Four Propane Fleets Receive Autogas Award During BusCon Expo

WASHINGTON (October 1, 2019) – Four transit fleets received the ninth-annual Top User of Propane Autogas Award from the Propane Education & Research Council (PERC) during the BusCon Expo in Indianapolis. The award celebrates fleets creating healthier environments for riders and communities by using clean, cost-effective, and domestically produced propane autogas. The awards were presented during an awards breakfast on Wednesday, Sept. 25, at the Indiana Convention Center.
 Island Explorer clean-fuel propane shuttle bus fleet wins Award from PERC for Acadia National Park Clean Propane Shuttle Bus Fleet reports BPN propane industry's trusted source for news and info since 1939 Oct. 1 2019
“We are proud to honor these fleets not only as top users of propane autogas, but as fleets that are committed to bettering the environment and providing safe, clean, and reliable transportation for their communities,” said Michael Taylor, director of autogas business development at PERC. “Propane autogas can provide many advantages and benefits, including the lowest total cost-of-ownership, reduced emissions, and reliable performance, to help both private and public fleets provide better service for taxpayers and clients.”
 
The 2019 award recipients are Acadia National Park in Bar Harbor, Maine, represented by Paul Murphy; Forest Preserves of Cook County in Cook County, Illinois, represented by Thomas Thompson; Volusia County Transit in Dayton, Florida, represented by Robert Stephens and Rick Kazawitch; and Davidson County Transportation System in Lexington, North Carolina, represented by Richard Jones.
 
Acadia National Park
Since 1999, Maine’s Acadia National Park has provided free and convenient transportation to visitors through the propane-powered Island Explorer Bus System. The Island Explorer’s 35-unit fleet transports hundreds of thousands of passengers to the attractions within the park and the surrounding community each year, all without damaging the very fragile and delicate ecosystem. The fleet operates 21 Hometown Trolley buses, 12 ElDorado MSTIIs, and two Ford F-550s. Over the 20 years the Island Explorer has been in business, conservationists estimate it has reduced carbon emissions by over 27,000 tons and has prevented nearly 41 tons of smog-causing pollutants emitted by over 2.9 million private vehicles. The reduced emissions of propane autogas have minimized the environmental impact of the buses on Acadia’s guests, animals, and plants — all while making the park more accessible for visitors every year.
 
Forest Preserves of Cook County
The Forest Preserves of Cook County manages the largest forest preserve district in the United States, with nearly 70,000 acres of land for visitors to explore. In alignment with the forest preserve’s mission to provide clean, safe outdoor areas for visitors, the department operates several propane-powered vehicles including 15 Ford Interceptors, four transit vans, and one passenger van. The fleet also includes 41 large riding rotary propane-powered lawn mowers. By converting both mowers and vehicles to propane, the Forest Preserves of Cook County has not only been able to significantly reduce emissions, but also lower its fuel and operation costs.
 
Volusia County Transit
The Volusia County Transit provides a demand-response complimentary ADA paratransit service seven days per week within the urban areas of Volusia County. Starting in 2015, the fleet began running propane-powered paratransit buses in the community. Today, the fleet has expanded to four Ford E-450 Turtle Top paratransit vehicles in operation. By using propane, Volusia County has reported a substantial reduction in vehicle emissions while concurrently lowering fuel costs. The county also uses propane to heat its maintenance shop and operate its forklifts.
 
Davidson County Transportation System
The Davidson County Transportation System fleet is on the road 12 hours a day, five days a week, providing rides for passengers. Currently, the fleet operates four propane-powered Ford E-450 light transit vehicles on its routes, with plans to add three more vehicles to the fleet in the near future. Because Davidson County receives Congestion Mitigation and Air Quality Improvement program funding, the fleet officials determined propane autogas would best serve the community because of its lower fuel costs and reduced emissions. Based on the success of the propane-powered transit vehicles, the county is looking to add propane autogas to other Davidson County department vehicles.
 
For more information on how propane autogas can fuel fleets, to hear testimonials from fleets already using the alternative fuel, or to find resources to help fleets get started with propane autogas, visit Propane.com/Fleet-Vehicles.  

About PERC: The Propane Education & Research Council is a nonprofit that provides leading propane safety and training programs and invests in research and development of new propane-powered technologies. PERC is operated and funded by the propane industry. For more information, visit Propane.com.

