Fuels Market News Magazine Summer 2021

SUMMER 2021

FULL CHARGE

What China’s hold on the lithium battery market might mean for EVs

In the Lead: Broco Oil’s Robert and Angela Brown

Truckers Wanted Facing the Driver Shortage

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SUMMER 2021

34 Will China Be the COVER STORY

New OPEC?

Beijing’s dominance of the lithium battery market raises questions with the rush toward EVs.

FuelsMarketNews.com

40

In the Lead

46

Trucker Shortage Hits Home

A dynamic fuel marketer duo takes service to a new level at Broco Oil.

A lack of drivers is challenging the trucking industry and impacting retailers.

FMN Magazine SUMMER 2021 | 1

04 From the Editor 06 NACS News 10 Fuels Institute 12 Fueled for Thought RETAILER OPERATIONS 14 M oving Forward by Charging Up

What to look for as the EV market expands in the coming years.

16 5 Ways SD-WAN Can Transform Retail

14

These digital strategies can help merchants enhance the customer experience and stand out from competitors.

20 A Different Kind of Clean Fueling

Don’t neglect the most visible part of your business—the forecourt.

22 Making

the Best Choice

There are four main methods of fiberglass manufacturing—which one is right for your forecourt products?

24 Fuel Quality With Today’s and Tomorrow’s

Engines and Fuels A Q&A with MidContinental Chemical Company

26

COMMERCIAL FUELS 26 A Matter of Control

Setting parameters on how drivers use fleet cards can help maximize efficiency.

FUEL MARKETERS 28 Propane

Generators Check All the Boxes

They are a reliable, portable, powerful and sustainable option when the power grid goes down.

30 The Past and Future of Gasoline Additives

Octane boosters, friction modifiers and detergents improve fuel economy and performance.

30 2 | FMN Magazine SUMMER 2021

52 56

Industry News Remember This?

FuelsMarketNews.com

FROM THE EDITOR

Let Us Not Repeat This…

I was only nine years old at the time, but I remember the 1973-74 energy crisis triggered by the OPEC oil embargo over the U.S. support of Israel in the waning days of the Yom Kippur War. It was impossible to miss, even if your driving experiences involved being chauffeured around by your mom.

I remember the discussions between my parents about how high gasoline prices were at the time. I remember sitting in our car in a line outside a station and being told that we could only purchase gasoline on certain days (even or odd depending on your license plate number). And, the remnants of the crisis were still around when I got my first car. Sports cars lacked the “sports” (though the new emission standards had something to do with that as well).

Then there was the speedometer limited to 85 miles an hour and highway speeds limited to 55 miles an hour—both efforts designed to conserve gasoline.

Interestingly, these events drove the development of the technologies required to launch the shale oil fracking revolution that returned the United States to a significant degree of energy independence. CBS used to run a two-minute news segment in the 1970s during the Saturday cartoons called “In the News.” Making me feel a bit old right now, I remember one on extracting oil from shale and how difficult the process would be. Not anymore.

Which brings us to the main feature in this issue of FMN Magazine, “Will China be the New OPEC?”.

There is currently an extraordinary, and at times haphazard and forced appearing, international rush toward electrification of the vehicle fleet.

The electricity for an electric vehicle can be generated through a range of sources, much as it is today. The production of the batteries (and base components that make up batteries), however, is currently dominated by China. And by dominated, the figures 4 | FMN Magazine SUMMER 2021

I remember sitting in our car in a line outside a station and being told that we could only purchase gasoline on certain days. are often well above 50% and certainly beyond the type of dominance once enjoyed by OPEC. While it will likely take many years for electric vehicles to supplant the internal combustion engine, the logistical aspects must be front-of-mind, distributed and layered as these efforts are promoted to avoid a potential repeat of those dismal, crisis days.

On another note, NACS has entered a relationship with OPIS which provides the association with access to some useful market data relative to both retail and rack fuel prices. Each week, FMN runs an update of this data in our Fuels Retailer-Marketer and FMN Commercial newsletters. Go over to our website, www.fuelsmarketnews.com, and take a few minutes to sign up. In addition, you will get a full rundown of the latest industry news and a variety of original content as well.

EDITORIAL Keith Reid Editor-in-Chief (847) 630-4760 kreid@fmnweb.com Kim Stewart Editorial Director (703) 518-4279 kstewart@convenience.org Sara Counihan Managing Editor (703) 518-4278 scounihan@convenience.org CONTRIBUTORS Anton Albrand, Ezra Finkin, Nabill Huq, Steve Klein, Kris Oliver, Dr. Raj Shah, Roy Strasburger, Dr. Vikram Mittal, Mike G. Zahajko DESIGN Beyond Definition www.beyond-definition.com

ADVERTISING Ted Asprooth (847) 222-3006 tasprooth@convenience.org

PUBLISHING Erin Pressley Publisher (703) 518-4208 epressley@convenience.org Rose Johnson Audience Development and Production Manager (703) 518-4218 rjohnson@convenience.org Fuels Market News Magazine is published quarterly by the National Association of Convenience Stores (NACS), Alexandria, Virginia, USA. Subscription Requests: circulation@fmnweb.com POSTMASTER: Send address changes to Fuels Market News Magazine, 1600 Duke Street, Alexandria, VA, 22314-2792 USA. Contents © 2021 by the National Association of Convenience Stores. Periodicals postage paid at Alexandria, VA, and additional mailing offices.

Keith Reid is the editor-in-chief of Fuels Market News.

He can be reached at kreid@fmnweb.com.

1600 Duke Street, Alexandria, VA, 22314-2792

PUBLISHED BY

FuelsMarketNews.com

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What’s Next.

The NACS State of the Industry Report of 2020 Data has arrived! The report is the convenience and fuel retailing industry’s premier benchmarking tool and the most comprehensive collection of data and trends.

Want to find out what’s next and how you can get there faster? For more than 50 years, the convenience and fuel retailing industry has relied on the NACS State of the Industry Report to answer this question and more.

This report will help you: • Learn fuel analysts’ perspectives on the lessons of 2020 and their predictions for 2021.

• Understand the big picture with data and analysis on economic, market and shopper dynamics.

• Maximize effectiveness and profitability with insider access to aggregate financial, operational and category data from more than 24,000 convenience stores across the United States.

•B enchmark against top performers in the industry and determine key drivers of their success.

Don’t forget about the NACS State of the Industry Compensation Report of 2020 Data. This report provides critical benchmarking data and up-to-date standards in the key human resource categories of compensation, turnover, benefits and recruitment. It also breaks down the newest available numbers in the convenience industry and is considered an essential guide for HR professionals.

Purchase both digital reports today at www.convenience.org/research.

6 | FMN Magazine SUMMER 2021

FuelsMarketNews.com

Listen Up The U.S. charging infrastructure is ramping up to keep up with EV owner demand. This innovative solution puts charging in the hands of car owners … conveniently, of course. Join NACS as we speak with Joshua Aviv, founder and CEO, SparkCharge, on this advancing topic.

You don’t want to miss these NACS Convenience Matters podcast episodes: NO. 286: RINS, RFS AND EVS AND WHAT THEY MEAN TO THE FUELS SECTOR A Renewable Identification Number, aka an RIN, is a credit attached to every renewable fuel gallon produced in the United States. Learn about what’s going on with RIN prices and how they relate to EVs and fuel demand.

NO. 284: MAKING ELECTRIC VEHICLE CHARGING MORE CONVENIENT

NO. 278: IT’S ELECTRIC! Enough dancing around. It’s time to look ahead at the future of cars because an electric reality is coming quickly—very quickly if you live in places that mandate it soon like the U.K. NACS speaks with international convenience and fuel retail market expert Dan Munford about what the future might hold for cars, customers and travel.

NO. 277: GAS PRICES IN 2021 How did gas prices get where they are in 2021, and what are some long-term implications for where gasoline demand and prices are going over the next few years? NACS gets the answers from OPIS Chief Oil Analyst Denton Cinquegrana.

Listen now at www.conveniencematters.com

NACS and FMN Calendar of Events SIGNATURE EVENT

NACS Show October 5-8, 2021 | Chicago, IL

PHOTO©ISTOCK/CIYDEMIMAGES

GLOBAL

NACS Convenience Summit Asia August 17-19, 2021 | Virtual

GOVERNMENT RELATIONS

NACS In Store Throughout 2021 | Stay tuned …

FuelsMarketNews.com

LEADERSHIP

NACS Executive Leadership Program at Cornell University July 25-29, 2021 | Ithaca, NY

NACS Innovation Leadership Program at MIT Sloan School of Management October 31-November 5, 2021 | Cambridge, MA

NACS Financial Leadership Program at the Wharton School of the University of Pennsylvania August 1-6, 2021 | Philadelphia, PA

NACS Marketing Leadership Program at Kellogg School of Management, Northwestern University November 14-19, 2021 | Evanston, IL

NACS Women’s Leadership Program at Yale School of Management October 26-28 and November 2-4, 2021 Live Virtual

For more information about these NACS and FMN events, visit www.convenience.org/events.

FMN Magazine SUMMER 2021 | 7

A Must-Read Since published in mid-February, NACS’ Convenience Corner blog post “Does the President Control Gas Prices?” has been the No. 1 most viewed page among all NACS websites in 2021. Gas prices are the ultimate pocketbook issue that everyone talks about, so it makes sense that politicians would do everything in their power to keep gas prices low. Especially presidents. So why are they so bad at it? NACS’ Jeff Lenard explores what’s really behind the rise and fall of gas prices.

Read the post at www.convenience.org/conveniencecorner.

We’re Back. Together.

Registration for the 2021 NACS Show is now open. Over four action-packed days, the NACS Show will help retailers crack the code to success in convenience. The NACS Show has a full schedule of activities for every kind of convenience and fuel retailer. Convenience store distributors, retailers, wholesalers and exhibitors/vendors will all uncover the most innovative products and technologies, tap into impactful education sessions and access engaging networking opportunities.

Join NACS October 5-8 at McCormick Place in Chicago.

Register today at www.nacsshow.com.

8 | FMN Magazine SUMMER 2021

FuelsMarketNews.com

WHAT THE HELL IS UNLEADED 88?

IT COULD BE A TANK FULL OF PROFITS.

Flex Check your station’s equipment today and see if you’re already ready to put Unleaded 88 on the slate. flexfuelforward.com/flexcheck

On the Road Again

BY JOHN EICHBERGER

I

f the global priority with regards to the transportation sector is to reduce carbon emissions, then putting all our eggs in one basket and waiting for electrification to transform the world is already a failed strategy. With nearly 1.5 billion vehicles in the world, and with more than 90 million new vehicles sold annually (*nonpandemic years, of course), it is impossible to envision a transition to relying on only battery electric vehicles (BEV) any time soon, no matter what governments may try to do in terms of sales requirements. So, what should be done regarding the existing and continuing combustion engine liquid fuels market? To find viable solutions—and we certainly can—we must adopt a broader perspective, be open to options and think about engines and fuels as a system.

Relevant to this topic is our musical feature of the month: Willie Nelson. The song “On the Road Again” plays well with some of the recurring themes found in this column, but the primary importance is found with Willie himself, a strong advocate for the use of biofuels who even established a brand of biodiesel called “BioWillie.” His support for the fuel was based upon personal experience with its performance but also his interest in supporting farmers and reducing America’s reliance on foreign oil.

There are options to improve the emissions profile and lower the carbon impact of traditional powertrains by evaluating engines and fuels from a systemic perspective. One of the most developed efforts in this context involves high compression engines and higher-octane fuel. The U.S. Department of Energy’s Co-Optimization of Fuels and Engines initiative has done great work evaluating what might be possible and how fuel enabling more efficient engine design could be produced.

FIGURE 1 | Engine Efficiency Improvements With Higher Octance and Fuel Sensitivity 7.5%

4.1%

4.4%

2.5%

91 RON, S=8 (Baseline)

95 RON, S=8

95 RON, S=10

98 RON, S=8

98 RON, S=12

SOURCE: DOE'S CO-OPTIMIZATION OF FUELS AND ENGINES

10 | FMN Magazine SUMMER 2021

In addition to what Co-Optima has produced, the Fuels Institute published two reports on octane evaluating, its role in engine performance and what it would take to introduce a new high-octane fuel into the market to support advanced engine design.

Short story: It would take about 20 years and cost quite bit of money to transition the entire market. But the idea of maximizing fuel properties to improve the efficiency of engines is the right approach, and the results of the Co-Optima research provide some valuable insights into possibilities.

The octane discussion continues, and there are opportunities to be exploited.

BIOWILLIE AND FRIENDS We have been blending biofuels into petroleum products for decades, and there could be opportunities to leverage that experience to reduce the overall carbon intensity of our fuel, thereby having an immediate impact on carbon emissions from existing and future combustion engine vehicles.

According to the California Air Resources Board, biofuels already provide a lower carbon footprint than hydrocarbon fuels and are projected to improve over time as energy inputs for producing the fuels become greener.

