Download Introducing Biodiesel in the Great Lakes Recreational Marine Market

I NTRODUCING B IODIESEL IN THE
G REAT L AKES
R ECREATIONAL M ARINE M ARKET
Funding provided by the Great Lakes Regional Biomass
Energy Program and the Illinois Soybean Board.
Table
of
Contents
Background.......................................................
3
Distribution & Logistics......................................
4
Market Development.........................................
10
Outreach & Expansion......................................
14
Conclusions & Recommendations....................
17
Appendices
Appendix I -- Regulatory Analysis
Appendix II -- Presentations
Appendix III -- Advertising
Appendix IV -- Collateral Materials
Appendix V -- Public Relations
Appendix VI -- Sample Editorial Coverage
Appendix VII -- Boater and MarinaContact Database
Appendix VIII -- Market Development Activity with Marinas
Appendix IX -- NMMA Certification Test Procedures for TCW3™
GREAT LAKES Biodiesel
Market Development Program
2
Background
Background
A comprehensive market assessment process, reinforced with industry
input from a market specific task force, indicated that the recreational
marine market offers significant market penetration potential for biodiesel.
Specifically, market drivers exist for several types of boaters to purchase
premium priced biodiesel and/or biodiesel blends due to desirable attributes. Sailboaters, environmentally conscious boaters, and commercial
charter companies have all expressed a willingness to “pay more” for a
product like biodiesel.
Successful programs have been established in the Florida Keys and
Chesapeake Bay regions. The marine industry task force established by
the National Biodiesel Board recommended that marinas should become a
focus for distribution efforts because they are the primary fuel source for
non-commercial boaters.
With funding from the Illinois Soybean Board and the Great Lakes Regional Biomass Energy Program, the National Biodiesel Board, Chicago
Harbors, and Columbus Foods partnered to introduce biodiesel and
biodiesel blends to recreational boaters on the Great Lakes. The City of
Chicago, through the Chicago Transit Authority and the Chicago Police
had previous positive experience with biodiesel in 1995 and therefore were
interested in a program to introduce biodiesel to consumers. The Chicago
Harbors, which are under the supervision of the Chicago Parks District and
management of Westrec Marinas, decided to participate in the program.
The overall objective of this
project was to establish a
distribution system for
biodiesel and educate marinas and end users on the
attributes of biodiesel to
enable successful market
penetration of biodiesel in the
Great Lakes region. Specifically, the following objectives
were to be achieved:
⇑
⇑
⇑
⇑
⇑
Establish retail fuel
distribution for biodiesel in
the Great Lakes region
Develop and implement a
Police boat operating on a biodiesel blend.
customer sampling
program to introduce biodiesel to targeted boaters
Conduct a biodiesel education program for boaters on the attributes of
biodiesel and its use and handling requirements.
Educate marine groups (boating and industry) on the environmental
and operating attributes of biodiesel through presentations and representation at the annual boat show sponsored by NMMA
Leverage results of the program with other marina operators and
regional organizations
GREAT LAKES Biodiesel
Market Development Program
3
Distribution
and
Logistics
Previous experience in the Chesapeake Bay and the Florida Keys
highlighted the significance of effective distribution, full knowledge of
regulatory issues for bulk fuels, and consumer friendly packaging. Prior
to addressing these issues however assistance was provided to the
Chicago Parks District to resolve questions from biodiesel use the
previous year.
Distribution &
Logistics
During the 1997 boating season Westrec Marinas, in conjunction with
Columbus Foods, fueled three boat tenders on a biodiesel blend. Approximately one and one-half months into the test the tenders, which are
used to shuttle individuals to their boats, experienced a loss of power
and clogged filters. After repeated changes of fuel filters, Westrec
discontinued use of the fuel. The issues experienced in 1997 were
never fully resolved and confidence in the product needed to be addressed.
