“Biodiesel has opened a lot of doors for us.” That’s what the vice president of Sapp Bros., Inc. says of the renewable fuel’s effect on his company’s travel center and fuel wholesale businesses.
The Economic Advantage of Biodiesel
Sapp Bros., Inc. has experienced the benefits of biodiesel with two different businesses.
One is Sapp Bros. Travel Centers, which operates 17 travel centers stretching from Salt Lake City to Pennsylvania, many of them along Interstate 80. The other is a fuel wholesale business, Sapp Bros. Petroleum, which sells petroleum diesel, biodiesel, biodiesel blends, and other fuels and lubricants.
“Economically, biodiesel is a good thing to do,” says Kevin Cassidy, Vice President of both the petroleum and travel center businesses. “It’s also a sustainable fuel. It’s made us more competitive.”
Biodiesel economics spur interest
The company’s travel center in Peru, Illinois, offers a case study in these benefits. Located 100 miles west of Chicago on I-80, Sapp Bros. Peru is a full-service travel center that sees 750,000 customers a year.
It was one of the first travel centers in the state to offer biodiesel blends when it introduced the alternative fuel in 2005, according to Cassidy.
“The state of Illinois established a sales tax exemption on blends of B11 and higher that still stands, and it made sense to do it,” he says. “The B100 was priced attractively, below what our petroleum diesel cost. And we were able to offer a B11 blend at 8 cents per gallon below our No. 2 ultra-low sulfur diesel (ULSD). It went over very well with our customers.”
The infrastructure changes needed to introduce biodiesel were relatively simple. Sapp Bros. Peru converted a 12,000-gallon underground storage tank to hold straight biodiesel, or B100. Then as now, biodiesel is piped over to a loading station where petroleum fuel trucks come in, and Sapp Bros. uses splash blending by loading the B100 into the top of a truck’s tank. The truck then unloads the blended fuel into tanks that feed the diesel islands.
“To get started with biodiesel, our infrastructure upgrades were minimal,” Cassidy says. “It was around an eight-month payback on the cost.”
Cassidy is able to easily adjust the blend level and frequently goes up to a B20 blend.
“The blending economics make B20 a smart choice for us,” Cassidy says. “And I’ve had drivers say it’s cleaned up their fuel systems, cleaned their fuel injectors, and they actually get better mileage with biodiesel blends versus a regular No. 2 ULSD because of the clean injectors.”
The Peru travel center and the wholesale business run out of the location use B11 throughout the winter, and on milder winter days will move up to B20. Cassidy says by using a good cold weather additive, they’ve had no issues in storage tanks, at dispensers or with customers.
No matter the weather, he advises other travel centers to do their homework on producers and to purchase quality fuel.
“REG produces a quality product, they stand behind it, and they have the supply to meet our demand,” Cassidy says.
Biodiesel has made Sapp Bros. more competitive both against other travel centers and as a fuel distributor.
“Because we took the step and handled biodiesel, it opened up a lot of doors for us as a wholesaler,” Cassidy says. “And at our travel centers, having a diverse lineup of fuels attracts a bigger customer base. Besides filling up with fuel, they’re inside your stores. They’re shopping, maybe getting something to eat. There are benefits to bringing in new faces.”
The Bottom Line
Sapp Bros. pays less for biodiesel. They can price biodiesel blends lower at the pump than ULSD, making them more competitive. Helps drive in-store sales.
Quick ROI on blending system. Easy to switch blend level.
Watch: Sapp Bros. Explains Biodiesel Benefits
Biodiesel has made Sapp Bros. more competitive in the crowded travel center market. See the results.
Golden Opportunity in the Golden State
Published on: Feb 10, 2019
Southern California distributor stays busy by meeting the growing demand for biodiesel and renewable diesel.
California Fuels & Lubricants has a diverse group of fleet customers. There are trucking companies, local governments, construction crews, businesses that work in the Port of Los Angeles and even plant nurseries.
They may be in different industries, but there’s one thing the fleets have in common: a desire for cleaner-burning alternatives to petroleum diesel.
“One of the biggest trends we’re seeing is
growing demand for biodiesel and renewable diesel,” says Jaime Duenas, President of California Fuels & Lubricants. “Fleets are trying to lower their greenhouse gas emissions and carbon footprints.”
Part of that trend is attributable to California’s Low Carbon Fuel Standard (LCFS), which requires a reduction in the carbon intensity of transportation fuels. But it’s also due to the worldwide trend of environmental sustainability supported
by corporations, governments
No matter the motivation, California Fuels & Lubricants is happy to supply the fuels to meet the demand.
“The renewable fuels help us meet the needs of our longtime customers and to bring on new customers that are looking for
a cleaner fuel,” Duenas says.
Biodiesel as a solution
For California Fuels & Lubricants, those renewable fuels are biodiesel, renewable diesel and most recently, a blend of the two called REG Ultra Clean®.
It gets all three fuels from Renewable Energy Group (REG).
California Fuels & Lubricants began offering biodiesel in 2014, starting with a B5 blend before quickly moving up to B20.
“There were customers looking for a higher blend for a couple of reasons,” Duenas says. “One reason was it helped them with their emissions. The other part of it was they got a little bit of a break on the pricing because of some
of the financial advantages of using B20.”
Renewable diesel also popular
A year later, California Fuels & Lubricants expanded into renewable diesel. Like biodiesel, renewable diesel is an environmentally friendly fuel, but it’s made by a different production process and falls under the diesel spec, ASTM D975.
“Renewable diesel is another option for our customers that is good for the environment and performs well in their vehicles,” Duenas says.
A new blend
Now, in addition to offering biodiesel blends and renewable diesel individually, the company is selling a product with the two blended together. Known as REG Ultra Clean®, it has the best features of the individual fuels, including excellent
Cetane, a low cloud point and added lubricity. The biggest benefit is on the environmental side. A renewable diesel and biodiesel blend significantly reduces total hydrocarbons, particulate matter, carbon monoxide and nitrogen oxide (NOx) compared
with petroleum diesel.
California Fuels & Lubricants offers a blend that is 80 percent renewable diesel and 20 percent biodiesel, which it gets from REG. But it’s not just their customers that use it.
“Our fleet is running on an RD B20 blend,” says Duenas. “That speaks to our confidence in the fuel’s performance and its emissions profile.”
Diverse supply for its customers
The popularity of all three fuels has kept California Fuels & Lubricants busy delivering to trucking yards, municipalities, construction sites and one of the world’s busiest ports.
“We are known as a company that offers a variety of fuels,” Duenas says. “Our customers are happy with the products, they’re happy with our service, and they’re happy with the overall experience of using our renewable
fuels in their vehicles.”
LIKE WHAT YOU READ?
REG delivers insightful content like this to your inbox in our e-newsletters. Sign up today.