Compared with California-specification gasoline, starch ethanol (i.e., produced from corn) is 28% less carbon intense and is projected to reach 55% reduction by 2040. Meanwhile, biomass-based diesel (both biodiesel and renewable diesel) is 70% less carbon intense. These are fuels currently available throughout the market with decades of user experience.

While there are some compatibility issues associated with increasing the use of biofuels, these can be overcome on a shorter time frame than will be required to convert the fleet to BEVs. And, according to a study currently under FuelsMarketNews.com

FIGURE 2 | Estimated Carbon Intensity

Average Carbon Intensity

(from CARB Illustrative Compliance Calculations)

(grams of CO2 per mega joule of energy produced)

120 100

99 99 80 80

80 60

71 45

40

40 40

40 40

20 0

30 30

30

20 4

CA Gasoline

CNG

Starch Ethanol

Hydrogen 2020

development by the Fuels Institute (slated for release this summer), there are business opportunities associated with the retail of biofuel blends.

The benefits of incorporating more biofuel blends into the market can be enhanced if we apply the systems approach mentioned above. Not all vehicles are manufactured to run on all the biofuel blends that can be brought to market, but if there were a strategy in place in which new combustion engines were designed to take advantage of the performance properties of biofuels, then new markets could develop.

LESSONS FROM THE HIGHWAYMEN Willie Nelson was a great solo act, but he also found success by joining with Johnny Cash, Waylon Jennings and Kris Kristofferson to form the Highwaymen—a country music supergroup. I think our policymakers can learn a lot from this example of bringing together the best of the best to create something even better—let’s combine the best options available to help us to reduce emissions.

I believe the next couple of years represent a unique opportunity to consider the future of federal biofuels policies. The statutory volumetric standards of the Renewable Fuel Standard extend only through 2022, at which FuelsMarketNews.com

2040

CNG/ LNG From Landfill

Biomass- Cellulosic Based Ethanol Diesel

10

Electricity

SOURCE: RICARDO CONSULTING

point the Environmental Protection Agency will be fully responsible for setting requirements. There are many who believe the program needs to be reconsidered by Congress, and some suggest that California’s Low Carbon Fuel Standard should be reviewed as a possible model. I have no idea how these discussions will play out, but the data suggest a robust biofuels policy could be a significant contributor to the overall objectives of lowering our carbon emissions.

In the shadow of all the attention being given to electrification, it is my hope that policy discussions will incorporate the many ideas that exist and do not ignore the continued role of the dominant transportation energy source in the world—liquid fuels.

There are options to improve the emissions profile and lower the carbon impact of traditional powertrains by evaluating engines and fuels from a systemic perspective.

Note: This is an abridged version of the Fuels Institute blog, The Commute. Read the full version at www.fuelsinstitute.org/Resources/ The-Commute/On-the-Road-Again.

The Fuels Institute, founded by NACS in 2013, is a nonprofit research-oriented think tank that evaluates market issues related to vehicles and the fuels that power them, incorporating the perspective of diverse stakeholders to develop and publish peer-reviewed, comprehensive, fact-based research projects.

John Eichberger is executive director of The Fuels institute. For more information, visit www.fuelsinstitute.org.

FMN Magazine SUMMER 2021 | 11

FUELED FOR THOUGHT

E15 Compatibility Changes

Easing restrictions may benefit fuel marketers but increase costs for UST operators.

BY JOE O’BRIEN

T

he U.S. Environmental Protection Agency has introduced a proposed rulemaking that if adopted would make it easier for fuel marketers to sell E15 (15% ethanol) and would create a scenario in which customers would be more likely to purchase it. Although expanded utilization of E15, also known as Unleaded 15 and Unleaded 88, could contribute to the reduction of greenhouse gas emissions, there are some serious “what if” scenarios that fuel marketers need to contemplate should this rulemaking be adopted.

The proposed E15 rulemaking aims to change two things. First, the proposal suggests that the E15 labels currently required on dispensers could be modified or eliminated. Second, the proposed rulemaking may loosen compatibility requirements for the underground storage tank system.

12 | FMN Magazine SUMMER 2021

One of the compatibility proposals would make it so that owners and operators do not need to demonstrate the compatibility of existing UST systems if the system has secondarily contained tanks and piping and also uses interstitial monitoring. In this situation, the EPA would encourage—but not require—operators to replace other UST components for which they cannot demonstrate compatibility if (according to an explanation from PEI) “the equipment is accessible from ground level and replaceable with minimal investment.”

Another proposed change would require owners and operators to ensure that all new or replaced UST equipment—even diesel tanks—be compatible with ethanol blends up to 100%.

The proposal to change the E15 labeling requirements looks to position E15 as the new E10, and it raises questions about meeting basic truth-in-labeling principles. In response, the Indiana legislature passed a bill that if it FuelsMarketNews.com

becomes law, would still require E15 warning labels. That notwithstanding, the proposed equipment compatibility changes should be the chief concern to fuel marketers. Let’s examine why.

WHAT UNINTENDED CONSEQUENCES MIGHT UST OWNERS AND OPERATORS FACE IF THEY NO LONGER NEED TO DEMONSTRATE COMPATIBILITY OF THEIR TANKS AND PIPING? Rescinding the requirement for proving E15 compatibility for systems that have secondary containment creates a problematic loophole for owners and operators. Owners and operators might believe that the EPA is taking the position that existing infrastructure, regardless of its compatibility ratings, will be able to handle gasoline blends containing up to 15% ethanol as long as it has secondary containment.

Secondary containment is designed to prevent a release, not to prevent other equipment in the system from degrading or failing. There has not yet been adequate documentation to confirm that fueling system equipment that is not rated for E15 would not be damaged or fail if the system is exposed to E15 for the typical lifetime of a fueling system. E15 marketers may be meeting EPA requirements under the rulemaking, but they may face costly equipment repairs as a trade-off.

How the EPA defines and stresses “replaceable with minimal investment” in its proposed rulemaking also deserves further clarification. While it may be easy to argue the definition of minimal investment to avoid the expense of replacing equipment, the argument becomes moot if there will FuelsMarketNews.com

be no enforcement or requirement to maintain a fueling system that has all components rated for E15 compatibility.

BEYOND THE EXPENSE OF EQUIPMENT FAILURES, WHAT HIDDEN OPERATING COSTS COULD OWNERS AND OPERATORS FACE IF UST COMPATIBILITY REQUIREMENTS ARE LOOSENED? Insurance companies will be assuming more risk. This will almost certainly impact their policies. Operators should prepare themselves for the likelihood that deductibles and premiums would increase, perhaps so significantly that the costs would compel operators to use compatible equipment regardless of the EPA regulations. Insurers could also adjust their policies so that operators will need to certify the compatibility of UST equipment (and then recertify the equipment more frequently). If there were a leak within the UST system in this scenario and the equipment was found to be incompatible, it would seem highly unlikely that the insurance company would cover the costs.

CONCLUSION The EPA has required that the entire UST system be compatible with the substances stored within the system since 1988. The proposed E15 compatibility rule changes would seem to conflict with the original intent of that foundational compatibility requirement. While easing restrictions for the storage and distribution of E15 may help some fuel marketers grow margins in the short term—and it will undoubtedly bolster ethanol production—it may ultimately increase costs, downtime and liabilities in the long term for UST operators.

The proposal to change the E15 labeling requirements looks to position E15 as the new E10, and it raises questions about meeting basic truth-inlabeling principles.

Joe O’Brien is vice president of marketing at Source™ North America Corporation.

He has more than 25 years of experience in the petroleum equipment fuel industry.

Contact him at jobrien@sourcena.com or visit www.sourcena.com to learn more.

FMN Magazine SUMMER 2021 | 13

RETAIL OPERATIONS

Moving Forward

by Charging Up What to look for as the EV market expands in the coming years.

BY JIM MORAN

N

avigating the exciting future market of electric vehicle equipment solutions comes with the opportunity to blend current customer’s needs to better serve the market. The future needs of commercial and retail customers require a commitment from their equipment distributors to recognize the “mixed fuels” future when providing solutions for station remodels and tank system installations, along with the time-consuming EMV upgrades that are taking place today. A 14 | FMN Magazine SUMMER 2021

transition from liquid fuels to electrons will require a new approach to this new market augmenting a traditional fueling solution.

EV sales of 2% today are set to significantly expand in a few years, and commercial fleets and large trucks and buses are expected to transition at an even faster clip as leases mature and fleets turn over. Current fleet manufacturers offering an EV solution include Arriva, Chanje, Daimler, Gillig, Kenworth, New Flyer, Nissan, Paccar, Proterra, Rivian, Tesla, Volvo and

EV sales of 2% today are set to significantly expand in a few years, and commercial fleets and large trucks and buses are expected to transition at an even faster clip as leases mature and fleets turn over.

Workhorse. This list is sure to grow.

Charging equipment is also evolving as battery technology improves FuelsMarketNews.com

PHOTO©ISTOCK/3ALEXD

RETAIL OPERATIONS

to accept faster charging capabilities.

This will help make DC fast chargers a more attractive option for the EV customer. Home chargers only serve a portion of the fueling needs, even though these needs are being met the majority of the time for current EV owners in the U.S. Some 88% of EV owners “often or always” charge their vehicles at home, according to a J.D. Power study. Owners with permanently mounted Level 2 homecharging stations were most satisfied with their home-charging experience.

Parts and labor to install a Level 2 charger typically cost $1,200 to $2,000 (even more if major electrical upgrades are required).

Most multifamily complexes don’t offer an EV charging station, which opens a big opportunity for convenience store operators to offer this service and create new sales opportunities inside their stores while the charging takes place.

This demand will be brought on by the influx of car manufacturers making EVs a bigger part of their offering. Audi, BMW, Cadillac, Chevrolet, Ford, Honda, Hyundai, Jaguar, Kia, Landover, MercedesBenz, Mitsubishi, Nissan, Rivian, Stellantis, Subaru, Smart, Toyota, Volkswagen and Volvo have incorporated EVs into their lineups.

Headlines from inside and outside our industry every week tell us the story of the future today.

Jaguar Land Rover’s Jaguar brand will be 100% electric by 2025, as the company works to become a net-zero carbon business by 2039.

Ford Motor Co. will invest $22 billion on new electric vehicle models FuelsMarketNews.com

through 2025 and another $7 billion on autonomous vehicle technology.

EV DEVELOPMENTS In 2020, EV battery-pack prices fell 13%, from $156 to $137 per kilowatt-hour (kWh), according to Bloomberg New Energy Finance. Ten years ago, the average was $1,100 per kWh. Analysts have long predicted that EVs will achieve purchase price parity with liquid fuel vehicles when battery prices reach $100 per kWh. The Biden Administration plans 500,000 new public EV charging stations by 2030 and immediate restoration of the full income tax credit for EV purchases, U.S. Secretary of Transportation Pete Buttigieg confirmed.

Tesla hit its 2020 target of 500,000 vehicle deliveries, despite a government-mandated two-month shutdown of its Fremont, California, factory.

Massachusetts plans to end gasoline-powered new vehicle sales by 2035 and eliminate all passenger-vehicle greenhouse gas emissions (GHGs) by 2050, the state announced.

As we monitor the progress with subsidies, grant money and tax credits that are required to make most of the EV equipment purchases happen, we are reminded that the plans will have to make sense and demand will drive the market.

The day is coming when it will cost the same or less to manufacture an EV versus a traditional internal combustion engine vehicle. The only question is when, and again, demand will dictate the outcome.

As the Greek philosopher Heraclitus said, “The only thing that is constant is change.”

The Biden Administration plans 500,000 new public EV charging stations by 2030 and immediate restoration of the full income tax credit for EV purchases.

Jim Moran is the products sales manager for Portland, Oregon-based Northwest Pump, a leading petroleum equipment distributor with 17 branches located from Alaska to Hawaii and throughout the Western states. Visit www.nwpump.com or call 1-800-452-PUMP.

FMN Magazine SUMMER 2021 | 15

RETAIL OPERATIONS

5 Ways SD-WAN Can Transform Retail These digital strategies can help merchants enhance the customer experience and stand out from competitors.

BY JOHN TAIT

T

he pandemic has dramatically altered how consumers shop for, pay for and receive purchases of all kinds, disrupting triedand-trusted business models almost overnight and forcing retailers across the globe to quickly adapt to meet customers’ new and shifting needs.

Retailers that were well on their way to digital transformation have been better able to weather these swift changes to consumer buying habits. Even post-pandemic, retailers who have invested, or are investing, in digital capabilities will be positioned to create customer experiences that help them stand out, using technology-based strategies.

To support these future strategies, however, retailers must implement 16 | FMN Magazine SUMMER 2021

a connectivity foundation that is more secure, more scalable and more reliable than the traditional MPLS model. For any retailer with more than five locations and more than 100 employees, software-defined wide-area networking (SD-WAN) can provide the connectivity backbone that allows business workflows to remain agile and perform optimally.

