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LP Gas 2014 10 PDF
LP Gas 2014 10 PDF
A new way of
fueling Propane industry
leaders contemplate
widespread shift
toward European-style
refueling technology
S
ES
E EN
SU AR
IS AW
ER
NC
CA
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W E M A K E I T E A S Y T O G O T A N K L E S S
VO L U M E 74 | N U M B E R 10
OCTOBER 2014
Features
30 | SUPPORT SYSTEM
AmeriGas executive uses
her cancer diagnosis to
improve lives of others.
38 | A NEW WAY OF
FUELING
Propane industry leaders
contemplate widespread
shif toward European-
38
style refueling technology.
45 | STEPPING UP (AND
DOWN)
Industry partners in place
for propane to penetrate
step van market.
Departments
6 | OPENING DELIVERY |
A cancer diagnosis can put 30 18
everything into perspective.
18 | FOCUS ON PROPANE
AUTOGAS | Propane
conversion runs smoothly for
customized transportation
company.
On the cover | A Ford F-150 at Superior Energy Systems that runs on propane/Brian Richesson
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President,
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P
rostate cancer awareness month which is scheduled this year for Nov. a year, Conway says. Last year, they
of September transitions to 17 at Stonebridge Ranch Country Club raised less than $1 million.
breast cancer awareness month in McKinney, Texas. If there’s one message he likes to
of October, and we take time Pros4Care is an initiative that Ed convey about the disease, it involves
out from our busy lives to think about Varney of Emerson Process Manage- the conflicting reports about prostate-
people. ment and former LP Gas Editor Pat specific antigen (PSA) test scores.
We think about our family, friends Hyland, now of the Propane Educa- “If a PSA score is high, it tells the
and colleagues, and those affected by tion & Research Council, cofounded physician and patient that something is
these diseases that have permeated the out of concern for the risk older men, wrong, possibly with the prostate, with
country. Chances are we know some- specifically from the propane indus- the gland itself,” he says. “It could be
one who has faced these dire life situ- try, face from the disease. Its golf event an enlarged prostate or poor prostate
ations – and someone who has coura- has generated more than $250,000 health, but it does not directly reflect an
geously battled and overcome them. since 2007. issue with cancer. There’s a misnomer
These diseases force us to ask Golf seems like a popular way to that when a PSA score is high, it’s can-
“Why?” and question life’s big picture. grow awareness about a disease affect- cer automatically.”
Jane Stroupe of AmeriGas asked ing men – after all, Arnold Palmer has Instead, additional testing would
these questions in her battle against fought for the cause – but as one PCF follow to determine what’s causing the
breast cancer, but now she’s helping to representative explains, it’s not just high score, Conway says.
answer them for women who are re- about men helping men.
cently diagnosed with the disease. Jen- “Not everything we do in golf is Joining the fight
nifer Webb, our contributing editor, from a men’s perspective. It’s become a With so much information available
tells Jane’s touching story beginning family matter to a larger degree,” says about cancer and events promoting
on page 30. Chris Conway, director of golf, sports prevention and research, here’s a quick-
As part of these national cancer enterprises, at PCF. “Often it’s the hitting list of web resources:
awareness initiatives, North Coast ladies in our lives who actually have ■ American Cancer Society: cancer.org
Media, our parent company, is contrib- more of that arm-bending type of per- ■ Prostate Cancer Foundation: pcf.org
uting a portion of this month’s reve- sistence to help our guys – husbands, ■ North Coast Media publication Pest
nues across all magazine brands toward brothers, fathers, uncles – go get Management Professional shared this
the American Cancer Society (ACS). checked and make sure they’re taking link, outlining an initiative in which
Aside from skin cancers, breast care of their health.” men can receive free PSA screenings for
cancer is the most common form of Conway oversees the organiza- prostate cancer: eddiecheck.com.
the disease among American women, tion’s golf programs and helps groups ■ And to register for the Pros4Care
with one in eight facing a diagnosis around the country facilitate events to golf event, contact the Texas Propane
during her lifetime, according to ACS. benefit prostate cancer awareness and Gas Association’s Jackie Mason at 800-
Prostate cancer is prevalent in Ameri- research. The golf professional serves 325-7427 or visit txpropane.com.
can men, with one in seven facing that as a resource, offering ideas to help More information can be found on
diagnosis during his lifetime. ensure events’ successes. These ideas page 55. LPG
may come in areas such as marketing
Propane’s role with PCF and promotions, sponsorships, and
For seven years now, one particular budgeting. He’s been a resource for the
event in the propane industry has sup- Pros4Care event.
ported the Prostate Cancer Founda- In all, these events around the coun-
tion (PCF): The Pros4Care golf outing, try can raise upwards of $1.5 million brichesson@northcoastmedia.net
P
According to embina Pipeline Corp. selected a site Much of the propane destined for large
ThompsonGas, the acqui- for its planned West Coast propane international export markets is expected to
sition involves some cus- export terminal project, agreeing come from the growing supply in western
tomers located in South with the Port of Portland, Ore., and Canada, the company said.
Carolina and represents setting forth the terminal site, which in-
ThompsonGas’ first move cludes an existing marine berth. Phillips 66 breaks ground in Texas
into that state. The terminal agreement enables Pem- Phillips 66 held a groundbreaking cer-
bina to begin the process of engaging and emony for construction of its new LP gas
Ferrellgas to expand consulting with project neighbors and other production and export terminal in Free-
midstream operations stakeholders within the city; municipal, port, Texas.
