Bulk fuel installations
Diesel is the lifeblood of a truck operator’s business, so having your own bulk fuel storage makes sense in so many ways. We guide you through the task of specifying a fuel installation.
The March 2012 fuel-tanker drivers dispute that threatened to halt fuel distribution served to underline what is arguably the key advantage of having your own on-site stock of fuel. It can be summed up in a single word – resilience. “Many hauliers have little or no ability to store fuel beyond what they normally use on a day-to-day basis, so any shortage of supply would have an immediate impact on their businesses,” said the Road Haulage Association, commenting on the prospect of fuel supplies being interrupted.
Installing a complete 50,000-litre bulk fuel installation – appropriate for a typical 25-vehicle fleet - is likely to cost in the region of £40,000. It is not hard to justify that expenditure purely for strategic business reasons but it can be self-funding too. If you take full tanker-load deliveries you pay on average around 2p/litre less than the typical fuel-card price. A fleet of 25 tractor units consumes two million litres of fuel within two years, and with each litre saving 2p, would recoup the £40,000 within that period.
The luxury of your own on-site supply also allows you manage fuel purchases to own advantage, staying out of the market when prices are high and stocking-up ahead of duty rises, for instance.
It is only fair to point out that an on-site fuel installation involves some less positive aspects too, such as environmental responsibilities, security and management issues, plus the cash-flow implications of tying up so much money in fuel.
Once you opt for on-site bulk fuel storage, there are three strategic decisions to take. First, there is the question of tank capacity. There are no firm guidelines on this, but Kevin Powell, sales director at big tank supplier Ledbury Welding and Engineering, says that two weeks’ usage is often regarded as the minimum capacity and four weeks’ supply would not be unusual. “Operators are definitely choosing to hold more fuel these days for strategic reasons, so tank sizes are going up,” says Powell.
Both LWE and another big tank supplier, JA Envirotanks, reckon that the most common size they supply to truck operators is around 50,000 litres. This is sufficiently large to accept a full tanker load – around 36,000 litres – with a safe stock still remaining. The next question is how much money to spend. Fairly basic kit will refuel trucks but is it worth spending more on sophisticated monitoring and management equipment that offers lots of extra features?
“Buy what is appropriate to your throughput of fuel,” is the advice from Martyn Gent, sales director at Cameron Forecourt, a big supplier of turnkey fuel installations. “If you have a throughput of a million pounds of fuel each year, don’t cut corners when it comes to managing that.” That means choosing equipment that gives tight control and maximum visibility of stock levels and fuel issues. He urges operators to consider the consequences of equipment breakdown, emphasising that reliability and durability of hardware such as pumps should never be compromised.
The final decision concerns choice of supplier. It is possible to source all the key components – tank, pumps, fuel-island controllers and fuel management software – independently. The challenge of co-ordinating that lot is considerable. “We find people prefer to deal with a single supplier these days,” observes Barry McLeod, sales and marketing director at Blackburn-based fuel management equipment company Triscan Systems. That passes responsibility for sourcing all various components to just one of the suppliers, such as the tank manufacturer or the supplier of the software or fuel controllers. The key point is making sure each component supplier is comfortable working with the others, paying particular attention to the interface between them such as wiring and communications.
The other purchasing alternative is to use a company such as Cameron Forecourt, which manufacturers none of the system’s components but specialises in pulling all the strands together to provide a one-stop-shop for a turnkey system.
You may also need some civil engineering work, perhaps preparing a concrete pad for the tank or constructing a fuel island for the pumps. A pad for a typical 50,000 litre tank will probably cost around £6,000. Your chosen supplier will have preferred civil engineering contractors in your area and should advise on this.
Rules and Regulations
The Control of Pollution (Oil Storage)(England) Regulations 2001 govern the storage of diesel in quantities of over 200 litres on commercial premises. The Scottish Environment Protection Agency published similar legislation in 2006; Northern Ireland published its version in 2010. So far, the Welsh Government has not followed suit.
