Diesel Gallon Equivalent Standard Adopted for Natural Gas Sales

The National Conference on Weights and Measures (NCWM) recently voted to approve the diesel gallon equivalent (DGE) standard as a legally authorized method of sale for natural gas that is sold as motor fuel.

According to NGVAmerica, the DGE standard allows for the ready comparison of natural gas with diesel fuel.

The DGE standard complements the gasoline gallon equivalent standard that was previously adopted by NCWM and has been in place for compressed natural gas (CNG) since 1994. According to NGVAmerica, the adoption of the DGE standard also fills a void for liquefied natural gas (LNG), which, although sold by most retailers in DGE units, previously lacked a uniformly recognized standard.

The adoption of the DGE standard is the culmination of a more than three-year process of industry working with the NCWM to adopt an approach for selling LNG. The NCWM’s action also means that the DGE unit will be available for CNG retailers who want to use the unit for their retail sales to fleets.

NGVAmerica led a coalition of national trade associations, fuel providers and retailers, natural gas utilities, trucking fleets, and retailers to make the case for adoption of the standard.

“NGVAmerica thanks the NCWM leadership for its thoughtful consideration of this issue and for working with the natural gas vehicle industry to get this done,” NGVAmerica President Matthew Godlewski said. “This successful vote was the culmination of years of hard work by NGVAmerica staff, our members, industry allies, and public officials with the shared goal of transparency for the customer.”

In addition to providing a unit of sale for fuel retailers and consumers, the DGE standard provides a benchmark for consistency with taxation methods and creates efficiencies associated with accounting and record-keeping requirements, according to NGVAmerica.

Twenty-eight states currently use the DGE for taxing LNG, and 10 states have enacted legislation or approved regulations recognizing the DGE as a standard for dispensing natural gas.