A Citizens Energy Group subsidiary has scored an eight-year contract to provide alternative fuel to United Postal Service, the Indianapolis utility announced Tuesday.
Kinetrex Energy in March will begin supplying liquefied natural gas to five of UPS’s fueling stations in Indiana, Illinois, Ohio and Missouri. UPS announced in October that its new fuel infrastructure was large enough to support about 1,000 vehicles.
The companies did not disclose a dollar value for the contract, but it is “by far” the largest for the new subsidiary. Terms include providing up to 2 million gallons of fuel per month, said Citizens spokesman Dan Considine.
“Having the opportunity to supply LNG to a global company like UPS puts Kinetrex Energy one step closer to becoming the Midwest’s leading LNG provider,” Carey Lykins, president and CEO of Citizens Energy Group, said in a prepared statement. “With LNG from Kinetrex, UPS will burn a significantly cleaner and less expensive fuel produced here in America.”
As its name implies, the fuel type is natural gas chilled into liquid form. Citizens says the fuel costs about 40 percent less than diesel and reduces greenhouse emissions by 20 percent.
The agreement is part of a UPS initiative to make its vehicles drive 1 billion miles using alternative fuels and other advanced technologies by 2017, Zachary Scott, president of UPS’ Ohio Valley District said in a prepared statement.