The regulations cover the basics such as tank placement, the size of the bund and tank design. The Environment Agency also publishes Pollution Prevention Guidelines (PPG). These are more detailed and contain sound advice about specifying and managing bulk fuel installations but do not carry the force of law. However, in the event of a fuel spillage that threatens a water course, any company that has not followed the PPG will find it difficult to defend themselves against prosecution by the Environment Agency. The clean-up costs of such spillages are also considerable. PPG 2 is the principle guide covering most bulk refuelling installations.
PPG 3 is devoted to oil separators (sometimes called interceptors) that prevent any surface water contaminated by oil or fuel from entering the drains until the oil/fuel has been separated. Most truck yards should already have separators built into their drainage system. However, if installing a bulk fuel tank you need to check that the existing separator is the right type, big enough and in the right place for the new installation. Installing a new separator will cost £15-20,000, so this is a key decision to get right. Seek advice from the Environment Agency if unsure.
Tanks may be made from either moulded plastic or welded mild steel. Plastic tanks range from around 1,000 to 20,000 litres. Steel tanks usually start at around 5,000 litres and go right up to 200,000 litres. Steel tank manufacturers can be a bit sniffy about plastic tanks, so we sought an unbiased view from Tuffa Tanks, a Uttoxeter-based company that supplies both types. Where hauliers have the choice of either material, Tuffa reckons that 80 per cent of its customers choose plastic. Claims that ultra-violet (UV) rays in sunlight lead to degradation of the plastic are no longer valid according to Tuffa, because modern polymers are far more UV stable than they used to be. Plastic tanks should are also slightly cheaper: a 5,000-litre example, including a dispensing pump, costs around £2,500-3,000.
Once tank capacity exceeds 20,000 litres steel is the only solution. Rectangular tanks are more popular than cylindrical ones because they accommodate more fuel on a given footprint. Both shapes should have their own integrated (enclosed) bund. Reckon on a life-span of 20-30 years. Powell of LWE advises budgeting for a capital cost of around £20,000 for a typical 50,000-litre steel tank, including filling cabinet, pump, gauge, alarms and delivery to site. He suggests it is a good idea to compartmentalise really large tanks. For example, a 150,000-litre tank could be divided it into three compartments, each of 50,000 litres. All the pumps can draw fuel from any compartment but in the event of a problem, such as bacterial contamination, the affected tank can be isolated. This means that the entire fuel stock is not afflicted and vehicle refuelling is uninterrupted.
Operators are also advised to consider the risks associated with the growing proportion of biodiesel in our normal (EN 590) diesel. This can now contain up to 7% biodiesel and by next year all diesel must have a bio-content of at least 5%. Biodiesel has a propensity to absorb water, such as condensation, which then sinks out of the fuel and collects in the bottom of the tank. The interface between this water and the fuel above is a breeding ground for bacteria that grow into organic lumps that block filters in dispensing pumps and vehicle fuel systems.
One solution adopted by tank manufacturers such as LWE and JA Envirotanks is to construct the tank with a floor that slopes down to a separate sump. Any water – heavier than the diesel - will find its way to the sump, remote from the fuel pick-up pipe. The interface between the water and fuel is also small, so bacterial growth should be localised in the sump. A pipe from the top of the tank runs down to the sump, so its contents can be sucked out periodically. Diesel bio-content is likely to increase to around 10% in the coming years, driven up by the EC’s Renewable Energy Directive. “The sloping floor design future-proofs the tank by reducing the risk of fuel contamination,” says JA Envirotanks’ general manager Simon Proctor. It adds £2,500-£3,000 to the cost of a typical JA Envirotank 50,000-litre tank.
Dispensing pumps are almost certainly the weakest point in any fuel installation: they have the most moving parts and are most vulnerable to accident damage.
Small pumps delivering 50-70 litres/min and costing around £400 are adequate for modest fleets of vans or light trucks but are neither fast enough nor sufficiently durable for intensive use where a series of trucks is drawing several hundred litres each. That calls for tougher, faster, heavy-duty pumps, costing £2,000-2,500 apiece. These should provide 10-15 years of reliable service. “People usually ask for the fastest pump available,” comments Gent of Cameron Forecourt, “but there are some practical limitations.”
