LP Gas reports daily from NPGA’s Propane Expo

April 11, 2015 By    
Photo credit: Mike Boening Photography/Foter/CC BY-NC-ND

Photo credit: Mike Boening Photography/Foter/CC BY-NC-ND

The propane industry’s largest event, the National Propane Gas Association’s (NPGA) Southeastern Convention & International Propane Expo, ran April 11-13 in Atlanta. LP Gas magazine reported daily from the show with news and notes that appear here in this space. Additional coverage is available through social media at twitter.com/lpgas_mag and facebook.com/lpgasmagazine.

You can also check out our industry exclusive show guide, featuring product and service information from leading companies that exhibited in Atlanta.

Autogas Pavilion provides excitement for attendees

The inaugural Autogas Pavilion produced a lot of buzz on the trade show floor. Nineteen companies were represented in the pavilion, where a number of propane-powered vehicles were on display to educate attendees about autogas opportunities.

“We’ve gotten great feedback on the pavilion,” says Teresa Wade, marketing coordinator at Trinity Containers, who served as chairwoman of the National Propane Gas Association’s Autogas Pavilion task force. “Each exhibitor said they had a tremendous turnout. It’s fantastic what these companies have been able to do.”

Expectations for propane pricing, market growth

ICF International's Mike Sloan

ICF International’s Mike Sloan

Mike Sloan, principal at ICF International, shared his research-based perspective on propane pricing and markets during an educational session.

Sloan stressed that international markets will increasingly impact the price of U.S. propane because the domestic and international markets are now linked.

“Winter propane prices will be impacted by what happens in Europe,” Sloan says. “A cold winter in Europe drives prices higher in the United States. A warm winter in Europe holds down prices.”

Sloan says an increase in U.S. exports will lead to lower average propane prices in the U.S. Don’t expect to see the prices available from a couple of years ago, he says, but the lower prices should benefit some propane markets.

Propane autogas may be an exception, though. At least for the moment.

“The economics of converting to propane are not as favorable as they have been,” Sloan says. “Probably the biggest factor in that market right now is the decrease in gasoline and diesel prices. Fleet managers are less [motivated] to convert. They saved 30 percent on their budgets without doing anything.”

Still, Sloan expects autogas to deliver gallon growth over the next five years. According to Sloan, between 12,000 and 13,000 new propane vehicles were added to the road in 2014. Sloan expects that number to increase to 30,000 by 2020.

Overall, Sloan expects propane gallons to grow by 6 percent between 2014 and 2020. He expects the growth despite an expectation that a number of traditional propane markets will remain relatively flat.

“We’re expecting real growth in consumer demand for propane for the next five years,” Sloan says. “That would be 500 to 600 million gallons of new consumer propane demand.”

The residential market is among the traditional markets that will be slow to grow. In fact, it might retract.

“It’s not a growth market yet,” Sloan says. “We’re expecting a modest decline nationally in residential consumption. It is at a much slower decline than we’ve been watching the last few years and it’s driven primarily by improvements in efficiencies.”

PERC, marketers explore irrigation engine opportunity

The Propane Education & Research Council‘s (PERC) Cinch Munson explored the opportunity for marketers to grow gallons with irrigation engines during an educational session.

“We have a two-year window to really grow this market,” says Munson, director of agriculture business development at PERC. “We can make some huge inroads and build on that.”

Seven manufacturers have brought about 35 new propane irrigation engine models to market over the last five years, Munson says. The new engines are more efficient, and they offer farmers advantages over competitive energies.

PERC's Cinch Munson

PERC’s Cinch Munson

“Before, propane engines were built to run on gas and were converted,” Munson says. “People had a bad perception of them. We just didn’t have the right engines to grow the market.”

Munson adds that propane irrigation engines typically burn 1.57 gallons of propane to every 1 gallon of diesel.

“When you figure in the prices, it really calculates out extremely well [for propane],” says Munson, who pointed out that electricity is also a major competitor to propane in this market space.

Adds Bill Moore, a propane marketer at Georgia-based Conger LP Gas who’s had success selling irrigation engines and propane to farmers: “Propane is $6 to $7 an hour cheaper than diesel and $1 to $2 more than electricity [for farmers’ irrigation engines].”