A meeting was held on May 6, 1998 with regard to troubleshooting the
performance of the three boat tenders fueled with a biodiesel blend
during the 1997 boating season as well as initiation of the Great Lakes
Marine Project. During this meeting, a visual inspection of a fuel filter
and a small amount of liquid that have been saved from the prior
summer’s test was possible.
Representatives of Volvo-GMC and the Parks District outlined their
issues with the use of biodiesel and the impact that it had operationally
the previous season. Two scenarios were discussed with regard to the
cause of these problems; high blend level/solvency and microbial
growth. After visual inspection of the fuel filter and the small amount of
liquid present, additional information was sought with regard to the
fueling infrastructure and the engine family that powers the boat tenders.
Specifically, information was also sought about the components in the
fueling system (composition of the filter element, fuel lines, etc.).
The fuel filter and liquid sample were sent to System Lab Services.
Based on test results, concentrations of metals in the samples were low;
well within range of what we would normally expect to see. Due to the
small amount of liquid and inability to perform other analyses a conclusive answer as to the cause of the discoloration was not possible. The
metal analyses would indicate that it was not a metals compatibility
issue. Microbial growth, sediment from the fueling system, and/or fuel
component compatibility are other potential causes of the discoloration.
Due to the length of time that elapsed since the fuel filters were pulled
from the vehicle, it would not have been conclusive to perform any tests
for microbial growth. Biodiesel, unblended, is an excellent solvent and
can release sediment and carbon buildup from the fueling system. This
could have been a cause of the discoloration. In addition, biodiesel is
not compatible with specific types of rubbers and elastomers. This also
could have been a cause for the discoloration. It was concluded that the
solvency effect of biodiesel most likely caused the filter clogging issue.
GREAT LAKES Biodiesel
Market Development Program
4
All parties agreed to move forward with the program. A follow-up meeting
was held on June 3-4, 1998, in Chicago, to complete plans for the distribution of biodiesel. Biodiesel was to be made available at four of the
Chicago Harbors managed by Westrec:
Burnham Harbor
Jackson Outer Harbor
Monroe Harbor
Belmont Harbor
………Regulatory Analysis
Initially, plans were made to offer biodiesel for sale to boaters in both bulk
and smaller containers. Specifically, consideration was to be given to bulk
facilities at Jackson Outer Harbor, but not at the initiation of the program.
An assessment of the regulatory issues associated with marketing
biodiesel in bulk form was conducted prior to initiation of the project. The
Illinois State Fire Marshal provides the primary source of regulation. The
USEPA may also play a role depending upon the size of above ground
tank that is installed at the marina. Since the Chicago Harbors managed
by Westrec are within the City limits, the Department of Environment and
the Fire Prevention Bureau must approve the site plans. However the
City has indicated, that their regulations are not up to date, accordingly,
the city will approve plans that conform to the State Fire Marshall’s
regulations. Both a permit and site plan will need to be obtained prior to
any bulk sales. Additional details are included in the full regulatory report
which is located in the appendix of this report.
Distribution &
Logistics
“Definitely
reduces
odor, no
question—
especially
pronounced
in a downwind run.”
Fred Kimmel
………Product Packaging
Biodiesel has been sold to boaters in small containers at other locations,
including five gallon buckets. The five gallon packaging had proven to be
very difficult for boaters to handle and sometimes resulted in spills.
Therefore, Columbus Foods decided to package biodiesel in 2.5 gallon
containers. In order to assist the customers, labels for the containers
contained mixing instructions. Also, the label contained other important
information such as information on the spontaneous combustion risk
associated with rags soaked with biodiesel.
Recommendations from the Chesapeake Bay program noted that any
distribution plan must include bulk sales. Customers prefer preblended
product as well as the lower costs associated with bulk vs containers.
The issue is that marina owners cannot afford to switch their existing
diesel tanks to only biodiesel at the current time. Marina owners also will
not pay the capital expense of an additional tank until profit margins and
consumer demand has increased considerably. Columbus Foods was
willing to place 300 to 500 gallon skid tanks at Chicago Harbor locations
in order to minimize financial risk for the marinas.