Cars and vans have small filler necks that restrict the size of the nozzle, limiting fill speed to no more than about 70 litres/minute. Garage forecourt pumps for cars usually work at 45-50 litres/minute. The fastest heavy-duty pumps can work at 200 litres/minute but frothing and the fuel tank’s breathing will often make that speed unachievable. Flow rates of 90-130 litres/minute are reckoned to be more realistic for most trucks.
Smart pump layout can minimise refuelling delays. Although it is customary to have the pump(s) in a filling cabinet incorporated into the end of the tank, consider having an extra pump on a central island, accessible from either side. This is convenient for all vehicles, irrespective of their tank location. Failing that, delivery hoses need to be at least 3.5m long to reach to the far side of chassis. However, long hoses are more likely to become snagged or damaged, so the experts recommend the use of retractable reels or high-level arms that keep hoses off the ground.
It may be worth installing two pumps, even if one can handle the throughput. Accident damage or a pump breakdown will almost certainly cause serious disruption to your business, making the cost of the second pump look like money well-spent. A lightweight pump would suffice as a short-term stand-by until the main pump is up and running again.
Accurate pump metering is crucial for really close control of fuel stocks: even small inaccuracies accumulate to play havoc with your stock reconciliation. Good quality heavy-duty pumps include air-separation, improving their metering accuracy. The best pumps achieve plus or minus 0.25%, equivalent to 50ml in 20 litres, the standard needed for the resale of fuel. Expect accuracy of plus or minus 1.0% for smaller, cheaper pumps.
Tank gauging and stock control
Accurate fuel management depends on the close reconciliation of two stock figures: booked stock (the theoretical total, as calculated by the fuel-management system’s record of fuel issued and delivered) and ‘wet stock’ (the actual volume of fuel in the tank). Any discrepancies indicate fuel loss.
There are only four possible causes for fuel loss: inaccurate pump calibration; leakage; short-deliveries or theft. All are cause for investigation. “You should never rely on the booked stock figure from the fuel management system” says Gent of Cameron Forecourt. “A good tank gauge is absolutely essential.” Dipsticks are inherently imprecise because they fail to take account of temperature-related expansion of fuel. Dipsticks also require somebody getting on top of the tank: risk assessments normally advise against that.
Hydrostatic gauges with big, bold faces can be read from the ground - a big tick in the safety box – and nor do they need electrical power, so they are simple and reliable. They work by hand-pumping a plunger on the gauge head. This creates a pressure that is transferred by a capillary tube to a balance chamber sitting on the base of the tank. The pressure displaces the fuel from the balance chamber, so the amount of pressure required is directly proportional to the head of fuel above it. The gauge measures the pressure but displays the answer against a scale that indicates litres (or % fill).
On the plus side, hydrostatic gauges are fairly cheap, usually costing between £70 and £400.
They have a couple of limitations. First, their accuracy is normally around 1% of their full scale, which is not really good enough to detect small stock losses. Second, the absence of an electrical connection means that the information from the gauge is not going anywhere unless someone checks it and makes a manual reconciliation with the booked stock. Rather more precision (plus or minus 0.5%) is available from a tank gauge that measures the head of fuel by using an electronic pressure transducer. This relays a continuous reading to the fuel management system.
Cameron Forecourt advocates Veeder Root’s TLS tank gauge, claimed to be the most accurate available. It uses a “magnetostrictive” probe, involving a permanent magnet float that sits on the surface of the fuel, moving up and down the probe. Without going into the complex physics this system is claimed to be astonishingly accurate, capable of detecting a leak as little as 0.38 litre/hour. The software can differentiate between a small leak and fuel being drawn without the pump running, indicating that fuel is being siphoned from the tank. When the system detects a loss it can fire off an email or text message to alert the operator.
This moves tank gauging from simple stock control into automatic, real-time continuous fuel management with environmental and security functions as well. Gent of Cameron Forecourt says the Veeder Root TLS system costs around £2,000 but he has no hesitation in recommending it. “It is infinitely superior to any other system,” he reckons.
