Total Package Fleet

How can trucking firms of all sizes avoid volatile diesel prices and at the same time protect the environment? That's easy-by producing clean-burning, renewable fuel themselves.
By Ron Kotrba | January 10, 2007
Trucking firms are highly sensitive to the price of diesel. Their vulnerability is worn on their sleeves, but many other businesses and individuals are susceptible to the ripple effect of high-priced diesel fuel. When load carriers pay more for fuel, their burden is often relieved by their customers who, in turn, pass the added cost on to their consumers. The effect may not be so obvious to the naked eye, but it's a fair summation of the practice. Furthermore, once fuel prices hit a certain level, those companies onto which the fuel surcharges are being passed become forced to reevaluate their transportation needs in order to save money.

Even those who ride bikes, drive hybrids or walk everywhere are impacted by the diesel market's encompassing stranglehold. We're all affected by the high cost of diesel fuel, which experts say can ratchet up prices on all sorts of consumer goods. Furthermore, that "cost" doesn't come only in the form of money. Fragile relationships with kings and dictators, whose countries keep the supply of base materials for transportation fuels flowing, perhaps come at an even greater cost than those bills settled with the almighty dollar. If oil tankers ceased delivery to U.S. shores-even if only a fraction of oil lost its way here-major problems would quickly arise.

Outside of the customary paradigm, there's another option by which trucking companies can model their businesses-one that doesn't rely on the supply and demand of petroleum, or the price gouging alleged to occur between those few countries and companies dictating prices.

Ullrich GmbH, a German trucking company, is setting a new standard in sustainability by producing the very fuel it consumes as a large load carrier, and that fuel happens to be biodiesel. This trucking outfit isn't making 55-gallon batches in its garage, though; Ullrich is much more sophisticated than that. Its story is one of a family business becoming one of the largest load-haul service providers in the world, after which it then began using B100 and, ultimately, made the leap into commercial-scale production to fuel its fleet toward freedom from high diesel prices. The Ullrich model seems worth emulating in today's economy, and it may very well be a model of the future in which some experts believe the decentralization of energy production is inevitable.

Ullrich Fleet and Biodiesel Meet
Founded in Kaufungen, Germany, in the central state of Hess, Ullrich GmbH has grown to be Germany's largest independent truck load carrier. From relatively humble beginnings in 1966 when the company consisted of a mom and pop start-up with a single truck, the company has grown to employ 1,450 people who keep more than 1,000 trucks hauling goods on Germany's highways around the clock. According to Marc Andreas Ullrich, the firm that started out more than 40 years ago is still family owned, with the third generation of Ullrichs now involved in managing the business. Ullrich hauls virtually anything within reason, and has the means to do so. The company's vast fleet of tractor-trailers include deep-freeze containers, cross-feed and swap trailers, tautliners, car transporters, tanker trucks, and containers built specifically for hauling construction materials. Essentially Ullrich hauls most everything, from cars to escargot. After years of successful growth, company leaders made the decision to give biodiesel a try.

"In 1997, the company management came up with the idea of buying biodiesel for the operation of its vehicle fleet," Marc Andreas tells Biodiesel Magazine. "This was prompted by an article on research into biodiesel production at the University of Kassel (in Kassel, Germany)." Even in 1997 in Germany, biodiesel blends didn't have a real presence in fuel markets-especially not B100. Outside of government, university researchers and niche environmental circles, it really didn't receive much exposure at all. "The Ullrich family decided to take a risk and bought into biodiesel," Marc Andreas says. "At the time, colleagues and customers reacted with incomprehension and amazement. Hardly any other haulage company was using biodiesel at the time. Most truck manufacturers were also decidedly averse to approving the use of biodiesel in their vehicles." Today, only 10 years later, nearly all diesel automakers approve the use of B2 or B5 in their engines, or at least they don't object to it. Many of Ullrich's fleet trucks are powered by MAN Diesel engines, which is granting general approval for the use of biodiesel up to B100, Marc Andreas says.

The family-owned German trucking firm is now the world's largest consumer of biodiesel. Since the decision to start using biodiesel was made a decade ago, Ullrich trucks have traveled more than 700 million kilometers (435 million miles) on B100, a distance unrivaled by any other biodiesel user. Outside of what Marc Andreas says is a 5 percent fuel economy drop and an increase in oil-change intervals, his company's trucks operate just fine on B100. "Experience has shown that following the introduction of biodiesel, every problem with the vehicle is initially attributed to biodiesel," Marc Andreas says. "Even defective headlight bulbs have been blamed on biodiesel. Once the prejudice of suppliers, workshops and drivers were found to be unjustified, they too have been able to accept the conversion to biodiesel, and no further adverse effects have been observed. We are thus left with the positive, environmentally friendly and resource-saving aspects of the use of biodiesel."