Prior to initiation of the program however, Westrec decided to not approve bulk sales due to problems experienced with their underground
GREAT LAKES Biodiesel
Market Development Program
5
diesel tanks during the spring season and the resulting legal considerations. Bulk sales are an item that could be considered in the future
depending upon consumer demand.
Distribution &
Logistics
………Sales Training
Consumer education is a vital part of this marketing program. In order to
deliver a consistent and accurate message to consumers, the managers
of each harbor where biodiesel was marketed went
through a training session conducted by the MARCIV. Managers for each of the Harbors were given
information about biodiesel including a FAQ page as
well as one-on-one instruction. This information will
be passed to employees of each of the Harbors.
Employees assist boaters during fueling of vessels
and had the opportunity to ask boaters if they are
familiar with biodiesel. Since marina employees were
the primary contact with customers, this training was
essential. Listed below is a sample of the FAQs that
were addressed with marina managers:
FREQUENTLY ASKED QUESTIONS ABOUT BIODIESEL
What is biodiesel?
Biodiesel is a cleaner burning fuel for diesel engines which is
produced from renewable resources such as vegetable oils. It can
be used as a pure product or blended at any percentage with
petroleum diesel. Biodiesel is simple to use, renewable, domestically produced and readily available.
Is biodiesel a new technology?
Rudolf Diesel, the inventor of the diesel engine, actually designed
the engine to run on peanut oil. However, modern diesel engines
operate on derivatives of vegetable oil or recycled cooking oil.
Biodiesel sign at Monroe Harbor.
How is biodiesel made?
Production of biodiesel results from a simple chemical process called transesterification.
Basically, esterification occurs when the feedstock oils are blended with an alcohol such as
methanol or ethanol, in the presence of a catalyst.
Is biodiesel a legal fuel?
Biodiesel is legal for commerce in the United States. Biodiesel has been registered with
the US Environmental Protection Agency as a fuel and as a fuel additive.
Can I use biodiesel in my existing diesel engine?
Biodiesel can be blended with petroleum diesel in any combination with little or no modification to the engine or the fuel system and with similar engine performance. Ensure that
only fuel meeting the biodiesel specification is used.
GREAT LAKES Biodiesel
Market Development Program
6
Does biodiesel cost more than other alternative fuels?
Distribution &
Logistics
Independent studies have confirmed that biodiesel blends are cost competitive with other
alternative fuels and in many cases represent the least cost option for users. Biodiesel use
does NOT require expensive conversions of engines nor modifications to refueling
facilities.
Will I notice any differences when I use biodiesel?
Boaters will notice a change in exhaust odor (to that of fried foods) and a reduction of
smoke from the exhaust.
Is biodiesel safe?
A flash point of over 300½ F makes biodiesel safer to store and handle than petroleum
diesel fuel.
“[I was]
ecstatic
with the
fuel.”
Bob Lurie
Does biodiesel reduce the amount of exhaust emissions released into the
air?
Biodiesel offers significant reduction in exhaust emissions to help protect our environment.
✔ Particulate Matter — breathing particulates has been shown to be a human
health hazard. Biodiesel blends significantly cut particulate matter emissions.
✔ Carbon Monoxide - Everyone knows the dangers of this pollutant.
Biodiesel blends greatly reduce the amount of carbon monoxide diesel engines
produce.
✔ Ozone Forming Potential — research documents the fact that the ozone
forming potential of the hydrocarbon emissions of biodiesel is nearly 50% less
than that of petroleum fuel.
✔ Sulfur Dioxide — This pollutant causes acid rain. Biodiesel does not
contain sulfur therefore reducing sulfur dioxide exhaust from diesel engines.
Is biodiesel better for the environment?
Tests sponsored by the United States Department of Agriculture confirm that biodiesel is
less toxic than petroleum fuel and biodegrades as fast as dextrose (a test sugar).
Where can I find more information on biodiesel?
