Dear PEI Member:
There has been a lot of talk recently about using domestically-produced
compressed natural gas (CNG) to fuel cars and trucks.Some argue that CNG will remain a fringe phenomenon for the
foreseeable future. The high up-front cost of purchasing natural gas vehicles (NGVs), the
lack of refueling stations, and the cost to outfit and install those
refueling stations top the list of reasons why CNG-powered vehicles won't
make major inroads in the U.S. market.
Indeed, there are some tough obstacles to overcome. While some companies and cities have incorporated NGVs into their fleets,
so far only one manufacturer, Honda, sells a family automobile in the U.S.
that runs on CNG. Honda's suggested retail price for the Honda Civic Natural
Gas is $26,255, compared to $20,505 for the gasoline-powered Civic EX―the
least expensive gasoline version of the Civic equipped with an automatic
transmission. The federal government helped close that price gap
beginning in 2005 by granting a tax credit of $4,000 to purchasers of the CNG-fueled Honda, but that credit expired on December 31, 2010. Steve
Center, Honda's U.S. vice president for environmental business development,
told Bloomberg News recently that Honda's goal is to sell 4,000 to 5,000 CNG
vehicles annually, double the previous rate. (To help that along, Honda is
installing CNG refueling stations at selected Honda dealers in California).
The International Association for Natural Gas Vehicles notes on its website
that there were 112,000 NGVs in the U.S. as of December 2010, ranking the U.S.
14th in the world in the number of CNG vehicles on the road―not
exactly compelling numbers.
So, what has folks so excited about CNG-fueled vehicles? The answer is
simple: Fuel prices. The average retail price of gasoline has increased
more than three-fold in the last 10 years. A gallon of gasoline cost $1.18
in 2002. Right now, Americans pay an average of $3.90 for the same gallon of
gasoline. With demand for oil in emerging markets expected to maintain its
upward trend, even higher prices are likely to result in the future. Natural gas is
cleaner, cheaper than gasoline and it is domestically available. To an increasing number of
companies, it deserves a look―or, in some cases, another look.
Chesapeake Energy, the second largest producer of natural gas in the
U.S., has been one of the biggest champions of NGVs.
Chesapeake announced earlier this month that it will work with General
Electric (GE) to promote the CNG and LNG (liquefied natural gas) infrastructure.
Chesapeake and GE will deploy more than 250 of GE's ecomagination™-qualified
"CNG In A Box™" fueling systems across the U.S. through 2015. CNG In A Box
takes natural gas from a pipeline and compresses it on-site at an industrial
location or at a traditional automotive refueling station to turn it
into CNG.
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Prospects for CNG Refueling Stations
EPA Approves E15 Mitigation Plan
PEI Scholarship Program Deadline: March 31
RP1200 Comment Period Ends
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In addition to divulging that it has already spent
nearly $4 million with Love's and OnCue to build 40 new CNG stations in
Oklahoma, Chesapeake identified the following petroleum marketers and
grocery store chains that soon will be offering CNG: Valero, Murphy USA,
Stripes, Gulf, Kroger, QuikTrip, 7-Eleven, Kum & Go, Meijer, GetGo from
Giant Eagle, Wawa, Sheetz, Lehigh Gas and Dandy Mini Mart. Chesapeake also
stated it expects that Clean Energy's Natural Gas Highway will be able
to offer LNG truck fueling coast-to-coast and border-to-border by 2013.
The automakers seem to be stepping up the pace
as well. Chrysler said earlier this month that its new Ram 2500 Heavy Duty CNG truck will be sold to commercial customers that operate truck fleets.
The truck will have natural gas tanks and an 8-gallon fuel tank for
gasoline. Chrysler said a small amount of gasoline is needed to start the
truck but, after ignition, it runs entirely on natural gas. If the natural
gas tanks run out, the engine can switch to gasoline. The company expects to
deliver the first trucks in July.
Other automakers are moving into the natural gas
market. The day before the Chrysler announcement, General Motors said it
would release two 2013-model pickup trucks powered in part by natural gas.
The company said it would start taking orders in April for the natural
gas-powered 2013 Chevrolet Silverado and GMC Sierra 2500 HD. GM expects to
ship these vehicles toward the end of this year. The trucks will be available
to both commercial fleet operators and retail customers. Mercedes-Benz and
Fiat are said to be keeping an eye on the U.S. to see to what extent the market
welcomes NGVs.
Interest in CNG vehicles and stations is on the
uptick. We'd like to hear from you about how you think it will shake out.
Respond to rrenkes@pei.org with your
comments.