Because SD-WAN can connect dispersed locations over multiple geographical locations and use the best network route available at any given time, it allows different types of network traffic to be prioritized as needed. This provides for redundancy and a seamless user experience, but it also allows retailers’ networks to be

more dynamic. For example, using a combination of managed wireless and IP connectivity with SD-WAN instead of purely MPLS can lower or eliminate circuit costs for retailers operating in a mix of rural and urban markets.

Diversity of managed communications, combined with the intelligence of SD-WAN, can improve cost and uptime, which reduces the risk that POS terminals will go down and business is not interrupted. It can be layered on top of any connectivity solution to securely connect users with applications, including those in the cloud.

SD-WAN offers retailers the connectivity capabilities they need for in-store and e-commerce digital transformation initiatives. Here are five strategies it can support.

1: OFFER CUSTOMERS FREE WI-FI AND USE IT TO GAIN INSIGHTS While not all consumers will return to shopping in physical stores, it is likely that most of them will. And wherever they go, consumers will expect to have connectivity, which means free Wi-Fi is becoming a must-have for retail sites.

FuelsMarketNews.com

RETAIL OPERATIONS

PHOTO©ISTOCK/LJUBAPHOTO

SD-WAN allows retailers to securely add on a free Wi-Fi solution for customers without affecting the connectivity layer that supports payments terminals or other digital initiatives in a store. And this free Wi-Fi isn’t just a perk for customers.

Retailers can harness analytics from the Wi-Fi to obtain valuable insights about shoppers’ patterns, behaviors and preferences.

For example, Wi-Fi analytics can tell retailers whether the customer is a first-time or frequent visitor.

Wi-Fi analytics can show how much time a shopper has spent in the store and where in a store they spent it, as well as aggregate data about overall shopper behavior. This aggregate data allows retailers to revamp their store layouts to increase sales by highlighting popular items (or placing less popular items near better-selling ones) or placing promotional or add-on purchases near frequently traveled areas.

2: ACCEPT AND SECURELY SUPPORT OMNICHANNEL PAYMENTS Consumers haven’t stopped buying, but they have changed the ways they shop and pay for goods, with many turning to e-commerce, mobile apps or curbside pickup. This new desire for a variety of payment and buying options isn’t going away, and retailers must deliver on it. SD-WAN’s ability to expand connectivity over a wider area allows retailers to take payments in more places—outdoor terminals, FuelsMarketNews.com

pay-at-the-pump options, self-service kiosks and even via mobile POS terminals, like tablets.

While flexibility in where and how payments can be processed is ideal for the consumer, it can create cybersecurity risks. This is because more payment devices mean more points of interaction to and from apps or internet breakout. Proper security controls, especially for payments, are critical.

SD-WAN enables retailers to securely connect all types of payments options, as well as any other devices and networks within a retail environment. Depending on the equipment and/or vendor, SD-WAN can also protect sensitive personal and financial data and traffic—key for the retail industry. Regulatory compliance with PCI DSS security credentials is, of course, also critical within a retail environment, and some SD-WAN solutions available today have been designed to incorporate PCI DSS requirements.

SD-WAN allows retailers to securely add on a free Wi-Fi solution for customers without affecting the connectivity layer that supports payments terminals or other digital initiatives in a store.

3: USE SMART CAMERAS TO RETHINK STORE LAYOUTS Today’s security cameras aren’t just useful for catching break-ins and providing surveillance. New always-streaming smart devices can capture shopper patterns that can drive strategy and improve decisionmaking. Retailers can see what’s happening at their physical locations, observing foot traffic patterns and gauging customer reactions to learn FMN Magazine SUMMER 2021 | 17

Retailers can see what’s happening at their physical locations, observing foot traffic patterns and gauging customer reactions to learn more about shoppers’ preferences and their intent to purchase.

John Tait is global managing director of TNS’ Payments Market business.

He is responsible for identifying and driving growth across the Americas, Europe and Asia Pacific regions, and is focused on meeting the unique requirements of TNS’ customers.

18 | FMN Magazine SUMMER 2021

more about shoppers’ preferences and their intent to purchase.

Cameras can yield actionable insights to improve in-store offerings, maximize the placement of sales associates and in-store displays and even develop individual promotions. While tying these into a store’s analytics and network means there are even more devices on a retailer’s network, SD-WAN allows retailers to manage traffic to avoid a network from overloading.

4: OPTIMIZE THE SUPPLY CHAIN AND INVENTORY SYSTEMS The supply chain issues some retailers experienced earlier in the COVID-19 pandemic demonstrated the importance of being able to efficiently manage supply chains. Especially as shoppers demand more e-commerce options and faster delivery, retailers must be able to quickly perform inventory checks, automate orders for high-demand stock and track orders in real time. SD-WAN can help retailers streamline operations and eliminate any network downtime, so all systems stay up and running.

5. GET READY FOR A NEW FUTURE Retailers need to simplify, secure and improve their network across all branches and locations to support continued digital transformation; remain agile in the face of change; and improve in-store and e-commerce customer experiences. SD-WAN can consolidate point solutions, simplify network management, provide visibility into data applications, and support new bandwidth-intensive digital strategies—all while supporting business-critical applications so that payments stay up and running.

However, some retailers may be challenged to implement this technology, either because their in-house IT staff doesn’t have the time, or because they don’t have in-house IT. Fully managed solutions can help in this instance. They remove the hands-on work of deployment, while giving a business all the capabilities of SD-WAN—allowing retailers to focus on transforming the customer experience, not their network.

FuelsMarketNews.com

PHOTO©ISTOCK/FG TRADE

RETAIL OPERATIONS

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RETAIL OPERATIONS

A Different Kind of Clean Fueling Don’t neglect the most visible part of your business—the forecourt.

BY ROY STRASBURGER

“H

ow did it get to this point?”

Have you ever experienced the situation when you are looking around and, suddenly, your eyes seem to snap into focus and you see the teetering piles of papers on your desk, dirt on the floor, shoes left out or abandoned cars in your front yard? I can go for days, if not weeks, in blissful short-sightedness, never noticing the untidiness and rubbish that often surrounds me.

20 | FMN Magazine SUMMER 2021

(Note: To be clear, my wife is a very neat person. Any and all references to any type of mess are the sole responsibility of the author.)

The cleaning up is not difficult and, to be honest, it doesn’t take much time.

The key is motivation. Once you have cleaned and tidied everything up you feel a real sense of accomplishment, and the “encouragement” that you have been receiving from the rest of your household to do something about the mess

now becomes focused on a new project that needs to be done.

In retail, the inertia to “just let things be” contributes to a larger picture of neglect and untidiness. It is not intentional. It is incremental, and you don’t even notice that it’s happening.

I find that the area of a fuel and convenience store that suffers the most from incremental untidiness is the fuel forecourt. It is an interesting paradox because it is the most visible part of your business to the customer, but it is the area that you, the owner, look at the least.

Attention to the details on the forecourt declined when the gasoline industry went to being completely self-service and the attendant disappeared. The person now responsible for the upkeep of the forecourt is safely ensconced inside a building, whose interior is almost always more comfortable than being outside.

FuelsMarketNews.com

PHOTO©ISTOCK/JPGFACTORY

RETAIL OPERATIONS

Sadly, almost all fuel retailers rely on their customers to tell them when something under the canopy is not working.

The customer is the last person you want to see those kinds of issues.

You should look at your fuel site every day to see what needs to be done. Start with the basics, asking yourself, are the trash cans in good repair and empty, trash bags properly fitted, water buckets full and where they’re supposed to be and squeegees in the buckets?

Is there trash on the ground, are the decals on the pumps fading and need to be replaced, are the pump toppers properly fitted and do they have the correct signage, do all of the lights in the canopy work?

Check to see whether the security tape is in place on the fuel pumps, and closely inspect the credit card reader for skimmers or whether the front panels look like they have been tampered with. Are the hoses and nozzles clean and working properly? Are the safety brakes connected properly, and do you have working retractor cables?

Is there paper in the credit card reader? Are all the electronic displays working properly?

If you have air and water dispensers, do they work? Is the emergency shutoff switch prominently visible? Are there paper towels in the dispensers? Do you provide gloves for people to handle the nozzles, and are they stocked?

Make a note of the more timeconsuming issues that you need to FuelsMarketNews.com

address: Is the paint on the concrete or the poles starting to chip or crack, is the underside of the canopy dirty, does the concrete around the fueling positions need to be cleaned or power washed? Are there oil stains? Is there gum stuck to the concrete?

This type of inspection should be done on at least a weekly basis if not daily. These areas create a lasting impression with the customer—for better or worse.

I highly recommend that you develop a checklist of all of the items that need to be inspected. Have the person on duty fill it out, take before and after pictures of the things that were fixed, sign and date the inspection sheet, and put the checklist in a specific location in the office. When you conduct your own inspection and you see something that is not right, look at the previous inspection reports to see if it was noted—or whether the inspection even took place. If the problem is not already listed, it is time for a counseling session with the team to explain to them how important this is.

Most of these repairs and maintenance items do not cost a lot of money, but they do take a lot of attention. Be sure to hold specific individuals responsible and accountable for getting the work done.

This is a different type of clean fueling, but it is as important to your business as the product itself.

In retail, the inertia to ‘just let things be’ contributes to a larger picture of neglect and untidiness. It is not intentional. It is incremental, and you don’t even notice that it’s happening.

Roy Strasburger is the CEO of StrasGlobal. For 35 years StrasGlobal has been the choice of global oil brands, distressed assets managers, real-estate lenders and private investors seeking a complete, turnkey retail management solution.

FMN Magazine SUMMER 2021 | 21

RETAIL OPERATIONS

Making the Best Choice There are four main methods of fiberglass manufacturing— which one is right for your forecourt products?

BY ED KAMMERER

T

here is a buffet of sorts for fuel retailers to choose from when they are outfitting their sites with components—such as manhole covers, an underground storage tank (UST) and dispenser sumps and covers, multiport access covers, top hats and skirts—that are constructed of fiberglass. A completely outfitted retail-fueling site will likely contain components that have been manufactured via one of four main fiberglass-production methods. All of them are viable and commonly used today, depending on the component that is being built.

22 | FMN Magazine SUMMER 2021

OPEN-MOLD SPRAY UP This method, also known as “chop and spray,” is the oldest. It utilizes a specialized spray gun with a bottle of resin to apply a pre-mixed, spooled fiberglass strand to a single-sided mold. In addition to its low cost, the main benefit of this method is that it is easier to produce parts that are of an irregular shape (not circular or square), as well as parts that are not meant to have an airtight or watertight seal or bear heavy loads and forces. The main drawback is that a part can only be produced with one smooth side, and the thickness can

be less consistent than those produced by other methods. It can also lead to an inconsistent blend of resin and glass fibers, causing weak or porous parts.

Hand rollers are run over the surface to squeeze out any air pockets which can weaken the finished product. This process is labor and time intensive.

RESIN-TRANSFER MOLDING (RTM) This construction method, which has been available for about two decades, uses a composite of glass fibers and resin that is packed into a mold, with the glass providing tensile strength and the resin contributing compressive strength to the finished product. All of the fiberglass fibers must be fully saturated with the resin to ensure a smooth, consistent finish on both sides of the object. This saturation is accomplished by layering the glass sheets into a mold and then injecting the mold with resin.

FuelsMarketNews.com

RETAIL OPERATIONS

The two components are then compressed together by extreme forces in a hydraulic press that ensures a perfect blend of resin-saturated glass. RTM is effective in developing dense, compact layers of fiberglass for objects that need to bear heavy loads or repeated high-force events, like forecourt manhole covers. The drawbacks to this method come in the actual manufacturing process itself, which requires expensive tooling and a large hydraulic press to ensure that the two halves of the mold are bonded together strongly.

VACUUM-ASSISTED RESIN TRANSFER MOLDING (VAC-RTM) This evolutionary stage in the RTM method uses a vacuum to pull, rather than push, the resin into the fiberglass.

This creates a better seal without the need of a large, expensive hydraulic press; something as basic as a pair of vice-grip pliers can be used to securely clamp the two halves of the mold together. The finished walls of a VacRTM product are also smooth, which makes it easier to attach other components to it with no holes or pores that can adversely affect sealing capabilities.

The biggest challenge with this method is that there is an absolute maximum amount of force that can be generated by a vacuum. This limits the amount of fiberglass that can be permeated by the resin, which restricts the load-bearing properties of the finished product and the overall range of different products it can be used in. This process makes it ideal for parts like containment chambers but not manhole covers.

SHEET-MOLDED COMPOUND (SMC) This is the newest fiberglass-manufacturing innovation, and it combines the best of the older Open-Mold Spray Up FuelsMarketNews.com

and RTM methods. SMC starts with a putty-type mixture of glass fibers and resin that is formed into sheets that can be molded to meet the specific end-user needs for the end product’s length, shape and density. The sheets are cut to the size and shape needed, then placed in a mold and pressed into shape. The result is a part that has the highest level of consistency available, making it the premier way to construct a high number of consistently shaped and formed parts over a short period of time. The main drawback with SMC is found at the onset of the manufacturing process—a large (sometimes two stories tall) hydraulic press is needed to shape the fiberglass/resin sheets into the finished product. The other drawback is the high initial tooling cost and capital expense. The SMC process is ideal for high-volume parts requiring consistent and detailed end results.

