Case Study: Retailer Benefits From Renewable Fuel

By Jon Scharingson, Renewable Energy Group Inc.

So what’s it like for a retailer to sell biodiesel blends at the pump? I can talk about the benefits, but I’d rather you hear from one of your peers in the industry.

Kevin Cassidy is vice president at Sapp Bros., Inc., which has travel center and fuel wholesale operations.

The travel center side of the company operates 17 locations stretching from Pennsylvania to Salt Lake City, with many of them along Interstate 80. I’d like to focus on one of those: Sapp Bros. Peru. Located about 100 miles west of Chicago, the full-service travel center sees 750,000 customers a year as I-80 funnels in a steady stream of truck and car traffic.

Sapp Bros. Peru was one of the first travel centers in Illinois 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 said. “The B100 was priced attractively, below what our petroleum diesel cost. And we were able to offer a B11 blend at eight cents per gallon below our No. 2 ULSD. It went over very well with our customers.”

Quick payback
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 said. “It was around an eight-month payback on the cost.”

Using B20
Sapp Bros. Peru 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 said. “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.”

Other Sapp Bros. retail locations also offer biodiesel blends, finding the fuel to be a winning combination with its positive economics, lower emissions and strong performance. It’s not just about fuel sales, however. There’s also an in-store boost.

“Having a diverse lineup of fuels attracts a bigger customer base,” Cassidy said. “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.”

To find out what biodiesel can do for your locations, contact me at jon.scharingson@regi.com or (515) 239-8042. You can also learn more at regi.com/products-services.

Jon Scharingson oversees the sales and marketing efforts for REG, a biodiesel producer.

 

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