Women In Propane: Service Tech “Sam” Bassett A Rarity

Samantha “Sam” Bassett, a service technician at Superior Energy in Vernon, Conn., often receives surprised looks from customers when they open their doors to find a 24-year-old woman showing up to install or fix a gas appliance, equipment, or line.
BPN profiles Women In Propane Samantha Bassett a rare female propane service technician at Superior Energy in Conn. butane-propane news sept 2019
“It’s not that they’re disrespectful, but when they open the door and see me with heavy, industrial equipment, they second-guess me a lot. I get a lot of second guesses,” she said.

Female service technicians are the minority, but they are even rarer in the propane industry.

“I’ve yet to come across another female technician. A lot of people at the supply house talk, and they don’t know any other woman doing what I’m doing,” she said. “I think it’s actually pretty cool I’m the only woman around who knows how to do this.”

Customers agree. “I was pleasantly surprised to see Sam at my door. I never had a female technician come to repair anything. Very competent and very polite and friendly,” one customer posted on the company’s Facebook page. “Sam was on time, professional, friendly, and my dog liked her!” posted another customer.

Bassett’s career in the energy field began in high school when she took a summer job installing solar panels. After high school, she studied to become an electrical apprentice and was looking for a job when a family friend asked her to come to work at his propane company in their town of Stafford Springs, Conn.

“I was just going to do it temporarily until I found a job in the electrical field, but that never happened.” She stayed at the small company primarily working with residential customers for six years before joining Superior Energy about 18 months ago.

The family-owned propane company based in Vernon, Conn., is one of the leading propane companies in Connecticut and parts of southern Massachusetts. Founded in 1939, today the company not only distributes propane, but also specializes in space heating equipment, fireplaces, gas fire logs, and temporary construction equipment. They tout hiring employees like Sam who live in, and are familiar with, the communities they serve, and provide them with opportunities to continue their training, even paying for schooling and all certifications.

“Furnaces, fire pits—anything burning propane or natural gas, we install,” she said. “I’m hoping to expand as much as I can. I have my G2 license.” (A certified G2 technician may install, inspect, alter, purge, activate, repair, service, or remove a natural gas or propane appliance and the equipment and accessories essential to its operation, unsupervised.) “I’m definitely going to get my G1 license” (the highest level of certification).

“I like the challenge of trying to figure out what’s wrong with stuff. I like to use my mind,” she said. Her love of fixing things was instilled by her father, who lives with his wife and Sam’s sister about 10 minutes away. “I have always loved doing anything mechanical. I loved working out in the garage with my dad.”

During the summer, Bassett works on a lot of pool heaters, cooking ranges, and gas lines, but her favorite installations are gas log fireplaces or any freestanding fireplace. “They look awesome once they are installed. I think they are beautiful, and they make the customers so happy when they are burning for the first time.

“I really enjoy what I do. There’s nothing I really hate about this job other than working in the blazing heat or freezing cold,” she said half-jokingly. “I like the look on people’s faces when you finish a job, especially people who have had no hot water or heat. You go there and they are so appreciative.”

When she’s not working, Sam enjoys camping on the weekends with her boyfriend and three dogs and doing anything outdoors—hunting, fishing, and playing on a softball team.

When asked why there are not more female service technicians in the propane industry, she said she honestly is not sure. Her advice to other women thinking of entering the field: “It’s a lot of hard work, and it’s not for everyone, that’s for sure. You can do it. You just have to put your mind to it.” — Karen VanAsdale

(SOURCE: Butane-Propane News magazine, September 2019)

Driver's Wages…How They Affect Your Business Value

(September 30, 2019) — With the national driver shortage in full swing, we are seeing upward pressure on wages. There are many articles that can be written on the driver shortage, however, as our focus is on business value, we will stick to the effect on value.
Cetane how lpg driver wages affect biz value reports Butane-Propane News the propane industry trusted source for news and info since 1939. 09-30-19
Over the last two years, we have seen driver wages increase by as much as 10% annually. Companies are offering signing bonuses, low- or no-cost medical coverage, and other enhanced benefit packages. These increased costs all come out of owners’ pockets and as a result, without offsets, earnings and value have been decreasing for many companies. To understand the value aspect, I want to recount a story from a transaction I worked on 12 years ago.