EPA APPROVES E15 MITIGATION PLAN
The U.S. Environmental Protection Agency (EPA) issued its approval on
March 15 of a Misfueling Mitigation Plan submitted by the Renewable Fuels
Association (RFA), bringing the fuel a step closer to being offered to the
public. Individual ethanol producers can use the plan when applying to EPA
to register their fuels. Many states still have regulatory issues that
prevent E15 from being sold, but the RFA suggested that several states―specifically
Iowa, Illinois and Kansas―have resolved these
issues and are expected to be the first to introduce E15 to consumers. Many
gasoline retailers maintain that liability and equipment compatibility
concerns will prevent them from marketing E15 until those issues are
resolved.
PEI CONVENTION AT THE NACS SHOW 2012
Registration and housing for the 2012 PEI Convention at the NACS Show
will open April 2. The event will be held October 7-10 in Las Vegas, at the
Las Vegas Convention Center. The PEI headquarters hotel is the newly named LVH (Las Vegas Hotel and Casino), formerly the Las Vegas Hilton. It will be
the hub for several PEI events, such as the Young Executives Roundtables and
Reception, and the PEI After-Hours Lounge, where PEI members gather after
the trade show closes. PEI also has room blocks at Harrah's and Planet
Hollywood Resort & Casino.
Exhibit space in the Petroleum Equipment & Services area is going fast,
with only 53 booths remaining. Contact Bob Young to discuss exhibit
opportunities at byoung@pei.org or
918-236-3966.
The PEI Board of Directors will meet next month, at which time convention
sessions proposed by the PEI Education and Convention Committee will be
finalized. Click to view a
tentative schedule of events. More to
come on this as session topics and speakers are confirmed.
Early registrants receive deep discounts. Full early-bird registration is
$295 for members and $495 for nonmembers. This includes admission to the
education sessions, all three days of the trade show, the PEI Industry
Reception and the NACS Welcome Reception. Companies that register five or
more employees are eligible for group discounts.
Be ready to register and make your hotel reservations on April 2 to enjoy
the greatest savings and selection of hotel options.
STATE ETHANOL NEWS
South Dakota has awarded 80 percent of the grant money ($755,000) set
aside to help gasoline station owners install 44 blender pumps at 21
locations in the state. The state's grant program, overseen by the
Governor's Office of Economic Development, pays station owners up to $25,000
for the first pump and $10,000 for each pump thereafter. The first round of
grants was awarded on a first-come, first-served basis. The rest of the
money―$3.5 million during the next five years―will be
awarded competitively. The state is taking applications until April 30.
Tom Vilsack warned members of the Renewable Fuels Association that
there continues to be a strong need to defend the Renewable Fuels Standard
(RFS) mandates on ethanol, as well as to build a broader market for the fuel
and to invest in innovative emerging technologies. Vilsack said he sees the
ethanol industry as "the platform for our transition to producing more
advanced biofuels." He said EPA's decision on E15 is important but
maintaining the RFS is a greater priority, citing oil company efforts to
modify or eliminate the federal mandate.―Kansas
Grain & Feed Association Federal News Friday newsletter, March 9, 2012,
reporting on Secretary of Agriculture Tom Vilsack's remarks last month to
the RFA's National Ethanol Conference.
PEI FOUNDATION SCHOLARSHIP APPLICATION DEADLINE MARCH 31
The application period for the 2012-2013 PEI Foundation Charles D. Kemp
Scholarships closes March 31. Scholarship recipients are selected based on
academic achievement, leadership, character, financial need, and the
applicant's intent to contribute to the future of the petroleum and energy
handling industry.
To be eligible, an applicant must be a dependent of a full-time employee
of a PEI member company in the Distributor, Manufacturer, Service &
Construction or Affiliate Division. Applicants must be incoming freshmen at an
accredited four-year college or university intending to major in business,
engineering, distribution studies or a similar field. The scholarship awards
are $1,000 each. To review the scholarship guidelines and complete an
application, please visit
www.pei.org/foundation.
PEI RP1200 COMMENT PERIOD ENDS
The public comment period for suggested changes to PEI's
Recommended Practices for the Testing and Verification of Spill, Overfill,
Leak Detection and Secondary Containment Equipment at UST Facilities
closed yesterday. In all, 255 comments were received from tank owners, regulators, equipment manufacturers, testing
companies and consultants. The committee responsible for
writing the document will meet April 24-26 to begin its review of the
comments. Publication of the recommended practice is expected sometime late
this summer.
REGULATORY BRIEFS
Connecticut. SB 375, a bill that would phase out the state fund and
state assurance for reimbursement for costs associated with a release from
an underground storage tank, was the subject of a hearing of the General
Assembly's Environment Committee on March 16. So many people turned out for
the legislative hearing that an overflow room was opened so people could
listen to the proceedings. The Connecticut Petroleum Association spoke out
strongly against the proposed legislation.
