Driving Profitability Into Propane

By Robert Battye… 

The benefits of using tank monitors with forecasting, ticketing, routing, and truck computers to drive distribution efficiency and improve customer engagement are well understood. However, achieving reduced costs and customer terminations requires management awareness of inefficiencies, staff engagement in a change program, courage to operationalize savings by retiring bobtails, and, the focus of this article, intimate integration across systems and applications.
Anova Tank Monitoring drives propane profits reports BPN the lpg industry's leading source for news since 1939. 12-09-19
Typically, only the last reported level is imported into the back-office tank record to prompt manual ticket generation by operations staff. In many cases, monitor maintenance issues are not displayed on dispatch screens to at least make dispatchers aware that the monitor is no longer operational. The means of integration, the data structure and mechanisms for matching accounts and tanks between systems, differs from vendor to vendor, and often requires significant manual intervention to ensure the data is used effectively.

Advocating Change
The newest addition to the Anova family, Gaslog, like others in the industry, recognizes the opportunity to reduce the workload of operations staff, improve fill rates, increase truck productivity, and create a platform for new consumer engagement models through better integration across the systems propane distributors rely on. We have been quietly advocating for the development of advanced integration standards for several years and would welcome the opportunity of working with other vendors, including competitors, to agree upon and start the realization of a set of standards that would benefit our mutual customers.

While a tank monitor solution provider such as Gaslog, an Anova solution, can encourage and discuss change, it is more important that propane marketers advocate for this too. Everyone listens to their customer! In business transformation workshops, Gaslog details back office integration requirements and recommends progressing these with the relevant back office application and tank monitor vendors.
Anova Tank Monitoring drives profitability in propane industry reports BPN the LPG industrys leading source for news since 1939. 12-09-19
Other Industries
Standards have proven invaluable in other industries. Cellular technology vendors from chip manufacturers to base stations to cell tower receivers to routers and switches, the key to monitoring and truck computing, mobile phones, and much, much more, must adhere to the agreed global 3GPP standards in order to enable the worldwide calls, SMS’s, and data transfer we now take for granted.

There are a lot of standards that have come into existence, either agreed upon by vendor groups (e.g., XML in data exchange) or determined by a user industry wanting to focus more on their core business and less on integrating disparate systems (e.g., OPC-UA in industrial automation).

As the technology suppliers, we have an exciting opportunity to collectively increase the “off the shelf” benefit of the systems, services, and products provided to the industry we serve. Today, each of us decides what, how, when, and why to integrate. However, with the rapid increase in the use of data-driven logistics, it would help the propane industry and the vendors if there were an agreed set of standards that vendors could respond to.

The use of tank monitors may have reached an inflection point, with rapid growth in the last three years very much in evidence. The expansion of tank monitoring is expected to follow the “S-curve” seen in the adoption of other technologies; it begins with a small number of “early adopters,” moves into a period of accelerated growth as technology is adopted by “followers,” and culminates in slower growth as a saturation point is reached and “laggards” follow suit.

Gaslog estimates 8% of bulk tanks are monitored in the U.S., but that number is rising rapidly as evidenced by double-digit growth in monitor sales and the number of new monitor suppliers in the market. This growth is being driven by greater value and industry challenges.

Tank monitoring’s total cost of ownership continues to fall while reliability and battery life continue to rise. Total cost of ownership includes capital depreciation, monthly fees, and installation cost. While a cellular-based system is cost effective for up to 30% of tanks, we are entering the industry 4.0 era, facilitating a trend towards automation and data exchange with Internet of Things (IoT) costs falling further, driving effective ROI for more than 60% of propane tanks.

At the same time, the need for the delivery efficiency is increasing. The number of gallons supplied has been contracting each year; the cost of delivery has increased; demand and weather patterns have become less predictable; and the cost of propane has grown more volatile with changes in global demand. For propane marketers, reducing the cost of delivery and customer churn for increased profitability is critical to meeting these challenges.