Ferrellgas Partners LP state and federal governments; and all ap- The terminal will be located at the site
plans to acquire two plicable environmental and regulatory of the company’s existing marine terminal
salt water disposal wells authorities, according to a company press and will leverage its midstream, transporta-
in the Eagle Ford Shale release. tion and storage infrastructure to supply
region of south Texas The company, based in Calgary, Alberta, petrochemical, heating and transportation
from C&E Production LLC Canada, said it will spend $500 million to markets globally.
and its affiliates, based in initially develop a 37,000-barrel-per-day The terminal will have an initial export
Bryan, Texas, the propane propane export facility, with an anticipated capacity of 4.4 million barrels per month –
retailer announced. in-service date of early 2018.
Continued on page 10
The acquisition will
increase the partnership’s
salt water disposal wells
in the region to eight.
Ferrellgas established [ P R O PA N E M A S T E R L I M I T E D PA R T N E R S H I P CO M PA R I S O N ]
its midstream division in Fiscal Recent Total Units
May with the acquisition Year Quarter Price Current Current Est. Tax Debt/ Outstanding
of Sable Environmental Company End End (9/15/14) Distribution Yield Deferral Capital (millions)
LLC. It said the C&E AmeriGas (APU) Sept. June $45.52 $3.52 7.7% 75% 59% 92.9
assets will be managed Ferrellgas (FGP) July April 28.17 2.00 7.1 90 108 82.7
with other existing salt NGL Energy Partners (NGL) March June 42.12 2.36 5.6 80 45 83.6
water disposal facilities Suburban Propane (SPH) Sept. June 44.42 3.50 7.9 80 52 60.3
under the Sable platform, Average: 7.1% 66%
increasing the daily oper-
ational permitted capac- [ L A S T T W E LV E M O N T H S ]
ity 33 percent to 180,000 Gross Gross Gross Proft Gross Proft Retail Gallons Sold Percent Gross Proft
barrels. Company Revenue Proft Margin (Per employee) (millions) Change (Per gallon)
In addition, Ferrellgas AmeriGas $3,413 $1,397 41% $164,390 1,270 2% $1.02
will have the contractual Ferrellgas 1,979 614 31 169,483 653 2 0.65
right to acquire an addi-
NGL Energy Partners 2,125 227 11 90,940 163 9 0.16
tional well from C&E affili-
Suburban Propane 1,602 760 47 193,260 533 1 1.43
ates in the region.
Average: 33% $154,518 4% $0.81
• Dollar fgures in millions, except for per-unit data. Sharon Lui – analyst, Wells Fargo Securities LLC
Amthor adds distributor • Revenue and gross proft data are based on total propane gallons sold.
in South Carolina • Employee data is based on most recently completed fscal year.
• NGL’s revenue and gross proft data include the sale of distillates and
Spartan Tank & Trailer in other natural gas liquids.
Spartanburg, S.C., was
Source: FactSet, partnership reports and Wells Fargo Securities LLC
8 | LPGas October 2014 www.LPGasmagazine.com
AUGUST
[NEWS B R I E F S]
s
Flow
o n
ti
ova
In n
e re
Wh
12 | LPGas October
Month 2014
2014 www.LPGasmagazine.com
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fresh ideas for building your business. Get your tools at propanemarc.com.
PERC has a new initiative aimed at helping marketers convert heating oil customers
to clean, American-made propane. The campaign includes an informative brochure
for you to distribute to prospective customers in your area, as well as a print ad
template you can place in local newspapers.
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SINCE 1937
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AUTOGAS
in Norristown, Pa., joined Amthor as an
outside regional sales representative of
its propane, refined fuel, portable rest-
room and vacuum tank lines.
STATIONS
dent of sales. The company says Kostecki has more than 20
years of management and sales experience. He most recent-
ly was northeast regional sales manager for ADT Security
Services, where he managed commercial and residential
sales teams.
• From permits to staff support after installation ■ A Houston investment firm acquired @BlueBirdBuses
in a deal worth almost $500 million. Blue Bird will go
• Flexibility to customize applications to your needs
public.
• In full compliance with all applicable NFPA standards
• UL and CSA Listed units that can be placed on fuel ■ Another 101 Blue Bird Propane Vision buses are mak-
islands with other fuel dispensers ing their way to Canada.
• Package systems for quick infrastructure installation
■ Nova Gas Solutions says it developed its new Smart
• Wide range of dispensing Stack to flare propane more efficiently and safely.
products to meet fleet-
specific operations ■ EIA: U.S. #propane inventories up 1.7 million barrels
• System is 100% compatible last week to 79.1 million, about 21% higher than year-
with any current fuel ago levels. All regions move up.
management system
■ U.S. #propane price increases will likely moderate or
retrace as inventory building resumes in the coming
weeks, @PIRAEnergyGroup says.
SPONSORED BY
P
rovide A Ride President Alan “It cost us more, but I think it was Provide A Ride drivers pull up to
Groedel learned about propane one of the best moves we made,” he a pump that looks no different than a
as a fueling option through the says. “As a result of hiring them to do gasoline pump. To improve efficiency,
Taxicab, Limousine & Para- the installs, our implementation ran a dedicated refueler is used so drivers
transit Association trade group. very smoothly.” do not have to leave their vehicles.
