Wisconsin Natural Gas for Transportation Roundtable

Presented by: Andy Grimmer

General Manager

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Who is ANGI?

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> We are a focused, worldwide supplier of CNG refueling systems with over 30 years of experience

Who is ANGI?

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> We design, manufacture, test, and deliver CNG fueling equipment and systems from our headquarters in Janesville, Wisconsin, USA (305 W Delavan Drive)

Who is ANGI?

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> We have a broad line-up of CNG refueling products and equipment support services:

> Dryers > Compressors > Gas Panels > Storage Solutions > Dispensers > Controls > Maintenance and Support

Services > Machine/System Monitoring

Services > Training Services

Inlet Gas Dryer

Compressor

Priority Panel Controls

Dispenser

Storage

■ First component connected to the gas supply, which serves to remove water vapor from the gas prior to entry to the compressor

■ As gas loses its ability to hold moisture once it is compressed, it needs to be dried to prevent moisture from condensing out in the storage station or in the vehicle storage containers, which can lead to blockage and/or corrosion

■ Provides storage of CNG prior to dispensing

■ Available in two primary types: ASME (American Society of Mechanical Engineers) coded vessels and DOT cylinders (designed and constructed to Department of Transportation standards)

■ Main component of any system, used for taking pipeline quality gas delivered at very low PSIG up to levels used for fueling

■ Consists of the compressor, natural gas engine or electric motor, engine cooler and the recovery tanks

■ Natural gas from the dryer enters the inlet filter where the gas is cleaned of any particulates

■ Natural gas is then condensed over 2-5 stages based on the design of the system and condensates are removed before the gas flows to its next stage

■ Receives the compressed gas from the compressor and direct the gas flow to either high pressure storage or directly to the vehicle dispenser

■ When multiple dispensers or storage tanks are being utilized, the priority panel ensures proper flow

■ Utilized as the connection point between the CNG fueling system and the vehicle or tank controls

■ Gas is delivered to the dispenser from the compressor(s) and/or storage containers and passes through a fast closing valve

■ When a vehicle connects and authorizes the dispenser, the automatic fast closing valve opens and allows gas to flow through the filter, water, temperature compensation system and fill hose to the vehicle

■ Distributed control systems that use advanced Programmable Logic Controller (PLC) and embedded system designs

■ Offers remote communication and monitoring of system components, such as compressors and dispensers, and of the overall gas management process

Who is ANGI?

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> We deploy our products in fully engineered and well integrated CNG fueling systems of almost any size or complexity

Who is ANGI?

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Update!…ANGI was recently acquired by Danaher Corporation (DHR) (June, 2014)

ANGI will be operating under the Gilbarco Veeder-Root Division of Danaher Corp.

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North American CNG Industry Updates and

Trends

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Trucking Service Fleets, Shuttles & Taxis Refuse Transit High Horsepower

Some of the largest truck fleet operators in the world have begun adopting natural gas fueled trucks to move their freight

From the largest refuse company in the U.S. to some of smallest independent operators, refuse companies are increasingly investing in NGVs, driven mainly by the tremendous savings in fuel costs

Two-thirds of all the natural gas being used as a transportation fuel in the U.S. goes into the country’s transit systems

Natural gas currently powers more than 11,000 transit buses across the U.S.

Airports are increasingly adopting NGVs as a way to comply with federal and state air quality plans

NGVs include hotel, parking and airline crew shuttles, charter vehicles and taxis

Regulations and the availability of natural gas has created an opportunity within traditional diesel fuel consuming markets including marine, railroad, mining, construction and oil and gas production

Source: (1) ACT and the National Petroleum Council. (2) Cummins Westport.

Important CNG Market Segments

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Source: (1) ACT and the National Petroleum Council. (2) Cummins Westport.

Adoption Rates

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2013 2014 2015 2016 20170.0%

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1951 1961 1971 1981 1991 2001 2011 20210.0%

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1996 1998 2000 2002 2004 2006 2008 2010

Forecasted Class 8 Market Penetration CNG and LNG Vehicles % of Total U.S. Fleet (1)

> The Natural Gas Industry has Reached the Tipping Point

“[In a couple of years, 1 in 3 Navistar trucks sold will burn natural gas]…This is not a subsidy-driven market…It's developing on its own because the economics are compelling“

Eric Tech, President (Engine Business)

Sales of New Natural Gas Refuse Trucks (2)

Class 8 Trucks Transit Refuse

“WM’s strategy is to replace 80% of its new refuse vehicles with natural gas trucks and build 25 new natural gas fueling stations each year.”

