Davenport Energy Acquires Roanoke, Covington Fuel Oil Companies

Davenport Energy Inc., a family-owned petroleum products company headquartered in Chatham, Va., announced the purchased of APB Whiting Oil Company in Roanoke and Whiting Jamison Oil Company in Covington from Petroleum Marketers Inc.
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The acquisition, completed Sept. 14, 2015, will expand Davenport Energy’s petroleum products and customer base in both regions. APB Whiting and Whiting Jamison provide heating oil as well as other petroleum products for residential and commercial customers. In addition, APB Whiting offers furnace, boiler, burner, and air conditioning installation, repair, and service in the Roanoke area.

“Davenport Energy has provided safe, reliable propane delivery in Roanoke, Blacksburg, and Christiansburg since 2011,” said President and Chief Executive Officer Lewis E. Wall, Jr. “This expansion will allow us to add heating oil products and service with plans to eventually offer propane in Covington and throughout the Alleghany Highlands and into West Virginia.”

APB Whiting and Whiting Jamison employ 20 people, including drivers, service technicians, and office personnel. They will become part of Davenport Energy. Davenport Energy plans to relocate its Granby Street office to APB Whiting’s location on Starkey Road in Roanoke. It will keep Whiting Jamison’s office on Locust Street in Covington.

For the time being, APB Whiting and Whiting Jamison will remain on trucks, signs, and uniforms, but eventually both companies will be rebranded Davenport Energy. “APB Whiting and Whiting Jamison have a great reputation for providing petroleum products and services to homes, businesses and industries in Roanoke and Covington,” Wall said. “ We expect a smooth transition since Davenport Energy has a long history of providing those same products and services to customers across Central, Southside, and Southwest Virginia.”

A regional propane and heating oil company, Davenport Energy was founded in 1941 and will celebrate its 75th anniversary in 2016. Headquartered in Chatham, Davenport Energy has offices in Roanoke, Rocky Mount, Martinsville, Bedford, and South Boston.

Taking Care of Customer Needs Is a Top Priority

For many years, appliance and equipment manufacturers have lamented that few propane dealers sell their products. However, 75% of propane marketers responding to a recent Butane-Propane News survey sell heating equipment and appliances, and of that 75%, 93% offer water heaters. The survey also showed that consumers have become more cost-sensitive, are more interested in conservation, and demand the best service.
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BPN, in partnership with the National Propane Gas Association’s Benchmarking Committee, surveyed its committee members from all across the nation regarding market trends in the retail propane industry.

Survey questions dealt with:
• goods and services offered
• propane market sectors served
• recent changes in consumer needs and wants
• current marketing tactics

By publishing the results of this unique survey, BPN aims to provide propane professionals with a means to benchmark how their company stands in relation to others, as well as give its readers insight to additional goods, services, and marketing practices that might prove beneficial. These are offered with the ultimate goal of increasing propane gallon sales.

Heating Equipment & Appliances
The first group of survey questions dealt with what heating equipment and other types of appliances propane companies offer. As mentioned, results indicated that 75% of respondents sell heating equipment and appliances. Of those that sell heating equipment and appliances:
• 93% offer water heaters
• 81% offer fireplace/gas logs
• 76% offer zone heating equipment
• 62% offer central heating equipment

Less frequently offered appliances include:
• 54% grills
• 48% generators
• 37% cooking appliances
• 24% clothes dryers
Interestingly, 60% of the respondents have showrooms.
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Do you service heating equipment and/or appliances?
The next question asks if propane retailers service or install heating equipment and appliances. Of those that do,
• 73% provide installation for heating equipment
• 79% provide service for heating equipment and appliances

Of interest was a small sample of responses from companies as to why they do not provide installation or service for propane heating equipment and appliances. The most frequent reason indicated was a lack of qualified workforce. Others responded they had no interest in this business niche. One wrote, “Customers expect the propane company to do the work for free in return for their propane business.”