I was on the buy side of a transaction working for a public utility company that owned a retail propane and fuel company. We negotiated the purchase of a small home fueloil business. The company value was around 4X EBITDA of $250,000, or $1 million purchase price. The owner had two sons working as service technicians and we agreed to bring them on at our top wage at the time of $21 per hour.

A couple of days before the closing, the owner called me and said he wanted his sons to be making $25 per hour. I explained a higher wage would result in a lower purchase price due to our return on investment financial model. I told him I would run it through our model and get back to him. I crunched the numbers and discovered that for each dollar per hour, we would need to reduce the purchase price by $12,500. This resulted in a $100,000 reduction for the increases he proposed. We had to factor in payroll tax, overtime, and other wage-related costs. I went back to the owner and told him we could do it and explained why the purchase price would be reduced by $100,000. He sat back and thought about it and then he asked me what was the least amount we could pay his sons. In the end, we left the wages where they were and closed on the transaction.

Cetane CeO Steve Abbate explains how LPG driver wages affect biz values reports BPN propane industrys leading source news since 1939. Since 1939.Had this been a larger company or a propane company trading at 8X EBITDA, the numbers would have been larger. As you can see, wages have a profound effect on value. So, what’s an owner to do to attract good drivers, pay a reasonable wage, and retain the value in their business? The first thought would be to increase margin on the fuel to offset the increased expenses. That is certainly one solution, however, you still need to be competitive in pricing for fear of customer attrition.

Another solution I have come across recently is to hire a veteran. The U.S. government has some great programs to help employers who hire veterans. We have seen savings on health care with government subsidies that range around $7000 to $16,000 per year. The Work Opportunity Tax Credit (WOTC) is a federal tax credit that may be available to employers for hiring certain veterans. That credit averages $4500, according to recruiter sources. The GI Bill also pays training up to $20,000 for some positions and $5500 for CDL training. For more information on hiring a veteran, go to www.vets2techs.com or call Jesse Lord at (570) 575-4184.
Cetane Steven Abbate expert addresses driver shortage age reports BPN the propane industrys trusted source for news since 1939
Business value and expenses are always a concern, however, please don’t let the increased expense affect the overall business model of your company. We recently worked with a company that had an above-average growth rate. When we dug into the numbers, we discovered that all the drivers made substantially more than average wages. His truck fleet was also newer than average. When we questioned the owner, he said that he likes to work in a nice office and his drivers like to work in a nice office although theirs is on wheels. He said that he is able to charge more to his customers because he is able to provide better service and his drivers are a key. So, understand your financial decisions and how they affect value. However, also understand that there are other ways to increase profits and the resulting value in a business.

Steven Abbate is managing director of Cetane Associates LLC, a provider of hands-on merger and acquisition advisory services for privately held companies. He may be contacted at This email address is being protected from spambots. You need JavaScript enabled to view it..

National Autogas Day: Clean, Propane School Buses Gain Popularity Among USA School Districts

(September 27, 2019) — As the country celebrates National Autogas Day, Butane-Propane News (BPN) recognizes school districts across the country that are replacing aging, polluting diesel buses with clean, cost-effective propane autogas buses. The Propane Education & Research Council (PERC) reports there are nearly 13,000 propane school buses operating in 700 school districts. These buses transport more than 700,000 students across North America. Propane now makes up about 45% of all non-diesel school buses used for pupil transportation. That’s about 675 million gallons of propane being consumed over the lifetime of the existing buses on the road.

With more school districts looking to stretch budgets, save taxpayer dollars, and make “greener” choices, school districts increasingly are opting to upgrade to propane school buses as an efficient solution to meet these challenges.

One example is the Grain Valley School District in Missouri that found after evaluating alternative-fuel options that propane was the far superior choice in both environmental sustainability and fuel and maintenance cost savings. Over the years, Missouri state reimbursements for school transportation have dropped from 75 percent to 16 to 20 percent. School districts in the state, and across the nation, have had to tap their own general school funds to make up the shortfall.
Independence and Grain Valley MO school districts and others across USA upgrade to clean fuel propane school bus fleets to save money environment National Autogas Day Sept 27 2019 reports BPN the propane industry's trusted source for news and info since 1939
To help save money, the Grain Valley district considered alternative fuels for new school buses and evaluated both compressed natural gas (CNG) and propane autogas. District representatives attended an alternative fuels workshop hosted by Kansas City Regional Clean Cities, a Metropolitan Energy Center program. The district considered various fuels but “the vehicle costs and fueling station costs for CNG were much higher versus propane,” said Shawn Brady, director of transportation.

