benefits were marginal or inconclusive.

B-20 biodiesel fuel (80% diesel/20% biodiesel) is readily available to the Town via the State contract.   The same supplier, World Energy, can also provide us with pure B-99 biodiesel or a B-20 biokerosene (80% kerosene/20% biodiesel).  We recently purchased B-99 biodiesel through Piedmont Biofuels, Pittsboro, North Carolina.  We purchased 1,000 gallons of B-99 from Piedmont Biofuels during the fuel supply disruption after Hurricane Katrina.  Our gasoline is purchased through the State Contract and our natural gas though our local supplier.