Manufacturers of forecourt components that offer a full portfolio of products will utilize all four types of fiberglass-manufacturing processes and continue to find ways to innovate.

For example, some new dispenser sumps are constructed via the SMC method, making them one of the few dispenser sump models currently available with smooth interior and exterior walls, which allows entry fittings to bond or seal to them better, preventing leaks.

Having an array of choices is always good. The challenge for the site operator is identifying parts that are able to feature the best traits of the specific manufacturing method, from top hats and skirts that are still produced with the chop-and-spray method, to next-generation dispenser sumps that take advantage of the advanced SMC production process.

A completely outfitted retail-fueling site will likely contain components that have been manufactured via one of four main fiberglass-production methods.

Ed Kammerer is a member of the Fuels Market News Editorial Council and the director of Global Product Management for OPW, based in Cincinnati, Ohio.

He can be reached at ed.kammerer@ opwglobal.com.

FMN Magazine SUMMER 2021 | 23

Fuel Quality With Today’s and Tomorrow’s Engines and Fuels

Gary Lackore, National Sales Manager, MidContinental Chemical Company www.mcchemical.com

24 | FMN Magazine SUMMER 2021

Hybrids make a tremendous amount of sense in any transition to electrification.

MCC provides a full range of fuel additives, from gasoline and diesel multifunctional additive packages to specialty areas like cold flow and jet fuel icing inhibitor. Drawing on your background, do the internal combustion engines that support this technology have special requirements?

While the internal combustion engines (ICEs) in hybrids do not have any special requirements, it is extremely critical that they operate at a high level of efficiency, just as it is for non-hybrids. The hybrid vehicle customer experience will be based on both power platforms, yet the ICE will be counted on to deliver performance regardless of the EV capability. As such, the ICE will not be used 100% of the time; therefore, the time-sharing of both power systems could impact the cleanliness and readiness of the ICE to perform.

To make sure that the ICE is ready to perform when called upon, use of TOP TIER gasoline or a quality aftermarket total fuel system cleaner is recommended. Using gasoline containing higher detergent content or using a quality aftermarket detergent FuelsMarketNews.com

additive is important in keeping the fuel injection system of the ICE working properly to get the best performance and fuel economy.

IMAGE©iSTOCK.COM/ROST-9D

Is the fuel performance aspect of this technology transition fully appreciated at this stage?

It is important to consider that optimum engine performance needs to be realized more so in a hybrid application than with others. Why? Today’s ICEs, especially in hybrids, are most likely reduced in size (cubic inches or CCs) and have a turbocharger (mechanically boosting engine output), and the displacement is asked to power a heavier vehicle because of the battery. The optimized performance of the ICE is critical to overall performance, engine durability and drivability. An engine that has a fuel system or fuel injectors that are not operating efficiently will use more gasoline, emit higher emissions, produce less power and lose fuel economy.

To build on current trends, formerly conventional fuels will increasingly become bio/ renewable blends. What role do additives play in these products?

Additives will continue to play a vital role in fuel system and fuel system component cleanliness of all ICEs. Renewable fuels and biofuels will inherently be contributors to deposit formation causing power loss. This power loss is realized via drivability.

FuelsMarketNews.com

Hybrid technologies are not as beneficial to diesel vehicles, but diesel will be supporting commercial transportation for many years. These engines will increasingly be cleaner and more efficient, but at the same time more demanding on fuel quality. How does additization help their performance?

Although there are some diesel hybrid vehicles being produced, this technology is not a good fit for many diesel vehicle applications. Advanced technology, both in hardware design and fuel systems, will create an environment for increased performance and improved fuel quality. These advancements make it even more critical for the engine to operate at the optimum performance level. The fuel system is integral to engine performance. There are improvements in diesel engine performance that can be achieved with additives such as detergents, lubricity improvers, cetane improvers, etc.

One of MCC’s stated goals is to help grow its customers’ business and build customer loyalty by delivering differentiated products to their customers.

With that in mind, how can marketers and retailers maximize on these opportunities with additives?

The basic “rack fuels” will continue to be valued by the consumer … price is price, right? However, high-value fuels are a means of differentiating your brand and the value associated with it. The fuels category is another area in which your brand has meaning and definition to your customers.

Marketers and retailers have the opportunity to additize both retail and commercial fuels with performance enhancing additives in which their customers will find value.

This article is brought to you by MidContinental Chemical Company

Additives will continue to play a vital role in fuel system and fuel system component cleanliness of all ICEs.

FMN Magazine SUMMER 2021 | 25

COMMERCIAL FUELS

A Matter of Control Setting parameters on how drivers use fleet cards can help maximize efficiency.

BY STEPHEN BENNETT

F

uel has long been one of the top costs for fleet operators, and keeping a sharp eye on fuel spending remains as critical as ever. But fleet fueling experts point out that paying less is just one of the steps to achieving fuel cost control. Some fleets do a better job than others of choosing a fleet card program that best suits their operation, and then maximizing the benefits the card provides.

“Different card products have different controls associated with them,” said Jake Zuanich, president of P-Fleet, a company in San Diego, California, that offers expense and 26 | FMN Magazine SUMMER 2021

payment management solutions, including fleet cards, for commercial fleets and companies that rely on independent contractors.

One of the biggest benefits of fleet cards is the ability to set parameters, Zuanich said. The goal is to enable drivers to get fuel when they need it, while also making sure that if something does go wrong there are limits in place. “There’s a lot to evaluate as you begin to look at a new program,” Zuanich said. “Make sure you don’t fall in love with a penny-a-gallon discount. Look at everything and what those potential costs are.”

Some fleets’ operations run according to a regular schedule, with exceptions. Drivers don’t typically fuel on weekends, for example, but on occasion there are special loads. Controls come into place in those cases.

“There may be some settings that you’d want to adjust so that the fleet card is not able to be used on the weekends,” said Howard Abrams, president of Sokolis Group. The Warrington, Pennsylvania, company offers fuel management and fuel consulting services, including negotiating fuel prices and overseeing the fleet card program that a fleet chooses to use. “Same thing applies to hours of the day. You may want to lock down the fleet cards so they’re not able to be used overnight—maybe from midnight to six a.m.”

However, flexibility with controls is also critical.

“We combine controls that are hard limits—‘You can’t do this’—and FuelsMarketNews.com

PHOTOS©ISTOCK/RICHLEGG/GRANDRIVER

COMMERCIAL FUELS

others that generate alerts for when drivers fuel on a weekend,” Zuanich said. That helps to ensure that a driver won’t get stuck on a weekend job, unable to use the card. At the same time, the transaction will be flagged for later vetting. “Once drivers know that you’re on top of it, they don’t mess around with it a whole lot,” Zuanich said.

Purchase limits are another critical area for fuel controls. Sokolis Group monitors the amount of credit and advises its clients on adjusting fleet card limits, often necessary when fuel prices are in flux.

“If fuel prices are rising and a fleet card is set with a daily limit of say a thousand dollars—that may not be sufficient,” Abrams said. The daily transaction limit, in terms of dollars that can be spent, may need to be tweaked if fuel prices are rising sharply.

Conversely, “If fuel prices are going down and you don’t take a fresh look at what the daily limits are on the amount that can be purchased, you could be exposing yourself,” Abrams said. “If a thousand dollars a day was needed when fuel prices were high and fuel prices fall significantly, maybe you only need five-, sixhundred dollars a day. You can look and lower those limits to prevent possible exposure.”

FuelsMarketNews.com

That exposure would be if a fleet card fell into the wrong hands and somebody was able to utilize it. Abrams said, “You can at least limit your exposure by lowering the daily amount.”

Other controls can be applied to stipulate purchases of one fuel type (gasoline only or diesel only) and whether to allow drivers to purchase items besides fuel—such as candy or drinks in a convenience store with fuel pumps out front.

“All fleets can benefit from the use of a card program,” Abrams said.

Among fleet types that may have additional risk—and therefore could benefit especially by implementing a fleet card program—are fleets with vehicles that use gasoline and typically in transaction amounts that aren’t very large. Abrams said such fleet operators can be at greater risk because a driver may misuse the card.

“Meaning they use it to put gas in their family vehicle,” he said.

By using a fleet card, fleets are able to record transactions with all the data elements like the date and the time and the vehicle number. Those crucial details that are tied to a transaction made with a fleet card can act as a deterrent. And the effective use of controls allows a fleet card to be used with the maximum of efficiency.

There’s a lot to evaluate as you begin to look at a new program. Make sure you don’t fall in love with a penny-agallon discount.

Look at everything and what those potential costs are.

Stephen Bennett is an editor and reporter specializing in the fuel and transportation industries.

FMN Magazine SUMMER 2021 | 27

FUEL MARKETERS

Propane Generators Check All the Boxes They are a reliable, portable, powerful and sustainable option when the power grid goes down.

BY BRYAN CORDILL

P

ower interruptions can cost American businesses as much as $150 billion per year, according to data from the Department of Energy (DOE).

This staggering statistic has brought a renewed attention and desire for commercial remote and standby power generators from a wide range of businesses and industries across the United States. It’s also putting a spotlight on energy solutions that can boast resiliency in the face of 28 | FMN Magazine SUMMER 2021

power interruptions, whatever the case may be.

Whether brought on by inclement weather or growing electricity demands being placed on the country’s century-old grid, power outages can take a toll on operations—especially those that have the potential to lose expensive inventory if the power goes out.

Propane marketers can capitalize on this opportunity by offering their customers propane-powered

generators. Propane generators can protect businesses from losing valuable equipment, inventory or infrastructure when the power grid goes down—and they offer clear advantages over other options when considering resiliency, performance, environmental impact and reliability.

ENERGY RESILIENCY Whether located on the power grid or off the beaten path, propane marketers can give their customers a dependable power generation solution with propane. Because propane is an independent and highly portable energy source, propane can supply power and energy resiliency to businesses regardless of their location—making it an ideal generator energy source.

VERSATILE PERFORMANCE Propane generators are available in a wide variety of capacities, so there’s a FuelsMarketNews.com

FUEL MARKETERS

model that will meet the needs of any building or facility. Notably, propane can provide power to ports, hospitals, offices, data centers and communications, fire and police departments, restaurants, hospitality buildings and more. In addition to protecting buildings and businesses from losses due to power outages, propane generators are also able to meet code requirements for emergency power that requires on-site storage.

Propane generators are also powerful enough to meet jobsite demands during construction. Once commissioned, propane generators can be configured to service only the most critical building loads or to maintain full operation in the event of a power failure. They can also be configured to help with peak-shaving and demand-response programs that provide additional revenue for businesses.

ECO-FRIENDLY OPERATION Customers are not only looking for a reliable power solution but also seeking equipment with a low emissions profile. Ensuring a sustainable operation is more important than ever, making propane generators a compelling solution. Propane generators produce significantly fewer emissions than their diesel counterparts, providing customers with a clean operation.

Most notably, propane burns cleaner than diesel, reducing emissions such as nitrous oxides (NOx), sulfur oxides (SOx), particulate matter and carbon dioxide. Data from the DOE shows 16% greater carbon dioxide emissions per unit of energy for diesel compared with propane.

FuelsMarketNews.com

Additionally, when the fuel is stored on site, either above or below ground, you don’t risk land or groundwater contamination. Diesel, on the other hand, has the potential for contamination from spills and leaks that are retained in the soil.

PROVEN RELIABILITY Propane is a stable, reliable energy source that doesn’t degrade over time like diesel does. Many manufacturers are taking notice and, as a result, are creating more propane-powered product offerings. For example, Qnergy—a clean-technology manufacturer of power generation systems—paired propane with its Stirling engine in an effort to bring resiliency and peace of mind to the next level. While the company’s generator can work seamlessly with multiple fuel sources, Qnergy found that running it on propane further enhances the system’s value proposition and better reinforces the equipment’s resiliency, reliability and sustainable operation.

Qnergy’s Stirling engine is known for its reliable, zero-maintenance operation—even through extreme temperatures, high humidity, flood plains and high winds. Notably, many major and independent oil and gas companies rely on Qnergy’s propane-powered technology to meet their remote power needs, and businesses using this generator saw 100% uptime during the 2021 Texas power crisis brought on by severe winter storms and electrical grid failures.

To learn more about the benefits of propane-powered generators, visit www.propane.com.

Whether located on the power grid or off the beaten path, propane marketers can give their customers a dependable power generation solution with propane.

Bryan Cordill is the director of residential and commercial business development for the Propane Education & Research Council. He can be reached at bryan.cordill@propane.com.

FMN Magazine SUMMER 2021 | 29

FUEL MARKETERS

The Past and Future of Gasoline Additives Octane boosters, friction modifiers and detergents improve fuel economy and performance.

DR. RAJ SHAH AND STANLEY ZHANG

T

he design and development of modern automobiles has improved dramatically for the past couple of decades in terms of reliability, performance and affordability. Despite the progressiveness of modern vehicles, the average fuel economy of these vehicles appears to have stagnated.