In the past it was common to reconcile wet stock and booked stock just once a month. That means rather a lot of fuel can be lost before problems are detected. And high fuel prices and the immense popularity of diesel cars means there is a far greater risk of fuel theft these days. If relying on a manual reading taken from a hydrostatic gauge on the tank, a weekly reconciliation between wet stock and booked stock should be regarded as the bare minimum. If the wet-stock figure automatically is downloaded electronically there is little excuse for not making a daily reconciliation.
Controllers and management software
Fuel-island controllers manage access to the pumps and fuel dispensing. The controller and its key pad can be either a stand-alone unit or integrated into the top of the pump cabinet. Paul Ledbury, technical director at Merridale, a Wolverhampton-based manufacturer of fuel pumps and management systems, says integrated pump/controllers are most popular with his company’s customers because they save space and are a little cheaper than separate units.
A crucial decision concerns the capture of odometer readings. The majority of operators choose a manual system, where drivers enter their vehicles’ odometer readings on the controller’s key pad. Readings must be within a predetermined range since the last entry, so faulty readings automatically are challenged by the fuel controller. However, because priority is given to drawing fuel, most systems are programmed to accept even incorrect readings if entered three times, leaving management to make a manual adjustment when sorting out the fuel issue records.
The alternative approach is using technology to capture odometer readings. Distance can be sourced from several points on the truck, such as its tachograph, gearbox or a port on the CAN-bus system. Tokheim offers a system that uses GPS (global positioning system), arguing that this is the most accurate method of measuring distance and so produces the most accurate vehicle fuel consumption figures too.
This distance data, together with vehicle/driver identification, can be passed to the fuel-controller in a variety of ways, some using touch-keys and others using contactless radio-frequency wireless technology. The big advantage of automatic data capture is that it needs no driver input and guarantees “clean” distance data. The obvious downside is cost. Capturing the data automatically usually costs £200-£250 /vehicle, whereas a combination of manual entry and a simple vehicle/driver identification key is typically no more than £10/vehicle.
Data transfer from the fuel-controller to the office computer running the fuel management software can be via a cable but wireless technology - either a GSM mobile phone link or a GPRS data link – is more common these days to avoid long cable runs.
Fuel management software provides huge amounts of information, ranging from individual vehicle and driver performance to stock reports, low-fuel warnings and fuel cost summaries. More sophisticated systems offer extra frills such as CO2 emission calculation and graphs. In order to make sense of this torrent of data it is worth checking that the software offers concise exception reports, drawing your attention to any important issues that arise. For example, some software provides automatic continuous reconciliation of wet stock and booked stock, flagging up a warning if the discrepancy becomes unacceptable. It is also worth checking to see how the software deals with inputting fuel that is drawn off-site.
Web-based fuel-management is a more recent development. This means the data from the fuel-controller goes to the software provider’s server via the internet, so there is no fuel management software running on the operator’s computer. Going web-based gives accessibility of fuelling and stock information from anywhere with an internet connection. Whether you opt for this or decide to run the software on your depot computer depends mainly on your IT strategy; some companies prefer to keep everything in-house while others believe web-based services are the future.
The main task is keeping pumps running reliably. An annual service is normally adequate, cleaning filters, checking for leaks, examining drive belts and checking meter calibration. This service should also include checks on the whole fuel installation such as inspecting the bund, checking gauges and ensuring overfill and bund alarms work. The water content in the fuel should also be assessed, along with the general cleanliness of the installation and a check that the emergency spill kit is present and correct. Expect this annual service to cost around £80-£150 for a one-pump installation.
Opinions vary about how much maintenance steel fuel tanks require, other than a visual inspection and touching-in external scratches before corrosion takes hold. A mid-life re-paint after 10 years or so might be a sound investment, particularly in a salt-laden atmosphere near the coast. One school of thought suggests that an annual internal clean is a wise precaution against the build-up of sludge, water and bacteria, particularly now that biodiesel content is being ramped-up. However, many reckon that tanks jog along quite happily for many years on a leave-well-alone policy. If you adopt the latter strategy, pay particular attention to condition of pump filters because these will probably give a clue to the accumulation of deposits in the tank. A fuel condition analysis will provide more information.
