Drive down fuel costs

For a business in which gasoline is like life's blood, Barnes Inc. could be hurting much worse than it is, according to Mark Barnes, president and CEO of the Madison-based landscaping, lawn maintenance, and snow removal company.

Barnes credits his company's ability to cope with high gas costs to steps taken years ago, such as transitioning its fleet of sales vehicles to hybrid sedans.

In 2006, the company replaced the pickup trucks used by sales people with Toyota Prius hybrids, and now has 14 Prius sedans, which get better than twice the mileage of the pickups.

"We bought them in 2006, not necessarily with the anticipation that gas was going to be creeping up on $4 a gallon, but with the savings to us then," Barnes said.

Back in 2002, the business inserted gas surcharge language in its contracts. For some billing cycles, the surcharge isn't added if business is strong and gas prices are stable, but Barnes calls the surcharge a "tool" that's sometimes needed.

"I thought there was the possibility that (gas prices) could really cut into our bottom line if we didn't prepare," Barnes said.

Thinking ahead

Other businesses also have coped with gas prices by thinking ahead.

Jim Hirsch, president of Paul Davis Restoration of Lakeland Counties, Cottage Grove, said he began buying Prius sedans back in 2004 to replace conventional pickups and sedans used for sales and project management.

The business — which fixes property damage — now has a fleet of six hybrids. "When we first got them, people we came across were thinking they were more of a curiosity," said Hirsch. "Now people are thinking we were pretty smart."

Businesses are coping with gas prices in various ways, and not all find that electric hybrids are the answer. For one thing, many tasks require heavier duty vehicles that typically have gasoline or diesel engines. As Barnes said, "you can't plow a driveway with a Prius."

One thing business owners such as Barnes and Hirsch have in common is that they thought ahead about the type of vehicles they could use to gain better fuel economy. Another important thing any business can do is to rethink their approach to vehicle maintenance.

The right strategy can blend cost savings with reduced emissions and other "green" benefits.

"Using hybrids was both values driven, and economics driven, and it's nice when those two things come together," said Hirsch.

Vehicle choice

Use of alternative fueled vehicles and hybrids is growing "aggressively" among corporate fleets, said Keith Kreps, CEO of ALD Automotive USA, a national fleet management company based in Madison. However, says Kreps, hybrid sedans aren't yet dominating the fleet market.

"Hybrids have not yet come onto fleet market in a major way, for a couple of reasons," said Kreps. "One is trying to justify the initial costs compared to similar, conventional vehicles, and second, is that the resale value for hybrids isn't fully established yet."

Even for companies that are going green in multiple aspects of facility and energy use, the move to hybrids is not a given. One major client passed up a proposal to buy hybrids over concerns about disposal of spent batteries, said Kreps.

e85 vehicles popular

For service vans and light trucks, said Kreps, flex fuel vehicles, or FFVs, that can burn either unleaded or e85 — a blend of 85 percent ethanol and unleaded — are in relatively high demand. "It's a way of trying to be more environmentally conscious with a truck," Kreps said.

The ethanol in e85 has a lower energy content than unleaded, which leads to lower mileage.

According to the U.S. Department of Energy, FFVs typically get about 20 percent to 30 percent fewer miles per gallon when fueled with e85. Kreps said most of the calculations he's done put the break even point at about 60 cents a gallon.

Some clients, says Kreps, are put off by some reports that it takes more energy to produce e85 than is derived from it as a fuel. According to the U.S. Department of Energy, ethanol has a positive energy balance.

Another complexity with e85 is access to fueling locations. According to The Wisconsin Bio Industry Alliance, a Milwaukee-based nonprofit, the number of e85 locations in Wisconsin is now more than 100 and growing rapidly, compared to 30 locations in 2006.

Alliant's biofuel fleet

Still, some corporate fleets are moving to e85 and biodiesel, a form of diesel made from renewable sources like soybeans. Alliant Energy has 800 of its trucks powered by biodiesel and e85. Biodiesel powers larger trucks, while e85 is used for smaller vehicles.