Thanks to his knowledge of au- The Icom system requires no driver Information is gathered at the
togas, the Cleveland-based firm that interaction, Groedel says. As a result, pump, making it easy to track mileage
runs government-funded specialized his drivers required “extremely mini- and propane usage that can then be
transportation programs was awarded mal training.” captured in reports.
a contract with the Greater Cleveland “A driver could not tell at any one For someone who had never been
Regional Transit Authority (RTA). time, by vehicle performance, whether involved with alternative fuels, Groedel
Groedel turned to the alternative the vehicle is running on propane at is “extremely” happy his company now
fuel because he wanted his proposal to that moment or gasoline,” he says. uses bi-fuel vehicles.
reflect his company’s concern for the The maintenance staff and techni- – Diane Sofranec
environment and control over fuel cians at Provide A Ride participated
costs. in an intensive, week-long training
“The Cleveland RTA is running session, Groedel says, and it took
vehicles on propane, propane and gas, close to three months for them to get
and electricity,” he says. “So propane fully comfortable in diagnosing and
helped make us look like a smarter troubleshooting any issues.
partner to work with.” Now, they are installing the
Six months later, Provide A Ride is conversion kits on their own as the
using 800 to 900 gallons of propane a company takes delivery of 10 new
day, six days a week for its fleet of about vehicles.
45 bi-fuel vehicles. An on-site fueling station makes
Initially, the company’s paratransit fill-ups convenient. The vehicles
vehicles and cargo passenger vans were are filled with propane early in the Diesel $3.91
ISTOCKPHOTO.COM/ANDREW JOHNSON
gasoline only, but have since been con- morning. Drivers work eight-hour
verted to run on propane, as well.
“For a quantity buyer such as my-
shifts and come back to the station
mid-day where the vehicles are refu-
Gasoline $3.70
self, with 40 to 50 vehicles running on eled and sent back on the road for
propane, running 225 miles a day and
only getting about 12 miles per gal-
another eight hours with a fresh
driver.
Propane $3.07
lon, we buy a lot of propane,” Groedel It took almost three months to Diesel $3.91
Fuel Pr ice Re
n Cities Alte
Source: Clea port, national
ly 2014
rnative
says. “That being said, propane sells receive city approval for the fueling averages, Ju
for close to $1.50 a gallon less than station on the Provide A Ride prop-
gasoline.” erty, however. AmeriGas handled
Provide A Ride hired Icom North this aspect of the project, hiring ar- The average retail price of propane
America to come to Cleveland and chitects and engineers to oversee the autogas in July, including federal and
complete the conversions. construction and design. state motor fuel taxes and calculated
from about 500 public and private fueling
stations, fell 24 cents per gallon from
April. Diesel dropped 6 cents a gallon,
while the per-gallon price of gasoline
To learn more about the S2G LPG Commercial Chassis, visit increased 5 cents. Propane pricing
freightlinerchassis.com or call Freightliner Custom Chassis
reflects a sampling of primary and
at (800) 545-8831. For ordering details, contact your local
dealer. See it in action on YouTube—search “S2G Truck.” secondary stations, which also sell the
fuel for non-vehicle uses.
Hearth Products
Inquiries: info@raymurray.com
Email orders: orders@raymurray.com
RMI Autogas
RMI is a proud distributor of Cleanfuel products Catalog
[ AU T O G A S ]
Pennsylvania awards 33 grants for alternative fuel vehicle projects
The state of Pennsylvania is provid- lightweight fleet vehicles. The awarded AFIG grants will help
ing nearly $4 million in Alternative This year’s AFIG grants focused on pay for the conversion or purchase of
Fuel Incentive Grants (AFIG) to 33 the conversion or purchase of natural 261 propane vehicles, 274 natural gas
local governments, non-profit orga- gas vehicles weighing less than 26,000 vehicles and 23 plug-in hybrid or elec-
nizations and companies making the pounds, as well as the conversion or tric vehicles. The vehicles will support
switch to propane, compressed natural purchase of electric, propane or other about 24 new fueling stations and 35
gas (CNG) or electric for medium to alternative fuel vehicles of any size. existing stations.
Here are the projects involving
companies, collaborations and coun-
Bergquist is two ties investing in propane:
• Allegheny Yellow Cab, which con-
dispensers in one. verted 14 taxis and shuttles to propane
($39,200)
• The Delaware Tinicum Town-
ship Propane Vehicle Conversion
Initiative/Greater Philadelphia Clean
Cities, with partners Tinicum Town-
ship (converted eight police vehicles
+
to propane), Colonial Airport Parking
and Park & Jet (purchased a total of 26
propane shuttle vans) ($238,700)
• Lancaster Rhoads Energy, which
converted 14 vehicles and purchased
two vehicles to run on propane
($63,952)
• Luzerne United Parcel Service,
which converted 50 delivery trucks to
Cylinder Fleet propane ($250,000)
• Montour Reichard Busing Co.,
Jim Miller, Obie Dixon and Marty Lerum are supply and
risk management experts for Propane Resources. Contact the
company’s office at 888-739-6732.