Other Propane Market Sectors
The next question addresses what other propane market sectors retailers serve in addition to residential. Results found marketers involved in:
• 96% commercial
• 65% agriculture
• 57% autogas
• 47% commercial landscaping
• 33% golf courses

A small group of businesses were in the process of adding industrial forklifts to their inventory.

Changes in Consumer Wants and Needs
In the section asking propane retailers their perceived changes in consumer wants and needs, the top three responses included:
1) Consumers have become more cost sensitive (this includes an increase in pre-pay and guaranteed price program participation).
2) Customers have become more interested in conservation and “going green” (this includes changing to more efficient appliances).
3) Customers demand better service and demand service ASAP.

Respondents also noted an increase in generator, gas log, and tankless water heater sales.

Less common responses included customers trending away from propane and switching to natural gas, solar, and heat pumps.

Rounding out the comments: consumers’ lack of education regarding energy, and that autogas continues to be a “tough sell,” were among the changes mentioned.

Marketing Tactics
In the category of marketing tactics to create awareness of services, the responses were wide-ranging. Radio advertising was one of the most common responses, followed by website utilization, newsletters, direct mail, newspaper advertising, social media/Facebook, and local home shows.

Included less frequently were television advertising, billboards, word-of-mouth, email marketing, open houses, door hangers, banners, and cold calls.

Several stressed taking advantage of monthly statements for marketing messages. Individual respondents commented on identifying up-sale opportunities and promoting propane as a “green” source of energy.

One additional opportunity for propane companies to increase gallons sold came to light with the question, “Do delivery drivers note when they see an electric appliance?” By a two-to-one margin the answer was no. This indicates that an opportunity exists to inform customers of the benefits of using propane-fueled appliances.   — Andrea Young

For comments or questions regarding the BPN survey, contact Andrea Young at This email address is being protected from spambots. You need JavaScript enabled to view it..

Gallon-Growing Opportunities in Equestrian Market, Breweries, Dairy Farms

Rinnai (Peachtree City, Ga.) has seen a steady increase of propane tankless water heater use in the equestrian market as well as for dairy farms. Equestrian centers, often located in remote areas well-suited for propane, need hot water to bathe the horses. The temperature control that tankless water heaters provide is perfect for equestrian center use, explained James York, Rinnai vice president of engineering, unlike a storage tank model, where temperatures may go up or down as it reheats, or it loses heat depending on the amount of use.
Rinnai provides hotwater to Georgia Camp Ground
Dairy farms are another good opportunity for propane marketers to grow gallons. A large volume of hot water is needed for washing the milking system, bulk tank, and parlor equipment. York said that many dairy farmers have switched to tankless water heaters because they can supply consistent temperature, are energy efficient to operate, and provide reliable and redundant operation, all of which are important to any dairy farm.

“These are rural places, with lots of pasture land, so they’re nearly always coupled with propane.” York noted that assisted living facilities and breweries are some of the newer areas also experiencing strong growth in propane tankless water heater use. The company recently installed tankless water heaters at an assisted living complex in North Carolina, and in 2013, BPN highlighted Rinnai propane tankless water heater use at Bearwater Breweries in North Carolina. He added that his company has installed tankless water heaters at several additional breweries since then, “as word has gotten around the industry of what a great application tankless water heaters [are]. This is due to the precise temperature control and energy efficiency.”

Many Tankless Products Help Grow Gallons In Multiple Applications
Rinnai has recently introduced several new products that will provide propane marketers the opportunity to grow gallons in the residential and commercial areas. The company has expanded its condensing tankless system offerings, and York explained that condensing tankless systems are more than 90% efficient with energy factors (EF) up to 0.96. The condensing appliances use the latent heat of exhaust to preheat incoming cold water, extracting the maximum amount of energy from the process. “We have recently added two smaller high-efficiency tankless models that are 130,000 Btu and 160,000 Btu. And we added another, the RUC90, which is at 180,000 Btu. So effectively we’ve got many different sizes of tankless water heaters that are all above 90% efficient in this condensing class. We have a full product portfolio…to cover small to big applications to make sure customers get exactly what they need.”