Gaslog has accumulated more than 6 million propane delivery records working with propane distributors on logistics transformation. This data shows an average fill without monitoring of 42% of water volume and an average fill with monitoring of 53%. With better integration between monitors, back-office software, and onboard truck computing systems, an average fill of 60% with improved truck productivity (e.g., 3000-plus drops per year) should be achievable. At that point, propane marketers can dramatically reduce their costs by operating fewer bobtails and needing fewer drivers, a scarce resource.

Reducing Time to Benefit
The time it takes to achieve these benefits could be reduced if there were a standardized level of integration. Tank monitors would be an even more powerful tool in a propane distributor’s arsenal if dispatchers, drivers, and back-office staff could take the information for granted and rely on systems to make sensible decisions and recommendations (e.g., deliver gas to a customer with more propane but a higher usage rate than someone with less gas and two weeks remaining). They could automatically switch back to k-factor forecasting if the monitor is unable to report for several days, or generate a work order for monitor deployment after marking an account as a telemetry target. These automated interactions between systems are taken for granted in many other industries.

Advanced integration could automate the management of a new customer from onboarding to termination. Manual back-office functions such as re-entering customer details in multiple systems could be eliminated; sophisticated level history, usage rates, and forecasting algorithms could combine to improve delivery efficiency and truck optimization; and monitor productivity would improve through integration with service management systems, generating a monitor and tank installation ticket. A diagram on this page shows manual steps in blue and potentially automated steps in green.

If you have to rekey customer data, manually associate a monitor with the target tank, log into different systems, and issue verbal or email instructions to technicians, it creates a lot of work, causes mistakes, and ultimately results in monitor productivity falling and distrust of the data. If the data exchange and workflow are automated, operations can focus on their core tasks of forecasting, scheduling, and routing, and drivers can concentrate on delivery, both trusting the systems and leveraging “data” as a part of their day-to-day work.

Given the limited data involved, it shouldn’t be hard to develop some basic standards to deliver an improved level of integration and data exchange that could evolve and improve over time.

Technology can play a key role in driving productivity in distribution, improving profitability and cash flow, and creating space for competitive strategies that increase the attractiveness of propane to a changing customer demographic. To get there, you need off-the-shelf integration across distribution, customer engagement, and supply chain systems, knowing that changing out one tank monitor or back-office system for another does not require substantial reinvestment in integration to maintain and improve your business’s efficiency.
Anova Tank Monitoring Drives Propane LPG autogas Profitability reports BPN the industry's leading source for news since 1939. 12-09-19
Evaluation Criteria
In the absence of standards, propane distributors can ask us, the vendors, how our systems integrate with others and detail decision criteria when selecting tank monitors and systems.

Distributors need to prioritize features and benefits that are important to them, perhaps breaking them down into high, medium, and low priority requirements; setting targets; and using these to compare competitive systems and products.

Overarching requirements should include the required systems interfaces that will facilitate intimate integration in the future when 30% to 60% of tanks are monitored; data security standards to meet growing consumer concerns over privacy and statutory regulations; and application and network reliability, knowing in the dead of winter, your ability to deliver propane depends on your systems being up.

Some requirements are easily evaluated and well understood by the buyer. These might include the life span of the battery; the frequency of calls; the level of safety certification; and the forecasting and ticketing APIs for level and usage-rate. External advice may be needed for other requirements, particularly when it comes to security, integration standards, and communications. The 2G GSM sunsetting was a lesson well learned by vendors and customers alike.

Conclusion
By choosing systems with a long life span and a commitment to back office integration beyond today’s typical exchange of level data, propane marketers can maximize the benefits of tank monitoring, as well as their investment in back-office systems and truck computers, to leverage what is possible today while simultaneously planning for a future in which the IT systems carry more of the workload. This will further reduce the number of runouts and improve engagement with the end-gas consumers, generating stronger customer loyalty, and potentially halving the direct cost of delivering propane.