WE M AKE
WINTERS
omple
A Comp te Line of
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Infrared Heaters for NEWW
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orth American petrochemical to be the most significant source of tion derived from technologies such as
producers’ increasing use of increasing global on-purpose propyl- metathesis and propane dehydration.
cost-advantaged natural gas ene production, and will be the process According to the IHS report, current
liquids as a feedstock over oil most likely employed in the United global propylene demand is about 90
means less propylene is being pro- States, the Middle East and Asia for MMT, and is expected to increase to
duced as a coproduct by the region’s this production,” Carr says. “Currently 130 MMT by 2023.
steam crackers. there is one propane dehydrogenation Propylene is produced from naph-
This trend is driving greater global unit operating in the region (Flint Hills, tha, natural gas liquids in refinery
need for on-purpose production of near Houston), but plans are under way units and, to a much smaller extent,
propylene, which is a key chemical
building block second in demand only
to ethylene, according to new research Global Propylene Production, by Technology
from Englewood, Colo.-based IHS. [ 20 03 -23 P E R C E N T ]
“The increasing need for on-purpose
production of propylene is primarily 100%
being driven by two factors: first, the 90%
changing feedslates in North American 80%
70%
petrochemical production, which are
60%
getting lighter due to more ethane
50%
being used versus naphtha; and sec- 40%
ond, the decline in North American 30%
gasoline demand as automobile CAFÉ 20%
standards are implemented,” says 10%
Chuck Carr, senior director of global 0%
olefins at IHS Chemical and author of 2003 2008 2013 2018 2023
the IHS study, in a press release. IHS Chemical
Refineries Steam Crackers On-Purpose Production
“Ethane is a cheaper feedstock than
naphtha, but it produces minimal
amounts of propylene as a coproduct,” for six more to be built by late 2018. In coal, and it is essential for the produc-
Carr says. “Since global demand for response to this new dehydrogena- tion of polypropylene plastics such as
propylene is increasing, on-purpose tion capacity, pipeline service changes films and packaging. Polypropylene
production of propylene has become and expansions are expected in North accounts for 67 percent of total
increasingly significant in the last 10 America. We are going to see signifi- demand.
years, and this trend will continue cant investments being made in terms Propylene is mainly produced as
through 2023.” of pipeline capacity and storage.” a coproduct in steam crackers and a
In 2003, less than 3 percent of global In 2013, North America produced byproduct in refineries. The second
propylene production – 2 million slightly more than 20 MMT of pro- largest source of propylene supply
metric tons (MMT) – was considered pylene (including fuels). By 2023, IHS has been production of refinery grade
on-purpose production. But, according expects North American demand for material in fluid catalytic cracking units
to the “IHS Chemical North American propylene into chemicals to exceed and other refinery units.
Propylene Supply Study,” that number 20 MMT, and the region is expected In terms of North American propyl-
had increased to nearly 12 MMT, or 12 to produce about 15 percent of ene production, 5 MMT is consumed
percent, of global production in 2013. global supply. Of that production, Carr for fuels, while the remaining nearly 16
By 2023, IHS says, nearly 30 percent, expects 5 MMT will be on-purpose MMT are consumed to produce chemi-
or about 38 MMT of global propylene production from North America. Just 4 cal derivatives. More than 60 percent
supply, will be on-purpose production. percent of the region’s current propyl- of the region’s production is produced
“Propane dehydration is expected ene production is on-purpose produc- and consumed in the Gulf Coast. LPG
Support System
AmeriGas executive uses her diagnosis to improve lives of others
J
BY JENNIFER WEBB ane Stroupe has had the kind of career last year when she helped organize a support
CONTRIBUTING EDITOR that hardly seems possible anymore: Ris- group for women who, like her, are coping with
ing from a part-time clerk job at Piedmont a cancer diagnosis. The group helps women who
Natural Gas with almost no knowledge of are struggling to make sense of their new reality.
propane, almost 40 years later she now is “Someone is always there that has just been
an area director for the country’s largest pro- diagnosed, and they are scared to death,”
pane company. Stroupe says. “We help them cope by answer-
ing their questions and listening to their con-
cerns. They are encouraged they will be healthy,
‘fairly normal’ women like we are very soon. It is
a great feeling to provide support to each other
and give a new friend a hug to let them know
they can make it through the process.”
Health scare
Stroupe, an only child, was grieving the sudden
death of her mother in March 2013 when a rou-
tine annual mammogram that June showed an
abnormality.
She distinctly recalls the feeling of fear that
swept through her when she and her husband,
Mark, heard she “definitely” had breast cancer.
“It was as if our world stood still,” she says.
“All the information we were being given was
overwhelming, and we learned medical termi-
nology we never wanted to hear.”
She underwent a bilateral mastectomy in
With her cancer treatments complete, Jane mid-July, and the aggravations that accompany
North Coast Media, Stroupe, left, says she feels like “a free woman.” serious health concerns began: She started che-
the parent company Photos courtesy of Jane Stroupe and Nancy Coop motherapy on her ninth wedding anniversary.
of LP Gas Magazine, A port-a-catheter inserted the previous day
is donating a portion Three things about that career path are par- apparently punctured a lung, causing it to col-
of October issue ticularly extraordinary: First, thanks to a payroll lapse and sending her back to the hospital for
revenues to the error, she was promoted from part-time clerk to four days. Her hair fell out 16 days after her first
American Cancer full time two weeks into the job; second, in 1997 treatment, triggering denial and eventually ac-
Society. The national she made history as the first woman president of ceptance to the point that she embraced the va-
organization is her company; and third, she has never left that riety of wigs and hats available.
dedicated to saving company in four decades, although its owner- “I bought beautiful wigs and hats and
lives from cancer, ship and name have changed over the years changed my look every day to suit my mood,”
focusing on research, through a series of acquisitions. Stroupe says. “Some days I was a blonde, some
education, advocacy Today, Stroupe, 60, serves as area director days I was a redhead. Some days I wore a hat
and service. Learn for AmeriGas district offices in parts of South with hair sewn in.”
more at cancer.org. Carolina, North Carolina, Tennessee and Geor- Having learned about resources available
gia. That leadership experience proved valuable Continued on page 32
To learn more, visit us at the WLPGA Forum & AIGLP Congress in Miami, stand 102-103 and find out how we can help you
grow your business. www.vikingcylinders.com
To learn more, visit us at the WLPGA Forum & AIGLP Congress in Miami, stand 102-103 and find out how we can help you
grow your business. www.vikingcylinders.com
Autogas Dispensers
Features:
• Gas Pump Style Cabinet
• LC Temperature Compensated Meter
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• 1000 or 2000 Gallon Tank
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-50,000 Users Per Station!