Eric Woods, VP of Fleet & Logistics

“By transitioning our entire fleet to CNG… we are able to offer our nearly 40 million annual bus customers a more sustainable and cost-efficient transit experience”

Mike Hubbell, VP

ACT Research

National Petroleum Council

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The largest opportunity

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2013 2014 2015 2016 2017

Forecasted Class 8 Market Penetration

Class 8 Trucks

ACT Research

National Petroleum Council

Input(From http://www.eia.gov/forecasts/ieo/transportation.cfm)

(from http://www.ucsusa.org/clean_vehicles/why-clean-cars/oil-use/)

(from ANGI)4) Average CNG station produces 12.5 gallon per min5) Average operating time of compressors is 12 hours per day x 6 days per week

Equates to: 2808000 (gallons per year)

CalcConsumption (current) 1E+15

2010 2020 aveHeavy Duty 5.1 6.3 5.7

Total 5.1 6.3 5.7

95% 4.845 5.985 5.415

1% (quardillion BTUs) Total 0.04845 0.05985 0.05415

1% (Gallons, Gasoline) Total 417,348,609 515,548,282 466,448,445 (based on 116,090 BTU/gallon)

station count = (1% number)/typical capacity per year

149 184 166

BTUs (quardillion)

1) U.S. light-duty vehicle energy demand declines from 16.5 quadrillion Btu in 2010 to 14.9 quadrillion Btu in 2020 and 13.0 quadrillion Btu in 2040

2) U.S. energy demand for heavy-duty vehicles (including tractor trailers, buses, vocational vehicles, and heavy-duty pickups and vans) increases the fastest among transportation modes, from 5.1 quadrillion Btu in 2010 to 6.3 quadrillion Btu in 2020 and 7.6 quadrillion Btu in 2040.

3) Oil accounts for more than 95 percent of all the energy used for transportation in the United States

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> Key Industry Drivers Issues Impacting Adoption

Leading Designer, Engineer and

Manufacturer of Fully-Integrated CNG

Fueling Systems

Cost Versus Diesel / Gasoline The significant cost differential between

natural gas and diesel, of as much as $2.00 per DGE, is fueling the adoption of natural gas as a transportation fuel

Savings in fuel costs translate into significant savings over the life of a vehicle providing attractive payback periods to vehicle owners

Continued Development of Natural Gas Engines and Related Technology Sector is marked by very

well financed and dedicated OEMs delivering real technology solutions to end-users

Cummins-Westport 11.9L engine launched in 2013

Private industry focused on setting up natural gas networks/corridors

Infrastructure roll-out expected to grow commensurate with the strong growth of CNG vehicles in the U.S.

Energy Independence

Emissions Regulations and Natural Gas as a Cleaner & Safer Fuel Manufacturers increasingly

turning to NGVs to meet stringent emissions and CO2 requirements

Lowest emissions levels among competing fossil fuels

Mature technology allows for safe handling

Vast domestic supply of natural gas, coupled with advanced drilling techniques, leading to lower dependence on foreign oil imports and reduced potential for foreign supply disruptions

Vehicle Payback

Fueling Infrastructure

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> (TREND) The decision matrix is maturing and is increasing based on actual operating experience

> Large issues at hand which may increase adoption > Lower differential cost between CNG

vehicle and diesel counterpart > Expanded refueling station network > Tighter emissions regulations > Broader vehicle offering

> Large issues at hand which may imped adoption > Smaller fuel price spread

Issues Impacting Adoption

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>Traditional” fuel retailers >C-Stores >Truck Stops >Grocery/Warehouse stores >Fleet Fueling Providers >Fleets (Public and Private) >Gas Producers and LDCs

Multiple Stakeholders are Investing in CNG Fueling Infrastructure

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> Currently About 1,600 CNG Stations in the USA > About ½ have some level of public access > Station count has increased about 15% YOY for the past 3 years

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Current

Public 671

Private 661

Planned (1)

Public 100

Private 45

(Q1 - 2014 Data)

TREND – On Average new station capacity is increasing (built for fueling trucks) TREND – Larger percentage of the stations are designed for public access TREND – Stations are moving toward truck routes TREND – State Gov. subsidy is promoting station develop.

Station Density and Count

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“Crystal Ball” – > More fleets from more market segments will be able to

complete an ROI evaluation that justify the move toward CNG away from diesel when routes and vehicle applications are a fit. > Return to base and short route trucking, trash hauling and transit. > Emerging fleets include beverage, parcel deliver and service fleets

such as lawn care, HVAC, snow removal, etc. > More product offerings and lower differential cost in the CNG

vehicle are needed to move a broader portion of the market > Technology improvements will be delivered to the market to

improve the performance of the vehicle and the station > Regulatory oversight will increase which will be good for the

industry (EPA, Safety, Custody Transfer, Codes)

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THANK YOU Fuel for the World Ahead