Money for Nothing?

There was a standout event at the National Truck Equipment Association Annual Meeting this past week in Atlanta that got me pretty excited about fleets that are already starting to adopt hybrid and alternative fuel vehicles. The day-long Hybrid Truck and Alternative Fuels Summit featured speakers from government, industry, and public-private alternative energy groups, all talking about the growth they’re seeing in this market, and the excitement was contagious.

 

The first such Summit, held at last year’s NTEA Show in Indianapolis, was a sell-out, and this year’s event was bigger and better. Whereas last year you might have heard speakers talking about production runs of hybrid bucket trucks for utility fleets in the dozens of units, this year they were mentioning production runs in the thousands, and in the foreseeable future.

 

One noteable speaker was Rachel Beckhardt, project analyst, corporate partnerships for Environmental Defense, a public-private partnership that promotes environmentally-friendly technology. In her presentation, Beckhardt invited fleet managers to go to www.environmentaldefense.org/hybridincentives for a comprehensive list of financial incentives available to them to help defray the incremental costs of buying hybrid work trucks. My favorite moment came when Beckhardt gave an example of the kind of information available on the website by saying, “New Hampshire has a big pot of money” for fleets purchasing hybrids. This is New Hampshire, folks, one of the smallest states in the nation… Imagine what kind of money is available across the country!

 

There are big pots of money out there for your fleet, and now you know one new way to find it!

 

Idle Irritation

Here in Wisconsin, we’ve had a particularly cold, snowy winter, so it comes as no surprise that a lot of people have been leaving their cars, trucks and SUVs idling to keep warm. But when is enough enough?

 

Honestly, it doesn’t matter if it’s 10 below out or a perfect 68 degrees: a lot of people will leave their car, truck or SUV idling while they run into the store for a pack of cigarettes, a Coke, a newspaper, whatever. How and why have Americans picked up this disgusting habit? Don’t people make the connection that leaving their Suburban idling at the curb while they buy stamps is a complete waste of gasoline (or diesel fuel)? Do they realize they’re getting exactly zero miles per gallon?

 

I don’t understand the disconnect. I’m sure they’re good people, and I’m sure at least 60 precent of them want our troops back safely from the Iraq oil fields, so why are they so wasteful with this increasingly scarce and expensive resource? Even if it’s below zero outside, do they really think their car interior is going to get cold in the three minutes it takes them to buy a pack of smokes? Are we really that soft? Are we really that lazy? Do we really care that little about the world around us?

 

High Price for a Plug-in Credit

The good news is that the House passed a bill this week that includes a $4,000 tax credit for the purchase of plug-in hybrids, those great new vehicles that can run on all-electric power for upwards of 20 miles before their gas or diesel engines kick in. That credit could be quite a boost to this new technology, which, while exciting, remains expensive. General Motors has been talking for months about putting their plug-in hybrid, the Chevy Volt, into production within the next few years, and a $4,000 tax credit could be just the kick that GM needs for a successful launch.

 

There’s just one catch: President Bush has vowed to veto the bill, because it reduces tax credits for big oil companies. Next time you wonder why we’re not making any progress in reducing our dependence on imported oil, just take a look at the Bush White House’s record of corporate welfare to petroleum companies. And if you are considering buying a plug-in hybrid but hesitate because the price is too high, just remember the message you’ve been sent from Washington.

 

Biodiesel Blather

I just had the interesting experience of spending half my week with fleet maintenance managers at the Technology & Maintenance Council (TMC) Annual Meeting & Expo, and the other half of my week with biodiesel producers, distributors and retailers at the National Biodiesel Congress. I met with a lot of intelligent, knowledgeable people at both events, but at one event there was a whole lot of bad intelligence about the other event. The fleet maintenance managers, it turns out, have some pretty wrongheaded ideas about biodiesel… in fact, some of the things I heard brought to mind Mark Twain’s famous quote: “It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.”

 

Well, here’s what some of the fleet maintenance managers at TMC “know for sure”: They know for sure that biodiesel is causing aluminum fuel tanks on their big rigs to rust out from the inside out. They know for sure that there are absolutely NO quality standards for biodiesel. And they know for sure that, from the moment it’s produced to the moment you pump it into your fuel tank, biodiesel does not pass through a single filter.

 

After hearing these claims being made by worried fleet maintenance managers at TMC, I had a chance to ask some biodiesel experts at the Biodiesel Congress to respond. One expert did admit that, if you made your own biodiesel at home from questionable feedstock and with absolutely no quality control, you could rot out your fuel tank from the inside out. But then, you could also fill your tank with regular diesel fuel that happens to have water contamination, and you’d have the same result.

 

In response to the other claims being made about biodiesel at the TMC meeting, the biodiesel experts I talked to simply shook their heads in disbelief and said “We have a lot of work to do.” Now, in all fairness, there were a few fleet maintenance managers at TMC who spoke up in defense of biodiesel, but they were few and far between. The sad fact is that many fleets will not go near biodiesel, because they have bad information. Will they be willing to consider the other side of the story? Maybe, but as one TMC fleet guy told me, “Maybe the biodiesel folks should come and talk to us and hear what’s really going on out there.”

 

When is Enough Enough?

Did you read this financial news this week?

 

ITEM: Royal Dutch Shell posts record profit of $27.6 billion for 2007.

 

ITEM: Exxon Mobil posts profit of $39.5 billion for 2007, the largest annual profit in US history.

 

How much are you paying for gas these days? Oh yeah, about $3 a gallon, right? A little more than that for diesel, maybe? And all the while, the big oil companies beg for more tax breaks and special protection from Washington.