Ullrich Leaps into Producer Status
An idea sparked in the minds of management two years after the German transport company began fueling its fleets with the biofuel. "Following initial successful tests in practical operation, the Ullrich family decided in the year 1999 to become involved in the production of biodiesel themselves," the third-generation Ullrich told Biodiesel Magazine. Time went by as negotiations and discussions were held to work out the details with Ullrich's turnkey provider, Probitech GmbH, and its contracted technology provider STH Engineering, a major shareholder of Probitech. "In the year 2000, the first production plant was designed, and subsequently went into production in 2001," Marc Andreas says. That plant, Ullrich Biodieselanlage I, produces 20,000 metric tons a year (6 MMgy) of biodiesel using virgin (rapeseed and soybean) oils and/or used vegetable oils in a continuous process with waterless purification. "Probitech is using ionic exchanger material for the purification process," the turnkey provider states in a presentation on Ullrich. The Kaufungen-based refinery operates three shifts per day with two operators per shift at 8,400 hours of operation a year-or 350 days.

With the company still expanding, it became clear that more production was needed to meet the fleet's growing demand for fuel. Knowing exactly what to do, the family-owned business crunched some numbers and made another call to Probitech. In the winter of 2004-'05, Ullrich Biodieselanlage II-a larger plant with a capacity of 30,000 metric tons per year (9 MMgy)-began production. Probitech says production there can be increased to 50,000 metric tons (15 MMgy). "The relationship between Ullrich and Probitech is very close as we are improving the technology continuously together," says Marc Andreas, who tells Biodiesel Magazine that the biodiesel produced at Ullrich's facilities meets the European EN 14214 standard. He also says that while there is no management agreement between the turnkey provider and the haulage-company-turned-biodiesel-producer, there is a technical service agreement in place.

Clearing a Couple of Different Paths
Many independently owned trucking firms in the United States may not be equipped to absorb the high capital costs needed to develop sophisticated refineries like the two facilities Ullrich had Probitech and STH Engineering build, even though the return on investment comes in the form of practicality and savings. However, there are less-capital-intense options to consider. Area-specific trucking operations could form a cooperative and share the costs of designing, building and operating a biodiesel production facility. Perhaps not everyone can afford an equal share in such a project, but if larger groups contribute more and the smaller groups contribute what they can, what results is a fair system of getting out what has been put in. If that isn't an option, a small fleet manager of a trucking outfit might consider a less robust fuel-refining system capable of handling cheap feedstocks.

Cheryl Haas of Haas Converting LLC, a start-up business based in Wisconsin, tells Biodiesel Magazine that her company makes relatively low-cost, low-volume conversion units. "Our company manufactures biodiesel processors for farmers, individuals or companies," she says. "One processor can produce 300 gallons per day. It's made from biodiesel-compatible stainless steel with high quality and safety standards." A "day" consists of a two-hour stint of operating time, she says. Haas is reluctant to divulge the cost of her converter because the company is in the midst of a marketing arrangement. "If we had to put a number on it, I'd say $30,000-approximately," she says. If cheaper waste oils are used, biodiesel can be made for about $2 a gallon including maintenance costs using the conversion unit. In order for her company's processors to handle waste stocks, an add-on option would be required, which would come at an increased cost.

If trucking companies are interested in small-scale conversion systems, a simple design can even be handed to local contractors for relatively little cost so long as low volume and simplicity are desired. While some may question the legitimacy of or the quality of product from small-scale operations like these, they provide at least a partial opt-out strategy from a fuel system of questionable pricing practices, sustainability and supply.

Marc Andreas says the Ullrich family trucking business was originally motivated to use B100 in its growing number of fleets because of the positive environmental aspects associated with the fuel-lower harmful emissions and biodiesel's carbon-neutral status-but began producing its own biodiesel for the cost-savings. "The use of biodiesel is widely accepted by the trucking industry, as there are still financial advantages," Marc Andreas says. "As the nonregenerative energy resources are limited biodiesel is very important for the energy mix."

Ron Kotrba is a Biodiesel Magazine staff writer. Reach him at [email protected] or (701) 746-8385.
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