Robert Battye has more than 30 years’ of project and executive management experience in IT, the last 12 working with propane companies as vice president North America and COO of Gaslog, a leading tank monitoring solution provider, which recently announced its merger with Anova. He can be contacted at This email address is being protected from spambots. You need JavaScript enabled to view it..

Viking Cylinders, A Hexagon Ragasco Brand Joins Arbor Day Foundation Initiative

Lincoln, Nebraska (December 6, 2019)Viking Cylinders, a Hexagon Ragasco brand, today announced it is joining the Arbor Day Foundation for the launch of its Time for Trees initiative, a commitment to plant 100 million trees in forests and communities worldwide by 2022, alongside its partners. The initiative will leverage trees as a simple, powerful way to reverse the damage done by climate change and address the urgency of preserving the necessities of life – like clean air and water, healthy food and a livable climate – which are becoming increasingly compromised.

Viking Composite Propane Cylinders and Hexagon Regasco join Arbor Day Foundation Tree Initiative and plant a tree for each eco-friendly LPG cylinder that replaces a steel propane cylinder reports BPN most trusted source for news since 1939.12-09-19“The Time for Trees initiative is an important step in protecting the necessities of life, but we can’t do it alone. We’re thrilled that partners like Viking Cylinders are committed to coming together to drive change,” said Dan Lambe, President of the Arbor Day Foundation. “The Arbor Day Foundation is uniquely positioned support the reforestation efforts in California, Iowa and Nebraska.”

Viking Cylinders will fund planting a tree, whenever a consumer switches from a traditional steel propane tank to an eco-friendly Viking Cylinder propane tank. Consumers can easily swap their existing steel tanks for fiberglass at propane exchange cages at select retailers. Viking Cylinders and its propane company partners are working to expand availability nationally.

“Every time a consumer switches from a steel tank to a Viking Cylinder, we will plant a tree” said Sean Ellen, Managing Director of Hexagon Ragasco North America. “Viking Cylinder fiberglass propane tanks are better for the environment than steel tanks. Our products do not rust and therefore do not require harsh chemicals and paints for routine maintenance. Consumers love our tanks because they are lightweight, easy to transport and have a nice stable base. Plus, since you can see the propane inside, you will not run out unexpectedly in the middle of cooking out.”

Ultimately, the initiative will seek to leverage trees to deliver countless benefits to the environment, global economies and society, including:
  • Environment: 100 million trees remove 578,000 tons of chemical pollution from the air.1 Forests also provide 75 percent of the world’s accessible fresh water2 by removing impurities and preventing erosion, and a single tree can absorb 48 pounds of carbon dioxide annually3 to help regulate climate.
  • Economy: Trees are a major pillar of the global economy. The timber sector generates $600 billion annually and 54.2 million jobs,4 and forests also contribute to the recreation and tourism industries.
  • Society: Spending time in green spaces is proven to improve health – reducing stress levels, blood pressure and rates of cardiovascular disease. Forests also help advance medical breakthroughs. More than a quarter of modern medicine is derived from tropical forest plants.5
The Time for Trees initiative is unique in that it will be powered by corporations, communities as well as individual citizens, showcasing the simplicity of tree planting – in one backyard or at scale. As part of this call to action, the Arbor Day Foundation is also inspiring 5 million tree planters to join in this initiative through existing partnerships and community programs.

For more information, contact Tarun Kundhi, +1 402-617-2335, This email address is being protected from spambots. You need JavaScript enabled to view it.

To learn more about the Arbor Day Foundation’s Time for Trees initiative or how to get involved, please visit TimeforTrees.org.

About Hexagon Ragasco
Viking Cylinders is the North American brand of Hexagon Ragasco. Hexagon Ragasco is the world's leading producer of composite LPG cylinders with over 16 million units in globally and over 100,000 in the US. The high-volume, highly automated production facility in Raufoss, Norway is the most advanced of its kind world-wide. Hexagon Ragasco's products are unique and provide many advantages over steel cylinders in terms of safety and user-friendliness. Hexagon Ragasco is a wholly-owned subsidiary of Hexagon Composites ASA. Learn more at vikingcylinders.com.

