Eugene Weekly : News : 12.23.04

Green Gas
SeQuential opens retail biofuels filling station.
BY SARAH MAZZE

Even George Bush has talked about ethanol, but it's tough to fill up a tank with the domestic, renewable fuel in the Pacific Northwest. Oregon's only stations providing E85, or 85 percent ethanol fuel, are at the Department of Administrative Services (DAS) filling stations in Salem and Portland, and those offer government access only.

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That will change this August, when SeQuential Biofuels opens a filling station just outside Eugene city limits on McVeigh Highway. The site will be the first in the state and among the first in the region to provide retail E85, which only works in "flex fuel" vehicles, to the public.The station will also offer E10 and biodiesel blends at a site with a slew of eco-friendly features.

"I'm getting phone calls every week from people buying flex fuel cars asking if they can buy [E85] gas from us," said Dan Clem, DAS fleet manager, whose stations can't sell to individuals. Once SeQuential's biofuel pumps and green-roofed convenience store replace the dusty construction site, Clem will have a place to refer those callers.

THE STATION

SeQuential used an EPA grant to clean up the brownfield where the station will be located, just off the 30th Avenue exit of I-5. Lane County's first permitted commercial green roof will top the convenience store, which will sell local products and offer a selection of Sweet Life goodies and coffee. Outside, a farm stand will market local organic produce.

A bioswale, in combination with the living roof, will absorb water from up to a one-year storm event. Gas stations have particularly nasty runoff, which the bioswale will filter before it reaches the stormwater system.

A 33.6 kilowatt, 144-panel solar array will shelter the pumps and provide up to half of the station's electricity. And the convenience store design takes advantage of passive solar heat and lighting to reduce energy needs. Ian Hill, managing partner of SeQuential, guesses that the store will go up to three-quarters of the year without heating or cooling.

Although the original plans called for living wages for the attendants, the final budget gives people working in that position $8.25 an hour with some benefits. "In the end, it's just a gas station," Hill said. "Paying people $15 an hour with benefits is not tenable with the type of revenue we'll have."

Hill hopes that students of LCC's Renewable Energy Technician Program will work as attendants in exchange for connections and experience in the renewable energy field.

THE MARKET

As fleet owners, the government has an opportunity to drive the biofuels market. So far, the state is taking the lead on ethanol. But a new policy complicates matters by directing state government to run the vehicles as cheaply as possible — which at times could rule out ethanol. Currently, E85 costs around $4 a gallon, compared to about $3 for gasoline.

The DAS motor pool rents and leases vehicles to nonprofits and government agencies, including the UO. Of those vehicles, 458, or 12 percent of the fleet, are flex-fueled, meaning they accept E85. Most cars will only run on up to 10 percent ethanol (E10).

DAS plans to have its Lane County vehicles fill up with E85 and biodiesel at the new SeQuential station, thanks to the governor's commitment to lower net emissions.

Clem still intends to fill up rentals with E85, but agencies that DAS leases to may follow state policy more strictly and use regular gasoline when E85 is more expensive.

The county, on the other hand, has only invested in a few flex fuel vehicles and does not expect to use E85 in the near future. Ron Gernhardt, Lane County's fleet services purchasing specialist, explained that the county has already invested in capital and maintenance costs for its gasoline and diesel filling station – taxpayer money he doesn't want to waste by purchasing fuel elsewhere. With only a few flex fuel vehicles, Gernhardt can't justify the cost of installing an ethanol tank at his station. Tipping fees, rather than taxes, fund the waste division, and that fleet uses 5 percent biodiesel, he said.

The City of Eugene, which has used 20 percent biodiesel throughout its fleet for several years, plans to switch the remainder of its fleet to E10 by year's end. Like the county, it only has a few flex fuels and doesn't want to add a tank for E85 or pay retail prices for filling up outside its on-site station.

SeQuential Biodiesel believes that about 60,000 flex fuel vehicles are registered in Oregon. Some of their owners may not know about their vehicle's capability to use renewable fuels. Some flex fuels have a leaf emblem on the back; others note compatibility with E85 next to the gas cap. Other flex fuels are only identifiable by the Vehicle Identification Number (VIN), a service that SeQuential will offer at the station.

Any diesel vehicle can run on biodiesel. Until the station opens, biodiesel is only locally available by delivery, at cardlocks and twice weekly from SeQuential's mobile biodiesel pumps.

The biodiesel sold at the station, which Hill estimates will reach about a quarter of a million gallons a year, will come primarily from the million-gallon SeQuential Pacific plant in Salem. The plant processes fuel from local waste-grease and soon will use canola seed grown and crushed in Eastern Oregon.

With few ethanol plants in the Northwest and none in Oregon, SeQuential will rely on the Midwest for now, where processors make ethanol from corn. However, the fuel can also be made from wood or agricultural waste, both of which are abundant in our region.

With no local history of retail ethanol sales, the station's prospects are hard to predict. "It's great that SeQuential is taking some risk," said Dan Clem of DAS. "It's an emerging market."