Contact the National Biodiesel Board at 800.841.5849 or visit the biodiesel web site at
<www.biodiesel.org>.
Is biodiesel exhaust safer for people to breathe?
Polycyclic aromatic hydrocarbons (PAH) and nitrited PAH (nPAH) compounds have
been identified as potential cancer causing compounds. PAH and nPAH compounds were
reduced by 75% to 85% in engine tests completed at an independent testing laboratory.
GREAT LAKES Biodiesel
Market Development Program
7
How does biodiesel compare to regular petroleum diesel?
Distribution &
Logistics
From a practical standpoint, biodiesel’s performance in diesel vehicles is nearly identical
to petroleum diesel.
Is the cetane of biodiesel higher or lower than that of petroleum diesel?
The cetane number of biodiesel is higher than that of petroleum diesel fuel.
Are there any special considerations for the use of biodiesel?
Boaters need to be aware of the special attributes of biodiesel:
Infrastructure
In general, the standard storage and handling procedures used
for petroleum diesel can be used for biodiesel. The fuel should
be stored in a clean, dry, dark environment. Temperature
extremes should be avoided. Acceptable storage tank materials
include stainless steel, fluorinated polyethylene, and fluorinated
polypropylene. Biodiesel has a solvent effect which may release
deposits accumulated on tank walls and pipes from previous fuel
storage. The release of deposits may clog filters initially and
precautions should be taken .
Materials Compatibility
Biodiesel over time will soften and degrade certain types of
elastomers (rubber replacements) and natural rubber compounds. Precautions are needed when using high percent blends
to ensure that the existing fueling system components (primarily
fuel hoses and fuel pump seals), do not contain elastomer
compounds incompatible with biodiesel. Manufacturers recommend that natural or butyl rubbers not be allowed to come in
contact with neat biodiesel. Biodiesel will lead to degradation of
these materials. If a vehicle’s fuel system does contain these
materials, replacement with biodiesel compatible elastomers
®
such as Viton B is recommended. The recent switch to low
sulfur diesel fuel has caused most original equipment manufacturers (OEMs) to switch to components suitable for use with
biodiesel, but users should contact their OEM for specific information. Rubber is not the only material affected by biodiesel’s
solvent properties. If left on a painted surface too long, biodiesel
can dissolve certain types of paints. Therefore, it is recommended to wipe any biodiesel or biodiesel blend spills from
painted surfaces thoroughly so that the boat’s gelcoat or teak are
not affected. Contact the National Biodiesel Board to check
about specific materials compatibility issues.
Spontaneous Combustion Risk
Biodiesel soaked rags should not be stored together due to the
risk that the rags will biodegrade, give off heat, and potentially
create an environment favorable to spontaneous combustion.
GREAT LAKES Biodiesel
Market Development Program
8
Cold Flow Properties
Distribution &
Logistics
As with any diesel fuel, cold flow properties are important.
Users of a 20% blend of biodiesel will experience an increase of
the cold flow properties (cold filter plugging point, cloud point,
pour point) of approximately 1 to 3½ Celsius. Thus far, no
precautions beyond those already employed for petroleum
diesel have been needed for fueling with 20% blends. However
neat (100%) biodiesel will result in faster gelling than
petrodiesel in cold weather operations. Solutions for winter
operability are much the same as that with low-sulfur #2 diesel
(i.e., blending with No. 1 diesel, utilization of fuel heaters and
storage of the vehicle in or near a building). Biodiesel appears
to be largely unaffected by conventional pour point depressants.
Operating Performance
One of the major advantages of biodiesel is the fact that it can be
used in existing engines and fuel injection equipment without
negative impacts to operating performance. Biodiesel has a
higher cetane number than conventional diesel fuel and its use
in previous in-field demonstrations showed similar fuel consumption, horsepower, torque, and haulage rates as conventional diesel fuel.
