By Natalie Johnson Vashon-Maury Island Beachcomber staff writer/special to the Journal

Faced with escalating fuel costs and increasingly stringent environmental regulations, the state ferry system hopes to convert at least a quarter of its fleet — including one Vashon boat and two that periodically serve the San Juans — to a new fuel source.

At Washington State Ferries’ biannual community meeting Dec. 6 in Friday Harbor, David Moseley, head of the ferry system, will give an update on the state’s efforts to convert six ferries to run on liquefied natural gas by 2015.The ferry system, looking to cut fuel costs, has been studying liquefied natural gas for about two years, Moseley told the Beachcomber in a recent interview.

LNG seems a logical choice for the ferries. It’s expected to remain significantly cheaper than the diesel fuel that ferries currently use, Moseley said, and it also produces fewer greenhouse gas emissions.

WSF recently got preliminary approval from the U.S. Coast Guard to retrofit the six Issaquah class ferries, including the MV Chelan, Sealth and Issaquah, which serves Vashon, to run on the new fuel. Later on, the 144-car Olympic class ferries, which are currently under construction, may be converted as well.

“I think that liquefied natural gas is a major fuel source of the future,” Moseley said.

The ferries division, given a nod from the Coast Guard, is now working to develop more specific plans, which it will present to the Coast Guard, as well as the state Legislature, for approval as early as this winter. It’s also searching for a private investor, perhaps a natural gas supplier, to help finance the multi-million dollar project.

“It would be a pretty major change for the system,” said Rep. Joe Fitzgibbon (D-Burien), a member of the Legislature’s Joint Transportation Committee. “We want to make sure we look at safety risks and costs and everything before we take any irreversible steps.”

The ferry system, which burns 17 million gallons of fuel a year, has taken a hit in recent years as the cost of diesel has climbed. In 2000, fuel consumed about 10 percent of the ferry system’s budget. Today, fuel costs the ferries $67 million a year, or about 30 percent of the budget. Combine that with decreasing tax revenue, Moseley said, and the state needed to look at its options.

“Obviously (fuel) is a huge expense,” he said.

Retrofitting the six Issaquah ferries to run on LNG would save the state $140 million to $196 million in fuel costs over the lifetime of the vessels. The fuel savings would pay for the $103 million conversion in six to eight years, while the boats have 25 to 30 years left on the water, according to a state study.

Other estimates, however, show the state might not save so much.A report prepared for the Joint Transportation Committee by the Cedar River Group, a Seattle-based consulting firm that has worked with the ferry system in the past, put the cost of the retrofit at $144 million, making the savings less than the state estimate.

Moseley said the ferries division is currently working to refine the numbers but noted that despite the differing numbers, both studies recommended that WSF move forward with the project. What’s more, Moseley said, the ferry system needs to do something to address its greenhouse gas emissions.

New regulations put forward by U.S. Environmental Protection Agency mandate that the ferry system reduce its emissions significantly in the next eight to 10 years. Converting to LNG would allow the system to meet the new standards, Moseley said.

“Both our analysis and the Cedar River Group analysis said this is a direction we should continue to pursue,” Moseley said.

As the state moves forward, it’s looking at a number of hurdles in the transition to LNG. Retrofitting a boat would require it to be taken off the water for several months. Liquified Natural Gas would have to be trucked down from Vancouver, B.C., though it’s possible a plant could eventually be built in the Northwest. The state would also have to make changes in how the boats are refueled. And the U.S. Coast Guard currently has no regulations for LNG-fueled passenger boats, which would be a first in the country.

Natural gas, considered a more hazardous fuel than diesel to transport, is currently highly restricted by the Coast Guard. “It’s totally new territory,” Moseley said.

The state, however, is working closely with the Coast Guard to find terms it can agree on, and Moseley feels the conversion is feasible. Norway, which has large natural gas supplies, has been running LNG-fueled ferries successfully for years, he noted. British Columbia and New York are looking to convert some of their ferries as well, and a major cargo shipping line in the Northwest is well on its way to retrofitting some of its vessels.

“We don’t see any insurmountable obstacles at this point,” Moseley said.

For the San Juans ferry advisory committee, the top concerns at this point involve questions of security and safety. San Juan Island’s Jim Corenman, FAC chairman, said converting the Issaquah class boats to LNG “seems to be a reasonable proposal”, at least on paper, but that issues other than fuel expense should be considered as well, such as “risks versus rewards”.

For example, he said creating a new process and new procedures for re-fueling the boats, ones that require specialized training because LNG is highly flammable, much more so than diesel, could prove to be a safety risk and add to operational expenses. In addition, he said it’s unclear at this point whether those ferries, equipped with one or two cryogenic tanks carrying up to 50,000 gallons of LNG on top of a passenger cabin, pose a greater security danger than they are today.

“I think we and the pubic need to have a discussion about all the safety issues involved and be able to weigh in on that,” he said. “That hasn’t happened yet.”

A study is under way that may help shed light on many of the questions involving safety and security, Corenman said.

In Olympia, Fitzgibbon said lawmakers were open to considering liquefied natural gas, but there were still many unanswered questions on their end. It will be one of a gamut of ferry-related issues the Legislature considers when it convenes in January.

“We like the fact that certainly there would be less greenhouse gas emissions and particle emissions. … We just need more information to find out if this is a realistic plan to move forward with,” he said.

— Journal editor Scott Rasmussen contributed to this report.