“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.
REG's Fuel Services
Published on: Sep 13, 2019
AN INTERNATIONAL COMPANY KNOWN FOR PRODUCING FUEL NOW DELIVERS FUEL IN ITS OWN BACKYARD.
The fuel delivery service of Renewable Energy Group (REG) has a 90-year tradition, even though it’s a new part of the company.
In 2018, REG acquired Keck Energy, a Des Moines-based company that had been supplying fuel to central Iowa farmers, fleets, municipalities, convenience stores and other customers since 1927. REG, headquartered in Ames, Iowa, is North America’s largest
producer of biodiesel and a provider of blended fuels.
“REG brings technology — like its technical service team, labs and R&D work — and extensive experience with biofuels. Combined with Keck’s longevity and customer service, it was a really good match,” says Joel Collinson,
Manager, Fuel Operations, REG, who started working at Keck Energy in 1997.
The emphasis remains on providing outstanding customer service and delivering high-quality, cost-effective products.
“People have a choice every day on how they buy fuel, where they buy fuel,” says Adam Sander, Director, REG. “So we understand we have to service our customers in a great fashion every day and earn the business on a daily basis.”
REG'S FUEL SERVICES
Delivers in central Iowa
Offers gasoline, ethanol
blends, diesel, biodiesel,
biodiesel blends and additives
Delivers loads from 250
gallons to 8,500 gallons
Provides tanks and
bulk fuel storage
Continuing a 90-year
EXTENSIVE FUEL OFFERINGS
REG delivers diesel, gas, various blends of biodiesel and ethanol, and additives throughout central Iowa. Customers include farms, private fleets, public fleets, convenience stores and some smaller fuel users like golf courses.
In addition to its fleet picking up fuel at terminals, REG has a bulk plant in Des Moines for storing different grades of gasoline, diesel and biodiesel.
“This helps ensure that we have supply on hand and that our trucks can get it to our customers in a timely manner,” Sander says.
A product customers are increasingly interested in is a higher blend of biodiesel such as B20, which is 20 percent biodiesel and 80 percent petroleum diesel.
“The petroleum business has morphed,” Collinson says. “More fleets, and the general public, want to help the environment. Biodiesel helps reduce emissions and ash output, and it also has higher Cetane and lubricity than petroleum diesel.”
BESIDES FUEL DELIVERY, REG OFFERS:
Fuel tank rental
— Tanks range from 500 to 2,000 gallons and are especially popular with construction companies, as well as with operations that want the efficiency of filling up at their home base but don’t want to invest in a larger tank of their own.
management — Both manual monitoring of tanks and a system by which tank levels can be tracked remotely.
Pricing options — Including fixed-price or indexed contracts.
YOUR FUEL PARTNER
Ultimately, it’s providing better customer service and forming close relationships that differentiates REG from the competition.
“We’re a smaller company for a gas and diesel supplier,” says Tim Munford, an REG truck driver. “You’re going to know the drivers’ first names, you’re going to know us as people, and we’re going to know
you and help you with your tanks and make sure everything’s going well.”
That personal touch is combined with experience, expertise and quality.
“Choosing REG as a fuel supplier makes a lot of sense because we have the experience, and we have fuel solutions for all types of customers,” Sander says.
“Their businesses depend on getting high-quality fuel that will allow them to run their operations at a very cost-effective price. That’s what we’re dedicated to doing on a day-in and day-out basis. We’ll do whatever it takes to
ensure our customers get what they need.”
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