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10/11/2021

Embracing Alternative Fuels Still Important for C-store Industry

Ethanol blends, RNG, biodiesel and more continue to expand in availability.

NATIONAL REPORT — While electric vehicles are getting more and more attention these days, alternative fuels — including ethanol blends, biodiesel, renewable natural gas (RNG) and compressed natural gas (CNG)continue to grow and should not be overlooked.

Researching and investing in lower-carbon options remains a focal point for fuel companies.

In March 2021, BP Products North America and Chevron formed and expanded joint ventures around RNG, respectively. Chevron expanded its joint venture with Brightmark LLC to produce and market dairy biomethane, an RNG, after it teamed up with California Bioenergy LLC and local dairy farmers in September 2020 to achieve the first RNG production from dairy farms in Kern County, Calif. Meanwhile, BP entered a new partnership with Clean Energy Fuels Corp. to develop, own and operate new RNG projects at dairies and other agriculture facilities.

“There is a resurgence of interest in RNG because it hits environmental concerns people have,” said John Eichberger, executive director of the Fuels Institute, a non-advocacy research organization dedicated to studying transportation energy based in Alexandria, Va. “A couple of years ago, UPS struck a deal with Clean Energy to purchase tons of RNG because it satisfies low-carbon fuel standards, and it’s a great fuel for fleets because the infrastructure to fuel them is pretty easy.”

Additionally, oil companies must meet their renewable volume applications, which is why they are blending E10 and biodiesel, and there have been several converting refineries for renewable diesel, the Fuels Institute executive shared. The credits are available to them right now as there is a blenders tax credit of $1 a gallon, he noted. 

“There is a lot of incentive for them to make these conversions, and they need to look at what products they need to bring to market to stay viable,” Eichberger said.

At the same time, ethanol blends are seeing a lot of growth on the forecourt right now. In 2020, the number of retail sites selling E15 grew by 10 percent, bringing E15 to more than 2,300 stations across 30 states, according to Growth Energy, a trade association working to advance pro-biofuel policies and expand customer access to higher blends of ethanol.

Convenience store retailers including Casey's General Stores Inc., Cumberland Farms, Family Express Corp., Holiday Stationstores, Kum & Go LC, Kwik Trip Inc., Minnoco, Murphy USA Inc., Protec Fuel, QuikTrip Corp., RaceTrac Petroleum Inc., Royal Farms, Rutter's, Sheetz Inc. and Thorntons offer E15 on their forecourts, which is known as Unleaded at the pump.

“The number of stores selling E15 has grown and will probably accelerate, and most vehicles on the market today are approved for E15,” said Eichberger. “I see ethanol blends growing as pretty much all fuel has 10 percent ethanol and E15 is growing already with less hurdles to get it, including compatible and certified equipment.”

As of press time, the Fuels Institute was analyzing the results of a recent study looking at sales data for stores offering E15. By the end of a 12-month period, it was outselling higher octane blends.

At VP Racing Fuels, a San Antonio, Texas-based company that provides branded fuel programs to the convenience channel, the company has a number of ethanol fuels, as well as several formulas that utilize bio-butanol. Looking further down the road, it is exploring synthetic fuels, which can utilize renewable energy, sequestered CO2 and hydrogen to synthesize hydrocarbons. 

“Ethanol is an easy-to-handle fuel and has a fairly long history of use in the gasoline pool,” said Alan Cerwick, CEO of VP Racing Fuels. “I believe its use will continue well into the future. In fact, E15 could become more widely adopted. But E85 in consumer application has effectively died. Ethanol could also bridge the octane shortage that seems to be growing.”

More and more manufacturers and vendors are creating technology to handle alternative fuels, including dispensers and other equipment that works with ethanol blends, CNG, biofuels and more. Dover Fueling Solutions, which has been providing technology for alternative fuels for years, offers the industry’s first blending technology that enables multiple ethanol blends from a common hose, according to Scott Negley, senior director of product management at Dover. The company also offers dispensers UL-listed for E25 and B20 as standard.

“[At the forecourt], we’ve seen greater variations of fuel offerings, with various additives to help drive greater fuel margins with premium grades, and increased use of biodiesel and ethanol blends such as E15,” Negley observed. “We will continue to invest in alternative energy solutions across our global regions, engaging with potential partners and growing our portfolio of renewable energy models. For example, we’re expanding our line of multi-hose, enhanced blenders to offer retailers more choices of higher ethanol and biodiesel products.”