About Arbor Day Foundation
Founded in 1972, the Arbor Day Foundation has grown to become the largest nonprofit membership organization dedicated to planting trees, with more than one million members, supporters, and valued partners. During the last 45 years, more than 300 million Arbor Day Foundation trees have been planted in neighborhoods, communities, cities and forests throughout the world. Our vision is to help others understand and use trees as a solution to many of the global issues we face today, including air quality, water quality, climate change, deforestation, poverty and hunger.

As one of the world's largest operating conservation foundations, the Arbor Day Foundation, through its members, partners and programs, educates and engages stakeholders and communities across the globe to involve themselves in its mission of planting, nurturing and celebrating trees. More information is available at arborday.org.

California Hits Decarbonization Efforts With Major Outreach Campaign

(December 6, 2019) — With nearly 50 city governments across California threatening to adopt regulations that would curtail or prohibit the use of propane and natural gas, the Western Propane Gas Association (WPGA) is fighting back with a new public outreach effort, reports the National Propane Gas Association (NPGA).

Protect My Propane petition started in California to protect homeowners from being forced to go all electric reports BPN 12-06-19A new website, ProtectMyPropane.com, educates consumers on the importance of energy choices and propane’s benefits. The website also encourages consumers to sign a petition demanding elected officials and policymakers protect energy choice in future regulation.

The most recent challenge came in November when the Santa Rosa City Council voted to move ahead with a proposal to require the use of electric appliances in most residential construction. The panel voted unanimously to require the exclusive use of electric appliances in most new residential buildings below four stories beginning next year. The measure, which will require the backing of the California Energy Commission, will join similar moves by the cities of Windsor, Berkeley, and other local governments across California that have implemented propane and natural gas bans in the name of fighting climate change.

The Western Propane Gas Association has received co-funding from NPGA’s State Engagement Initiative for the outreach project. The state association is also using NPGA’s online grass-roots tools for its efforts to connect consumers with elected officials in cities considering anti-propane regulations. For more information on how states can access these online tools, contact Lesley Garland, NPGA vice president, state affairs, at This email address is being protected from spambots. You need JavaScript enabled to view it..

Maxquip Invests In the Ontario Auto Propane Market With Acquisition Of Canso Auto

(December 5, 2019) — Maxquip has announced that it has acquired the assets of Canso Auto. Canso Auto is a company in Toronto Ontario that specializes in converting cars and trucks to run on auto propane. The company was started by Rudy Grant in the year 2000.

Maxquip INVESTS in ONTARIO AUTOGAS PROPANE MARKET WITH ACQUISITION OF CANSO AUTO reports BPN the propane industry's leading source for news since 1939. Dec 03 2019This is an investment into an industry that Maxquip is very passionate about. It provides Maxquip with a greater ability to not only be a wholesaler of auto propane conversion solutions, but the additional capability of being an installer in the Toronto market. Having conversion facilities in Winnipeg, Surrey and now Toronto allows Maxquip to better understand and improve on the conversion experience, and to develop new technologies for the ever-changing automotive sector.

Cameron Stewart, President and CEO of Maxquip says “We believe there are significant opportunities to help grow the use of auto propane in the Toronto area in a sustainable manner. We are pleased to have the opportunity to invest our resources in this sector. It is an exciting time for the industry and Maxquip is proud to be a part of it.”

With a strong focus on reducing greenhouse gases, today more than ever is when auto propane comes shining through as an inexpensive and environmentally friendly alternative fuel. Compared to other fuels, propane’s utilization helps to improve air quality, reduce greenhouse gas emissions and protect the environment.

“Very happy to be part of an organization that is always looking forward and investing in businesses and technologies that are making a difference.  With this acquisition, it strengthens our presence in the alternative fuels market and assists us in providing more green energy solutions to our customers,” says Willie Stephen, VP Pacific Region, who is based out of the Surrey Maxquip branch as he shares his excitement regarding the addition of Canso.