Please contact Chad Pendill or Charlie Koch with any questions on our Autogas Dispenser Systems.
To learn more, visit us at the WLPGA Forum & AIGLP Congress in Miami, stand 102-103 and find out how we can help you
grow your business. www.vikingcylinders.com
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P R O PA N E AU T O G A S
fueling
contemplate widespread
shift toward European-style
refueling technology
BY BRIAN RICHESSON nents, says Jessie Johnson, the company’s vice presi-
EDITOR IN CHIEF
dent of sales and marketing.
brichesson@northcoastmedia.net
The issue merited a meeting of industry stakehold-
E
uropean-style dispenser nozzle and connector ers earlier this year at the Southeastern Convention &
technology being installed and tested at pro- International Propane Expo in Atlanta. The consen-
pane fueling and fleet locations in the United sus there was for the industry to move forward with
States carries safety, environmental and ease- the European-style technology. The group felt this
of-use benefits that will improve the overall technology helps create the most positive fueling ex-
experience and perception of autogas nationally. perience and sets a high standard that’s useful across
That’s the case being made by some U.S. propane North America.
industry leaders who envision widespread adoption “At the end of the day, everybody is for it. The noz-
of this technology to replace 1¾-inch Acme filler zle is lighter and easier to connect, and it puts propane
equipment currently in use for autogas applications. in a more positive light,” says Curtis Donaldson, man-
The movement began at Mississippi-based Bloss- aging director and founder of autogas dispenser man-
man Gas, which was familiar with the European ufacturer CleanFuel USA. “But how do we go about
nozzle technology when it heard of incidents and doing it in an organized manner that transitions us
complaints from the field regarding current compo- and, most importantly, takes care of our customers?”
European technology
Industry partners are moving forward with a nozzle
manufactured by Swiss company Staubli, which has
North American headquarters in Duncan, S.C. The
nozzle, which is used primarily in Spain and Portugal,
is on course to receive Underwriters Laboratories (UL)
approval, Johnson says.
Another international manufacturer – Elaflex – is
also looking to develop this style nozzle and is moving
forward with UL approval, says Tucker Perkins, chief
business development officer for the Propane Educa-
tion & Research Council. The U.S. autogas industry
currently uses Elaflex’s GasGuard Acme-style nozzle.
“We want to move forward promoting this [Euro-
pean] connection to industry customers,” says Per-
kins, and that means getting manufacturers of con-
nectors and adapters involved, as well as the propane
industry’s equipment distributors in the United States
and Canada.
Vehicles must be retrofitted with a European-style
connector (or fill valve) to fit the Euro-style nozzle.
Mike Walters of Superior Energy Systems demonstrates If this nozzle or connector is not in place, an adapter
the European-style nozzle on a company vehicle. Continued on page 40
www.xact-data.com Get the highest cumulative tank-level accuracy and the reliability to have 100%
confidence in precisely when and how much you need to deliver on every route.
Xact Tank Monitoring Systems use ultrasonic technology to pinpoint tank levels
on any size tank, located anywhere, with secure Internet access. Cut your costs
and catch more fish. Call +1 503.227.7908 or
email us at xactsales@schmitt-ind.com
A PRODUCT LINE OF
www.schmitt-ind.com
© 2014 Schmitt Industries, Inc. All rights reserved. XACT TANK MONITORING SYSTEMS and
SCHMITT INDUSTRIES are trademarks of Schmitt Industries, Inc.
P R O PA N E AU T O G A S
MEGR-1232
s Field tested across all regions
of the USA
s Extensive UL testing to
UL144/UL144C
MEGR-1222
s KEY FEATURES: Stainless steel
internal components, molded
lip fabric reinforced diaphragms,
powder coat finish, GLT Viton
seats, Peel-N-Stick leak check
MEGR-1622H label, exclusiveTri-Tap two-stage
pressure port system, plus
Your FULL LINE equipment distributor is now offering much more!
MEC Regulators.
40 | LPGas October 2014 www.LPGasmagazine.com
P R O PA N E AU T O G A S
As the parent company of Petro, Meenan and Champion Energy, with local operations
throughout the Northeast and Mid-Atlantic, Star Gas, L.P. has made multiple successful
acquisitions in recent years and is actively searching for professional, full-service heating
oil and propane companies to add to our local family. Here are just a few reasons
to join the Star Gas family:
Over 100 years of industry leadership.
We are the country’s leading provider of home heating oil so we understand the complexity
of acquisitions and how critical it is for you to be able to work through the process
while running your business.
Grow with our family and grow your business.
Our experience, large network and resources uniquely position us to make a seamless
transition for you, your employees and customers. Your company’s identity, reputation
and place in the community will be preserved and protected.
If you are considering selling your business, please call us today for a discreet and
confidential consultation.
