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Industry should partner with bus co's over biofuel

"Oil industry should partner with bus companies over biofuel roll-out"

The upcoming regulations on biofuel sales are a prime opportunity for oil companies to partner with bus companies to introduce new fuels and infrastructure, says a local biofuel expert.

Elizabeth Yeaman of EECA says bus companies are unique within the transport industry as their fleet usually fills tanks at private depots rather than on the road.

This "boutique" environment gives control over supply and infrastructure, providing ideal conditions for trialling a new fuel energy source, Ms Yeaman says.

The Government is currently considering legislation that will mean all oil companies in New Zealand will have to start selling a minimum percentage of biofuels for transport under a Biofuel Sales Obligation (BSO). At present only Mobil and Gull sell biofuel blends at the pump to the general public.

The Biofuel Bill proposes biofuels must make up 0.5% of combined petrol and diesel sales and by 2012, the figure rises to 2.5%. It is up to the companies how they achieve these obligations.

Ms Yeaman, who was a guest speaker at the recent Bus and Coach Association annual conference and sparked robust debate, says bus transport is a "classic niche market".

"It is the only road transport market in New Zealand that isn't reliant on petrol stations. This provides an opportunity for oil companies to do something different from other parts of the transport sector.

"The provision of biofuels also has a nice tie in with how the bus industry is promoting itself: sustainable transport and tourism."

* *
*Case Study: Christchurch bus company biofuel trial*

Some New Zealand bus companies have previously embraced the use of biofuels but the lack of infrastructure and rising cost of some biofuels provided a barrier.

Brent Early, Managing Director of Christchurch-based Leopard Coachlines Ltd, trialled biofuel blends across his entire fleet of 100 buses for a year in a joint partnership with Environment Canterbury. This followed a six-month trial of two buses.

Mr Early says he was initially sceptical of whether his buses would perform as well on biofuels but encountered no problems with performance plus his modern fleet required no special modifications, apart from new filters at the pumps.

However, he did encounter prohibitive costs that led to Leopard going back to regular fuel except for two of its inner-city buses.

Mr Early began the trial by using recycled vegetable oil but supply proved too unreliable so he switched to tallow (animal fats) but that soon doubled in price to about $1,000 a tonne. The tallow was then supplemented with palm oil from Malaysia, a source Mr Early was not comfortable with due to the possibility of impacts on rainforests.

In addition to the difficulties in sourcing biofuel, Mr Early had to wear significant costs in storing, blending and heating the biofuel (tallow requires heating to avoid solidification).

"I basically had to fund a near fulltime position a very expensive overhead."

Mr Early said the infrastructure had to be put in place plus a reasonably-priced, sustainable and reliable source of biofuel made available before the industry could be expected to convert.


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