Engine Warranties
Manufacturer’s warranties generally cover defects in material
and workmanship of the engine and its components. Those
warranties do not cover engine problems related to any type of
fuel issues, including petroleum based diesel fuel. Manufacturers usually list the types of fuels that are recommended or
approved for use in their engines. For biodiesel, the fuel is
defined by the biodiesel specification. Care must be taken to
ensure that only high quality fuel is used and that the proper
precautions are observed (materials compatibility, cold flow,
etc.) to ensure trouble free use of biodiesel.
GREAT LAKES Biodiesel
Market Development Program
9
Market
Development
Market Development
Boaters have expressed several reasons for wanting to burn biodiesel in
their diesel powered vessels because it introduces many benefits to the
boating experience. Not only does biodiesel increase biodegradability,
increase safety, and decrease emissions and toxicity, biodiesel also
allows for more pleasurable boating without costly engine modifications.
Many boaters have indicated that lack of smoke, safety, and the dramatic change in exhaust odor are significant reasons why boaters will
consider switching to biodiesel or biodiesel blends.
Marketing efforts in the marine market were focused on specific boating
groups where environmental benefits or competitive advantage are the
basis of buying decisions. The hottest prospects for niche market sales
today are: 1) commercial boat operators such as charter fishing boats,
dive boats and tour boats who would gain a competitive advantage
because riding in their boats won’t make their customers sick, 2) sailboat owners because each individual is a low volume user, and are
affected by the smell and smoke of diesel, and 3) environmentally
conscious boaters who hate the negative impacts of diesel. Buying
decisions will be made by highly motivated groups where price is secondary, or by those seeking competitive advantage where costs will be
balanced by increased revenue. Success with this market depends
upon recreational boaters understanding the environmental, operating,
and economic implications of biodiesel.
Market development activities centered on raising the general awareness of boaters about biodiesel through the use of ads, collateral pieces
available at the participating marinas, a Fuel Trial Weekend in June, and
public relations events and press releases.
……….Advertising and Collateral Pieces
Print ads were used to increase awareness among boaters. In order to
reach the largest number of boaters, marina managers were surveyed to
select the magazines that were highly regarded. A variation of the ad
used in the previous Chesapeake Bay program was utilized for this
program. Ads were
placed in two regional publications;
Lakeland Boating
and Great Lakes
Boating. Ads were
placed three times in
one publication and
four times in the
other. Ads were
changed throughout
the season to carry
different messages to
boaters. For exGREAT LAKES Biodiesel
Market Development Program
10
ample, initial ads tried to capture the attention of boaters by a catchy title
relating to the smell of the fuel. Following ads highlighted the availability
of biodiesel for the 1998 boating season. The last two ads which were
placed in the Spring of 1999 called attention to boaters that it was time
for them to try biodiesel. In addition to print advertising, several collateral pieces were utilized in the program.
Market Development
Previous experience gained from interaction with recreational boaters in the Florida Keys, Chesapeake Bay, and
other major boating regions demonstrated the need for two
types of outreach collateral; a non-technical overview of
biodiesel and a more detailed summary of biodiesel’s
attributes and special considerations for use. Although
many boaters are only interested in basic information about
biodiesel, there is a definite population of boaters that will
not use the product without significant information about the
composition of the product, its attributes, and any special
handling characteristics.
Leveraging other resources, the tri-fold brochure was
developed to be viewed by the average consumer who only
desire the highlights of biodiesel. Several messages are
stressed in this brochure:
Impacts on the environment,
benefits to the user, and
answers to frequently asked questions.
Development of the marine specific situation and outlook
report was handled in a similar manner as the tri-fold
brochure. The expanded, technical report covered the attributes of
biodiesel, availability, considerations for use, and market development
activities. The document was designed so that the ‘considerations for
use’ and ‘retail locations’ sections could be pulled from the
report as a one page reference.
Discussion of biodiesel’s attributes was technical in nature,
but written in an easy to understand manner.
In addition, banners were developed and placed at the participating marinas for the summer
and the Illinois Soybean Board
developed posters mounted on
heavy board which would serve
to hold the tri-fold brochures.
