February 15, 2011 | Vol. 61, No. 4

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Dear PEI Member:

The second edition of the Petroleum Equipment Institute's Recommended Practices for Inspection and Maintenance of Motor Fuel Dispensing Equipment (PEI/RP500) has been released and is now available for purchase at www.pei.org/rp500. Price is $40 for members; $95 for nonmembers.

PEI's Fuel Dispensing Equipment Inspection and Maintenance Committee made over 35 changes to the document. Some of the more important changes involved:

Emergency stop switches.
Inspecting dispenser cabinets.
Procedures for taking nozzles out of service.
Methods for checking the integrity of hose.
Procedures for testing nozzles equipped with a mechanical interlock.
Plumbing from the top of the shear valve.
Suction-pumping systems.
Warning users that the country's move to higher ethanol blends and lower amounts of sulfur in diesel may result in leaks or unusual operating conditions that may necessitate more frequent inspections than outlined in the document.
Determining that DEF is outside the scope of the recommended practice.

This new edition of RP500 will be welcomed by regulators who permit petroleum marketers to dispense ethanol at blend levels higher than the dispenser's listing, provided that the dispensers are inspected on a regular basis. The reaction to the initial version of RP500 was very positive. This improved and updated edition builds on that fine document.

PHMSA RELEASES PROPOSED WETLINES RULE
The Pipeline and Hazardous Materials Safety Administration (PHMSA) is proposing to amend the Hazardous Materials Regulations to prohibit the transportation of flammable liquids in unprotected external product piping on Department of Transportation (DOT) specification cargo tank motor vehicles. The proposed rule would require bottom damage protection unless only a residual quantity of no more than one liter (33 ounces) of gasoline or other flammable liquids remain in each pipe. In-line purging devices―estimated to cost $2,585 per

Revised Dispenser Inspection Document (RP500) Available

Wetlines Rule Proposed

Weights & Measures Summary

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vehicle―would meet this rule. The proposal does not apply to cargo tank motor vehicles (CTMVs) transporting combustible liquids. Truck-mounted DOT specification CTMVs (i.e., straight trucks and bobtails) are exempted from the proposed rule since the external product piping is not exposed to impact from a vehicle collision in the same manner as transport trailers. The proposed rule would require existing transport trailers in flammable service to be retrofitted with bottom protection equipment or meet the maximum one-liter residue standard within ten years. Newly manufactured trailers would be required to comply within two years. Read the full text of the rule here.

NCWM INTERIM MEETING RECAP
Last month the National Conference on Weights & Measures held its interim meeting in Dallas. This meeting is a precursor to its upcoming annual meeting which will be held July 17-21, 2011, in Missoula, Montana. Weights and measures officials from across the country set the agenda for the annual meeting at this interim gathering.

Issues relevant to TulsaLetter readers included retail price posting guidelines, language related to oxygenated fuels and ethanol blends, a biodiesel disclosure proposal, and a potential new definition of remanufactured components. Most of these issues remained as they were before the meeting―a status known as "informational" (nonvoting). Here's a more detailed rundown:

A task group on retail price posting plans to meet two times before the annual meeting. Its goal is to offer a recommendation to amend Handbook 44 rules governing the way fuel dispensers display the price per gallon.
The proposed change to Handbook 130 concerning the vapor pressure of oxygenated fuels met with lively debate. While proponents of the change argued the revision was mostly clerical in nature, opposition was voiced by API, PMAA, BP and others. Without passage of this measure, E15 would not be permitted in nine states.
Biodiesel marketers have been calling for a change to the way lower blends of biodiesel must be marked. Currently, blends below 5 percent do not require the exact amount to be disclosed.
Remanufacturers of petroleum equipment fought language that would have placed remanufactured components under the same scrutiny as a new component―requiring all the associated certifications and paperwork. Several representatives from the equipment remanufacturers and weights and measures community spoke against the measure. The committee eventually suggested moving the item forward for a vote―but with completely different language than originally suggested. The revised version―which is favored by remanufacturers―adds a line to Section G-A.6 of general code of Handbook 44 stating:
(d) "devices that have been modified to the extent that a new NTEP CC is required."

All these issues will be discussed further during the NCWM annual meeting in July. Only the item regarding remanufactured products will be put to a vote.

SENATE BILLS WOULD EXPAND NUMBER OF FLEX-FUELED VEHICLES/BLENDER PUMPS
Senators Tom Harkin (D-Iowa) and Richard Lugar (R-IN) have introduced separate pieces of legislation to expand the market for ethanol by requiring 90 percent of the vehicles for sale in 2016 to be flex-fuel vehicles capable of running on higher ethanol blends. Both bills would phase in the requirements starting in model year 2014 by mandating that half of all new passenger vehicles sold in the U.S. be capable of burning E85.