In a bad irrigation year, Moore says, he sells between 3,000 and 4,000 propane gallons per engine. Moore buys engines directly from manufacturers. He’ll then sell the engines to farmers and structure contracts with them so they purchase fuel from his company.

According to Munson, marketer and dealer involvement is the next step to get additional propane irrigation engines in the field. PERC developed an incentive within the last couple of months to urge dealers to push propane engines, Munson says. Marketers should seek opportunities to partner with dealers and installers, as well.

“Know your installer,” Munson says. “Get the dealer and the installer in early. Stay in contact with the buyer and the dealer through the process. Stay in contact with the installer to set the propane tank.”

Incentives are also available from PERC to encourage farmers to invest in propane irrigation engines.

Keys to controlling insurance claims

Eric Kuster, loss control manager at Fairmont Specialty, explained during an educational session how propane companies can control general liability, vehicle and property claims.

He stressed the importance of performing leak checks on all systems when required as a way to guard against general liability claims.

To avoid vehicle claims, companies should consider using the Propane Education & Research Council bobtail rollover training program with drivers, Kuster says. He notes the importance of defensive driving techniques and the danger of drivers following other vehicles too closely. He says companies should consider installing backup cameras on their vehicles.

Keeping equipment in good shape, reviewing fire prevention methods and reviewing and upgrading theft deterrent systems should help keep property claims in check.

Employees not following established company procedures often leads to large losses, Kuster says.

Technology helps fleets answer: What happened?

Technology is taking a front seat in our daily lives, including transportation, says Blake Gasca, CEO of Convoy Technologies.

Gasca asked attendees during an educational session: What problems are plaguing your fleet today? And he highlighted challenges, such as driver fatigue and distracted driving. Convoy Technologies offers technology that captures real-time and historical video when companies need it most.

“We’re there to protect the drivers and build information around what took place” during an on-road incident, he says.

Building momentum in propane autogas engine markets

Powertrain Integration sees a notable difference between last year’s Propane Expo and this year’s event.

Last year, the company was trying to build momentum behind its PIthon 8-liter V8 propane engine for Freightliner’s S2G chassis. But today, Powertrain Integration President Bob Pachla says, it’s approaching 1,000 units that power the S2G propane bobtail and a Thomas Built C2 school bus.

Other applications for the engine include an S2G propane box truck and entry into the shuttle bus market on an S2C Freightliner chassis. Freightliner recently announced that utility and beverage truck applications are on the way.

Powertrain Integration also displayed a 6-liter V8 propane autogas engine during the Propane Expo. The engine was installed in 1,000 walk-in vans for UPS.

Opening speaker shares on the need for ‘wingmen’

Lt. Col. Rob “Waldo” Waldman opened the general session Saturday by sharing his knowledge on how businesses can build trust.

Waldman at Southeastern Convention opening session, 600x400

Lt. Col. Rob Waldman

Waldman, a businessman and former F-16 fighter pilot, shared his experiences from military and how they relate to business. Waldman says he has always been afraid of heights. He had passion for planes and flying, though, so he overcame his fear during his time in the military with some help from his “wingmen,” people he knew had his back.

He believes the way to build trust in a business lies in wingmen – people who can check for blind spots in the industry.

Waldman says it’s important to commit to excellence, mission and team in the military. He says this concept also applies to businesses.

“Your job as propane marketers is to win the business, not just survive,” he says. “We have a choice to push it up or stay back. We know the answer is we gotta push it up. We can’t just ease up the moment we know we’re doing well. That’s complacency, and it kills business plans and relationships.”

The exhibit hall opened after Waldman’s presentation where attendees gathered for a two-hour reception.

CleanFuel USA debuts Euro-style nozzle

CleanFuel USA Euro-style nozzle, 250x158CleanFuel USA released the Elaflex ZVG2 Euro-style nozzle for fleets.

“There has been a recent industry push to standardize use of the Euro-style nozzle for autogas refueling in the United States, based on its lower emissions and ease of refueling,” says Curtis Donaldson, founder and managing partner of CleanFuel USA.

