Natural Gas Takes the Lead
LAS VEGAS -- What fuel alternatives will convenience store retailers sell at the pump in 13 years? Although panelists differed slightly in their answers, they all came to the consensus that natural gas is likely to have the best future.
During Monday's workshop, entitled What Will You Sell in 2025?, Chad Hollett, director of warehousing and distribution for Kwik Trip Inc., noted that natural gas -- which comprises compressed natural gas (CNG) for consumer vehicles and liquefied natural gas (LNG) for fleets -- simply cannot be ignored as a promising fuel alternative.
Before we decided to offer natural gas at our stores, we looked at the supply of it, he said. Natural gas has a 100-year supply and is produced here in the United States.
Hollett pointed out that natural gas offers a considerable price advantage for consumers compared to traditional petroleum. He expects the price per gallon of natural gas to continue to be cheaper than petroleum for some time to come.
As an added bonus, the director at Kwik Trip relayed that natural gas offers better margins for retailers.
However, Hollett and Norman Turiano, senior manager of fuel business development for Wawa Inc., noted that for natural gas to strongly penetrate the fuel market, the infrastructure must be there. We haven't worked enough with legislators to make a big push to build infrastructure, said Turiano.
John Eichberger, vice president of government relations for NACS, the Association for Convenience & Fuel Retailing, and moderator for the workshop, cautioned that we can't count on legislators to provide assistance regarding fuel alternatives.
For natural gas to turn into a robust fuel alternative, infrastructure is not the only thing needed. Auto manufacturers must provide the vehicles. Bob Wimmer, national manager for Toyota, told attendees his company is fully behind that effort. What auto manufacturers need to do is keep communicating with independent c-stores, he said. Pilot programs are one thing we can discuss.
Despite some challenges preventing natural gas from being a prominent option at the pump, Turiano said those obstacles can definitely be overcome. People think that 'a chicken and the egg' issue has no answer, he said. It's a critical mass issue. CNG is probably the best solution to the energy needs of the country.
During the workshop, natural gas wasn't the only fuel alternative discussed. Ethanol was a topic of lengthy discussion. Although ethanol already has its place as a fuel alternative, Wimmer said E15, which the U.S. Environmental Protection Agency approved for sale at gas stations in June, presents challenges for Toyota.
We've been told vehicles manufactured in 2001 or later can support E15, he explained. But there's no proof. We just can't take the risk [of lawsuits that could ensue if consumers misfuel their vehicles]. The key is to educate consumers about what their vehicles are designed for.
A less-publicized fuel alternative in recent years is hydrogen. Although the fuel option has been available for at least 15 years, panelists agreed its future is limited at best. There are some hydrogen fueling stations in southern California, noted Wimmer. There is some movement there. But it's not a short-term solution.
Turiano said hydrogen is not on Wawa's radar. It's the least likely fuel alternative for Wawa. I believe it will continue to be a liquid fuel universe, he stated.