North Carolina. The state's Gasoline and Oil Inspection Board has
approved changes to rules governing the way ethanol and other oxygenated
gasoline blends can be labeled. Under the proposed changes, gasoline
containing 10 percent or less by volume of ethanol would be required to
include a label that states "may contain up to 10 percent ethanol" or
similar wording. For blends containing between 10 and 15 percent ethanol,
the label would state "contains up to 15 percent ethanol" or similar
wording. Any blend containing between 15 and 85 percent ethanol would be
required to include a label stating the exact volume percentage of ethanol.
E85 blends are not affected by the changes. The rules now go before the
North Carolina Rules Review Commission.
APPOINTMENTS AND PROMOTIONS
ZCL Composites Inc. has announced that Ron Bachmeier will assume the
role of president and CEO of the company effective August 8, 2012.
He has been with ZCL and Xerxes since 1986 and is currently ZCL's chief
operating officer. Bachmeier will replace Rod Graham who earlier
recommended to ZCL's Board of Directors that it was time to begin a
transition to a new, permanent CEO.
The Steel Tank Institute/Steel Plate Fabricators Association (STI/SPFA),
Lake Zurich, Illinois, has promoted Marie Scimeca to manager of meetings and
Noël Zak to manager of membership and
communications.
OPW Fueling Components, A Dover Company, Hamilton, Ohio, has named
Brandon Grote district manager responsible for sales activities in Ohio,
Michigan, Indiana and Kentucky. In addition to his role as district manager,
he will be utilized as a product specialist in dispensing products for key
accounts and markets. Grote joined OPW in 2000.
INDUSTRY NOTES
Source
North America Corporation, Addison, Illinois, has added a new division
to the company: the SOLUTIONS Design Group. The new division will
support customers and sales staff with expertise on fueling systems, piping
layout and design, compliance and regulatory issues. James V. Gaszynski is
director of the SOLUTIONS Design Group.
Casey's General Stores Inc., Ankeny, Iowa, announced March 15 that it
will break ground this month on its first site in Kentucky and will likely
move into Tennessee before the end of the year.
Sobeys, Stellarton, Nova Scotia, has completed the purchase of 236
Shell retail gasoline locations and related convenience store
operations in Quebec and Atlantic Canada.
MEMBERSHIP APPLICATIONS
Missouri distributor. Greenlight Solutions, LLC, P. O. Box 101, West
Alton, Missouri 63386, has applied for distributor division membership. Ron
Fink is operations manager for the firm, which was established in 2006. The
company sells, installs, repairs and maintains petroleum marketing
equipment. Greenlight represents Bennett, HuskyCorp, LSI, PtrParts, RDMElec
and VeriFone. Sponsored for PEI membership by Richard H. Long, RDMElec,
Nebo, NC.
CNG fueling equipment designer. ANGI Energy Systems, LLC, 15
Plumb Street, Milton, Wisconsin 53563, has applied for affiliate division
membership. Katrina Bell is the marketing coordinator for the company, which
was established in 1983. The company designs, engineers and installs CNG
fueling
equipment systems. Sponsored for PEI
membership by David Crouse, OPW-FC, Hamilton, OH.
www.angienergy.com
Diesel fuel storage tank cleaning firm. Deposit Control Systems,
Inc., 4 Green Mountain Drive, Cohoes, New York 12047, has applied for
affiliate division membership. Tom Myers is president of the firm, which was
established in 1996. The company cleans fuel storage tanks and
provides other technical services. Sponsored for PEI membership by Patricia
George, AlgaeXIntl, Fort Myers, FL.
www.dcsbg.com
Third party repair depot firm. United Technologies, 3270 Fowler
Street, Suite 11, Fort Myers, Florida 33901, has applied for affiliate
division membership in PEI. Thomas K. Tabor is vice president of sales and
marketing for the firm, which was established in 2005. Sponsored for PEI
membership by Suzanne Johnson, JohnsonFL, Riverview, FL.
www.unitedtechnologiesinc.com
Media dispenser display unit provider. Outsite Networks, Inc., 2551
Eltham Avenue, Suite N, Norfolk, Virginia 23513, has applied for affiliate
division membership. Cindy Gould is operations manager for the firm, which
was established in 1998. The company provides loyalty/marketing equipment
and services for the convenience store industry. Sponsored for PEI
membership by Charles B. Hubbard, OilEqSS-VA, Chesapeake, VA.
www.outsitenetworks.com
Ohio service and installation contactor. S. M. Miller Construction
Co. Inc., 5755 Beatty Road, Grove City, Ohio 43123, has applied for service
and construction division membership. Steve Miller is vice president of the
company, which was established in 1991. The firm is a convenience store
contractor. Sponsored for PEI membership by William R. Patrick, X-FPtrEqp,
Columbus, OH. www.gosmmco.com
ADMITTED TO PEI
- Fluid Solutions LLC, Birmingham, AL (dis)
- GN Services, LLC, Spring, TX (S&C)
- Russell Barton, Browning Oil Company, Bowling Green, KY (O&E)
- Mike Wilson, The Pantry Inc., Sanford, NC (O&E)
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