Monday, September 01, 2014

Home News ALTERNATIVE FUELS: Timing is Everything

ALTERNATIVE FUELS: Timing is Everything

Industry News, Green Issue

As gas prices continue to soar, can technological advancements in alternative fuels emerge in time to make a difference?

Emily Mullins | September 9, 2008

Dana Lonn’s primary job is to “worry about what we should be doing five or 10 years from now.” As Toro’s director of the center for advanced turf technology, alternative fuel research crept to the top of his to-do list a few years ago. Today, as gas and energy prices skyrocket, it remains the department’s No. 1 priority. But determining how to make lawn and landscape machinery that runs on alternative fuels powerful, portable and, most of all, affordable enough for the average contractor still keeps Lonn up at night. “The whole alternative fuel thing is a chicken-or-the-egg problem,” he says. “Ultimately what makes long-term sense technologically is what makes good business sense to people. The economics have changed from $2 to $4 gasoline – things have to make economic sense.”  
 
The economics most certainly have changed. According to the Energy Information Administration (EIA), on Aug. 11, the average price of gasoline was $3.80 a gallon – down 7 cents from the previous week and up $1.03 from the previous year. The average price of a gallon of diesel fuel was $4.35 – down 14 cents from the previous week and up $1.50 from 2007. To the average contractor, this fluctuation not only doesn’t make good business sense, but may not make sense at all. What exactly are we paying for?

WHAT IT COSTS. According to the EIA, the cost to produce and sell gasoline to consumers includes the price of crude oil, refining costs, marketing and distribution, retail station costs and taxes. For example, in June, the average cost of a gallon of gasoline was $4.05. The breakdown to consumers was as follows: 74 percent crude oil, 9 percent refining, 7 percent marketing and distribution and 10 percent taxes. The same month, the average price of diesel fuel was $4.68 a gallon with the cost comprising 65 percent crude oil, 17 percent refining, 8 percent distribution and marketing and 10 percent taxes.
 
Along with old-fashioned supply and demand, the price of crude oil most significantly impacts what contractors pay at the pump. Crude oil prices are determined by worldwide supply and demand, and are also impacted by political conflicts in major oil-producing regions and the declining value of the U.S. dollar, according to the EIA. However, even when crude oil prices are relatively stable, prices can still fluctuate due to things like increased seasonal or holiday demand and local retail station competition. Prices change rapidly if there are disruptions in the supply of crude oil or problems at refineries or with delivery pipelines.
 
All of these factors have spurred the increased attention on alternative energy forms and U.S. energy independence. They’ve also encouraged many landscape contractors to invest in alternative methods of running their fleets and machinery. Biodiesel, ethanol, propane, electricity and even waste vegetable oil are all viable forms of energy landscape contractors around the country have incorporated into their businesses not only to make economic sense, but environmental sense as well.

Three contractors discuss their experience with alternative fuels in their fleets and equipment, sharing the pros, the cons and their views for the future.

COST CONCERNS. During a company meeting at DeSantis Landscapes about three years ago, employees discussed their desires to be more environmentally conscious, both personally and professionally. President Dean DeSantis reviewed the Salem, Ore.-based company’s overall business practices and concluded that running his fleets on biodiesel fit with its new initiatives. Since then, the company also has been certified as Oregon’s first commercial ecological landscape contractor by the Portland Regional Pollution Prevention Outreach Team, which recognizes landscape design, installation and maintenance contractors who minimize their environmental impact. The recognition has spurred nothing but positive benefits, DeSantis says. “People appreciate the fact that we’re trying to reduce our environmental impacts,” he says. “We market our efforts in all of our advertising and it’s been really good for business.”
 
DeSantis runs 11, or one-third, of his trucks on biodiesel, as well as six of his largest pieces of equipment. He continues to trade in his gas-powered trucks and equipment for diesel-powered counterparts capable of running off biodiesel on an as-needed basis, and will do so until all of his machinery runs off biodiesel. Most of the year, DeSantis Landscapes uses B99 – or a blend of 99 percent biodiesel and 1 percent petroleum diesel. Because biodiesel has a tendency to congeal in cold weather, DeSantis switches to B20 when temperatures are 20 degrees F and lower.
 
However, rising energy costs also have impacted the price of biodiesel. DeSantis’ biodiesel supplier, SeQuential, based in Portland with fueling stations throughout Oregon and two in Washington, uses waste vegetable oil to produce its biodiesel. The company used to get the oil free from restaurants that would otherwise have to pay to dispose of it. But the rise in alternative fuel production has made waste vegetable oil a hot commodity, leaving SeQuential no choice but to raise its prices. So this year, DeSantis chose to stick with B20 indefinitely. In July, DeSantis paid $4.70 per gallon of B20 compared to about $5.30 per gallon of B99. At the same time, petroleum diesel cost $4.80 per gallon. “We’re going to hold off on switching back to B99 right now simply because of cost,” he says. “Restaurants used to give the waste oil away for free, but now that there’s a market for it, the price is going up.”
 
