Propel continues CA E85 build-out, awaits USDA blender pump plan

By Kris Bevill | March 10, 2011

California-based Propel Fuels, a renewable fuels retailer that owns and operates approximately 21 E85 and biodiesel-blend filling stations in California and Washington, is moving ahead with plans to build out an additional 75 stations in California this year and expand its retail offerings to include other West Coast states. In addition to offering E85 and biodiesel to consumers, the company is also exploring opportunities with state and federal agencies to expand its offerings to include blender pumps. Jim Iacoponi, Propel’s vice president of operations, said the company’s goal is to provide “the widest range of renewable fuels to the motoring public,” beginning in California and growing to include Washington, Arizona and other states eastward.

Blender pumps are widely considered to be the most effective option for increasing ethanol’s share of the transportation fuels market. Because they dispense a range of ethanol blends, they are also viewed by many as being the most consumer-friendly option for increased ethanol blends. The USDA threw its support behind a much-needed expansion of blender pumps last fall, committing to aid the private sector in the installation of 10,000 blender pumps throughout the U.S. by 2015. But details on the agency’s plan since the initial announcement have been few. Judith Canales, USDA administrator for rural business and cooperative programs, recently visited one of Propel’s retail stations in Oakland, Calif., but failed to provide any specifics regarding the potential roll-out of the 10,000-pump program, choosing instead to focus her comments on the Rural Energy for America Program. “The USDA is committed to helping improve the economy and quality of life in rural America and we believe a strong renewable fuels industry, including convenient access to these fuels, is critical to this goal,” she said.

Iacoponi said that while Canales referenced the pump program only in general terms, he believes the agency remains committed to the program. “My sense was it’s clearly something that’s on the USDA’s radar, [possibly] extending the REAP program to include renewable fuels infrastructure. That’s my intuition,” he said.

Propel’s previous experience with public-private partnerships to install renewable fuel pumps seem to clearly qualify it as an ideal candidate to pair with the USDA for the blender pump program. The company received $10.9 million from the U.S. DOE and the California Energy Commission last August to support its plan to install 75 retail renewable fuels stations in the state by the end of this year. Iacoponi said that project remains Propel’s main focus, but the company is also seeking ways to expand its business to other states in need of access to renewable fuels. “We would hope that as we are successful in our California build-out this year that we could also be launching into markets in either Arizona or in Washington or possibly Oregon by the year’s end,” he said. “We think that would be outstanding.”