This is apparent when conducting comparisons between antiquated models and their modern counterparts.

The century old Ford Model T was reported to have achieved up to 21 miles per gallon, while the average fuel economy of a new car in 2019 was 25.5 mpg, according to Green Car Reports. The National Highway Traffic Safety Administration (NHTSA) and the Environmental Protection Agency 30 | FMN Magazine SUMMER 2021

(EPA) proposed the Corporate Average Fuel Economy (CAFE) regulations in 2011, which established an average fuel economy target of 54.5 mpg for 2026 models. However, in March 2020, NHTSA and EPA proposed revisions to the existing CAFE regulations, known as the Safe Affordable Fuel-Efficient (SAFE) Vehicles Rule. The amended regulations lowered the fuel economy target to a 1.5% annual increase through 2026, with a projected goal of achieving 40.5 mpg by model year 2030.

The increased fuel efficiency expectations for modern automobiles in the coming decade raise concerns regarding the possible methods available for satisfying the fuel economy projections. One of the most promising solutions for this ongoing dilemma

would involve the development and implementation of advanced automotive fuel additives. Fuel additives to introduce enhanced performance and protective properties have been staples in modern gasoline formulations.

Typically, the wide range of advantages translate to better fuel economy and improved overall functionality.

PROMINENCE OF OCTANE BOOSTERS AND ETHANOL-GASOLINE BLENDS Octane boosters are commonly used in modern gasoline formulations to increase the octane rating of the gasoline. Since octane ratings are measures of fuel stability, the higher the octane number the more stability. Boosted octane ratings also yield greater engine knocking resistance and more horsepower by allowing higher compression.

In 1921, tetraethyl lead (TEL) became the first octane booster used in commercial gasoline, known as leaded gasoline. TEL was capable of boosting the octane rating of gasoline at a low cost but was known to cause health risks and damage catalytic converters in vehicles, negatively impacting exhaust quality. Consequently, the U.S. Clean Air Act of 1963 was established FuelsMarketNews.com

PHOTO©ISTOCK/ TSIKHAN KUPREVICH

FUEL MARKETERS

by the EPA to mandate the option of unleaded gasoline in U.S. gas stations by 1974 and the gradual transition away from TEL. The search for alternative octane boosters led to use of methyl tertiary butyl ether (MTBE) and a blend of benzene, toluene, ethylbenzene and xylene (BTEX). MTBE found use in increasing the oxygenate content of reformulated gasoline, yielding higher octane ratings and reductions in harmful tailpipe emissions.

However, the high-water solubility of MTBE and the potential risk for the contamination of drinking water resulted in its eventual removal in commercial gasoline formulations by the EPA in 2005. BTEX still finds some use as an octane booster, but the Control of Hazardous Air Pollutants from Mobile Sources rule was updated by the EPA in 2007 to limit benzene content in gasoline at 0.62%.

Ethanol is the most widely used octane booster today, with about 98% of U.S. commercial gasoline containing up to 10% ethanol to boost octane and satisfy the Renewable Fuel Standard.

E10, a blend composed of 10% ethanol and 90% gasoline, is the most commercially available gasoline, while E15 and E85 are widely available as well. E15 contains 10.5% to 15% ethanol and is approved for use in model year 2001 and newer light-duty conventional vehicles. Meanwhile, E85, a blend containing 51% to 85% ethanol, is classified as an alternative fuel under the Energy Policy Act of 1992 and can be used in flexible fuel vehicles.

MINIMIZING FRICTIONAL LOSSES USING FRICTION MODIFIERS Combustion engines typically encounter significant energy loss due to friction, which is a prime cause for FuelsMarketNews.com

fuel inefficiency. Up to 25% of the fuel consumed per engine cycle is used to overcome friction between the piston and cylinder wall in gasoline engines, according to the National Highway Traffic Safety Administration. The upper portion of the cylinder is often not lubricated by motor oil; thus, fuel is usually the optimal lubricant for this application due to its proximity.

However, the combustion of gasoline within the cylinder removes any capacity for the gasoline to act as lubrication, thus requiring the addition of friction modifiers.

Friction modifiers allow for a thin layer of lubrication to coat the walls of the cylinder, reducing friction and wear, as well as decreasing the amount of gasoline burned per cycle. According to Chevron, friction modifiers have a water-soluble end that attaches to the metal surface of the cylinder wall and an oil-soluble end that faces outward to reduce friction. ExxonMobil introduced its Synergy Supreme+ premium gasoline, which includes a new friction modifier that reduces wear and tear on engines by up to 30%, according to the company. Similarly, Shell’s V-Power NiTRO+premium gasoline yielded significantly smaller wear scars in a wear test (ASTM D6079) against lowest additive concentration (LAC) gasoline, according to the company.

Fuel additives to introduce enhanced performance and protective properties have been staples in modern gasoline formulations.

COMBATING CARBON ACCUMULATION WITH FUEL DETERGENTS The accumulation of carbon deposits in internal combustion engines necessitates incorporating detergents in many gasoline formulations. Fuel injectors are especially susceptible to carbon buildup, as deposits tend to form due to the oxidative degradation of gasoline components. The implementation FMN Magazine SUMMER 2021 | 31

FUEL MARKETERS

Dr. Raj Shah is a director at Koehler Instrument Company, a leading manufacturer of petroleum testing instruments, and an active ASTM member for the past 25 years. Contact him at rshah@koehlerinstrument.com.

Stanley Zhang is a student of chemical engineering at SUNY, Stony Brook University, where Dr. Shah is an adjunct professor and the chair of the external advisory committee in the Deptartment of Material Science and Chemical Engineering.

32 | FMN Magazine SUMMER 2021

of catalytic converters in the 1980s increased the popularity of fuel injection systems over carburetors.

As a result, the formation of carbon deposits on fuel injectors became increasingly prevalent, which made fuel injector cleaners and detergent mainstays in many additive packages. In 1980, Chevron developed one of the first fuel injector cleaner additives, known as PRC and later renamed Techroline, which contained polyetheramine. In 1995, Chevron released the product under the name of Techron, while other major companies soon followed suit, including BP and ExxonMobil with Invigorate and Synergy, respectively.

By 1996, the EPA established the LAC standard to require a minimum amount of fuel detergent in gasoline.

However, many automotive manufacturers felt that the minimum requirements outlined in the LAC standard would be insufficient in providing adequate deposit protection for their engines. Consequently, an organization of eight automakers—Audi, BMW, Fiat Chrysler Automobiles, General Motors, Honda, Mercedes-Benz, Toyota and Volkswagen— was formed to collaborate in establishing the Top Tier Gasoline program in 2004.

This introduced a higher standard for gasoline detergent additives and increased the concentration of certified detergents in fuels to raise fuel quality and enhance engine performance. A study by the American Automobile Association (AAA) revealed that the use of top tier gasoline resulted in 19 times fewer IVDs when compared to non-top-tier gasoline. Additional research found that the long-term use of non-top-tier gasolines could culminate in a fuel economy reduction

of 2-4%, according to AAA. The premium performance of top tier gasoline is available at over 54 different retailers around the world, including BP, Chevron, Conoco, ExxonMobil, Marathon, Shell and Sunoco. Top tier licensed gasoline is likely to garner further prominence, as more advanced engines will require its improved efficiency and protection.

BENEFITS OF CORROSION INHIBITORS, DEMULSIFIERS AND SOLVENTS Corrosion is another common issue that can negatively impact automotive performance. Fortunately, corrosion inhibitors can be utilized to minimize the corrosion of tanks, fuel lines, injectors and pumps from contaminated fuel. Several gasoline brands include corrosion inhibitors in their additive packages, which can line the metal components in a thin, protective coating. Also, demulsifiers are typically included to expedite water separation in emulsified fuels to prevent metal corrosion and filter plugging.

Additive packages typically incorporate solvent fluids to facilitate the mixing of the various ingredients within fuel formulations as well.

These compounds can prevent the formation of unwanted films on engine components from fuel detergent additives that can potentially cause damage to parts of the fuel system.

Modern gasoline engines will increasingly necessitate the development of higher performance, more efficient fuels. Stringent regulations on emissions and fuel economy will similarly increase. Fuel additives aim to address these challenges by offering a wide range of performance, efficiency and protective benefits for modern gasoline formulation.

FuelsMarketNews.com

34 | FMN Magazine SUMMER 2021

FuelsMarketNews.com

WILL

CHINA BE THE NEW

OPEC? S

omething extraordinary happened in 1973—the United States and various aligned nations found themselves at the mercy of a handful of small, underdeveloped countries located in the Middle East. The Organization of Petroleum Exporting Countries (OPEC) reacted to the U.S. support of Israel during the Arab-Israeli war by instituting an oil boycott and a production cut.

While this action had a political face, it also had economic underpinnings. OPEC had been working to realign the supply and demand equation to favor the oil producers, and this event firmly established the producers as the dominant partner in the relationship.

The rise of fracking strained the OPEC leverage. The United States now enjoys a Beijing’s significant degree of not only independence dominance of the but also actual dominance with crude and natural gas. Similarly, these new sources of lithium battery oil expand and decentralize future supply market raises in the oil markets.

Now, with the remarkably rapid push for questions with the electrification of the vehicle fleet among rush toward EVs. various governments, are we moving toward a return to an OPEC-like scenario

BY KEITH REID focused on China?

FuelsMarketNews.com

FMN Magazine SUMMER 2021 | 35

CHINA CERTAINLY SEES BOTH ECONOMIC AND SECURITY ADVANTAGES TO HAVING A DOMINANT MARKET POSITION WITH LITHIUM BATTERIES.

London-based research firm Benchmark Mineral Intelligence recently outlined the scope of the issue, showing Chinese dominance throughout the lithium-ion battery to electric vehicle (EV) supply chain. China controls 80% of the chemical production of battery grade raw materials (think refining in the oil industry); 61% of cathodes and 86% of anodes (battery components); and 73% of finished lithium-ion batteries. Only 23% of battery raw materials come directly from China, but that can be deceptive. China has been heavily investing in mining operations in South America and Australia that hold major reserves.

The Institute of Energy Research (IER) indicates that China is among the top five countries with the most lithium resources. As noted, it has been heavily investing in lithium (and other critical mineral production) throughout the world.

For example, IER notes China’s Tianqi Lithium owns 51% of the world’s largest lithium reserve in Australia. Another Chinese company has a long-term agreement to underwrite all lithium raw materials produced in Australia’s secondbiggest, high-grade lithium reserve. China is the second-largest shareholder in the largest lithium producer in Chile.

36 | FMN Magazine SUMMER 2021

HISTORY LESSON The driver for Chinese dominance in lithium battery production starts at home. China is resource constrained in numerous areas compared to its domestic needs. Electrification of the vehicle fleet is seen as beneficial from a pollution standpoint (aside from any climate-related carbon concerns).

China certainly sees both economic and security advantages to having a dominant market position with lithium batteries.

“I don’t think anyone should be shocked,” said Lewis Black, CEO of Toronto-based Almonty Industries, a global mining operator specializing in tungsten. Tungsten is also used in fast-charging applications and is similarly dominated by China.

“I don’t think anyone should see this as an enormous conspiracy—China’s looking to take over the world. They planned, and they executed.

Why would they keep supplying raw materials to a value chain that does not exist within China?

You could not have given a lithium mine away five, six years ago. Nobody cared. When lithium rose to the top [as a battery technology], China essentially had almost total dominance over that product. And there was no coincidence that they also then almost immediately strove to become the largest supplier of lithium-ion batteries.”

It was a deal that worked well for the producers of the solutions that required lithium batteries.

“It’s so extraordinarily easy to buy from China,” Black said. “It’s a win-win for you. You don’t have to carry inventory, just pick up the phone and there’s no problem. It’s in the container and on its way.”

Black expanded that point with mining. America previously has had mining operations producing many of the metals currently under Chinese control. However, regulatory and environmental pressures have pushed the operations offshore.

So, what are some of the major downsides with the current situation?

SUPPLY CHAIN ISSUES As of late spring 2021, there were a range of disruptive events in various sectors driven by COVID-related disruptions of production base and supply chains. The global semiconductor shortage dramatically illustrates some of the many risks associated with a heavily regional and non-diverse FuelsMarketNews.com

PHOTO©ISTOCK/PETOVARGA

industry serving global markets. The shortage was driven by highly consolidated major manufacturing; Asia-centralized production; global logistics disruptions; and poor supply/demand projections among manufacturers.

As with semiconductors, the lithium battery supply chain was negatively impacted by COVID-19, though in a less dramatic fashion.

A future far more reliant on EVs would undoubtedly have greater vulnerabilities.

“U.S. domestic production of batteries and other energy technologies is paramount to the security and sustainability of the electric transportation industry moving forward,” said James Breyer, CEO of startup Hercules EV, in a 2020 article in InsideEVs. “While supply chain disruptions of the magnitude seen with COVID-19 are hopefully fewer than once per millennium, it showcases the need for distributed supply chain networks.” He added that his company will work aggressively to partner with regional manufacturers.