These items were also located at
participating marinas.
Biodiesel information was made available to boaters.
GREAT LAKES Biodiesel
Market Development Program
11
Market Development
……….Fuel Trials Weekend and Sales
The Fuel Trials Weekend was conducted on June 27-28, 1998. The
overall intent of this event was to get free samples of biodiesel into the
hands of recreational boaters to prove the positive attributes of biodiesel.
S&S Public Relations, a public relations firm retained by Columbus
Foods, assisted with publicizing this event. A press release was sent to
local media sources announcing the weekend event. Two radio interviews on the weekend event were conducted by MARC-IV.
In addition, material was developed specifically for the event. Columbus
Foods prepared 4 x 8 banners for each site and prepared three fold
brochures on their company. The National Biodiesel Board developed (4)
four 2 x 4 banners announcing
the availability of biodiesel at
each of the Harbors. In addition, brochure displays (developed by the Illinois Soybean
Checkoff Board), brochures,
FAQ’s, and table top displays
were utilized at two of the sites.
An initial shipment of twentyfive cases of biodiesel (100
gallons) were delivered to each
of the four Harbors.
The two-day event went quite
well at two of the Harbors
(Burnham and Monroe). There
was relatively little boating
Fuel trial weekend at Burnham Harbor.
activity at Belmont and only
slightly more at Jackson Outer.
However, according to Columbus Foods a total of 100 cases of biodiesel
(500 gallons) were distributed to boaters during the weekend event. In
exchange for a free 2.5 gallon sample of biodiesel, boaters were asked to
supply their name and address if they were willing. Two television stations carried stories on the event including one five minute segment and
an introduction to the weather on Saturday evening.
The biodiesel containers distributed on the 27th and 28th only had a front
label. Containers were to have both a front and back label with the back
label including mixing instructions and other information on biodiesel use.
Because the back label was missing, Columbus pulled remaining
samples after the event until the back label with mixing instructions was
complete.
Biodiesel was back on the shelf and available for sale in July. Sales
throughout the summer were virtually nonexistent. Two factors had a
large impact on commercial sales. First, biodiesel did not become offiGREAT LAKES Biodiesel
Market Development Program
12
cially available for sale until late in the boating season due to labeling
issues. August and September are usually some of the slowest months
for fuel sales. Second, a significant amount of biodiesel was given to
boaters during the fuel trial weekend. Therefore, many sailboat owners
utilized the allotment given during that weekend and did not need to
purchase any fuel for the rest of the boating season.
Market Development
……….Public Relations
Other events/items that were
utilized to assist with marketing
include point of sale materials, the
Westrec mid-summer newsletter to
slipholders, an Illinois Soybean
Board sponsored press event, and
the Illinois Soybean Association
Westrec employee speaks about using
Legislative Day on August 11-12.
biodiesel.
For the August event, staffers were
picked up at Burnham Harbor on the evening of August 11th for a short
biodiesel powered boat ride of the Burnham and Monroe Harbors.
Biodiesel news releases and featured articles appeared in the Chicago
Tribune as well as the Illinois Agrinews (copies attached). The Illinois
Soybean Checkoff Board also
coordinated a press event which
was held at the Burnham Yacht
Club and included the Chairman of
the Illinois Soybean Checkoff
Board, Representative John
Shimkus, the Illinois Secretary of
State, the President of the Illinois
Soybean Association, and representation from the Great Lakes
Regional Biomass Energy Program.
The event was picked up by US
Farm Report, a nationally syndiBiodiesel powered boat tender at Burnham Harbor.
cated program hosted by Orion
Samuelson and Max Armstrong. Also, Congressman John Shimkus
appeared live on Chicago’s business station, WCIU. The Illinois Soybean
Checkoff Board has made a video tape of these programs available.