Despite the price increase, DeSantis still believes in the power of alternative fuels. Each year SeQuential supplies him with a spreadsheet documenting how much carbon dioxide (CO2) his biodiesel use has kept out of the atmosphere. In 2007, DeSantis Landscapes reduced its CO2 emissions by 172,593 pounds, or the equivalent of 16 vehicles taken off the road. “We avoided using 8,467 gallons of petroleum fuel last year,” he says. “That’s 8,500 gallons of foreign oil we didn’t have to depend on.”
 
While DeSantis believes biodiesel use is a viable solution to the energy crisis for the time being, he doesn’t believe it’s necessarily a long-term solution. But in the forward-thinking state of Oregon, people are always “clamoring for the next, cool ‘green’ thing,” DeSantis says, creating healthy competition among those who want to make a positive impact on the environment. “Biodiesel is not a panacea,” he says. “Unless we start eating a lot more french fries, we’re eventually going to run into a shortage of waste oil. We’ll need more innovation in the long term.”

VEGGIE TALES. Patrick Picard first invested in alternative fuels in 2002 after he attended a seminar on how to run diesel trucks on vegetable oil. It inspired him, said the owner of Equinox Landscape Construction in San Rafael, Calif., and he decided it was time to decrease his dependence on fossil fuels as much as possible.
 
Picard’s first joined a Northern California vegetable oil co-op, which provides its members bulk vegetable oil from a local producer, as well as all of the information necessary to successfully convert diesel-powered vehicles. While the idea seemed solid, Picard quickly realized it wasn’t as easy as it seemed. “I have to say it wasn’t without problems,” he says.
 
While ethanol proponents communicate the fact that the first automobiles ran off peanut oil, today’s engines are much different than they used to be. Picard experienced engine clogging and burnout before he decided to abandon the vegetable oil route and experiment with biodiesel, a method that has proved much more successful. He runs two trucks on biodiesel, at a cost of $4.50 a gallon in July. He also supplies his CEO with a Honda hybrid, has two electric mowers and uses electric hand-held equipment. “It takes a little longer, but so far our clients have been willing to pay for it,” Picard says. “My employees also prefer not having to work around loud motors day in and day out.”
 
Picard’s personal company vehicle is a gas-powered truck that operates with a propane injector system. This system allows Picard’s truck to run on 80 percent gasoline and 20 percent propane – a clean-burning fuel that costs about 30 percent less than gasoline. He keeps a propane tank in the bed of his truck, and the injector system mixes the propane and gasoline to make a combination fuel with a more efficient flash point. The propane injector system cost about $250 and not only increases Picard’s gas mileage by 20 percent, but also runs cleaner and offers better pickup, he says. “I recouped the cost of the system the first month in fuel savings alone,” he says. “I’m surprised more people don’t know about propane’s advantages.”
 
As Picard can attest, switching to alternative fuels takes time and research. Sometimes it can even be downright inconvenient. For example, Picard had to completely reroute his crews so they can make stops at biodiesel depots throughout the workday. But it’s a sacrifice he’s willing to make and says other contractors should do the same. “As stewards of the land, it’s time for landscape contractors to start experimenting with alternative fuel sources and making it part of our business plans,” Picard says. “We call ourselves the green industry, so we need to identify what we’re doing that’s detrimental to the earth and figure out how we can eliminate that.”   

TRIAL-AND-ERROR. Not all alternative fuel advancements occur on the West Coast. Bennett Holmes, owner of Rye Beach Landscaping in Rye Beach, N.H., is an East Coast pioneer who began experimenting with making his own biodiesel about four years ago. He admits he got started without knowing exactly how it would work out, but says he’s slowly improved and refined the process year after year. “There wasn’t as much interest in alternative fuels four years ago and information was sparse,” Holmes says. “I didn’t want to jump into things too quickly.”
    
Through Internet research, Holmes learned that mixing waste vegetable oil with a catalyst creates a chemical reaction that removes the glycerin from the vegetable molecule. What’s left combines with methanol, and successfully draining off the glycerin creates biodiesel. He conducts gravity tests on each batch using a hydrometer and, as long as the liquid is within an acceptable gravity range, it undergoes filtration and should power a diesel truck. “In a way, it’s like high school chemistry stuff,” Holmes says. “It’s not rocket science but it does involve some trial-and-error.”
 
Like other biodiesel users, he used to get the waste oil free from a local seafood restaurant, but the popularity of alternative fuel production means it now comes at a price. However, the novelty of the partnership between Holmes and the restaurant is not only good publicity for Rye Beach Landscaping, but also for the restaurant, which sells 200 to 250 gallons of oil to Holmes every week or 10 days for a nominal fee.
 
