Gas Exodus Extra: Diesel Has Its Day
With more diesel car models hitting the road, the opportunity for c-stores grows
OAKBROOK TERRACE, Ill. -- Despite the sexier flash of electric, hydrogen and natural gas, many industry watchers believe diesel has the greatest potential as a true alternative motor fuel to gasoline.
The diesel engine is about 30% more fuel-efficient than gasoline, and diesel is more energy-dense, so many automakers have ramped up diesel-vehicle production to help them meet the 36.5-mile-per-gallon (mpg) mileage target for cars in 2016, as mandated in the Corporate Average Fuel Economy (CAFÉ) standards. And unlike most of the other alternatives, diesel already has a well-developed fueling infrastructure—about one-half of fuel retail locations sell it, according to NACS.
“To get to the tough CAFE standards, boy, it’s really tough to get there with gasoline,” Tom Kloza, chief oil analyst for GasBuddy.com and OPIS, Wall, N.J., told CSP Daily News. “Diesel just helps you because it’s a bigger molecule, [and] you get more vehicles that are going to be above that 36.5 mpg.
“On the diesel side it’s very clear, and you [retailers] should consider it if don’t have it,” he said. On other alternative fuels, “it’s a little less clear.”
Meanwhile, the number of diesel cars hitting the road continues to grow. According to a recent report by the Diesel Technology Forum, a diesel advocacy group, the number of diesel registrations has leapt 30% since 2010. Illinois, Arizona and California saw the greatest percentage increases in registrations between 2012 and 2013, while diesels make up the greater percentage of registered vehicles in Wyoming, Montana and Idaho. That being said, diesel cars currently only represent about 1% of the U.S. vehicle market, or 3% when expanded to include vans and light-duty trucks.
Norman Turiano, founder of Turiano Strategic Consulting, Cape Coral, Fla., and former senior manager of fuel business development for Wawa Inc., Wawa, Pa., believes diesel will grab an increasing share of the liquid-fuel market, but says it will be an uphill battle. He points to Wawa’s experience in rolling out the fuel, when it faced resistance from many municipalities that feared it would transform the neighborhood convenience store into a truck stop.
The chain made a big effort to educate the various planning and zoning boards about the growing relevance of diesel, but even then, many still said no.
“I would say if you are trying to retrofit 100% of your sites, you may only be able to do 65% to 70% of it today,” said Turiano. “I believe that will change over time as these planning and zoning authorities become more educated on the topic, see more vehicles produced and see a landscape that looks similar to Europe, which has a high number of diesel vehicles on the road.”
Click here to read more about the changes in store for the industry as gasoline demand fades.