Steven J. Goldman, President/CEO Jeff Woosnam, VP, Operations – Neil Bianco, VP, Operations –
Star Gas Partners, L.P. 516.686.1615 Mid-Atlantic Acquisitions New York & Northeast Acquisitions
Star Gas Partners, L.P. 215.942.5008 Star Gas Partners, L.P. 516.307.4802
A NEW NAME
A FRESH LOOK
On Oct. 6, the newly named Trader’s Corner
e-newsletter will continue to provide propane market
analysis and help propane marketers with their
supply-planning decisions. Please be on the lookout
for this name change in your inbox. If you don’t
already receive this valuable weekly report, visit
lpgasmagazine.com and select “Subscribe” under
the “Newsletters” tab and sign up for free today!
STEPPING UP
(and down)
W
hen the propane industry we can almost say we have 100 percent and food and beverage companies.
gathered in Atlanta earli- penetration in terms of chassis and en- Like other propane-fueled fleets,
er this year for its largest gines,” says Tucker Perkins, chief busi- companies in these step van industries
trade show, talk centered ness development officer for the Pro- have one central location where vehicles
on a growing opportunity in the step pane Education & Research Council are garaged, maintained and refueled.
van market. (PERC). “That’s school buses and step They often have a propane tank and re-
UPS had just energized the indus- van chassis.” fueling dispenser onsite.
try with a March announcement that it According to PERC estimates, “A key attribute we’re looking for is
would invest $70 million in 1,000 pro- 300,000 step vans are in operation today do these vehicles return to a central base
pane-fueled package delivery vehicles in the United States, and 10,000 to 15,000 every night?” Perkins says.
and refueling infrastructure. And if a new vehicles are sold each year. The in- In addition, propane offers fleets the
brand like UPS can choose propane, dustry would like to capture about 25 range needed to reach their destinations
why not others? percent of that new-vehicle market share while costing companies about half of
Industry ties to engine and chassis annually, Perkins says. gasoline’s per-gallon price.
manufacturers have allowed propane to Industries putting step vans on the “Most of these guys are seeing a cut in
make a significant push into the school road include multi-stop package deliv- their fuel expenses of 30 to 40 percent,”
bus market, but those same ties are al- Perkins says. “That’s just huge to these
lowing it to make inroads with compa- Alpha Baking Co. is leading the charge guys, not to mention the environmental
nies utilizing step vans. And that means in its industry to incorporate domestic benefits and how they can talk about
propane industry partners can pursue alternative fuels like propane autogas. Continued on page 46
Superior performance
Five vital signs to get your propane business running at optimal levels
B
usiness owners and executives
have long sought answers to
the question of “What creates
superior performance in my
company?”
T
he phrase “You reap what you investment and keep an adequate size sales packet only told part of the story.
sow” has roots in early Christi- tank in place for a time when usage This business was a best-in-class ex-
anity and can also be applied in may increase. Low or sporadic user ample of owners wanting to build and
nonreligious situations, such as prospects were offered a tank purchase maintain a first-class business.
valuing your propane business. plan so the propane retailer could im- ■ What are the age and condition of
I recently advised partners through mediately recoup the tank investment your delivery and service trucks?
the process of selling their propane and still gain a gas customer. The business partners had a reason-
business, and it was a classic example of This tiered sales plan enabled the able number of newer model trucks in
reaping what you sow. Placing a value propane retailer to have a plan for all their fleet that fit the business size. The
on your propane business for change- propane users and to sell propane in a trucks were well maintained, with ser-
of-ownership purposes, whether it be narrower range of pricing that was more vice records from a reputable commer-
for corporate reasons, next-generation related to size of delivery than annual cial truck maintenance garage to prove
estate planning or sale to an outside usage. The propane retailer reaped large it. There were no old out-of-service or
party, depends on the owner’s actions numbers of loyal new customers every seldom-used trucks sitting around the
of the past. year based on the way prospects were yard gathering rust and leaking fluids.
In this sale, interested business buy- treated, and the business buyer felt com- ■ Do you have a loyal workforce that fits
ers had similar questions about the fortable with the risk of customer loss. the workload?
business that went well beyond the nor- ■ Do your new customers receive a Gas The owners worked in the business,
mal number of gallons and customers. Check or some equivalent inspection of their had some full-time employees and were
Questions were posed, such as: propane system? able to develop loyal seasonal employ-
■ What percentage of the propane tanks Business buyers and insurance ees who worked in the busy season.
at your customer locations are customer companies want assurance that your Employee compensation plans were
owned versus company owned? customers have safe-operating propane competitive but not overly generous. It
Although survey results vary systems. In this case, the owners per- was a well-balanced workforce with no
widely, the average propane retailer formed an equivalent Gas Check on all useless relatives of the owners taking
operates with about 15 percent of the new customers, performed a leak test on up space, so the business buyer was able
tanks under customer ownership. In all propane run-outs and had documen- to take all of the employees on board
this case, higher-than-normal levels of tation in customer files to prove it. The and continue to build the business.
tanks were customer owned. This will business buyers liked what they found. When the business sale was final-
usually make business buyers uncom- ■ What is the condition of your tanks? ized, the business partners received a
fortable because they are concerned The business owners had always premium price for their company based
about the stability of the customer base purchased new or highly reconditioned on the actions they had taken over the
under new ownership. tanks and had been in business for years to take good care of their employ-
However, the owner’s actions in sell- less than 10 years, so the condition of ees, customers, facilities, trucks and
ing tanks were justified by their over- the tanks in the field was very good. field equipment. Remember, the value
all new customer sales plan. In their The eventual business buyer did spot of your business is the result of your
market, the average to above-average inspections of customer installations own actions. LPG
user was leased a tank at no charge. If a as part of the due diligence process and
prospect came in who was projected to liked what was found. Tom Jaenicke is the founder and prin-
be a lower-than-average user, perhaps ■ What is the curb appeal and the cipal adviser at ATomiK Creative Solu-
a seasonal user or smaller home with under-the-surface condition of the office tions LLC. He can be reached at 810-
fewer gas applications, a tank lease plan and storage location? 252-7855 or tom@atomikenergy
was offered to help recoup the tank The photos inserted in the business solutions.com.