GREAT LAKES Biodiesel
Market Development Program
13
Outreach
and
Expansion
Outreach &
Expansion
An important aspect of the biodiesel marine program is to leverage success to make biodiesel more readily accessible for consumers. In 1998,
the biodiesel introduction was limited to the Chicago Harbor system.
Several activities were undertaken to raise awareness among boaters and
marinas outside of the Chicago area. Specifically, a large effort was
initiated with marinas north and southeast of Chicago. In addition, a
phone survey was initiated, several speaking engagements were conducted and representatives of Columbus Foods attended the IMTECH
boat show in Chicago.
……….Marina Market Development
Efforts were initiated to expand the distribution to other marinas outside of
the Chicago area. A listing of all Lake Michigan marinas was secured and
marinas immediately surrounding the Chicago area were phoned to determine the
appropriate contact (manager or purchasing
agent). These names and addresses were
entered into a database that was utilized for
a mailer.
A letter and two page color informational
piece were developed and packaged with a
biodiesel fuel sample and mailed to over 75
marinas in March 1999. Soon after the
mailer was sent, follow-up phone calls were
initiated. Managers were asked if they have
additional questions or would like a ‘face to
face’ meeting to discuss the opportunities
associated with selling biodiesel.
The marinas that expressed interest in
carrying biodiesel in the upcoming boating
Joe Loveshe, Columbus Foods, speaks
season then received an informational
with a customer.
brochure regarding biodiesel use in the
marine market. Several meetings were scheduled for April 21-22, 1999.
These meetings were used to secure additional retail outlets for biodiesel
during the ’99 boating season. Columbus Foods, a biodiesel producer/
marketer, joined these meetings and all marinas that expressed interest in
carrying biodiesel were directed to Joe Loveshe at Columbus Foods.
The target market was expanded to twenty-two additional marinas located
in Grand Haven, Muskegon and White Lake, Michigan. Again, all marinas
that expressed interest in carrying biodiesel were directed to Joe Loveshe
at Columbus Foods
GREAT LAKES Biodiesel
Market Development Program
14
……….Speaking Engagements and Presentations
Outreach &
Expansion
Biodiesel was the featured topic at the August Commodore’s Meeting.
The Commodore’s meeting, held at the Columbia Yacht Club, was
attended by all nine of the Chicago Yacht Clubs and all of the Chicago
Harbors. Also in attendance were representatives of the Chicago Police
Marine Division and the Coast Guard. After a presentation on this year’s
marine introduction at four of the Chicago Harbors and details on the
attributes of biodiesel, a question and answer session led to healthy
discussions of biodiesel’s applications.
At the conclusion of the meeting, one of the Yacht Clubs expressed
interest in handling biodiesel. Arrangements were made for Columbus
Foods to deliver product to the Burnham Yacht Club for the remainder of
this boating season. As additional leveraging activities, Columbus Foods
also conducted two more Fuel Trials Weekends similar to that held the
last weekend in June in areas outside of the Chicago Harbor system.
In addition to outreach activities, an initial meeting was held with the
National Marine Manufacturers Association (NMMA) with respect to their
certification program for TC-W3™. The advanced design of two stroke
gasoline outboard motors coupled with increased fuel/oil ratios increased
lubricant requirements. The NMMA developed a procedure for the
certification of premium quality lubricants. In order to qualify for the TCW3™ certification the marketer must enter into and comply with a licensing agreement with NMMA (including payment of an annual fee) and
conduct a series of defined tests on their product. The test procedures
provide a basis on which a candidate lubricant can qualify for certification. Presently, NMMA does not have any plans of introducing a certification program for fuels, however is considering a program for biodegradable lubricants.
GREAT LAKES Biodiesel
Market Development Program
15
……….Chicago Boater Survey
Outreach &
Expansion
A random sample of the boaters that received biodiesel samples in June
during the Fuel Trial Weekend were selected and contacted by phone
with regard to their experience with biodiesel. With one exception, all
experiences were positive. Most of the boaters utilized less than a 20%
vol. blend as they merely topped off their fuel tank with the 2.5 gallon
sample. Therefore, several boaters did not notice a dramatic reduction of
smoke or change in odor. This result can be expected if a lower blend
level such as 10% if burned. Almost 90% of the boaters thought that the
boat’s engine performance when using biodiesel was as good as or better
than when using petrodiesel.