In 2018, the district decided to purchase 14 propane buses to replace diesel buses of 2001 and 2002 model years. Brady researched and applied for a grant from the U.S. Department of Energy through Kansas City Regional Clean Cities to assist with the purchase costs of the buses.

Preparing for Propane Autogas
To fuel the new buses, the district entered into a contract with their local propane provider, Ferrellgas. A fueling station with two 1,000-gallon tanks was built in the school district’s bus parking lot in April 2018. “It saves time not to have to travel to refuel,” Brady noted.

Infrastructure costs for propane are the lowest of any fuel; alternative or conventional. For Grain Valley schools, the start-up cost for the fueling station totaled $16,500. “We received a 45 percent grant from Metropolitan Energy Center for the installation of our propane fueling station,” Brady said. The center’s grant amounted to $7,425. “The fueling station cost us only $9,075 after the grant.”

Before putting the new buses on the district’s routes, drivers received training in propane bus operation. “Our bus vendor provided training on how to properly operate the buses and maximize fuel efficiency,” Brady said. The district’s technicians traveled to the bus manufacturer’s factory in Tulsa, Oklahoma, for a complimentary week-long training course on maintenance. The district didn’t need to make changes to its bus repair facility. Requirements for a propane vehicle service facility are generally the same as those for conventionally fueled vehicles.

Financial Benefits
After tapping grants for purchase assistance, each new bus cost about $250 more than a comparable diesel bus. District officials say that the higher initial cost can be quickly recouped in fuel savings.

In fact, by adding propane buses to its fleet, Grain Valley School District has noted savings on both fuel and maintenance. On average, propane autogas costs up to 50 percent less than diesel. As part of its negotiated contract, Grain Valley paid a locked-in rate of $1.20 per gallon of propane in 2018-1019. For the 2019-2020 school year, the district pays $1.15 per gallon. For comparison, the district pays $2.31 per gallon on average for diesel.

Each bus in the district runs about 9,000 miles per year. For the 2018-2019 school year, fuel savings amounted to about $14,500. “The district’s increased savings year after year will allow the transportation department to serve as a better steward of taxpayer money,” said Brady.

Additional savings come from the reduced maintenance. With propane autogas, no exhaust after-treatment or diesel emissions fluids are required like with diesel to meet today’s strict emissions regulations. Propane vehicles don’t need particulate trap systems, turbochargers and intercoolers. Plus, propane uses less engine oil. All these factors contribute to the overall savings of time and money. The district’s technicians like the propane buses, Brady reports. “There are fewer parts and systems to have to maintain.”
However, Brady explained that “warranty work is challenging with no established shop in Kansas City.” He noted that IC does provide a traveling technician who assists his staff when they encounter maintenance issues. Kansas City Regional Clean Cities recommends fleet managers ensure that there is a local service shop to do warranty and continuing work on buses before purchasing.

Even more saving shows up for the district in the winter. Due to the chemical properties of propane autogas, the propane buses warm up faster and have no cold start issues. Unlike diesel vehicles, these buses can start up in temperatures as low as -40 degrees Fahrenheit. School districts report lower electric costs because the propane buses don’t rely on block heaters. “Our propane buses warmed up faster this past winter than the diesel buses,” Brady said.

Beyond the Bottom Line 
Grain Valley’s propane buses are helping the community’s air quality. Unlike diesel buses, propane vehicles emit virtually no particulate matter and, with substantially less nitrogen oxides (NOx). Buses fueled by propane also emit fewer greenhouse gases and total hydrocarbon emissions when compared to diesel buses. Propane’s quiet operation makes riding the bus more pleasant for passengers and safer for drivers, who are less distracted by engine noise. “We’ve benefitted from much cleaner air and much quieter buses running through neighborhoods,” said Brady.

Drivers also report that the propane dispenser pumps are just as fast or faster than the diesel fuel pump when it’s time to fill the tank. The district notes that it will be sure to order buses with 100-gallon fuel tanks going forward. “These were not available from IC when we placed our first order,” Brady said.

The district’s leadership in adopting an alternative fuel earned it a 2018 Agent of Change Award from the Metropolitan Energy Center, a Kansas City nonprofit catalyst for energy efficiency, economic development and environmental vitality.