Opinions are also split over the best way to clean a tank. “There is no substitute for physically getting inside the tank and jet-washing it clean,” one maintenance contractor told us. It is typically a day’s work and costs around £1,000 (depending on tank size) including disposal of the waste. The alternative method is pumping the fuel in the tank through a stringent filtering process, hopefully flushing out the deposits with the fuel. Mark Carter of Road Flow Commercial, a Stoke-on-Trent company that carries out this process says it is more convenient because the fuel stock does not have to be run down, and it avoids the risks of personnel working inside a tank. “If the tank contains 40,000 litres we would usually pass about 65,000 litres go through our system, taking samples as we go to see the improvement in the fuel’s cleanliness,” says Carter. He quotes £700-£1,000 to clean up to 90,000 litres of fuel in this way.
Some people advocate adding a low-level dose of biocide to the fuel every few months to keep bacteria at bay. Elaine McFarlane, a Shell fuels scientist and microbiologist, disagrees, pointing out that this leads to the development of resistant organisms. She says the right approach is to drain off the water at the bottom of the tank once a month.
Birstall, West Yorkshire-based Bedfords runs a fleet of around 90 trucks and 130 trailers. One of its contracts is with Associated Newspapers, publishers of the Daily Mail and Metro. Fleet engineer Steve Hollingsworth explains that the contract stipulates that Bedfords must ensure that it has bountiful fuel stocks in order to minimise the risk of disruption to newspaper distribution. “Our tank has a capacity of 150,000 litres and we buy about 37,000 litres each week,” says Hollingsworth. That means Bedfords can hold up to a month’s-worth of fuel, giving a good margin to guard against most eventualities. Nor does the company stint on the management system needed to control that fuel, using Triscan’s Apollo fuel-island controller and Odyssey management software. Bedfords also opted for Triscan’s Kisskey system, which means that drivers do not have to enter truck odometer readings manually when they draw fuel. Instead, the distance is derived from the tachograph and transmitted to an on-board device in the cab. The driver touches the Kisskey fob on this and then on the matching pad on the fuel-island controller to communicate the reading. “It’s a fantastic system,” says Hollingsworth. “It eliminates all errors we used to get when mileages were entered manually.” He adds, “It’s a pity we can’t get the same level of accuracy when drivers use fuel cards and we are relying on cashiers at fuel stations to enter the right figures!”
Bedfords currently runs the Triscan Odyssey fuel management software on its own in-house computer, but that could change in the future. Hollingsworth says the company is looking at its whole telematics strategy and it possible that as part of that review Bedfords may switch to the web-based version of Odyssey, making its fuel stock and usage information online.
Fagan & Whalley
Paul Reyner, general manager at the big Lancashire-based haulier Fagan & Whalley checks the fuel price every day. The company has a 120,000-litre bulk diesel tank on its site in Padiham near Burney, supplied eight years ago by Ledbury Welding & Engineering. Since then, additional sites have been acquired, giving Fagan & Whalley a total fuel capacity of around 250,000 litres. Reyner says he values every litre of that capacity and ideally would like to be able to hold even more if possible.
“It allows us to play the market when we are buying fuel, holding off when prices are high and stocking-up when they improve.” Hence the daily fuel price check. He reckons the bulk fuel he purchases is 2p-3p/litre cheaper on average than that purchased by the company’s drivers using fuel cards.
The Fueltek fuel management system at Padiham depends on drivers keying-in their vehicle odometer readings, rather than capturing the data automatically. Reyner does not see that as a disadvantage. “We have good drivers and we don’t get many errors, so I don’t think it’s a problem.”
Centaur Fuel Management
Cookson & Zinn
Commercial Fuel Solutions
Environment Agency – Pollution Prevention Guidelines (PPG)
Ledbury Welding & Engineering
Titan Oil Tanks