EPA regs force fuel dispensers to upgrade

More than 5 billion gallons of fuel will be dispensed this year at private commercial sites that are not in compliance with 1998 U.S. Environmental Protection Agency regulations. “Our survey of more than 1,300 commercial fleet operators found that only 52 percent of these operators with underground tanks are currently in compliance with all 1998 EPA regulations, including corrosion protected tanks and piping, spill containment, overfill prevention and leak detection,” says Joseph Slagle of Havill & Co., Toledo, Ohio, a marketing research and consulting firm specializing in the petroleum industry.

The survey, which was funded by companies that are leaders in petroleum equipment manufacturing, fleet card processing and petroleum marketing industries, is the first research of its kind to analyze the off-site and on-site refueling practices of commercial fleet operators.

By breaking the commercial market into segments — agriculture, construction, service, wholesale, retail, over-the-road/passenger carrier, utility and government — the refueling practices of each are analyzed in detail. Each segment is characterized in terms of vehicle demographics, fuel consumption, fleet card usage and on-site refueling facilities.

The research generated by the survey shows that many fleets have the financial capability to comply with the EPA regulations, and equipment suppliers are anticipating a robust market as these fleet operators upgrade. Both petroleum marketers and equipment suppliers are gearing up to capture their share of this demand bubble.

“Our forecast shows that an additional $2.3 billion per year in fuel sales will shift to the retail service station market by 1998,” Slagle says. Fleet cards have been the primary marketing tool for attracting fleets to retail outlets. New security and reporting features provide fleet administrators with the same control they have at their on-site facility, without the liability associated with on-site fuel storage.

“Still, more fleet administrators plan to upgrade their on-site facilities than close them,” he says. For many commercial businesses, fleet operations are an essential business activity. These fleets require 24-hour on-site fuel access to run efficiently. The operators of these fleets are planning equipment purchases to bring their facilities into compliance with the 1998 EPA regulations.

“The most significant result from this research,” Slagle says, “is the development of demographic models for profiling fleet accounts that have four or more vehicles.”

Prior to the survey, he says, clients had a problem figuring out how to prioritize sales prospects. By modeling the commercial fleet market, they now can target fleet operators who are ready to buy.

“These profiles provide information on vehicle demographics, on-site refueling facilities, off-site purchase patterns and credit card usage, Clients are now able to prioritize commercial prospects and then distribute these prospects electronically to sales reps who are equipped with notebook computers.”

For additional information about the survey, contact Havill & Co. at (419) 841-2244.