After investing about $4,000 in equipment and materials and “a considerable amount of time making improvements,” Holmes now runs 10 trucks and three pieces of equipment on homemade biodiesel. He estimates saving at least $2,000 a month in fuel costs, making his time and investment worth every penny.
 
“When diesel prices were upwards of $2 a gallon a few years ago, that was upsetting to me – even more so now that prices have surpassed $4 a gallon,” he says. “I’m glad I took the chance to be ahead of the curve. Many contractors have called me lately for information on how to switch over their fleets too.”

TIMING IS EVERYTHING. Like many national trends, alternative fuel use has ridden a wave from the West to East Coast. This regional evolvement will continue, but in different ways, Toro’s Lonn says. “Today the world is based on fossil fuels, but moving forward there’s going to be a fair amount more variety,” he says. “We predict fuel trends will be regional based on what makes sense geographically. For example, when you get into the Farm Belt it makes sense to be biofuel based. In other places, like the South, it might make more sense for energy to be wind sourced.”
 
Making sense – whether economically, environmentally or geographically – is a consistent theme in the search for new fuel sources. As equipment manufacturers strive for advancements, they’re discovering things also need to make sense in terms of efficiency. For example, it takes 800 pounds of batteries to equal the energy in a gallon of gas, Lonn says, making it physically impossible for a contractor to run business as usual using battery-powered riding mowers. Toro’s first hydrogen powered mower cost $500,000 to build – a cost that could never be effectively passed down to the end user. “In terms of equipment, we can do power,” Lonn says. “Making it light enough and affordable enough are the two main challenges.”
 
There are two main issues drawing contractors to lawn equipment that runs on alternative fuels, says Jeremy Hahne, vice president of marketing and customer support for Onyx Environmental, a manufacturer of propane-powered mowers. The first is the rising cost of petroleum fuels. The second is environmental concerns. “The EPA did a study showing that 10 percent of our nation’s pollution comes from the lawn and landscape industry,” Hahne says. “If you mow that same lawn with a propane powered mower, you overcome those emissions while benefitting the environment.”
 
Although Onyx Environmental has been experimenting with its patented propane-powered mowers for 15 years, Hahne says the machines are finally starting to gain acceptance in the landscape industry. Propane’s lower cost, a rise in refueling stations and contractors’ desires to “go green” have all contributed. But hindrances still remain. Propane-powered mowers cost about 10 percent more than their gasoline-powered counterparts, and, perhaps more importantly, the word about available alternative options is still getting out in the industry.
 
“We’ve been establishing a dealer network that offers demonstrations to landscape professionals,” Hahne says. “We’ve also been working with politicians and groups like the Propane Education and Research Council to spread the message.”
 
In terms of alternative fuel use, currently, landscape contractors can make more of an impact via their truck fleets rather than their equipment fleets, as developments in the landscape equipment market have lagged behind those in the automobile market for many reasons. (See “Eco-friendly Fleets” on page 64.)
 
First and foremost, the outdoor power equipment industry is considerably smaller than the automobile industry, which attracts more venture capital for experimentation. Differences in automobile and equipment engines mean developments aren’t always interchangeable.
 
“In a small market, it’s hard to take a meaningful step forward,” Lonn says. “It’s much more challenging in our market compared to the automotive – the engines aren’t as sophisticated. For example, all of the recent advancements with ethanol don’t really apply to equipment engines.” 
 
Contractors and manufacturers agree that more research is needed before alternative fuels can run machinery that will keep contractors’ production levels up to par. Many innovations are in the pipeline, Lonn says, but few of them are ready to pan out. Until recently, government regulations played the biggest role in alternative fuel advancements, but these days, economics and customer demand are running the show.
 
“In terms of equipment, there are some things available today – biodiesel is pretty doable and we’re moving toward hybrids,” Lonn says. “But there are still some tough problems we don’t know how to solve.”
 
So, is the industry too late? Are technological advancements too far behind for alternative fuels to make a real difference? Lonn is optimistic that the answer is no. “Global warming and energy independence are two major issues that have seemed to roll into one,” he says. “If we as a society had been more forward thinking 20 years ago, we’d be further along than we are today. But we weren’t. Is it too late to get started? I don’t know, you could argue that. But I guess I don’t have that pessimistic view. People can make a lot of progress fairly quickly, but we have to be motivated to make changes and have goals. The quick change in economics has changed the rules, and it’s taken us as a society a little time to figure out what they are. Will we be soon enough? Only time will tell.” LL  

Top news

Davey buys Lawn Logic

The company has made five acquisitions this year.

Akehurst Landscape names new president and CEO

The sudden death of Brian Akehurst, president of Akehurst Landscape Service, results in the election of a new leader.

Massey purchases Texas company

Green Pest Services joins Massey's portfolio.

The lease/buy decision

The rules may be changing when it comes to leasing snow equipment.

Call in the subs

Developing long-term relationships with contractor partners helps snow businesses expand and accommodate challenging service schedules.

x