Beginning of the Blender Pumps

A grassroots biofuel revolution that's been brewing in South Dakota for years is on the verge of sweeping the country. Ethanol blender pumps, considered by many as a means to increase the demand for ethanol while reducing America's dependence on foreign oil and mitigating high gasoline prices, are popping up in various Midwest locations.
By Erin Voegele / Photos by Susanne Retka Schill | August 04, 2008
Inspired by fuel pumps capable of blending No. 1 and No. 2 diesel, a group of South Dakotans wondered whether it would be possible to blend ethanol and gasoline in the same manner. In the mid 1980s this group, which included Owen Jones, Orrie Swayze and Merle Anderson, who retired from farming 16 years ago and lobbies for ethanol interests, met while serving on the original board of the American Coalition for Ethanol. Together with Allen Kasperson, an engine specialist who has been working with ethanol for nearly 30 years, they began exploring the possibility of blending ethanol and gasoline at the pump. "Many of us had been doing our own splash blending for some time," Swayze says, referring to the fact that he, and others in South Dakota, had been blending E85 and unleaded fuel in the tanks of their vehicles for years. Swayze is a founding member and past president of the South Dakota Corn Growers Association and farms near Wilmont, S.D.

Jones, who serves as the ACE treasurer and is part owner in Penrhos Farms in Britton, S.D., approached Dave Andresen, manager of the 4 Seasons Co-op in Britton, S.D., with the idea. After bringing the matter to the co-op board, they decided to push ahead. The co-op contacted WestMor Industries LLC, a Morris, Minn.-based supplier of fuel blenders and dispensers, who agreed to install the pump.

In March 2006, the first ethanol blender pump in the nation was in operation at the 4 Seasons Co-op. "We knew at the time of the installation it was a ground-breaking situation, and we certainly had no idea what lay ahead of us," Jones says.

The pumps give consumers a choice, Swayze says. That's especially important today as E85 and other midlevel blends are priced lower than regular-unleaded gasoline. According to Kasperson, the pumps also stimulate the local economy because many of the stations work with local ethanol suppliers.

Ethanol blender pumps are designed to use existing technology in a new way. Similar pumps have been used for years to blend unleaded gasoline and premium gasoline into a mid-grade product. What is new is that the equipment is now being used to make midlevel ethanol blends such as E20 or E30 available to consumers.

Although the technology isn't new, there were some concerns about using a single hose to pump different levels of ethanol blends. When a retailer offers regular unleaded gasoline, E10, E30 and E85 through a single hose and someone fills their tank with fuel, two-tenths of a gallon of fuel remains in the hose after each fill. If one person uses the pump to dispense E85, and the next uses the pump to purchase regular unleaded, the person trying to dispense regular unleaded will deposit two-tenths of a gallon of E85 into their fuel tank. This probably wouldn't impact a vehicle tank, but a smaller amount of fuel for use in a motorcycle or lawnmower could cause problems.

This problem can be avoided by using a multi-hose configuration. "We'll set them up so unleaded and E10 are always in a separate hose, away from the higher blends of ethanol," says Steve Kleespies, WestMor Industries' field service manager. "By making sure we never run E85 in the same hose as the straight unleaded or E10, we've eliminated that problem."

<strong>UL Certification</strong>
As the blender pumps and pumps dispensing E85 started to catch on, they attracted the attention of the Underwriters Laboratories Inc. In October 2006, UL suspended its authorization to use the UL seal on components used in devices dispensing fuels containing more than 15 percent ethanol. Currently, no blender pumps or fuel dispensers are approved by the UL for E85 or any fuel containing more than 15 percent ethanol.

Dresser Wayne Inc., a Texas-based fuel equipment supplier, has submitted fuel dispensing equipment that meets the specifications and guidelines recommended for E85 for UL approval. The equipment is made using stainless steel and nickel plated metals rather than aluminum and aluminum alloys. Rubber components and seals have also been upgraded to materials capable of resisting the corrosive nature of E85. "Basically anything that touches the fuel is different," says Scott Negley, Dresser Wayne's director of North America project management. "We are probably within a month now of having a UL approved E85 dispenser." Until that happens, numerous states have allowed gas station owners to use standard fuel dispensing equipment to allow the sale of E85 and midlevel ethanol blends before UL approved equipment becomes available. The South Dakota Department of Weights and Measures was one of the first agencies to face the issue. Knowing UL approval was being addressed, the department chose to allow the use of standard equipment so long as the pumps are proven to dispense accurately. A position paper outlining specific requirements and recommendations was also supplied to station owners. In Kansas, a pilot program administered by the state's Department of Agriculture is giving station owners the opportunity to install ethanol blender pumps. As part of the program, the pumps are monitored to ensure suitability and verify that measurements are accurate.

It is unclear what will happen when the UL approved equipment becomes available. Ron Lamberty, ACE's vice president of market development, says he believes in most cases pre-existing pumps will be grandfathered in, but any ethanol blender pumps that are replaced will need to be UL approved. However, it will likely be up to each state to decide how to regulate pumps already in operation.

<strong>Assistance Programs</strong>
Despite the lack of UL-approved equipment, some states are offering incentives to station owners to install the blender pumps. A grant program in South Dakota has been established to assist station owners in purchasing and installing ethanol blender pumps, with the goal of adding 100 new pumps within the next year. Station owners can receive $2,500 from the South Dakota Corn Utilization Council and an additional $2,500 from the ethanol industry to purchase the pumps.

