/// Guest post by contributor Jon Scharingson, Renewable Energy Group
For any business owner, monitoring the bottom line is an essential task. They need to keep constant tabs on their cash flow and make sure that each decision being made is economically feasible. Travel center operators are no exception, and when these men and women have looked at their bottom line, they have seen biodiesel as a means of improvement.
Biodiesel is well-chronicled as a clean-burning and environmentally friendly fuel, but as it permeates the marketplace and incentives are implemented across the United States, biodiesel’s economic advantages grow. In 2010, biodiesel sales were approximately 300 million gallons, but have jumped to more than 1.5 billion gallons in 2013.
Travel center owners have been moving into green energy, but the other green they are looking at is profit. A major contributor is the quest for positive blending economics; that is, the ability to buy biodiesel cheaper than No. 2 Ultra Low Sulfur Diesel, and actually be able to make a profit blending biodiesel in with No. 2 diesel fuel. Across the country, travel center operators have had the opportunity to buy biodiesel at 15 to 35 cents per gallon under No. 2 ULSD costs.
Between the value of RINS and state incentives, travel center owners are finding biodiesel to be a very meaningful asset. Minnesota, Texas and Iowa are among the states where incentives have been embraced. For example, in Iowa, there is a four-and-a-half cent per gallon incentive for B5 blends. In Texas, there is a retailer incentive of 20 cents-per-gallon for every gallon of biodiesel blended with diesel fuel.
Recently, Minnesota, upgraded their law that necessitates all diesel sold in the state contain a B10 blend of biodiesel during the warm-weather months. The new standard is the first of its kind in the country, and will be enacted July 1, 2014 and run through Oct. 31.
With a number of state and federal incentives coming into play, biodiesel producers are working cohesively with retailers to share biodiesel benefits, and understand how to maximize the benefits of various incentives. They are being shown how to navigate the various processes for application and the different economic incentives that go with it.
At today’s travel centers, there are many operators selling B2 or B3 blends that come from their suppliers. It is these operators that we really want to reach and show them how to take advantage of biodiesel economics, now that it has already been introduced at their location.
Biodiesel is becoming a mainstream fuel. It’s prevalent at B5, and many travel centers are implementing B20; owners are learning that if they are going to sell biodiesel, it is best to take full advantage of economic incentives and opportunities.
/// Read more guest posts on biodiesel posts here.
{Guest Post} Guest post provided by NATSO Chairman's Circle member Jon Scharingson, Renewable Energy Group. Renewable Energy Group® is a leading North American biodiesel producer with a nationwide distribution and logistics system. With more than 210 million gallons of owned/operated annual production capacity at biorefineries across the country, REG is a proven biodiesel partner in the distillate marketplace. Learn more about Renewable Energy Group.
The opinions and advice given by guest post contributors are not necessarily those of NATSO Inc. The posts should not be considered legal advice. Qualified professionals should be sought regarding advice and questions specific to your circumstances.
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