 

Have you had enough?

 

Real Gas Sold Here! Real Ignorance, Too!

Every now and then I see a mind-boggling sign at a gas station when I’m filling up my tank. The sign says, “No Ethanol! Real Gas Sold Here!” And, I have to say, for sheer ignorance this sign takes the cake.

 

“Real Gas?” What is real gas? Real gas is a precious commodity that we have to import from hostile countries, while members of our Armed Services fight and die in Iraq so that we can import even more. “Real gas” holds the United States hostage to higher energy costs, higher national security risks, more polluted air, automobile manufacturers from Japan who are surpassing our own domestic manufacturers every day, and yes, more deaths in Iraq. This is a selling point?

 

What is ethanol? Ethanol is a renewable, domestically-produced fuel that reduces tailpipe and greenhouse gas emissions, reduces our dependence on foreign oil, and, by the way, provides a higher octane value than straight gasoline. If you live in the midwest, as I do, E85 (a blend of 85 percent ethanol and 15 percent gasoline) costs about 60 to 90 cents a gallon less than gasoline. And ethanol doesn’t raise the cost of tacos, but that’s another blog topic.

 

The point is, any gasoline retailer who uses “No ethanol!” as a selling point is un-American. Here’s my message to them:

 

Stop what you’re doing! You’re not helping.

 

No Idle in California

Well, it’s been two weeks now since the new anti-idling law went into effect in California, and so far I haven’t seen any signs that A) the world is coming to an end, or B) trucking fleets are bypassing California to avoid the new regulation.

 

You may recall that the new regulation put in place by the California Air Resources Board (CARB) dictates that trucks with a gross vehicle weight rating greater than 10,000 pounds can idle for only five minutes. There are exemptions for being stuck due of traffic, weather or mechanical failure, or when being inspected or serviced, or queuing beyond 100 feet of a residential area or if the truck’s engine meets option NOx idling emission standards and the truck is beyond 100 feet from a residential area. Furthermore, drivers can’t operate a diesel-fueled APU for more than five minutes if they are located within 100 feet of a residential area. If your truck has a 2007 or newer engine, your diesel-fueled APU or fuel-fired heater must also meet additional equipment requirements. Oh, and the fines can be as high as $10,000.

 

The deafening silence from California can only mean one of two things: either the state has chosen not to enforce the new regulation (yet), or every trucking company operating in or through California is complying without complaint. I have to believe that it’s the former, but if so, when will they start enforcing the law, and who will be the first to feel the sting?

 

$100 a Barrel

Today, the name of this blog, “Over the Barrel,” seems especially appropriate, as last week crude oil futures surpassed $100 a barrel on the New York Mercantile Exchange. True, prices quickly slid back below $100, but the news here is that the doomsday barrier has been broken.

 

If you have followed the alternative fuels market, here in Fuel Advantage Magazine or elsewhere, you may have noticed that experts are fond of declaring that this or that alternative fuel, while perhaps not cost-competitive at the moment, will suddenly become so when petroleum passes $100 a barrel.

 

Well, now that that moment has come, where are all the alternative fuel bargains? Have you been shopping around for your fleet? Has B20 biodiesel suddenly become your savior? Has E85 ethanol suddenly become the silver bullet? Are you ready to place an order for those CNG trucks that have suddenly become a relative bargain?

 

I have mentioned before that here in southern Wisconsin, E85 is routinely 60 to 90 cents a gallon less expensive than regular unleaded gasoline, so any fleet in this locale that could realistically add flex fuel vehicles to its stable and hasn’t done so probably needs its collective head examined. Maybe $100 a barrel petroleum will change a few minds in that direction, but I wonder how long it will take.

 

You have heard the story of the two frogs tossed into pots of water. One pot was boiling, and the frog hopped out to safety immediately. The second pot was cold, but the heat slowly built up, and by the time it reached the boiling point it was too late for the frog. Well, I think we’ve reached the boiling point, my fellow frogs.

 

Welcome to the CAFE

I don’t know if you were as surprised as I was to learn that President Bush has signed into law a bill to raise the much-maligned Corporate Average Fuel Economy (CAFE) standards for passenger cars for the first time since 1985. Under the terms of the new law, fuel economy standards for passenger cars will increase by 40 percent by 2020, to a national fleet average of 35 miles per gallon. This is amazing news, folks, and it’s about time those numbers started to reflect the realities of the 21st Century.

 

Think about it: this standard has stagnated for over 20 years while the price of oil has nearly quintupled. When the current CAFE standards were set, you could still walk into a showroom and buy a brand new American Motors Eagle, Chevy Chevette or Chrysler K-Car. Oldsmobile and Plymouth were still proud nameplates. No one had ever heard the term SUV, and the only people who bought pick-up trucks were using them to haul manure to the back 40. In 1985 you could still buy a new Peugeot on American shores, for goodness sake. It’s laughable to think that we are still operating under the same fuel economy standards as a 1985 Dodge Omni when the price of regular unleaded gasoline now regularly tops $3.00 a gallon.

 

Okay, so the standards will now be raised. The problem is, 2020 is a long way away—that gives GM 12 more years to sell Hummers. In the meantime, what are you doing to improve your own fleet’s average fuel economy? You can wait for the automakers to start offering you more efficient vehicles, or… here’s an idea: you can start demanding them. Maybe if the market gets out ahead of the government on this one, the new CAFE standards will be obsolete before they even go into effect.

 

What are you doing with your own fleet: leading, following, or getting out of the way?