Many of those interviewed expressed a willingness to purchase biodiesel
during the next boating season. However one individual experienced
microbial growth problems when he utilized biodiesel and therefore will
definitely not be a repeat customer (he was the only individual surveyed
that experienced this or any other issue). A couple of boaters do not
intend to purchase the fuel in ‘99 due to the price of biodiesel, however
most merely asked where it will be available and indicated that they
intend to purchase biodiesel next season.
As follow-up to the phone survey, letters were sent to the boaters that
participated in the 1998 Fuel Trial Weekend informing them of the marinas that were expected to carry biodiesel in the 1999 boating season.
……….IMTECH Boat Show
The 1998 IMTEC Boat Show was held from October 1-3, 1998 at
McCormick Place in Chicago. The IMTEC show is organized by the
National Marine Manufacturers Association (NMMA) and attracts more
than 43,000 people each year, including marine manufacturers, dealers,
reps, marine services personnel and marina owners and operators. The
National Biodiesel Board made a floor display, brochures, and other
information available for the trade show. Assistance to man the display
was provided by representatives of Columbus Foods. The three day
show resulted in significant interest in biodiesel and a number of attendees were interested in its local availability.
GREAT LAKES Biodiesel
Market Development Program
16
Conclusion
and
Recommendations
Based on results of the random telephone survey of boaters that had
used biodiesel during the 1998 boating season, biodiesel was accepted
by recreational sailboaters as an acceptable substitute or blending
component to conventional diesel fuel. Only one boater of all those
interviewed had experienced any issue with the fuel. However, commercial sales from the boating season did not support this statement since
Columbus Foods did not report any sales levels of significance.
Conclusions &
Recommendations
As reported previously, two factors had a large impact on commercial
sales. First, biodiesel did not become officially available for sale until
late in the boating season due to labeling issues. August and September are usually some of the slowest months for fuel sales. Second, a
significant amount of biodiesel was given to boaters during the fuel trial
weekend. Therefore, many sailboat owners utilized the allotment given
during that weekend and did not need to purchase any fuel for the rest
of the boating season.
Based on the fact that Westrec and several other marinas outside of the
Chicago area offered biodiesel in 1999, marina operators understand
the value of an environmental fuel and will sell the product if demanded
by consumers. Sailboat operators have accepted the product, however
would prefer to use preblended product that is available in bulk form.
Other diesel marine users were not as quick to purchase biodiesel.
Margins for marketers such as Columbus Foods were very “thin” and
servicing the marine market only for sailboaters became an expensive
decision.
Therefore increased demand for biodiesel by larger fuel users in the
marine market and other markets such as state and federal fleets will be
required before fuel marketers can justify bulk fuel sales into the marine
market. Expanded use and production of biodiesel offers both environmental and economic benefits to the Great Lakes region. Production of
biodiesel creates the opportunity to utilize resources that are grown in
the Great Lakes region that will help to create jobs and increase economic activity. Use of biodiesel in marine applications will help to protect
the Great Lakes region because biodiesel offers positive environmental
traits.
Market development activities should be intensified in the area of education and outreach to potential users of biodiesel, specifically for large
users such as fleets impacted by the Energy Policy Act. At the same
time, marketers should concentrate on incorporating biodiesel into
existing or new programs that help to protect the Great Lakes and
investigate the possibility of preferential procurement programs.
GREAT LAKES Biodiesel
Market Development Program
17
Appendices
Regulatory Analysis
Presentations
Advertising
Collateral Materials
Public Relations
Sample Editorial Coverage
Boater and Marina Contact Database
Market Development Activity with Marinas
NMMA Certification Test Procedures for TC-W3™