POLITICAL CONCERNS One major difference between China and OPEC is that although OPEC was effective, it was limited by being an organization of different oil producing states that often had divergent political or economic motivations. This effectively put some limits on the organization’s ability to remain unified on its most aggressive initiatives. China’s neo-Communist government has far more unity and control.

China is a global economic and regional political competitor to the United States and Europe.

It aims to be the Pacific region’s dominant power and has established the “nine-dash line,” claiming ownership of large swaths of the South China Sea. Tensions have increased in the region with its Asian neighbors (Malaysia, Vietnam, Philippines, Japan) and the United States. Similarly, China has long threatened to “militarily reunify” Taiwan. As the world becomes more reliant on lithium batteries, this becomes a potential point of leverage in global diplomacy.

“They have never turned around and said, we’re not going to give you this,” Black said. However, during the coronavirus pandemic questions about access to supplies like antibiotics and other drugs did arise as the crisis unfolded.

FuelsMarketNews.com

Would shutting off battery supply have the same direct impact as oil? EV penetration is currently limited, so the impact would be painful (and not just for the loss of EV-related batteries) but likely not crippling. In the future that might change with far greater penetration of EVs and the significant growth of grid-related battery support, at least if the supply situation remains unchanged.

MOVING FORWARD The supply imbalance is hardly a secret. Addressing it requires increasing capacity in all areas from the raw materials to finished batteries.

“I think you have to develop the best projects that are not just exclusively domestic but also in countries where you have a relationship that is long proven and reliable,” Black said. “Whether it be the EU, Australia, South Korea—countries where there is a vested interest to ensure that supply chain diversity is successful.”

Black noted that the Chinese foreign investment model is equally applicable to other national interests. All the tungsten produced from his international operations is exported to the United States. Most members of Almonty’s board are American, as is the largest base of shareholders. “Would I like to mine tungsten in America?

Absolutely. But in the 1950s and 1960s tungsten had a higher value than gold, so a lot of the sites are depleted or environmentally compromised.”

FMN Magazine SUMMER 2021 | 37

AS WITH SEMICONDUCTORS, THE LITHIUM BATTERY SUPPLY CHAIN WAS NEGATIVELY IMPACTED BY COVID-19, THOUGH IN A LESS DRAMATIC FASHION. The Biden Administration has implemented an executive order, Securing America’s Critical Supply Chains, which includes “large capacity batteries.” This involves a 100-day review across federal agencies that will address vulnerabilities in their supply chains.

Similarly, the U.S. government is working with Canada to expand the regional production of minerals and finished batteries used to make electric vehicles. Canada is seen as a more favorable mining source for EV materials due to environmental resistance in the U.S., according to Reuters.

U.S.-based Tesla is responding to the risk. At the September 22, 2020, Tesla Battery Day, the company announced that it is looking to both increase and diversify its battery supply. Tesla plans to achieve 100 gigawatt hours of internal battery capacity (supplemental to current supplier contracts) in 2022 and 3,000 gigawatt hours by 2030.

Reuters reported that two major Korean battery manufacturers are building large factories in the U.S. specifically to produce electric-car batteries, and The Wall Street Journal reported that U.S. battery-making capacity is expected to increase sixfold by 2030.

The European Battery Alliance was launched in October 2017, with core participation from BMW, Daimler (Mercedes-Benz) and Volkswagen. The stated purpose is: “… to ensure that all Europeans benefit from safer traffic, cleaner vehicles and more sustainable technological solutions. All this will be achieved by creating a competitive and sustainable battery cell manufacturing value chain in Europe.”

The priority actions include steps to: Secure access to sustainably produced battery raw materials at reasonable cost; make Europe the global leader in sustainable battery technology; create and support new markets for batteries through clean energy and “mobility” packages; conduct advanced research into battery technologies; and standardize 38 | FMN Magazine SUMMER 2021

storage-related installations and safety rules, including charging infrastructure, active load compensation and the enabling of vehicle-togrid solutions. Billions of euros are already being committed to numerous projects.

As BloombergNEF reported, Volkswagen plans to build six battery factories in Europe for a capacity of 240 gigawatt hours by 2030. The publication noted that would make VW and its partners the world’s second-largest cell producer after China’s Contemporary Amperex Technology Co. Ltd. The European challenge is not in the building of production facilities but in access to raw and refined materials. “There are all these empty car factories they’re turning into battery factories,” Black said. “The physical act of converting the factory itself is not a big lift, so you can diversify. But then you must procure the raw materials—that’s the biggest challenge for the supply chain. And, to open a factory may take you 18 months to two years. Whereas with a mine, the design alone will take you four years.”

One approach that Black strongly recommends to counter current Chinese dominance has a parallel in petroleum today—a strategic reserve.

“One way that you could ensure a supply chain that was free of drama is to adopt a stockpiling approach,” he said. “You stockpile various strategic metals, which you then sell to American manufacturers at market price. That ownership must be transparent. The government gives you a contract; you supply it to them at the market price. There is a market risk, but a lot of commodities can be hedged to shield yourself from that.”

Keith Reid is editor-in-chief of Fuels Market News. He can be reached at kreid@fmnweb.com.

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LEAD A DYNAMIC FUEL MARKETER DUO TAKES SERVICE TO A NEW LEVEL AT BROCO OIL.

BY KEITH REID

40 | FMN Magazine SUMMER 2021

FuelsMarketNews.com

Harvey, Irma, Florence, Dorian, Laura and Sally.

Broco Oil also served as the prime fuel contractor for the 2018 Columbia Gas event where multiple explosions left residents without gas service throughout the Merrimack Valley.

BROCO OIL OWNERS ROBERT AND ANGELA BROWN AND THEIR DAUGHTER FARRAH.

I

t is not uncommon for “new” heating oil dealers to date back to the 1950s. The older ones often got their start delivering ice or coal before the 1930s. By that standard, Broco Oil, which offers heating oil and propane delivery to homes in Massachusetts and New Hampshire, is a very new company.

It started in the traditional way with a single truck in 2007 by local fire captain and U.S. Navy Seabee veteran Robert Brown and his wife, Angela. The company currently has 30 trucks and 45 employees. The business has expanded to provide mobile municipal and commercial fleet fueling, generator fueling, propane sales, tank maintenance services and a multifuel rail terminal. In 2019, Brown was named Veteran-Owned Small Business Owner of the Year by the Small Business Administration.

Perhaps most notable has been the company’s involvement with supporting disaster relief efforts. These events have included hurricanes

FuelsMarketNews.com

FMN: What prompted you to enter the industry?

Robert: I always knew I wanted to be an entrepreneur, and I had my chance when I got out of the Navy in 2005. Angela stuck with me through the military, and I proposed to her, and she said, yes. I got right on the fire department when I got out, but I ended up doing multiple jobs on the side because of the shifts you have with being a career firefighter.

I was driving a big truck in the summer pumping concrete and when the winter came, I was getting laid off, and I thought it would be a good idea to drive for a local oil company. I realized you interact with customers, and you get called for emergencies, which I liked.

Angela and I were sitting there, and she said we should do this together. I thought we would be good at it because we’re well-known in the area. Angela was always a very hard worker, and we complement each other well with a similar work ethic. My whole family has been public servants—veterans and the police and fire brotherhood. Word of mouth gets around fast, and we realized we could serve the police, firefighters, veterans, blue collar workers—and I became their go-to oil guy for heating.

FMN: Angela, what is your background?

Angela: I have a degree in business and entrepreneurship. I also have my CDL, my hazmat and tanker endorsements—all those certifications you can think of. I kind of grew up in the construction and excavation industry. I didn’t have a finance background, which would have been very useful.

FMN Magazine SUMMER 2021 | 41

IT WAS CHAOS FOR THE FIRST 10 YEARS OR SO. WE WERE NOT REALLY PLANNING FOR THE GROWTH, NOT EXPECTING TO DOUBLE IN SIZE EVERY YEAR AND NOT HIRING AS WE NEEDED. IT WAS TRIAL BY FIRE. FMN: What was the biggest challenge getting started?

Robert: Being so green—we were turning 25 at the time—I said, OK, I’ll buy an old truck, which was $7,000. We then realized we needed to get a line of credit because you can’t just pick up oil anywhere, and nobody would give us a shot.

Angela: We didn’t have any money or anything to use as collateral. I bought our printer off eBay for $20 because I could not afford to go buy one at Staples.

Robert: The SBA ended up giving us a $25,000 a loan—no collateral. And that was really the critical piece in the beginning that made things happen.

Now, they kind of use us as the poster child for small business success stories, and I always advocate for people to go to the SBA. FMN: Describe the early days.

Robert: It was slow when we first started because even the people that 42 | FMN Magazine SUMMER 2021

knew me wanted to make sure we were legitimate. It was at least a year or two before I started getting any traction.

Angela and I were personally taking the calls. I would just go door to door.

You have to swallow your pride and realize you have to start somewhere.

Angela: It was chaos for the first 10 years or so. We were not really planning for the growth, not expecting to double in size every year and not hiring as we needed. It was trial by fire. I’ve done every job here from the beginning, and as we grew I would peel a little bit off and give that to somebody else. Now, I’m more in the business development side. We just hired a CFO, and he’s been a lifesaver. We’re much better now at projecting how we’re going to grow.

FMN: How did you get into mobile fueling?

Robert: I would grow the business off being responsive while a lot of competitors are not, so we started getting a name for ourselves. Then, people that we served worked for construction companies and started asking us to fuel in the summertime. As we started hiring people, I’d rather give a guy a full-time job and not be seasonal, and that’s how we got into on-road and off-road diesel locally. And our service built it from there.

FMN: How did you get into emergency fueling?

Robert: I had a call from a guy when Washington, D.C., had that snowstorm FuelsMarketNews.com

back in 2016. They sent a bunch of guys down from out of state to plow snow. And then they started sending snow melters. So, the guy asked me if I could guarantee their fuel supply? I wasn’t even supposed to be down there, but I got two trucks, and we did the fueling operation.

The second response was after Hurricane Harvey. They didn’t have the small trucks to get in and really get after it for the small generator fueling. So, I got called way up here because they know my Seabee mentality—can do! We always went into places where we had to figure out how to get something done.

Some people see dollar signs; we did it at first without asking about the money because that’s what we do. And that right there was the most important decision I ever made for the company.

Doing the right thing has come back tenfold.

FMN: How much government versus private work do you do during disasters?

Robert: Mainly private, though Lake Charles was government. With the Columbia gas explosions, you had 500 generators running people’s homes—their electricity, the heat. A contract like that could be handled by one of these huge corporations, but we got hired as a subcontractor. We worked for all these other certified vendors, even though we were not hired directly by FEMA.

getting into the emergency world—we like to help people.

For Hurricane Irma we didn’t have housing set up. Some of our guys slept on top of oil trucks. At least the weather was nice enough. So, they put up mosquito nets and slept that way for six weeks.

But all the guys were bought into the mission because we were serving hospitals.

There are a lot of guys with us that always did want to serve, but maybe it was not in the cards for them. And these guys get a feeling of commitment with us and have a passion for it.

FMN: How do you manage morale at the disaster sites?

Robert: Looking out for the crew’s wellbeing is always in the forefront of any mission. The only thing we know how to do is embrace the suck together. And the morale goes up because they say, you know what, this isn’t that bad. We’re all doing a great thing. You must hire people that want to help people. That’s our whole reason for

FMN: How important is your service at these disaster sites?

Robert: We’ve had hospitals where if we ran out of fuel people would start to die in five minutes. So I’m just stationing a truck in the area. You have wastewater treatment facilities—the pumping stations. People always forget about that aspect. The wastewater treatment facility must be in good working order.

FuelsMarketNews.com

FMN Magazine SUMMER 2021 | 43

LOOKING OUT FOR THE CREW’S WELLBEING IS ALWAYS IN THE FOREFRONT OF ANY MISSION. THE ONLY THING WE KNOW HOW TO DO IS EMBRACE THE SUCK TOGETHER.

FMN: This tends to be a male-dominated industry. Angela, how do things go when you’re the one calling the shots?

Angela: I know how to do all the jobs and have done them. Somebody complains about hauling a load or something, they know I can jump in the truck and do it. I’m not shy, and I don’t mince words—I’ve always been an assertive and dominant type of person. I don’t think there’s anyone here that would second guess what I say. So, I really don’t have a problem with that.

FMN: Bioheat (a heating oil/biodiesel blend) is a heating industry priority. How are you incorporating biofuels into your operations?

Robert: Biofuels really became an opportunity when we reactivated our railroad terminal facility. We wanted to be green from the start, and we always try things. When biodiesel hit our radar, we started introducing that into our heating oil. We have been blending biodiesel for a few years now, and 44 | FMN Magazine SUMMER 2021

things really got interesting with the [regional] carbon initiatives. We’re now in the front line, being the biggest supplier in our New England area because we have the rail terminal.

