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State may see a new crop of alternative fuel stations

Government grants will help add sites that offer ethanol-based fuel.

February 26, 2008|Elizabeth Douglass | Times Staff Writer

Ben LeBeau pulled up to the Conserv Fuel station in Brentwood on a recent Friday and started filling the tank of his black Chevy Tahoe with a liquid rarely found in California -- E85, an alternative fuel made of 85% ethanol and 15% gasoline.

The station is near his office, and he's been a regular there for more than a month. LeBeau's Chevy, a so-called flexible-fuel vehicle, can run on gasoline, E85 or any combination of the two -- and that's one reason he bought it.

"Unless I have to, I don't use regular gas anymore," said LeBeau, 34, of Agoura Hills. He doesn't mind that his mileage per gallon is lower with E85, which is usually made from corn. The fuel is easier on the environment than gasoline, LeBeau said. "It's what you can do today."

For LeBeau and other E85 converts, there's just one problem: Although California leads the nation in adopting alternative fuels, there are only seven places to get E85 in the state, and only three are open to the public. New government funding and a greater sense of environmental urgency is starting to improve the outlook, though.

In 2007, California had 835 alternative fuel stations, more than any other state. Most dispense electricity (379), liquefied petroleum gas (215) or compressed natural gas (174), according to figures compiled by the U.S. Department of Energy. Sites offering liquefied natural gas, hydrogen, biodiesel or E85 were far down the list.

The disparity is largely a reflection of the state's longtime emphasis on converting large fleets used by governments, school districts and private industry to alternative fuels, rather than changing the vehicle choices and habits of the masses. It's also a manifestation of California's small role in growing corn and soy beans, the primary crops used to produce E85 and biodiesel.

Now, however, California has adopted ambitious new goals for alternative fuels and cutting greenhouse gas emissions -- and it can no longer afford to leave the public out of the mix. For starters, the state is going to increase the use of ethanol as a fuel additive to all gasoline sold here.

For years, California's gasoline has contained 5.7% ethanol to boost octane and comply with federal emissions rules; starting in 2010, that will rise to 10% ethanol. For a state that consumes about 43 million gallons of gas each day, that change alone represents a huge jump in ethanol consumption.

Meanwhile, biodiesel backers have helped build a statewide roster of more than 50 sites that offer the fuel, with many selling to the public and offering blends ranging from B10 (10% biodiesel and 90% petroleum diesel) to B99, a nearly pure biodiesel fuel.

New state and federal grants will help add E85 sites. In May, the state air board set aside millions to help set up 34 public E85 stations. Most are planned for the Sacramento area, but new sites will also open in the coming weeks in Carlsbad and Oceanside in San Diego County. Separate grants will fund new E85 sites elsewhere later this year.

Persuading gas station owners to take a chance on biofuels is not easy, though.

To add E85 pumps, most station owners would have to invest more than $50,000 in an era where high fuel prices have benefited refiners but squeezed dealer profits. Even if the owner landed government grants, "that's a big investment, and they have to be sure there's a market there," said Tam Hunt, energy program director for the Community Environmental Council based in Santa Barbara.

What's more, although most stations are independently owned, the majority of California's outlets carry major brands such as Chevron and Shell, and the oil companies impose strict rules about how those stations look and what fuels they offer.

Chevron Corp., one of California's largest fuel retailers, participated in a one-year state demonstration project that included setting up two E85 stations for government use and studying the results. But Chevron won't sell the fuel at stations it owns, and company spokesman Leif Sollid said, "our marketers and retailers have not expressed a widespread desire to install E85 at their stations."

Sollid disagrees with critics who believe U.S. oil companies are dragging their feet on E85 and biodiesel to protect profits from their franchise fuels. Even so, a look at the oil giant's U.S. retail network is telling: Out of 9,600 U.S. stations selling Chevron or Texaco fuel, 26 offer biofuels.

In an industry that has sold the same basic products for more than a century, change doesn't come easily. Sometimes it takes prodding from a younger generation.

Family-owned Redwood Oil Co., based in Rohnert Park, Calif., operates 19 Chevron-branded gas stations. In May, the company started selling 99% biodiesel at one station and added B20 at another outlet a few months ago.

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