Biodiesel Pays Off for Travel Center, Wholesaler

“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.”

Utilizing B20

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

Economics

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.

Infrastructure

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.  

Fleet Operator on Biodiesel: It'd be Ridiculous Not to Use It

S.K. Davison, Inc. uses biodiesel in all its diesel-powered vehicles, from tractor-trailers to mowers.

Ed Davison has a question for fleets not running on biodiesel blends: Why not?

“What is your argument for not doing it? You want as much black smoke coming out of your exhaust as you can get?  You want the dirtiest emissions of anybody out here?” asks Davison, who co-owns central Illinois hauler S.K. Davison, Inc. with his wife, Sharon. “When it costs nothing to clean up the environment, it would just be absolutely ridiculous to not do it.”

Davison has heard the arguments from fleet managers, especially those with small fleets similar in size to his. They worry about the effect of biodiesel on vehicle performance and warranties, despite OEM acceptance of biodiesel being nearly unanimous, and they worry about cost. But he has answers to those arguments based on more than a decade of experience with biodiesel.

“I use a B20 blend in absolutely everything that’s dieselpowered that we have,” he says. “I’ve never noticed a problem in anything.”

More than a decade of satisfaction with biodiesel.

At S.K. Davison, Inc., that’s a fleet of about two dozen vehicles.  The bulk of them are tractor-trailers, but they also have several dump trucks, a bulldozer and a backhoe for construction work, and some road maintenance mowers. S.K. Davison, Inc.’s primary business is hauling agricultural products for farmers and asphalt and aggregates for construction companies.

Davison was first introduced to biodiesel about 15 years ago, when his fuel provider started offering a B2 blend. They assured him it would work, but he had many of the same concerns he’s heard others express. None of them ever came to be.

“I’ve got a 1977 Cat D6 bulldozer out there, and it works just fine. And biodiesel works in my 2015 Detroit Diesel engine,” he says. “So it works in everything.”

Year-round use of biodiesel has financial and environmental benefits.

Not only does biodiesel perform well, but it also has financial advantages. Biodiesel blends of 11 percent and higher are exempt from Illinois’ 6.25 percent sales tax. Davison also likes that using biodiesel adds value to the products of the same farmers who use his hauling services.

S.K. Davison, Inc. went to a B11 blend in 2005 and B20 in 2012. It now uses B20 year-round, including in the heart of the cold Illinois winters. Cold weather or warm, the fuel performs.

In Davison’s mind, the biggest benefits of using biodiesel are related to the environment. Biodiesel is renewable and a cleanerburning alternative to petroleum diesel. He says it’s usually easier to do things the old way, but fleets of all sizes need to recognize the impact of their decisions.

"I know biodiesel works. It’s better for the environment. And I’m not going  to look my grandkids in the face and  go, ‘Grandpa had a choice and chose  not to do anything for your future." Ed Davison,  Owner of S.K. Davison, Inc.