When fleets store fuel, the value of that fuel lays in the value of the work the fuel helps them done. The value is in them being able to get business done.
Fleet decision makers have to view this fuel storage within the context of what’s going to keep their operational costs lowest. A fleet or a transportation company isn’t going to stored fuel for a year just for the sake of it. Fuel storage has to bring direct value to them.
Balancing fleet expenses with fuel savings
Most fleets can’t get away completely from storing fuel. The questions they have to reconcile are how long is economical for them to store the fuel, how much of it to store, and how to make sure it’s going to do what they need it to do, when they pull it out of storage for use.
How long can fleets store fuel?
Just like fueling stations aren’t going to store gasoline for 6 months, fleets don’t want to keep stored fuel around any longer than is needed. They will have a good idea of how long that needs to be.
When making these decisions, operations management have to balance up-front fuel expense considerations – the PM expenses of any potential fuel additization, labor cost for fuel quality management, tank maintenance, regulation compliance - with the value of back-end savings – reductions in maintenance costs, the value of having fixed fuel costs. It’s a tight rope that fleet managers have to walk consistently.
Tank Maintenance and the Costs of Compliance
Used in fuel storage, both above-ground (AST) and underground (UST) tanks have rules and regulations that are monitored by the EPA because of the perceived environmental threats posed by keeping stored petroleum around for long periods of time. This may even include the cost of things like cathodic corrosion protection. So there are inherent costs to get abreast of these regulations, all of which have to be factored into the ROi equation.
Keeping Fuel Around Vs. The High Cost of Fuel
If other financial considerations aren't oo onerous, fleets can use fuel storage as a hedge against volatile fuel prices. We saw some of this in 2022, when diesel prices skyrocketed to levels not seen in more than a decade. When fuel prices are high, or when they are volatile, there can be value in achieving cost stability for fleets by keeping a certain amount of stored fuel around. Provided the fuel is purchased when the costs are lower. And, importantly, the fuel is properly maintained (including additization) so its condition stays stable and ready for use.
Protecting Fuel Through Additizing
Diesel fuels used to be able to be stored for 6-12 months or more with no expectation of problems. Actually, that's underselling things - several decades ago, users like the US Army would expect to get 3-5 years of good storage life form their diesel fuels. All of those are longer than most fleets really need from any fuels they store.
Since today's fuels have changed to ULSD – with its inherent instability, affinity for collecting water, and increased sensitivity to microbes – effective diesel storage life is much shorter now. So anyone (fleet or not) storing fuel with the expectation of future use will need to additize their stored diesel.
What do they need to use? Fuel biocides to keep microbes at bay. Diesel stabilizers stop the fuel fropm reacting with environmental actors in order to keep its condition stable and usable. Water control agents are most appropriate for fleets that don’t store fuel for longer than 3-4 weeks.
Any of this type of fuel treatment is an extra upfront cost, to be sure. Most fleets don’t like upfront costs unless there’s obvious value that they’re getting from it. The obvious value is this - it’s far less of an expense to protect fuel with biocide and stabilizer than to pay for dealing with the problems that are seen from not doing that.
Fuel Storage Recommendations from the top
Major petroleum suppliers like Chevron are also getting in the act when it comes to recommending best practices for the fleet customers who use their fuels.
- Purchase clean dry fuel from a reputable supplier and keep the stored fuel cool and dry. The presence of free water encourages the corrosion of metal storage tanks and provides the medium for microbial growth.
- Add an appropriate stabilizer that contains on anti-oxidant, biocide and corrosion inhibitor.
- Use a fuel quality management service to regularly test the fuel and, as necessary, clean it through filters and add fresh stabilizers.
- Install a dedicated fuel quality management system that automatically tests and purifies the fuel and injects fresh stabilizer.