The Elaflex ZVG2 nozzle has been used with propane autogas dispensers for about 20 years. The Elaflex sold thousands of ZVG2 nozzles in the European market, according to the company.

In addition to the Elaflex ZVG2, CleanFuel USA will showcase three of its dispensers in booth 246.

Autogas dispenser integrates mass flow meter technology

Superior Energy Systems debuted the mass flow meter for its Pro-Vend 1000, 2000 and Dual Hose propane autogas dispensers. Jim Bunsey, director of operations for Superior Energy Systems, says mass flow metering technology is “heavily used” in compressed natural gas, and that many international customers requested mass flow metering technology.

The anti-corrosive, stainless-steel micro motion Coriolis mass flow meters from Emerson Process Management help to reduce fleet operators’ costs, requiring little to no maintenance compared with mechanical meters.

Bergquist unveils propane-filling valve at show

Bergquist valve Southeastern Show, 200x208Bergquist Inc. released the Snap-Fill propane-filling valve from the Cavagna Group. The Snap-Fill, designed for forklifts and riding mowers, uses the same connection as other Euro-style snap-on fittings.

“Individuals are beginning to use propane for forklifts and lawn mowers more increasingly than in the past,” says Bruce Montroy, senior vice president of sales for Bergquist.

The company says the Snap-Fill design also prevents users from wrist injuries after repetitive use. The propane-filling valve also eliminates cross-threading or partial installation.

Alliance AutoGas highlights bi-fuel autogas system

Alliance AutoGas showcased the 2016 Ford F-650/F-750 tractor that features a bi-fuel autogas system at the Autogas Pavilion. The bi-fuel autogas system reduces fleet-operating costs by as much as 30 percent, according to Alliance AutoGas. The “plug and play” conversion on the Ford F-650/F-750 also improved efficiency on the tractor, reducing the propane system’s installation time on it in half.

Alliance AutoGas also plans to develop a Ford Explorer police vehicle, a Ford Transit and an Isuzu NPR with the bi-fuel autogas system and plug-and-play system installation.

PERC addresses DOC restriction, forklift market projects

The Propane Education & Research Council (PERC) hosted its April meeting Friday in Atlanta. PERC President and CEO Roy Willis addressed the U.S. Department of Commerce (DOC) restriction on PERC’s consumer outreach activities, sharing that DOC has completed its analysis and that PERC was awaiting results from the federal government. PERC then announced Saturday that the restriction had been lifted, creating more opportunities for the council to promote propane to consumers.

PERC also approved funding for two projects: $255,000 for its 2015 material handling market research and outreach program and $2 million for 3- to 6-ton forklift engine development.

“Propane forklifts now are utilizing a lot of automotive technology that’s been modified,” says Jeremy Wishart, PERC’s deputy director of business development. “These just aren’t industrial engines, though.”

PERC partnered with Power Solutions International Inc. on the engine development program. Wishart says the $2 million will be used to develop an advanced propane engine focused on mobile industrial applications, specifically as a replacement to the Tier 4 diesel and electrified products in the 3- to 6-ton forklift market. In addition, the new engine would replace an outgoing 3.0-liter engine with better emissions, performance and scalability.

The material-handling market is becoming more competitive, Wishart adds. Propane is viewed as old technology in this space, and electricity is considered the greener technology.

PERC’s goals with the material handling market research and outreach program are to reposition propane within the market and prepare it for future competition in that space.

“As CNG makes its push into the market and as regulations develop, we’re going to see other alternative fuel sources,” Wishart says. “We need to be aware of that.”

The on-road vehicle market was also addressed at the meeting. Willis says a key to this market’s long-term sustainability is getting end users to discuss their propane autogas successes with peers.

“If we’re persistent, ultimately we’re going to cross that chasm and get to the point where end users are talking to their peers,” he says.

According to Willis, getting to the 13 to 15 percent market-share threshold within the on-road vehicle space qualifies a product as sustainable.

“While we have products that are close to crossing that chasm – for instance, we’re close to getting school buses to that mark – we have headwinds in most of our alternative fuel areas,” Willis says.

Read more about PERC activities in the May issue of LP Gas.

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