The district’s plan to purchase seven more propane buses this year, and eventually move to an all-propane fleet, speaks to the administration’s belief in the benefits of this alternative fuel for their students, drivers and overall community.

“Our district made the decision on propane buses to save money. The environmental impact is an added benefit. There’s no reason to not make the move into propane now,” Brady said.

Highlighting the environmental and economic sustainability as well as the safety of propane as a clean, alternative fuel is key to converting school districts into propane customers. An “In-Use Emissions and Performance Testing of Propane-Fueled Engines,” was commissioned by the Propane Education & Research Council (PERC). A link to the study, together with other information about propane autogas school buses, can be found on PERC’s website at propane.com/propane-products/buses/.

(Source: Case Study: School District’s Propane Buses Go Beyond Cost Savings; September 20, 2019 in Kansas City Clean Cities, News, Kelly Gilbert, Metropolitan Energy Center, Missouri Propane Education & Research Council (MOPERC) Missouri
Vehicles: (14) 2018 IC Bus CE Series propane autogas-fueled buses
 Fueling: On-site propane autogas station (Ferrellgas)

Risk Managment Transfer Versus Public Opinion

Last May, the Western Propane Trade Show & Convention brought together propane marketers mostly from around the West Coast. In visiting with the marketers at the trade show, I was approached by a California marketer who told me about the public outcry when the propane companies tried to collect for the loss of leased tanks following the forest fires that had destroyed thousands of homes, leaving large areas devastated.

Frank Thompson CEO of PT Risk Mgt. gives professional tips to reduce propane liability issues reports BPN the propane industry's trusted source for news and info since 1939The fires over such a wide swath were especially devastating to the propane companies that serviced this area. They lost their customers, their leased tanks, their regulators, the contents in the tanks, and, in the majority of cases, their present and future source of income.

With the price of steel, new 500-gal. tanks are worth approximately $1650 and 1000-gal. tanks are running around $2750. As a result, marketers have thousands of dollars of assets around the countryside.

Most property insurance policies may only have a small sublimit of insurance for tanks that are located at customers’ houses, with a total aggregate of $10,000, leaving a huge gap in coverage.

As a risk manager as well as an insurance agent, we, along with others, have always advocated the risk management approach to insurance: Insure those areas of your business that you control and transfer risk to others when you are not in control.

So the best risk management approach is to transfer the tank lease risk. Write the tank lease agreement so that the homeowner’s insurance company is responsible for any loss that would be covered by their policy, such as fire.

And that is where the outcome differs with the California fires; some marketers had lease agreements that transferred the risk to the homeowner’s insurance company and some didn’t. When the homeowners who had lost their homes received a letter from the marketer requesting reimbursement, they felt overwhelmed, which quickly turned to anger and open hostility. They felt they had lost everything because of the fire and now the propane company was their enemy trying to take more money from them.

Later, Rob Scott of Scott and Associates, a consultant for the Western Propane Gas Association, spoke to me about an approach that other marketers used that worked.

They met with the homeowners voicing their concern for their wellbeing and mentioned that, to help the homeowners in dealing with their insurance companies, they were advising them to include the cost of the tank, regulators, and propane in the tank. These efforts by the marketers showed compassion and understanding and that they were offering their help in the claims settlement process.

Looking at the three scenarios, there are several conclusions to be drawn nationally from the recent California fires.
  1. Marketers need to review their tank lease agreements to make sure that they clearly state that the homeowner’s insurance policy is primary when it comes to covered losses (fire, wind, hail, tornados).
  2. Tanks in the field are a sizeable financial asset to the marketer, but are faced with numerous exposures that are not under the marketer’s control. Look into purchasing Inland Marine coverage to insure them if you are in an area subject to catastrophic losses.
  3. When dealing with customers who have suffered catastrophic loss, show compassion and apply the Golden Rule, “do unto others what you want done unto you.”
  4. Failure to transfer risk not only in lease agreements, but also in non-owned dispenser locations, could cost you your company.
Thinking of the magnitude of those who lost everything in the forest fires, floods, tornados, and hurricanes in the past several years, I am reminded why everyone needs insurance and a knowledgeable insurance agent.

Frank B. Thompson is a chartered property and casualty underwriter based in Phoenix. He is the owner of PT Risk Management, an independent insurance company specializing in writing propane and petroleum risk policies throughout the U.S.