The new RUR series of tankless water heaters, which York described as its recirculation product, is easily adaptable to plumbing systems with or without a dedicated recirculation return line right out of the box. In the dedicated recirculation line mode, the integral pump circulates water from the tankless water heater through the hot water supply line and back to the tankless water heater via the dedicated return line. In crossover mode, the thermal bypass valve that comes standard with the water heater is installed between the hot and cold supply lines on the furthest fixture in the plumbing line from the tankless water heater. The cold water line is then used temporarily as the return portion of the circulation loop.

“This makes it extremely easy to retrofit and add recirculation to an existing home where you may not be able to add a dedicated return line.” He added that because only about 1% of homes have a dedicated return line, the RUR with the crossover valve will make “cost-effective recirculation available for nearly every home.”

Joe Holliday, senior director, product and new business development for Rinnai, went on to explain that recirculation is important, especially with the drought conditions in many areas of the country. “People are becoming very water conscious. So recirculation charges the loop — the piping system — with warm water. You don’t turn on the faucet and wait a few minutes while water is going down the drain. It’s warm water all the way there, and it recirculates back to the water heater.”
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On the commercial side, Rinnai unveiled its C199 tankless water heater in August, sold individually or on Rinnai’s commercial rack system, which includes several water heaters on a prefabricated metal frame. Holliday noted the C199 can be installed using various types of venting, whether it’s PVC or concentric for single units or common venting for multiple units on the Tankless Rack System. The C199 comes equipped so a contractor can easily set up the water heater to produce 185°F water right out of the box. He described concentric as one pipe within another pipe, which allows the installer to have single penetration through the wall that has both intake air on the outer pipe and exhaust air on the inner pipe.

Helping Young Campers Learn Healthy Life Skills
Campgrounds of all sizes and types are good prospects for propane marketers. They are typically in remote off-the-grid areas, and propane use at such a facility can add up quickly in the dining areas during mealtimes and in the bath houses, said James York.

Located on more than 400 acres in the farmlands of Georgia, Camp Southern Ground describes itself as “the passion project” of Grammy Award-winning artist Zac Brown. He is developing a camp to help children of all abilities to learn healthy life skills through programs promoting superior nutrition, physical exercise, and the latest practices in therapy. When campers arrive for the first time next summer at Camp Southern Ground, three commercial tankless water heaters from Rinnai on a Rinnai tankless rack system will provide hot water for the concessions area, restrooms, and shower facilities in the camp’s 12,000-sq-ft Shade and Play pavilion, which is currently under construction. Rinnai has donated the water heaters to the camp, which serves children ages 7 to 17.

The Shade and Play Pavilion will provide campers a place for recreational play shaded from the hot summer sun. The pavilion will include a multi-use court for basketball and other sports, a storage room, and a patio area for hosting cookouts and gatherings. The Shade and Play area, along with the camp’s 15-acre organic farm, will provide educational programs to teach campers about the importance of proper nutrition and the health benefits of growing and eating fresh fruits and vegetables. Its commercial concessions kitchen and walk-in coolers will provide cleaning stations and storage areas when fruits and vegetables are harvested, and will support the camp’s farm-to-table approach to cooking.

The dining hall, which will also be equipped with Rinnai Tankless Water Heaters, will have the capacity to serve 450 campers at each meal time. The campground will have a full service dining center, coupled with mostly organic menus. The camp’s mission is to operate a camp to allow children to overcome academic, social, and emotional difficulties so they may reach their full potential and to provide the tools necessary to achieve excellence in all facets of their lives. Plans are in place for programs implementing the latest innovative therapies and technology for children with neurobehavioral disorders such as Asperger syndrome, Tourette syndrome, and autism spectrum disorders, as well as learning difficulties such as ADD/ADHD and dyslexia. Camp Southern Ground will have activities to challenge, educate and inspire children with diverse abilities, and from all socioeconomic backgrounds, races and religions.

Rinnai’s tankless water heaters will play a key role in support of the camp’s efficiencies. The company installed the three tankless water heaters on its TRW03 wall-mounted system for the camp’s kitchen. Camp Southern Ground chose a wall-mounted commercial rack system to save space.

