Tank fleets play a leading role in biofuels logistics

April 1, 2008
Nearly four in 10 Americans say that developing alternative fuels and improving fuel efficiency should be the highest priorities

Nearly four in 10 Americans say that developing alternative fuels and improving fuel efficiency should be the highest priorities for investments that will lead to meaningful technological advances within the next decade. That was the conclusion of a recent national technology survey conducted by Ipsos Public Affairs, an independent global research company.

The survey result reflects a growing realization in the United States that energy independence offers the best way to build a strong economy and ensure national security for the future. This is seen as the only way to halt a growing dependence on imported oil that is draining away wealth and helping to finance foreign governments that are hostile to the United States.

Billions of dollars are being invested by US companies to develop alternative fuels, and output of those products is surging. Tank truck carriers are at the forefront of the effort to build an efficient, cost-effective logistics system to distribute those new fuels.

This issue of Bulk Transporter highlights the drive by the Kenan Advantage Group (KAG) to become a major national player in the biofuels logistics and distribution process. The KAG effort includes partnering with Minn Iowa Group and Iowa Northern Railway to develop a state-of-the-art ethanol consolidation and shipping facility in north central Iowa. In addition, KAG is establishing a network of ethanol transfer locations along the East Coast.

Dennis Nash, KAG president and chief executive officer, says he is convinced that production of renewable fuels will become a big industry in the United States. The farms on which biofuels are grown are the new oil patch, and tremendous growth opportunities lie ahead.

Nash isn't alone in his optimism among tank fleet executives. Others who have taken a leadership role with biofuels include Charles Whittington and John Whittington of Grammer Industries Inc, who built their own biodiesel plant in Indiana.

All of them cite growing demand as a key factor for their enthusiasm. Put simply, surging volumes of renewable fuels mean more loads for tank truck carriers. Tank trucks are transporting feedstocks and chemicals used in production of renewable fuels, as well as the finished products.

US ethanol production quadrupled from 1.6 billion gallons in 2000 to an estimated 6.4 billion gallons in 2007. Biodiesel output reached 450 million gallons in 2007. Federal mandates call for nine billion gallons of renewable fuels (primarily ethanol and biodiesel) this year and at least 36 billion gallons by 2022.

Ethanol and biodiesel aren't just cargoes for the tank truck industry. They also are alternative fuels for the trucks operated by the fleets. The potential for various alternative fuels was discussed at the Washington International Renewable Energy Conference (WIREC) in March.

Volvo Group used the event to unveil a range of functional heavy-duty alternative-powered trucks. A variety of carbon-dioxide-neutral renewable fuels were used with the diesel engines in the vehicles. In addition to biodiesel and ethanol/methanol, the engines were fueled with synthetic diesel, biogas, and dimethyl ether (DME).

Volvo officials participating in the WIREC event also reviewed some of the latest developments in hybrid truck technology and the market potential for those vehicles. Paul Vikner, president and chief executive officer of Mack Trucks Inc, a part of the Volvo Group, suggested that hybrid technology could boost fuel economy in heavy-duty trucks by 5% to 8%. Most importantly, these technologies are rapidly moving from the research-and-development phase to the mainstream.

All in all, this issue of Bulk Transporter puts a spotlight on renewable fuels and the impact they will have on this industry. Welcome to the future. It's going to be an exciting time.