We have a good partnership with REG. I’m serving the greater Boston area and the city of Boston with B20.

We have all our residential accounts— roughly 15,000 customers—getting B30 blends right now. And we’re going to be stepping that up to B50 by 2025.

It’s the only sustainable option for Massachusetts, which has to be net zero by 2050. We can’t get there unless we embrace biodiesel.

FMN: How has technology impacted your operations?

Angela: Up until five years ago we had printed tickets with the carbon copies. And I used to rip them all by hand—hundreds of tickets every night. I would separate them by town on the floor in front of me, and I would figure out my routes for everybody. And then usually at 11 o’clock at night, I would be dropping them in the trucks. Now we have an automated system, which is like heaven. It doesn’t matter where you are in the country. I can dispatch add, hold, move things around.

And it tracks absolutely everything.

Keith Reid is editorin-chief of Fuels Market News. He can be reached at kreid@ fmnweb.com.

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A lack of drivers is challenging the trucking industry and impacting retailers.

Since last August, merchandise deliveries to Square One Markets in Pennsylvania have been delayed at least 10 times, usually for about 24 hours. The reason: There was no driver available to make the delivery.

“Our distributor has never had that problem before,” said Lisa Dell’Alba, president and CEO of Square One Markets.

“But Pennsylvania is having a terrible time finding workers—construction, convenience store and truck drivers. It’s been difficult and caused a bit of disruption in our organization.”

Although Dell’Alba has been understanding about the delays, the issue is significant.

Especially when a popular brand of cigarettes is out of stock.

46 | FMN Magazine SUMMER 2021

“We try to manage our inventory efficiently, so we are not sitting on too much merchandise,” she said.

“And I’ve always taught our folks to have an order [of cigarettes] on hand. If you’re out of someone’s cigarettes, it’s like being out of fuel. And cigarette sales have gone up in this area since the pandemic began.”

HIGH TURNOVER Talk to people in the trucking industry, and some may tell you there is no shortage of truck drivers.

“That’s a myth,” said Norita Taylor, public relations director for the Owner-Operator Independent Drivers Association, a Missouri-based organization that advocates for the rights of independent truckers.

“What’s going on is high turnover in the longhaul sector of trucking,” she said. “If you look at the number put out by the American Trucking FuelsMarketNews.com

Association (ATA), they report extremely high turnover—sometimes 90% or higher. If you have high turnover, you don’t have a shortage. You have a surplus. But you’re not retaining them.”

In March, ATA reported that the fourth-quarter turnover rate for truckload fleets with more than $30 million in annual revenue was unchanged at a 92% annualized rate, while the churn rate for smaller truckload carriers was 72%.

ATA sees continued tight demand for truck drivers as the economy recovers and freight volumes grow.

“Motor carriers need to remain focused on driver retention,” ATA Chief Economist Bob Costello said.

“While the driver shortage temporarily eased slightly in 2020 during the depths of the pandemic, continued tightness in the driver market remains an operational challenge for motor carriers, and they should expect it to continue through 2021 and beyond,” Costello said.

The challenge of keeping truckers on the road is not new. Western Truck Owner magazine ran a three-part FuelsMarketNews.com

series on the problem back in 1928. Two years ago, ATA reported that the over-the-road driver population was 550,000 to 600,000, about 60,000 fewer drivers than the number needed. ATA estimates there could be 100,000-plus unfilled positions within four years if the situation doesn’t change.

Since about 71% of all U.S. freight is moved by trucks, a lack of active drivers is a problem. And there are multiple reasons for it, according to ATA, not just the pandemic. For one, the average driver’s age in the for-hire, over-the-road trucking industry is 46, and many veteran drivers are retiring.

A report published in 2019 by the American Transportation Research Institute estimated that 898,000 new truck drivers will be needed over the next decade, and half of those jobs will replace current drivers who retire. However, young people aren’t rushing to fill those vacancies.

BUMPY ROAD Several things may discourage young people from taking to the road. The expense of attending FMN Magazine SUMMER 2021 | 47

truck driving school and obtaining a Commercial Driver’s License can range between $3,000 and $7,000, depending on the issuing state. In addition, major carriers typically require new hires to have one to three years of driving experience, and then there’s the issue of long periods on the road.

“Today, the average driver is gone [from home] for three weeks at a time,” said Dr. Michael Belzer, a former truck driver who earned a Ph.D. and now studies the trucking industry as an economics professor at Wayne State University. “If you were 22, would you want to do that? Of course, you can always take your knowledge and drive local. You’ll make less money, but you’ll be at home.”

Justin Harness, chief revenue officer of U.S. Xpress Enterprises, one of the nation’s largest carriers, said, “As an industry, we need to look at the nature of the job. Driving a truck is a tough job. You’re often gone for weeks at a time and have an inconsistent lifestyle. This isn’t conducive to those with families. We should focus on putting the driver first—keeping them busy so they’re making money but also respecting their family time and getting them home when not working.”

48 | FMN Magazine SUMMER 2021

The industry has tried to attract all segments of the U.S. population to the driver’s seat of a big rig but has only enjoyed moderate success.

In 2018, 40.4% of drivers were minorities, up from 26.6% in 2001, reports ATA. But that same year, only 6.6% of professional drivers were women, a figure that has remained steady for almost two decades.

In 2019, the ATA established a diversity working group to consider ways to boost urban hiring and recruit more women and people of color. The organization plans to partner with historically Black colleges and universities to increase the number of minorities in the industry’s executive ranks.

TOUGHER WORK RULES A new deterrent for potential drivers is the federal government’s Drug and Alcohol Clearinghouse, which went into effect in January 2020. Mandated by Congress and administered by the Federal Motor Carrier Safety Administration, the clearinghouse is an online database that provides employers, driver FuelsMarketNews.com

A new deterrent for potential drivers is the federal government’s Drug and Alcohol Clearinghouse. licensing agencies and law enforcement officials with real-time results of the required drug and alcohol tests taken by professional drivers.

In the first six weeks of operation, the clearinghouse detected and identified nearly 8,000 positive substance abuse tests of commercial drivers, including bus, limousine, municipal and construction equipment operators, as well as truckers.

According to Harness, the clearinghouse has motivated a substantial number of drivers to leave the industry. “Combined with other factors, like drivers opting for often higher-paying construction jobs, around 200,000 will exit the driving workforce this year (2020) alone,” he said.

Adding to the transportation issue is diminished truckload capacity nationwide. “Carrier bankruptcies nearly quadrupled from 2018 to 2019,” he said. “And continually rising insurance premiums are hobbling small carriers. Add to this relatively flat new truck orders over the past year.”

HIGHER PAY FOR THE LONG HAUL The biggest obstacle to attracting new truck drivers may be pay. While Walmart truckers— all of them employees of the retail giant—make a highly publicized salary of about $90,000 a year, the average annual wage for a tractortrailer driver was $45,570 as of May 2018, according to the U.S. Bureau of Labor Statistics.

FuelsMarketNews.com

Indeed.com, the job board site, puts the average salary at $62,835 a year, based on more than 400,000 salaries anonymously submitted to Indeed and data culled from job posts over the past 36 months as of April 12. Indeed notes that the typical driver only stays about a year on the job.

The glitch in pay is that “drivers are paid by the mile but regulated by the hour,” said Norita Taylor, public relations director for the OwnerOperator Independent Drivers Association. The federal hours of service regulations, which mandate how many hours a trucker can drive in a day and when rest breaks are required, “make it very challenging to make a living if you aren’t paid by the hour.”

The average driver works about 65 hours a week “and is not coming home with that much [money],” said Belzer. “And a lot of their time is unpaid, nondriving time,” such as waiting while their trailers are loaded or unloaded.

Shipping is one of the most competitive markets, and “competitive markets drive down rates,” he added. “The shippers and consignees have the leverage. They’re the ones that get the companies competing with each other. The carriers will often take below-compensatory rates to move freight.

They want to keep the trucks moving. They may lose money, but they figure on the next load they’ll make money.”

Trucking is a cyclical industry “that is very commoditized with very thin margins, which FMN Magazine SUMMER 2021 | 49

The average driver’s age in the for-hire, over-theroad trucking industry is 46, and many veteran drivers are retiring.

makes it difficult for any carrier to provide significant pay increases without a larger catalyst,” said Harness. “Unfortunately, there are no short-term fixes to this problem, but as an industry, there will be opportunities for more discussion—both by trucking companies and our shippers—in the longer term.”

SELF-DRIVING TRUCKS Although there is no immediate solution to the need for working truckers, many things are going on in the industry. Numerous companies, including Daimler, Aurora, Waymo and Embark Trucks, are working to develop a self-driving truck that can move goods across the country safely. TuSimple of San Diego already has 40

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autonomous trucks transporting goods on U.S. roadways. So far, all of them have a backup driver on board. The company plans to create routes through Texas and between Los Angeles and Jacksonville, Florida, in the next few years.

Belzer has no doubt that these efforts will come to fruition and thinks self-driving trucks could be a solution for moving merchandise and materials between warehouses. But he’s skeptical about seeing them zip along the nation’s highways.

“There are so many pieces behind making this happen, and the development of this technology is expensive. Right now, we’re paying truck drivers minimum wage at best. Why would I pay three times as much for an autonomous truck when I can pay the truck driver so little?” he said. “And I’m

not convinced that the public is willing to see an 18-wheeler going down the road without a driver.”

Harness of U.S. Xpress Enterprises predicts that high driver turnover will continue, “exacerbated by lower commercial driver’s license school enrollment and the Drug and Alcohol Clearinghouse,” he said. “It’s becoming increasingly clear that high tide conditions will persist for a long while.”

Pat Pape worked in the convenience store industry for more than 20 years before becoming a full-time writer. See more of her articles at patpape. wordpress.com.

T HE P ROM I SE OF

PROPANE NPGA Southeastern Convention & International Propane Expo is the industry’s largest event—bringing together marketers and suppliers from across the United States and beyond.

“Southeast is our most important show of the year, both for generating leads and for meeting with exsisting customers – EVERYBODY is there!”

— Ben Gutkin, Warm Thoughts Communications, Clifton, New Jersey

REGI STR ATIO N IS O PENING S O O N !

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6/2/2021 4:47:55 PM FMN Magazine SUMMER 2021 | 51

INDUSTRY NEWS BENNETT PUMP RECEIVES VERIFONE POS EMV CERTIFICATION

Bennett Pump has received a letter of acceptance for Verifone POS systems on Heartland payment networks using the Bennett payment solution. Three levels of certification are required for active outdoor EMV at any retail fueling site. Bennett payment solutions cover levels one and two with the EMV hardware and software. The POS providers are responsible for level three certification with a payment network. This is a significant achievement benefitting all Bennett payment system customers. Bennett’s EMV upgrade kits provide a factory-fit solution for most every Gilbarco, Wayne and all Bennett fueling dispensers. Further, Bennett EMV upgrade kits represent an economical method for retailers to quickly become EMV compliant regardless of which dispenser manufacturer they have at their facility. The effortless installation process of Bennett’s EMV kits will facilitate compliance in short order as they upgrade their Verifone POS.

KAG ANNOUNCES NEW LEADERSHIP TEAM

The Kenan Advantage Group Inc. recently announced a leadership transition. After serving nearly 40 years in the transportation industry, President and CEO Bruce Blaise retired, and Charlie DeLacey, former CFO, has become CEO. Grant Mitchell, former COO, has taken on the additional responsibilities of president. The Kenan Advantage Group operates through its six groups consisting of Fuels, Specialty Products, Food Products, Merchant Gas, KAG Canada and KAG Logistics.

FLEET FUELING: THE FUELCLOUD TRUCK SYSTEM

FuelCloud has launched the FuelCloud Truck System, a fuel delivery system that uses FuelCloud’s patented technology to make fleet fueling faster, easier and more affordable for jobbers. Built on FuelCloud’s four generations of fuel industry experience and proven cloud-based technology, the FuelCloud Truck System makes fast and accurate fleet fueling possible without expensive on-truck hardware or manual delivery reconciliation. The core of the FuelCloud truck system is a software integration of FuelCloud’s transaction tracking technology with the Liquid Controls LCR-series registers—LCR-II, LCR 600 and LCR.iQ— already installed on jobber’s tank wagons. This integration allows delivery drivers to use the FuelCloud mobile app to deliver fuel and record delivery volumes in real-time on FuelCloud’s cloud-based dashboard. From the dashboard, office staff can monitor fuel delivery and create customer invoices using FuelCloud’s automated reporting 52 | FMN Magazine SUMMER 2021

tools, which significantly reduce the time typically required for reporting and billing.