Frank Windsor, general manager of Rinnai America Corp., noted in a press release that “Tankless is a smart choice for places like Camp Southern Ground, where the facilities are not needed year-round, but when they are, the demand for hot water is high.” He added that the redundancy of multiple tankless units, space savings, energy efficiency, and reduced overall cost of ownership will provide camp officials with peace of mind, “allowing them to focus on their mission of making camp an unforgettable experience for every child who visits.”

“Supporting the community and the amazing work of local organizations like Camp Southern Ground is one of the core philosophies for Rinnai and its employees. We are happy to be able to help in every way that we can, especially in investing in our future through our communities’ children,” said Takashi Sonoda, president of Rinnai America Corp.

Finding Gallon-Growing Opportunities In the Small Engine Market

The landscaping industry is a great opportunity for propane marketers to grow gallons year-round, and Benchmark Landscapes (Austin, Texas) is a prime example of a strong propane consumer. Benchmark runs a fleet of mostly John Deere mowers, and about 80 of them are propane models. Each mower runs an average of five to seven hours per day. That adds up to a lot of propane, and considerable cost savings for Benchmark.
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“There is an average of 5.5 to 6 gallons of propane a day used per mower,” said Casey Vickrey of Benchmark Landscapes, which services Austin, San Antonio, and other surrounding cities and will soon expand to Houston. He spoke to BPN in early August and noted every time of year is a little different when it comes to cost savings. Usually this time of year he sees about $1 per gallon savings. “You’re looking at, say, five gallons per day at $1 per gallon with 80 mowers. You start getting up to $2500 a week in savings, or $10,000 per month.”

Benchmark Landscapes is also a good example of the customer base for Alliance Small Engines, a division of Blossman Gas (Ocean Springs, Miss.) that is a manufacturing and engineering company. A sister company of Alliance AutoGas, which specializes in propane systems for over-the-road vehicles, Alliance Small Engines completely engineers 1- to 45-hp propane conversion systems for small gasoline utility engines, which power anything from weed trimmers all the way up to large agricultural water pump engines, noted Alex Catchings, director of business development for Alliance Small Engines.

Catchings, who joined Blossman Gas in October at the time the company formed Alliance Small Engines, was the co-founder of AltFuel LLC (Toledo, Ohio), which also provides propane conversion kits for small engines.
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Alliance Small Engines’ conversions are EPA- and CARB-certified, and its systems are specifically engineered for uses such as landscaping, the concrete industry, and golf courses.

Working directly with the original equipment manufacturers (OEMs) on the mowing side, Alliance Small Engines can determine the manufacturers’ specific needs for the equipment. Because of that collaboration, business is going well for the propane systems.

“They’re telling us exactly what they want, and we’re producing that product with them by having the proper engineering staff on board and approaching it from a manufacturer’s perspective, not only from what the industry wants,” Catchings said. “We’re actually working directly with the customers, they’re telling us what they want, and we’re producing that product.”

Part of that involves working together to create OEM-style mounting brackets for the propane cylinder as well as the conversion equipment for landscaping and other industries. Catchings notes that installing the brackets has been a challenge for users after they receive the equipment. Alliance has created OEM-style bolt-on bracket configurations for the prominent equipment to relieve that burden from the customer.

Now a customer ordering a system simply needs to provide the model numbers off of their mowers or other equipment, and in most cases Alliance can ship the completed brackets to the customer, allowing the customer to simply bolt it on to the equipment.

For propane marketers selling the conversion kits, Catchings notes that bolt-on brackets simplify the process so they don’t have to fabricate the brackets, which he said “is huge in our industry.”

The companies using the products get cost savings and environmental and other benefits of propane-fueled equipment. Benchmark Landscapes is a commercial maintenance company with about 400 employees that performs mowing and general landscape maintenance work, mostly for multi-family apartment homes. All of its mowers have 54- to 60-in. cutting decks.