Another program, developed by the Iowa Renewable Fuel Infrastructure Program, awards grants to stations owners in that state to help cover the expense of installing E85 dispensers, blender pumps and biodiesel dispensers. So far three blender pumps have been included in the program.

In addition, state programs in Georgia, Idaho, Indiana, Maine, Michigan, New York, Ohio, South Carolina and Tennessee are providing assistance to station owners implementing E85 infrastructure.

Station owners may also be eligible for assistance from the federal level. Section 244 of the Energy Independence & Security Act of 2007 calls for the establishment of a grant program to help retail and wholesale motor fuel dealers with the installation, replacement or conversion of infrastructure used exclusively to store and dispense fuel blends that contain between 11 percent and 85 percent renewable fuel.

<strong>Resistance and Legal Considerations</strong>
Station owners who have installed ethanol blender pumps acknowledge that some people are using midlevel ethanol blends in their nonflexible-fuel vehicles, but there have been no known consumer complaints regarding midlevel ethanol blends or vehicle damage. "The people who have had blender pumps the longest tell us they have not had a single complaint or warrantee issue," Lamberty says.

Although the U.S. EPA has ruled that it's legal to sell midlevel ethanol blends for use in flexible-fuel vehicles, it is illegal to use fuel containing more than 10 percent ethanol in standard vehicles. In a letter written to the South Dakota Petroleum and Propane Marketers Association in November 2006, Margo Tsirigotis Oge, EPA's director of the Office of Transportation and Air Quality, wrote that while the sale of midlevel ethanol blends for use in flexible-fuel vehicles is legal, "the use of such blends in gasoline-only vehicles is prohibited under the Clean Air Act. The retailer who has variable ethanol percentage pumps may be liable for causing such violation, whether the misfueling occurs at self-serve or full-serve pumps."

"We are actively investigating and inspecting retail outlets to determine if fuel containing more than 10 percent ethanol is being introduced into vehicles designed for gasoline only," says Erv Pickell, team leader for EPA Fuels Enforcement. "We expect to continue to perform such inspections and investigations, including where we get tips about specific stations possibly having violations."

The U.S. DOE's Web site clarifies that research is underway to find out whether midlevel ethanol blends can be used legally in standard nonflexible-fuel vehicles. For midlevel ethanol blends to be approved for use in standard vehicles, the EPA must approve a waiver to the Clean Air Act that classifies the blends as "substantially similar" to gasoline.

As the blender pumps become more popular, some resistance has surfaced from small-engine manufacturers and dealers, who worry that pumps could be mislabeled. They also wonder what station owners are doing to prevent people with nonflexible-fuel vehicles from using fuel containing more than 10 percent ethanol. Kris Kiser, the Outdoor Power Equipment Council's vice president of public affairs, says his organization is concerned about product failures, safety issues and engine build-up. "The last thing we want is E30 in any product not designed for it because it presents a safety risk to the user and a risk to the equipment," Kiser says. He goes on to explain that his organization is "not anti-ethanol, but what we don't like is a proliferation of different kinds of fuels."

CHS Inc. requires that all ethanol blender pumps located at Cenex branded retail sites be clearly labeled that the fuel is for use in flexible-fuel vehicles only. "Our decaling reads that any alternative fuel blends are for dispensing only in flexible-fuel vehicles, it is a requirement not a recommendation," says Doug Dorfman, CHS manager of marketing and retail development. "Any mis-fueling would be a violation of the federal Clean Air Act."

It is imperative that station owners label their blender pumps properly and accurately. It is also important to educate consumers about the fuel. Even though many people are using midlevel ethanol blends in their regular vehicles without experiencing any problems, it is currently illegal and will negate the manufacturer's warrantee on the vehicle.

<strong>Looking Ahead</strong>
While the small-engine manufacturers are skeptical, station owners are pleased with the response they've received once the blender pumps were installed. Since the ethanol blender pumps were installed, the Watertown, S.D.-based Sioux Valley Co-op has experienced a reduction in sales of regular unleaded gasoline, while sales of E10 have remained consistent and sales of E30 and E85 have increased each month. "We are happy with it," says Gary French, Sioux Valley Co-op's manager. "If we were to acquire another stationor build another stationwe would definitely put in the same type of pumps we have at our other four locations."

Other stations have experienced similar results. "We've seen quite an increase in sales," says Tammy Satrang, controller at the Britton, S.D.-based 4 Seasons Co-op. "Not just in sales through the blender pump, but gas in general at our facility. We have a lot more traffic coming through our station, a lot more customers just because the blends are offered here."

Since the installation of 4 Season Co-op's ethanol blender pumps, dozens of Midwest stations have begun to implement the technology. According to Kleespies, WestMor Industries has seen a sharp increase in interest during the past 16 months, selling approximately 50 ethanol blender pumps during that time. Considering Minnesota's plan to require the sale of E20 fuel, and various state programs being developed to encourage the growth of E85 infrastructure, it is clear that the use of ethanol blender pumps will become more widespread.

<em>Erin Voegele is an Ethanol Producer Magazine staff writer. Reach her at <a href="mailto:evoegele@bbiinternational.com">evoegele@bbiinternational.com</a> or (701) 373-8040. </em>