The Harkin bill (S. 187), titled the "Biofuel Market Expansion Act of 2011," would require "major fuel distributors" to install at least one blender pump capable of dispensing higher ethanol blends at 50 percent of the gasoline stations they operate by 2020. A "major fuel distributor" is defined as a person who owns a refinery or directly markets the output of a refinery, but does not include any person that owns or directly markets through less than 50 retail fueling stations. The Harkin bill would authorize up to $350 million in grants by 2016 to cover up to half the cost of installing blender pumps and would not be available to major fuel distributors.

LAST DAY TO SAVE ON PEI SALES BOOT CAMPS
PEI's spring Sales Boot Camps―Las Vegas (March 10-11), Baltimore (April 5-6) and Chicago (April 7-8)―are just around the corner. And if you register today, you can save $100 with our early bird rates. The workshop is designed for sales professionals in all PEI membership categories. Your sales team will chart a new path for success as presenter Rick Farrell explains how "Selling Has Nothing To Do With Selling." To register and learn more about the seminar, schedule and hotel, click here.

PEI AT THREE REGIONAL CONVENTIONS
You can find PEI exhibiting at three regional shows this spring. Stop by to learn about membership programs, upcoming events and the latest industry news. Or just take a few minutes to say hello to PEI's Tulsa staff and connect with fellow members. Look for us at:

Western Petroleum Marketers Association, Las Vegas, Feb. 22-24 (Booth 1607)
Southeast Petro-Food Marketing Exposition, Myrtle Beach, March 2-3 (Booth 1400)
Atlantic Regional Energy Exposition, Atlantic City, May 4-5 (Booth 430)

NUMBER OF U.S. C-STORES HIGHEST EVER RECORDED
The number of U.S. convenience stores grew 1.2 percent over the past year and stands at 146,341 as of December 31, 2010, according to the NACS/Nielsen TDLinx 2011 Convenience Industry Store Count. The increase reversed a two-year drop in the store count and is the highest number of stores ever recorded, eclipsing the 146,294 stores from the 2008 count. Todd Hale, Nielsen's senior vice president, Consumer & Shopper Insights, said that "we expect to see more consolidation as big-box retailers and some supermarket chains continue to add gas pumps to their sites."

Overall, 80.2 percent of all convenience stores sell motor fuels. A total of 117,297 stores sell fuel, a 1.7 percent increase over last year. The convenience retailing industry continues to be dominated by single-store operators, accounting for 62.7 percent of stores.

BRIEFLY NOTED
The Southern Co., Inc., headquartered in Memphis, Tennessee, has opened a branch office at 508 Airways Boulevard in Jackson, Tennessee. The company also operates a full- service branch in Tupelo, Mississippi.
Thorntons is now offering E85 at 36 stations across its 165-facility chain. E85 is available at 7 sites in Illinois, 11 in Indiana, 11 in Kentucky and 7 in Tennessee. "We support the use of ethanol, wherever it is economically available," said Matt Thornton, president and chief executive officer of Thorntons, in a company press release.
TravelCenters of America (TA) has started installing on-island diesel exhaust fluid (DEF) dispensers at about 50 locations. TA and Petro branded locations currently offer 2.5 gallon containers of DEF at all 228 of their locations.―Oil Express, January 17, 2011.

DEATHS
Eric Patrick Moriarty, a former employee of PPI-Durequip and son of Julie Carpenter, sales and project manager for Lakeland Graphics, died January 28. He was 25. Other survivors include his stepfather, Richard Carpenter; father, Patrick Moriarty; and his stepmother, Janet Moriarty.

MEMBERSHIP APPLICATIONS
Diesel filtration products manufacturer. JCH Fuel Solutions, 4527 Losee Road, North Las Vegas, Nevada 89081, has applied for manufacturer division membership. Jeff Shelton is the general manager for the firm, which was established in 1998. The company manufactures a complete line of diesel fuel filtration products that includes fully-automated fuel filtration systems and portable units which are sold through distributors. Sponsored for PEI membership by Thomas P. Goodwin, T&DSales, Temple City, CA.
Concrete cleaner manufacturer. Bio-Dry, P. O. Box 903, Huntersville, North Carolina 28070, has applied for affiliate division membership. Sandy Michel is president of the firm, which was established in 2001. Bio-Dry manufactures concrete cleaner to clean high traffic grease and oil off concrete and asphalt. Sponsored for PEI membership by Tony Thornton, CPI, Charlotte, NC.

ADMITTED TO PEI

Pneumatic Tanker Equipment, Johannesburg, Gauteng, South Africa (aff)
Servicios Technicos Especializados, Guatemala, Guatemala (S&C)
Arnold Osmun, Town Pump, Butte, MT (O&E)
Alissa Thome, Jaco Oil Company, Bakersfield, CA (O&E)

MEMBERSHIP TRANSFER APPROVED

Orion Merchant Solutions, Inc., dba Petro Solutions, Miami, Florida, from the service and construction division to the distributor division of PEI

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The TulsaLetter (ISSN 0193-9467) is published two or three times each month by the Petroleum Equipment Institute. Robert N. Renkes, Executive Vice President, Editor. Opinions expressed are the opinions of the Editor. Basic circulation confined to PEI members.