Benchmark started looking at alternatives to gasoline about five years ago when prices were escalating. One of its local mower vendors, McCoy’s Lawn Equipment in Austin, was a certified conversion center for Alliance AutoGas and introduced Benchmark to the Alliance and one of its marketer members, Pinnacle Propane (Carlsbad, N.M.).

Vickrey of Benchmark Landscapes has seen no difference in efficiency between the propane and gasoline engines. But he noted the propane engines run cleaner, have fewer maintenance problems than gasoline models, and his equipment has averaged about one extra year of service time over gasoline models.

“We don’t have to change the oil as often, so you have some service benefits from it,” Vickrey noted. “They’re consistent, and we don’t have any mechanical issues with them as far as starting or durability. Once they’re converted, you don’t really have to mess with them.”

Benchmark operates propane fueling stations at each of its sites and worked out a deal with Pinnacle Propane to pay 35 cents over the wellhead price, which averages about $1 per gallon less than the retail price. Pinnacle sets up the fueling stations for the landscaping company.

“Once we open a new location or new branch or move to a new city, Pinnacle goes to the city, gets all the appropriate permits, installs the new fueling station, and Benchmark puts in all the crash barriers and gets the electrical work completed,” Vickrey explained. Moving to propane has also eliminated employee theft of gasoline for use in their personal vehicles.

Vickrey likes that his company is contributing to a cleaner environment by using propane, but he says that is just an added perk. “The main reason most people go into it is the fuel savings. We probably have $100,000 to $150,000 invested in propane conversions. For a small company to invest that, the ROI on these things is about six months. It pays for itself quickly.”  
—Daryl Lubinsky

Propane Tankless Water Heaters: Beyond Residential Uses

Jim Gregorich has a piece of advice for propane marketers: Get out there and promote tankless water heaters. 

“It’s a piece of equipment lasting 15-20 years, so that’s a load that the gas company is going to have for a long time,” said Gregorich, vice president and general sales manager of Tempaco (Orlando, Fla.), a full-service propane and natural gas product distributor. Tankless water heaters can also serve as a gateway for propane marketers to get into a business or residence and “sell them everything else that goes along with it,” he added.
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Tempaco sells propane regulators and meters, propane tanks, piping, fittings, and as Gregorich says, everything “from the source of the fuel to the burner tip.”

But tankless water heaters are Tempaco’s biggest product line, and the company sells the Rinnai and Noritz brands to residences and entities such as school districts, hospitals, naval bases, correctional institutions, and restaurants. Fertilizer plants have been a strong customer addition as of late.

Prisons in Florida have been working to reduce their energy consumption, so tankless water heaters have been a good fit. The fact that tankless water heaters only consume gas when hot water is being used is another mark in their favor, because the showers don’t run on a consistent basis. Putnam Correctional Institution (Palatka, Fla.) was the most recent prison water heater installation for Tempaco.

In some prisons, Tempaco has installed as many as six tankless water heaters. But when only a small number of prisoners are using the showers, fewer water heaters run at that time.

“If demand requires that all six run, then all six run,” explained Gregorich. “We’ve been pretty successful with the prison systems as far as saving them energy and providing them with unlimited hot water.”

Tempaco, an acronym for Temperature Accessories Company, has done well with propane products for years, but the company started out in 1946 by performing installation and service on domestic and industrial-type fueloil and gas burners, boilers, dryers, and industrial control systems.

In 1966, to concentrate on wholesaling, the company sold the boiler-burner service portion of its operations.

At that time, it became a “full-line wholesaler” headquartered in Orlando, offering air conditioning contractors’ equipment, ducting, controls, and all components necessary to make complete heating/air conditioning systems. Controls and specialties are important segments of the business. Maria Robinson, who started at Tempaco in 1979 as a temporary employee in the accounting department, is the company’s president and CEO. She has been in that position since 1998.

Prisons have become an important client sector for Tempaco, and the company has installed tankless water heaters at about six locations throughout the past few years. Gregorich emphasizes that “installing” the heaters means helping engineer the job and sizing the equipment for the customer. A propane marketer or another contractor then installs the equipment at the prison.
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Safety has not been a concern for Tempaco employees when installing the water heaters for prisons. The company can usually install the equipment in a mechanical room located in an outdoor location away from the prison population.