Rudy Grant is a veteran of the auto propane industry. His involvement spans over 43 years, multiple changes in technologies and thousands of satisfied customers.

Maxquip would like to thank Rudy Grant for this opportunity to carry on the Canso Auto legacy and the first-rate reputation he has built over his career. He has been a long-time valuable member of the propane autogas industry, and a valued partner to Maxquip. The Maxquip team also extends a warm welcome to the Canso Auto staff as they join our family. We look forward to the experience and knowledge they will contribute. On behalf of everyone at Maxquip, we wish Rudy all the best in his future endeavours.

Airline Catering Provider Chooses Propane Vehicles 
at Los Angeles International Airport

LA airline catering sevice chooes propane autogas vehicles LA International AirportLOS ANGELES (Dec 3, 2019) — One of the world’s largest air service providers is now operating emissions-reducing propane autogas vehicles at Los Angeles International Airport. dnata, a global air services provider with inflight catering operations at the airport, purchased eight Ford F-750 delivery trucks fueled by propane, a domestically produced, clean and economical alternative fuel.

“Our top priority is to operate a clean and safe fleet. With these propane vehicles, we reduce emissions without sacrificing safety or performance,” said Peter DeVito, CEO of dnata catering USA.

dnata’s propane trucks are 90 percent cleaner than the Environmental Protection Agency’s (EPA) emissions standard. They are built with ROUSH CleanTech’s 6.8L V10 3V propane engine, which is certified to the optional near-zero nitrogen oxide (NOx) level of 0.02 g/bhp-hr. NOx is the biggest challenge to air quality in the United States and according to the EPA, exposure to NOx exhaust can trigger health problems, such as asthma, bronchitis and other respiratory issues.
dnatacateringpropane2
With dnata’s recent propane vehicle purchase, ROUSH CleanTech has built and deployed 20,000 Ford vehicles and Blue Bird school buses fueled by propane to fleets across North America since 2010.

“We look forward to continuing our partnership with dnata as the company expands in the U.S. and moves to a greener fleet,” said Todd Mouw, president of ROUSH CleanTech. “It’s these types of solid foundations that have helped us become the industry leader of alternative fuel technology, with 20,000 vehicles, more than 1,200 customers and over 1 billion miles accumulated.”

dnata’s first two vehicles were delivered this month, with another six arriving by year end. dnata will fuel the vehicles through mobile on-site fueling with its local propane provider, as well as at public propane stations. There are thousands of public propane autogas fueling stations across the U.S.
dnatacateringpropane3 airline catering service chooses zero-emissions propane autogas fleets to service LAX airport Propane autogas averages about half the price of diesel. “The economics of propane autogas are hard to ignore,” said DeVito. “Propane helps keep our budget in check because the fuel costs a lot less and requires less maintenance than diesel or gasoline.”

About ROUSH CleanTech: ROUSH CleanTech, an industry leader of alternative fuel vehicle technology, is a division of Roush Enterprises based in Livonia, Michigan. ROUSH CleanTech designs, engineers, manufactures and installs propane autogas and electric fuel system technology for medium-duty Ford commercial vehicles and school buses, and compressed natural gas fuel systems for school buses. As a Ford QVM-certified alternative fuel vehicle manufacturer, ROUSH CleanTech delivers economical, clean and domestically produced fueling options for fleets across North America. Learn more at ROUSHcleantech.com or by calling 800.59.ROUSH.

About dnata: dnata is one of the world’s largest air services providers. Established in 1959, the company ensures the aviation industry operates smoothly and efficiently in 127 airports. Offering ground handling, cargo, travel, and flight catering services in 35 countries across six continents, dnata is a trusted partner for over 300 airline customers around the world. Each day, the company handles over 1,900 flights, moves over 8,500 tons of cargo, books over 16,000 hotel stays, and uplifts over 320,000 meals.