GILBARCO VEEDER-ROOT EXPANDS E-MOBILITY PLATFORM WITH EVERSE

Gilbarco Veeder-Root announced it is expanding its e-Mobility platform with the European launch of EVerse, a new software offering that provides retailers and other businesses an end-to-end solution for hosting and managing electric vehicle charging networks. EVerse is designed to provide a customizable solution for customers wanting to offer electric vehicle charging services to consumers and private fleets. The platform provides GVR’s customers with the ability to create their own branded electric vehicle charging network that is tailored to their specific business and market needs. EVerse provides the functionality needed to run an EV charging network, including the ability to set pricing structures with multiple payment methods and establish contracts with electric vehicle owners. EVerse also provides a custom-branded app, giving consumers the ability to locate and pay for charging. As the number of EVs on the road continues to accelerate, EVerse provides a scalable and flexible solution that grows with demand and is compatible with GVR’s full portfolio of software and hardware products. Additionally, EVerse is supported by GVR’s service network with usage analytics, remote diagnostics and in-field support.

PDI ACQUIRES GASBUDDY

PDI has acquired GasBuddy, a mobile app used by drivers to find and share real-time fuel prices.

With this acquisition, PDI extends its capabilities in direct-to-consumer delivery of promotional offers and communications, and engagement of consumers in convenience store and petroleum loyalty rewards programs. GasBuddy has five million active mobile users, representing billions of fuel gallons and hundreds of millions of dollars of convenience retail spend. The GasBuddy app currently generates fuel pricing information on 150,000 stations across North America. While most of its peer-topeer interactions are from users searching and posting local gas prices, the app also enables reviews of facilities and supports wayfinding. PDI intends to enhance GasBuddy’s current offering, extending the ability of convenience retailers to attract new consumers to shop at their stores, receive offers funded by CPGs and enroll in the retailer’s loyalty program. Additionally, PDI will enable retailers to extend personalized fuel pricing offers in real time to consumers who are onsite or driving nearby. Retailers will also have an opportunity to promote in-store products.

FuelsMarketNews.com

INDUSTRY NEWS

DOVER ANNOUNCES ACQUISITION OF AVALAN WIRELESS SYSTEMS INC.

Dover announced that it has completed the acquisition of AvaLAN Wireless Systems Inc. AvaLAN is a leading provider of highly-secure wireless and wired ethernet solutions, along with managed routers, software-as-a-service and cloudbased services that enable operators to securely connect various parts of the site infrastructure and take advantage of modern data-enabled operational, payment and customer engagement technologies. AvaLAN is now part of the Dover Fueling Solutions operating unit. Located in Huntsville, Alabama, AvaLAN focuses on solving data connectivity challenges by securely connecting difficult-to-reach network edge devices. AvaLAN’s solutions solve customers’ data connectivity challenges at the network’s edge for large retail, enterprise and government customers, and supplies secure, managed, PCI-compliant and easy-to-configure wireless ethernet solutions.

INSITE360 PARTNERS WITH TOTALSIR

Insite360 has formed a partnership with TotalSIR, enhancing the customer experience with underground storage tank leak detection. Statistical inventory reconciliation (SIR) has been used by fueling retailers for years to help meet EPA regulations for leak detection. As regulations have changed, so have SIR customers’ needs; however, the need for a high-quality reporting mechanism remains the same.

To serve the complex needs of single/small multi-site operators, Insite360 has partnered with TotalSIR to deliver high-quality analysis specific to the customer segment with increased focus on the needs of these customers and expanded expertise for compliance.

TotalSIR specializes in providing compliance assistance to this segment of the market, which represents the backbone of the retail fuel industry. Partnering with Insite360 empowers TotalSIR to take its leak detection compliance services to the next level.

ICONS©FLATICON.COM/FREEPIK

GETGO ADOPTS INVENCO PAY-AT-PUMP TERMINALS

GetGo has added new Invenco® G6 and G7 Pay-atPump terminals, iNFX retail microservices and a cloud services management platform at its 266 GetGo locations to address outdoor EMV, while providing a richer media experience for consumers. Partnership with vendors also allows for smarter and targeted content at the pump. Using the Invenco Cloud Services remote media management platform, video content and promotions can be tailored to a specific location, time of day and updated more frequently, replacing the previous static signage experience. Invenco Pay-at-Pump terminals provide enhanced customer security with outdoor EMV-enabled chip readers and advanced data protection and anti-skimming technology. The new touchscreens support future integration of touchless payment for contactless payments, such as Apple Pay, mobile wallet credit FuelsMarketNews.com

cards and Google Pay at the pumps. The technology also supports mobile ordering for another potential contactless option for customers to enjoy GetGo’s fresh food offerings.

LEIGHTON O’BRIEN DEEPENS SAAS PRODUCT EXPERTISE

Leighton O’Brien has boosted its product expertise following the appointment of Clay Moore as senior director of product across its SaaS division. Moore has more than 30 years of experience in software development including 13 years in the downstream petroleum industry. He joins Leighton O’Brien from Titan Cloud, where he was the director of product. Working closely with the company’s wetstock and IT teams, Moore will drive product strategy and bring even greater depth and breadth to its product portfolio.

RDM IS THE EXCLUSIVE NORTH AMERICAN DISTRIBUTOR FOR DEFENDER ONE®

RDM Industrial Electronics Inc. is the new, exclusive North American distributor for Defender One pump security products. Defender One products include retrofit alarm kits for fuel dispensers to protect stations against fuel theft with in-dispenser security and a built-in siren. Defender One products are UL listed and U.S. patented to deactivate a breached dispenser without cutting power to the pump. RDM Industrial Electronics is an industry’s leading remanufacturer of petroleum electronic equipment. RDM specializes in circuit boards, intercoms, displays, printers, card readers, motors, keypads and overlays, POS systems, consoles, tank monitors and probes with new replacement products available.

OPW RETAIL FUELING RELEASES DSE FIBERGLASS DISPENSER SUMP

OPW Retail Fueling has announced the launch of its new value-priced DSE Dispenser Sump. Produced using an advanced composite technology manufacturing process, the DSE Dispenser Sump is a high quality, affordable sump that can be quickly delivered to retail operators. The latest addition to OPW’s comprehensive line of dispenser sumps, the UL/ULC listed DSE is installed beneath fuel dispensers to provide access to and secondary containment for dispenser plumbing, emergency shear valves and underground piping connections. The close-molded manufacturing process provides additional features for the DSE Dispenser Sump, including consistent wall thickness, consistent shape and smooth surfaces on both interior and exterior sump walls for superior entry fitting sealing. These new sumps feature a single conduit-less base that is compatible with all major dispenser models while being designed for ease of nesting/ stacking and unstacking, which maximizes shipping and distributor warehouse space.

FMN Magazine SUMMER 2021 | 53

INDUSTRY NEWS

FYI: Dover Fueling Solutions Launches DFS DX FYI is used to spotlight new companies entering the industry, significant acquisitions or major platform changes among companies currently offering solutions.

D

over Fueling Solutions, a part of Dover Corporation that delivers fuel dispensing equipment, electronic systems and payment, fleet systems, automatic tank gauging and wetstock management, has launched DFS DX. This connected solutions platform has been under development for two and a half years and promises operational cost reductions, increased sales and an enhanced customer experience through a combination of intelligent connected cloud solutions.

“What we’re trying to do with the DFS DX is create a digitally connected site that integrates the forecourt with the inside of the store on two key areas,” said Matt Tormollen, vice president and general manager, DFS Solutions.

“One is around asset optimization, just making sure that every revenue- or compliance-related asset is being fully utilized 100% of the time. That can be a dispenser, making sure that it’s properly dispensing, or Internet of Things 54 | FMN Magazine SUMMER 2021

enabled smart refrigeration, HVAC or even revenue-generating devices like coffee pots. Then, once we have the site optimized, we’re looking at how to improve the consumer’s experience.”

The DFS DX platform offers five core solutions: DX Wetstock is an end-to-end fuel management solution for fuel retailers that delivers real-time precise fuel loss identification and notification, including leaks, theft, evaporation and initial fuel delivery errors.

DX Monitor helps reduce maintenance costs by enabling easy, remote, centralized fuel dispenser software updates and health monitoring. Being connected to your forecourt minimizes site visits and increases dispenser uptime.

DX Promote transforms the fuel dispenser into an integrated immersive digital experience. Targeted advertisements, multiple media options and loyalty integration help drive sales to your convenience store, car wash and other related services.

Retail makes it easier than ever to manage and update your point-of-sale (POS) systems remotely over multiple locations. Tokheim Fuel POS and DFS Self-Checkout systems continuously update securely and efficiently.

DX Fleet is a cloud-based fuel management solution that provides commercial fleet owners, operators and managers the ability to remotely monitor their entire fleet fueling enterprise from a single interface. DX Fleet is targeted at cardlock locations and integrates with DFS’ new Petro Vend® 300E EMV-compliant fuel island terminal.

DFS DX utilizes Microsoft’s secure and scalable Azure IoT platform and the DFS Edge device to connect, gather and quickly process a multitude of secure data points to deliver real-time information and promote third-party integration into the system.

“Microsoft has an ecosystem, particularly on the retail IoT space, of over 8,000 OEMs on the Azure platform,” said Tormollen. “We built it to be open, and that’s really caught the attention of a lot of retailers and major oil companies.” He noted that the intention is to be a truly open platform so that a retailer can customize the platform to meet specific operational needs.

The solution scales from the single site operator to the largest retail chains.

For more information visit: https:// www.doverfuelingsolutions.com/dfsdx.

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FMN Magazine SUMMER 2021 | 55

REMEMBER THIS?

What [the] Big New Pipeline Will Mean

BY KEITH REID

T

he following was reported in the April 1962 issue of NPN magazine: A large-diameter $350 million products pipeline from Houston to New York is the goal of nine major oil companies.

They hope to have the line operational and moving 25 million gal. a day by late next year. It will be called Colonial pipeline.

Yes … that Colonial pipeline. The pipeline that dominated the news cycle in early- and mid-May 2021, due to a significant disruption caused by a ransomware attack from a Russian hacking group. Colonial was shut down from May 7 to May 12. Although the cyberattack—apparently—did not directly impact the pipeline’s operational systems, the shutdown was seen as an appropriate cautionary measure. The company reportedly paid a $4.4 million ransom to the hackers.

The impact of the shutdown was significant but shorter-lived than hurricane-related disruptions. Supply was limited to nonexistent in some markets.

Prices increased notably, consumers lined up for gasoline and panic buying and hoarding ensued. Some stations ran out of fuel.

So, what drove the development of the Colonial Pipeline? The answer is typical for any pipeline project—to connect a production center (in this case Houston and Baton Rouge) to a geographical area some distance away that has sufficient demand to support switching from maritime, rail or truck transportation. The pipeline traveled up the East Coast to New York, with product terminals accessible along the way. As a Colonial Pipeline Co. press release stated at the time, it was “…the largest single, privately financed construction project in the history of the United States.”

“Petroleum product pipelines are a classic example of what is sometimes referred to as ‘the economies of scale,’ said Colonial Pipeline’s then President R.J. Andress. “With modern technology preventing the laying of large-diameter pipe, when volume grows to a sufficient size, the pipeline becomes the most economical means of transportation.”

The original oil companies backing the pipeline were American Oil, Cities Services Co. (CITGO), Continental Oil, Gulf Oil, Phillips Petroleum, Pure Oil, Sinclair Pipeline Company, Socony Mobil Oil and Texaco. Constructing the pipeline reportedly took 2,000 workers and a payroll of $6.5 million.

The article noted that the supply situation in the 14-state area to be served by the Colonial Pipeline had become tight.

The Plantation Pipeline, already serving the Southeast, was running at capacity during the winter months.

What did fuel marketers think about the pipeline development? Those NPN interviewed were not overly impressed.

American Oil jobber Jim Marting of Gadsden, Alabama, stated: “I can see how additional facilities will lead product to move in a more economical rate. But I don’t expect to get, for myself, a greater margin as result of the pipeline.”

The Colonial Pipeline has grown considerably since the first batch of refined product shipped in April 1964 through a single 22-inch line. Today, the pipeline spans more than 5,500 miles (mostly underground). It is the largest fuel transmission line from the Gulf Coast to the Northeast, transporting about 45% of all the fuel consumed on the East Coast.

Keith Reid is editorin-chief of Fuels Market News. He can be reached at kreid@fmnweb.com.

For more than 100 years, from its founding in 1909 to when it went out of business in 2013, National Petroleum News (NPN) documented the rise of petroleum marketing and retailing in the United States. NACS, PEI and The Fuels Institute have catalogued the rich history of NPN in its entirety. Each issue of Fuels Market News will look back at the history of our vibrant industry, through the eyes of NPN, to see how it reflects the issues, challenges and opportunities we face today.

56 | FMN Magazine SUMMER 2021

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There’s nothing we can’t see.

Let us show you.

The way you manage your forecourt is about to change. The launch of our brand-new DFS DX platform is imminent. Find out what the future holds for you and your fuel business by registering to attend one of our webinar sessions. doverfuelingsolutions.com/DXRegistration

© 2020 Dover Fueling Solutions. All rights reserved. DOVER, the DOVER D Design, DOVER FUELING SOLUTIONS, and other trademarks referenced herein are trademarks of Delaware Capital Formation, Inc./Dover Corporation, Dover Fueling Solutions UK Ltd. and their affiliated entities, registered in the United States and various other countries. 4th-DEC-2020

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