Gregorich, who started with Tempaco in 1985 and has served mostly on the sales end during that time, believes fertilizer plants are another customer opportunity that the propane industry has left untapped. Large fertilizer plants need hot water for part of the fertilizer production process, resulting in what Gregorich says is a “huge” propane demand load. He emphasized again that when propane marketers sell tankless water heaters to a fertilizer plant, the marketers can sell regulators, valves, and piping that go along with the heaters.

Tempaco has completed several jobs that involved the installation of multiple propane tankless water heaters at a fertilizer facility. The facilities often use water that is 160°F or higher for cleaning equipment used in the fertilizer manufacturing process and to wash the trucks delivering fertilizer. A recent Tempaco fertilizer plant customer originally wanted to place a boiler at the facility, but the facility found the tankless equipment to be less expensive on the front end and more efficient, saving more money on the back end, “along with redundancy you don’t find in a single-boiler installation,” Gregorich said. So Tempaco sold six propane tankless water heaters to the business.

“They can fill this large stainless steel tank with 160° to 170° water, never run out, always have plenty of hot water, and again, it’s an excellent load for propane.”

Tempaco found yet another customer when it discovered the Salvation Army was looking for a method to provide hot water for cooking and cleaning to help displaced residents during Hurricane Katrina and other emergencies. The Salvation Army operated a semi-trailer that it converted into a rolling kitchen to provide meals. The organization needed hot water for cooking and cleaning but did not have room for a tank-style hot water heater. Working with the Salvation Army in Tampa, Tempaco arranged for the placement of a tankless water heater on the outside of the trailer, and piped hot water to the interior of the trailer.

Prisons, fertilizer plants, and the Salvation Army are just a few examples of Tempaco’s growing propane tankless water heater business. The overall real estate market in Florida is another. That business has been picking up in many areas of the state, and Gregorich said several builders have been willing to take a look at using propane products in their new construction projects.

Tempaco is working to educate builders and homeowners about the advantages of propane. A few Tempaco builder clients would likely have used electricity or natural gas in their homes if Tempaco hadn’t sold them on propane. “Builders, if they don’t hear natural gas, they don’t think propane,” he noted. “What we try to do is get involved and educate the builders…that propane companies can put in a system that is metered. We’re trying to make it an option for the builders. Just because they don’t have natural gas doesn’t mean they can’t have gas tankless water heaters. They’re not aware of propane. They’re not aware of the opportunities and how easy it is.”

The company’s marketing efforts succeeded with Innovative Home Builders in Florida. Tempaco sold tankless water heaters to Suburban Propane, and Suburban will supply the propane for the heaters at an Innovative Home Builders residential development. The developer would likely have powered the homes with electricity if not for the promotional efforts of Noritz. The tankless water heater company contacted Tempaco to supply the heaters for the development of about 250 to 350 homes.
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“That’s a nice little gas load,” Gregorich said proudly. “Again, that’s just one builder/developer in Florida. I just don’t think there’s enough awareness of the advantages and opportunities with propane. You don’t see a lot of propane systems going into residential areas, and that’s where we have to educate the builders, educate the dealers, and get our trailer in front of folks so people see they can be installed in any application.”

Tempaco’s live-demo trailer makes appearances at various trade shows and events, with fully functional Rinnai tankless water heaters on one side and Noritz tankless water heaters on the other. The trailer has appeared at propane company open houses, at public events at malls, and was on display in Atlanta at the National Propane Gas Association’s Southeastern Convention in April and, more recently, at an event for a plumbing association in Florida.

“As long as we have a source of electricity and water, both sides of the trailer are fully functional, so we can show people how tankless works,” Gregorich noted. “A lot of people are very visual. They want to see it, hear it, want to know about the controller, and they have questions. It shows regulation, gas pipe, and pretty much everything that’s going to be involved when they install it. That has been extremely beneficial to us. It’s pretty much a rolling billboard for tankless water heaters.”  —Daryl Lubinsky