P
aving abundant hot water in homeowners, plumbers, builders and
water heater above $600 per year. In that same region, the local areas, Kidd says. These tools include consumer bro-
cost of operating a propane-powered tankless water heater chures and consumer ad templates that are available at
was just $363, and the cost of operating a propane-powered propanemarc.com.
high-efficiency storage unit was $438. The full Newport Partners study can be viewed at
buildwithpropane.com/waterheating, and a free online
Annual cost of ownership course, “Water Heaters: Retrofitting from Electric Standard
Another key finding of the study was the fact that determin- to Propane Tankless,” is available at propanetraining
ing a water heater’s annual cost of ownership entails more academy.com.
than just its annual energy costs. The system’s cost and ex- Also, the free Energy Cost and Carbon Calculator mobile
pected service life also factor into that figure. app from Apple’s App Store or Google Play can calculate es-
Researchers examined each water heater’s purchase cost timated annual energy costs and carbon emissions for water
and its energy bills spread out across its estimated life. In all heating systems while on the go.
but one climate region represented in the study (hot/humid), “Over the past few months, PERC has engaged with
the lowest annual cost of ownership was for a propane tank- plumbers at a national level to make sure they’re aware of the
less water heater system. benefits propane water heaters can offer their customers,”
“This is likely due to the system’s longer-than-normal Kidd adds. “We encourage propane marketers to talk with
service life of 20 years, as well as its low annual energy costs,” local plumbers and follow up with their homeowner custom-
Kidd explains. “Propane tankless systems may cost more to ers. By working together, we can ‘pull the plug’ on electric
initially install, but they pay off in the long run.” water heaters and help homeowners save money and energy
while growing residential gallons.” LPG
Carbon emissions
Most homeowners are likely unaware of the effect their water Lynette Von Minden is senior public relations counsel for
heaters can have on their homes’ overall carbon footprints. marketing communications agency Swanson Russell. She can
While that may be true, it’s also true that today’s consumers be reached at lynettep@swansonrussell.com.
are more concerned about the environment than previous
generations, making carbon emissions a valid propane water
heater selling point in many situations.
The carbon dioxide emissions analysis in the 2010
Newport Partners study was based upon emissions factors
supplied by the Environmental Protection Agency’s Emis-
sion & Generation Resources Integrated Database (eGRID).
Researchers used this database to derive the emissions that
result from producing a unit of electricity. eGRID’s emissions
factors are provided on a state level, and they include electric- QUALITY • RELIABLE • EXPERIENCED
ity produced by a variety of sources – coal, nuclear and hydro
plants, for example. Conversions for more than 55 Years!
Two factors greatly contributed to the amount of emis-
sions that a water heating system generates: energy source Call the AUTOGAS PIONEERS today
and efficiency level. The study found that a standard-effi- 507-345-4000
ciency electric storage unit typically produces twice the car-
bon emissions as a high-efficiency, non-condensing propane acmecarb.com facebook.com/acmecarb
storage unit. Interestingly, because of their high electricity
consumption, even heat pump water heaters produced car-
bon emissions that were an average 33 percent greater than
propane condensing tankless systems across all of the cli-
mate regions in the study.
CHAMPION
BENEFACTOR
,
GAS EQUIPMENT
"For Propane There Is No Better Name" ® HEATING & HEARTH
DISTRIBUTORS
DONOR
Family Propane
Thank you to all the friends of Scholarship. For more opportunities to support
the NPGF Scholarship Foundation, contact Joanne Casey (JCasey@npga.org).
Walk-behind mower
The 2015 Turf Tracer S-Series walk-behind mower incor- mower’s durability. The system eliminates nearly
porates a number of improvements designed to deliv- 250 component parts, the company says. Exmark
er increased overall durability, serviceability and rerouted hydraulic hoses to maximize cooling and
ease-of-use, Exmark says. A number of engine keep the mower cleaner. A choice of 36-, 48- or
options are available for the 2015 52-inch UltraCut Series 3 cutting decks are
model, including a Kohler PCV680 EFI available with the new Turf Tracer S-Series.
propane engine. In addition, the Turf One feature Exmark did not change with
Tracer S-Series is available with a vari- the new model is its enhanced control
ety of Kawasaki engine options, two of system, which lessens operator fatigue
which are California Air Resources Board through improved ergonomics and precise
compliant. In addition, Exmark incorporated an electric fingertip control, according to the company.
clutch to simplify the deck drive system and increase the For more information, visit www.exmark.com.
Truck platform
Alkane Truck Co.’s Class 7 cab-over truck platform is engineered to
run on propane autogas. The truck is available in two models – the
33,000-pound P-33 and the 26,000-pound P-26 – and features a 6.8-
liter Ford Triton V-10 engine that was modified to run on gaseous fuel.
The fuel system is direct-injection, liquid-propane technology from
Bi-Phase Technologies LLC. According to Alkane, the P-33 and P-26 are
both Environmental Protection Agency and California Air Resources
Board certified for use on highways.
For more information, visit www.alkanetruckcompany.com.
