WEST PALM BEACH, Fla. --Gas station owner Eric Schreiber is planning on spending $30,000 or more on something he hopes he will never have to use. A backup generator to power 12 pumps at his Oasis Main Street Market Texaco in West Palm Beach, Fla., is not a good investment, he admits, even if it will help alleviate motorists' frustrations in the aftermath of a hurricane.
For starters, unless another string of storms hits South Florida, there is no guarantee he would ever use it, and stations only make a small amount of their money on fuel. It could take 20 [image-nocss] years for him to recoup his investment, he said. Still, he has agreed to participate in a city program announced by Mayor Lois Frankel on Tuesday that would give him a $5,000 grant to defray the cost, reported the South Florida Sun-Sentinel.
While West Palm Beach is using the carrot approach to get more generators at stations, other South Florida municipalities are wielding a stick, said the report. Officials have not forgotten the long waits for fuel after Hurricane Wilma, the report said, and some municipalities already have mandated generators at stations. Others, such as Boca Raton, are waiting to see what new requirements Florida legislators will pass in the coming weeks.
I don't necessarily think as a station owner we're looking at it as a return on investment, Schreiber told the newspaper. I hope for 50 years we never use the generator. If it happens, you know time will tell what my return on investment will be. If it takes 20 years, it takes 20 years.
West Palm Beach's program may be the first of its kind in the region, said the report. This is the first we're aware of, Florida Power & Light spokesperson Mark Falasca told the paper. FP&L will be installing the generators.
Here's how it works, according to the Sun-Sentinel: Stations along evacuation routes or those with 12 pumps or more would get $5,000 toward a generator. Others would be eligible for 10% of the generator costs up to $5,000.
The city has set aside only $50,000 for the program, said the report. That is not much, it added, considering there are more than 40 stations in West Palm Beach and only a few already are equipped with generators.
The U.S. Business Administration will guarantee up to 85% of loans for generator purchases in case of default, John Dunn Jr., an agency loan officer, said during a gathering at Schreiber's station.
Owners have until May 31 to apply for the city money.
In January, Hallandale Beach commissioners passed a law requiring stations to have generators within the next three years, the report said. In Parkland, commissioners tentatively passed a similar ordinance in February. Last week, a bill mandating some stations to have generators cleared a state Senate committee. The bill, sponsored by State Senator Steve Geller (D), would require station owners with more than 10 stations in a county to have at least one generator to power a station. Stations within a half-mile of evacuation routes and those that are newly built would have to have generator-ready wiring.
Depending on the size of the station, a generator can cost as much as $80,000, said the report.
Mike Huey, general counsel for the Florida Petroleum Marketers & Convenience Store Association, has argued against mandating generators. After a storm, most stations do not have more than a day's worth of fuel supply. It does not make sense for an owner to spend the $60,000 or $70,000 a generator cost when they might not have any gas, he said in February.
Stations only make six to 10 cents on each gallon of a gas they sell, Schreiber said. The large oil companies make the majority of the money on fuel. In light of their record profits and high gas prices, Schreiber said they should pay.Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.