Scott Reigstad, a spokesperson for Alliant Energy, said that besides the cleaner burning biofuels, Alliant Energy also has been sending reminders to employees to use good judgment when idling vehicles.

Barnes has held off on using biofuel for service trucks, in part over concerns about performance. But, he added, "it's time to start exploring some of these things. I think there are a lot of new technologies we can start looking into."

Think green

Flaws can be found with practically any alternative fuel, but for his business, Tim Nicholson thinks he's found a good solution with diesel sedans modified to burn waste cooking oil. Nicholson is one of the founders of the Glass Nickel Pizza Co., a chain of pizza restaurants.

At its original location on Madison's East Side, the company uses three older, Volkswagen Rabbit sedans modified to run on waste oil. Spent oil from the restaurant's fryer is filtered and used to power the Rabbits, which have an additional tank for the oil. "It's basically a perfect application for us," says Nicholson. "They used to charge us to take it away."

The savings from the three "grease cars," as Nicholson calls them, comes to about $30,000 a year, yet the business still uses plenty of conventional gas. Only five of 30 delivery drivers are insured to drive the grease cars, said Nicholson, so most use their own cars.

The main location also uses an electric hybrid sedan, but the spike in gas cost has caused Nicholson to increase per-delivery stipends.

Nicholson said he is reminding drivers to idle less, and avoid hard accelerations and braking. But he is frustrated that automakers have not been able to bring more options to market.

"As the founder of the company, I'm trying to find the way of future, which probably is going to be an all-electric delivery car, but I'm going to have build my own, because I can't find one," he said.

At Seventh Generation Energy Systems, a Madison-based organization that plans and builds wind and solar power systems, being green is core to the business, said David Blecker, president. Its Ford F350 service truck and its VW station wagon have diesel engines that run on biodiesel without modification.

The biodiesel costs more than diesel at the pump, but to Blecker, the lower emissions and renewable fuel translates to lower costs for the community.

"While we are paying a premium at the pump for the biodiesel, I know that those dollars are staying in the local economy," Blecker said. "I also know that we are not mortgaging the future in terms of increased greenhouse gas emissions or resource depletion."

Rethink maintenance

There is plenty that can be done to boost mileage through better maintenance. Rick Teebay, outgoing chairman of the fuels and technology committee with the National Association of Fleet Administrators (NAFA), Princeton, N.J., says the "usual suspects" that rob mileage are low tire inflation, dirty air filters, and not following other service intervals.

Also, look to remove unnecessary cargo from vehicles, consolidate trips, or consider using global positioning system (GPS) products to plan routes better, Teebay said.

"In places with real-time traffic information, GPS can help avoid traffic jams, besides telling you the most efficient way to get from point A to point B," he said.

Waiting too long between oil changes harms fuel economy because it leads to sludge build up in the engine, said Tony Molla, vice president of communications with the National Institute for Automotive Service Excellence (ASE), a Leesburg, Va.-based organization that certifies technicians. One of the simplest steps to take, according to Molla, is to avoid jack-rabbit driving.

"Drive like you have a raw egg between your foot and the accelerator," said Molla. "Smooth driving is good for mileage."

It can be challenging to motivate employees whose job is sales or service to think about vehicle maintenance, said Kreps. Some of ALD USA's clients have had success with motivational tactics. One client sent out digital tire pressure gauges to its salespeople as gifts, along with a note asking them to check pressure regularly.

In short, said Kreps, better communication leads to better maintenance. "We send out a lot of bulletins to our clients, and we tell them to be conscious about steps like getting oil changed," he said.

Besides more attention to maintenance, some companies are simply downsizing their conventional vehicles, or buying carbon offsets from firms that pool the payments to fund eco-friendly projects. Kreps said businesses can undertake a carbon footprint analysis of their vehicle use to come up with the best options — both for the bottom line, and the environment.

Others echo the thought that the right plan can both save money, and cut emissions. "The fuel savings (from hybrids) has been phenomenal, but it's also given use to this feeling of doing more to be stewards of the environment," said Barnes.