LPG dispenser
Johnston
manage fleet fuel use. A stainless steel
weather hood with insulation prevents
condensation from reaching the elec-
tronics department, Parafour says. The
7th annual
Pros4Care golf Event
Monday, November 17th, 2014 • Prostate Survivors play FREE
• $150 golf registration
Start
• Includes breakfast & awards lun h
nebridge Ranch Country Club
• Commemor ti
Autogas dispenser
The PAFD-1 CR dispensing unit from Superior Energy
Systems Ltd. uses a Windows-based PC with a high-reso-
lution display built into the cabinet, which includes a web-
based fuel management system that uses a key fob with a
data entry keypad. The dispenser features a zero-emission
fuel nozzle, the company adds, and
it can track custom-
ized customer-
required data
such as driver
Conformable autogas tanks
ID, vehicle ID, Propane Performance Industries (PPI) secured
vehicle mileage American Society of Mechanical Engineers approval
and more. The for its family of conformable aluminum propane auto-
unit has the gas fuel tanks. According to PPI, the conformable tank
capability to design means that, unlike a cylinder, the width mea-
show a train- surement is not the same as the height. This allows the
ing video for PPI tanks to fill spaces in a vehicle more efficiently and
first-time users, provide more capacity than regular cylinders, the com-
Superior says. Public refueling is possible, too, with the pany says. In addition, PPI says a tank can be positioned
addition of a credit card reader. horizontally, vertically or on its edge.
For more information, visit www.superiornrg.com. For more information, visit www.ppinorthamerica.com.
United States Postal Service Statement of Ownership, Management, and Circulation and exchange copies.):
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from recipient, telemarketing, and Internet requests from J I certify that 50% of all my distributed copies (electronic and print) are legitimate requests or
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PROPANE BUSINESS
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BUSINESS PLANNER P iness B u s
The Propane Marketer Business Planner is a one-of-a-kind
lanner
tool to help today’s propane retailer. It presents detailed
An in-depth
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business
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62 | LPGas
Gas October 2014 www.LPGasmagazine.com
Gas
COMPANIES TO WATCH
Porco Energy
Pink mower marks New York retailer’s entry into propane autogas
BY KEVIN YANIK | MANAGING EDITOR 50 hours,” says Santini, who
kyanik@northcoastmedia.net estimates his conversion cost
P
orco Energy runs its cylinder between $1,800 and $2,000.
exchange program through the “Now, we’re going every 100
summer, and it delivers a num- to 150 hours and still seeing
ber of summer gallons each the same amount of oil use.
year to heat pools. But leaders at Porco There’s really no breaking
sought new opportunities a year ago to down the oil at 150 hours.”
grow their business during propane’s Fuel consumption be-
offseason. tween Santini’s propane
Lawn mowers presented a unique mower and gasoline mowers
opportunity, they found. The oppor- is about the same, he adds,
tunity was also one that could thrust but he’s saving $1.50 to $1.75
Porco into the propane autogas market. per gallon on fuel for his pro-
“If we get good landscapers, we’re pane mower. Porco Energy partnered with
going to add 1,000 or 1,200 gallons per “All of our gas comes from Porco,” AltFuel to convert the Santini’s
year [per mower],” says Joe Porco, vice says Santini, who burned nearly 2,200 Lawn Care mower. For a slideshow
president, whose business is located in gallons of propane with his mower this of the conversion and more, visit
Marlboro, N.Y. “Those will be mostly year through August. “We have 15 or lpgasmagazine.com.
summer gallons, and that’s an ideal 16 [33-pound vapor] cylinders we swap
situation.” out as needed. They’ll take inventory LOCATION: Marlboro, N.Y.
The company originally approached based on what our consumption is.” FOUNDED: 1954
lawn mower dealers to encourage them In addition, Santini says his propane
EMPLOYEES: 49
to sell propane mowers, but Porco mower delivers a slightly better cut
found dealers currently have little inter- than his gasoline mowers. CUSTOMERS: About 12,000,
est in this area. “With propane you’re going to raise including 9,000 propane
“It’s a tough nut to crack,” he says. your rpm,” he says. “I’m getting about PROPANE SALES: 5 million
“Dealers were a little apprehensive to 200 rpms more, so that changes your annual gallons
get landscapers to go out and purchase blade-tip speeds.”
them. So we looked at converting exist- Besides the fact that propane powers ONLINE: www.porcoenergy.com
ing ones.” one of Santini’s mowers, Santini teamed
The conversion approach is how with Porco Energy to paint its Bobcat says. “Not only is it pink, but when
Porco Energy landed its first mower pink to promote breast cancer aware- people see the tank they’re like, ‘What
customer: Santini’s Lawn Care, another ness. The companies showcased the is that thing?’ I probably get one or two
Marlboro-based business. pink mower last year at a local festival. calls a week with people just asking
Santini’s owner, Steve Santini, ad- “The festival here raises money for about it.”
mits he didn’t know a thing about pro- various charities and donations,” Porco As for Porco, it plans to pursue ad-
pane mowers before Porco approached says. “It’s not for one specific thing. But ditional opportunities to grow gallons
him. But Santini decided to convert one the organization that puts it on does with mowers.
of his four mowers – a Bobcat Predator raise money.” “We’ve met with school districts on
Pro – to propane once he learned about The mower has drawn attention converting their mowers,” Porco says.
the fuel’s advantages. around town, too. “Municipalities and golf courses are on
“We service the mower every 40 to “It’s been an eye-catcher,” Santini our list.” LPG
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