ULSD Causes "PETRO-NOIA"

Cutting through the hype about ULSD fuel.


Introducing a new fuel into the fleet does not come without consequences—especially for maintenance. But, will the anticipated cons of higher fuel prices, lower lubricity, and lower energy output outweigh the projected pros of cleaner emissions and improved air quality once Ultra-Low Sulfur Diesel (ULSD)-fueled vehicles begin regular maintenance schedules?

NUMBERS GAME

From January 1, 2007, all Y2007 and later model year diesel highway vehicles are required to use Ultra-Low Sulfur (S-15) Diesel fuel. California mandated use of ULSD for all diesel highway vehicles as of September 2006.

Vehicles that require ULSD fuel have specific labels on the dashboard and near the fuel inlet indicating that they must be fueled with ULSD fuel. Vehicles without these labels may be refueled with either Low Sulfur Diesel (LSD) or ULSD fuel.

Patrick Kelly, downstream associate with American Petroleum Institute (API) in Washington, D.C., explains that the U.S.

Environmental Protection Agency (EPA) sought input from the engine and fuel industries regarding sulfur levels with the new ULSD. Auto and engine makers wanted a limit of 10 parts per million (ppm), but the oil industry felt that 50ppm was sufficient for the kind of advanced emission control systems that the industry was likely to use. He says EPA probably chose 15ppm, based on NOx absorbers that require the lowest sulfur ppm level.

An FYI to fleets during conversion to ULSD is that it may be necessary to develop a method for measuring sulfur content in bulk storage.

FEAR OF OPERATING COSTS

Darry Stuart, President of DWS Fleet Management in Wrentham, MA, and current chairman of the Technology & Maintenance Council (TMC), says the main issues causing ULSD "petro-noia" in fleet maintenance are fuel prices, availability, cold weather operation, lower lubricity, performance, and equipment and consumables expenditures.

EPA previously estimated that ULSD would cost an extra five cents per gallon. The Energy Information Administration (EIA), which provides official energy statistics from the U.S. government, believes that number is actually between five and eight cents per gallon.

According to EPA, ULSD fuel costs more to refine and distribute than Low Sulfur Diesel fuel, but many factors affect the consumer price of fuels, including the price of crude oil, geopolitical factors, weather, transportation and economic events, as well as supply and demand.

Tom Komos, vice president of fuel supply and marketing for TravelCenters of America (TA), offers that ULSD costs more to refine. He adds that some customers are "…wary of potential cost increases for a product that many do not yet need."

TA's vice president of sales, Mike Lombardi notes, "Some fleets had to revise their billing/payables systems to add a second type of diesel fuel. TA has partnered with several fleets to assist in converting their pricing and payables systems to handle two types of diesel pricing."

Bob Pudlewski, chairperson for the technical committee of the National School Transportation Association (NSTA), headquartered in Alexandria, VA, says price increases vary across the country. "Generally, we are seeing five to 10 cents per gallon difference," he says.

FUEL UNAVAILABILITY

"The biggest concern is availability," says API's Kelly. "Refiners are required to produce 80 percent that will be ULSD. They are over-complying by producing about 2.6 million barrels a day, which is over 90 percent needed for U.S. highway vehicles."

TA's Komos explains that ULSD can be downgraded as it moves through the supply system to account for real product degradation. "These downgrades are limited to 20 percent of the ULSD handled at each step of the process (pipelines, terminals, delivery and retail). Downgrade restrictions ensure that ULSD will be available at retail outlets for trucks that require it," he says. "Most customers prefer the old product, LSD, as it tends to be a little cheaper and the drivers and trucking companies are most familiar with its performance."

This content continues onto the next page...

We Recommend