Expected savings from Phase II EVR Equipment

Expected savings from Phase II EVR Equipment:

Although the state deadline to upgrade to Phase II EVR equipment is seeming to come at the most inopportune time, there may be some peace of mind in knowing that there is an expected savings from the volume of fuel that would otherwise be lost as vapor. Manufacturers have claimed that operators can expect product savings in the range of 0.15% to as high as 0.6%. This may produce enough savings, even at the lower figure, to pay for the cost of the upgrade itself.

For the Healy Clean Air Separator, savings could be from .015% to 0.25% of liquefied product. This could potentially produce a savings of 250 gallons for every 100,000 gallons of fuel dispensed.

With the average California station pumping about 1.3 million gallons of fuel per year, this potentially vents 10 tons of hydrocarbons into the air each year. This is the equivalent of losing 3,000 gallons of product per year. At only $2.50 per gallon, that’s $7,500 of lost revenue, each year.

Steve Lee is an Equipment Finance Specialist at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Steve is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

There Is No Excuse

The Air Resources Board is reminding California’s service station owners that they must upgrade vapor recovery systems on their gasoline pumps by April 1, 2009. The deadline is fast approaching, and less than 15% of the 11,000 gas stations are currently in compliance.

The state has invested millions of dollars into this initiative. There will be no exceptions with respect to this deadline:

"There's no excuse for not meeting the deadline - people know it's coming, the technology to comply is there and the public health benefits are easily quantifiable. Penalties for missing the deadline will not only cost operators, but delay clean air for many regions of the state." -- ARB Chairman Mary Nichols

Financing is becoming harder to obtain during these volatile economic times. Please begin your prequalification process immediately to secure your financing…it may not be there come 2009. Banks are increasingly calling lines of credit used for EVR upgrades, due to the high amount of soft costs involved and because the equipment is essentially non-revenue generating.

Steve Lee is an Equipment Finance Specialist at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Steve is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Veeder-Root Announces New Carbon Canister Enhanced Vapor Recovery System

October 17, 2008 Veeder-Root has finally announced the release of the eVRgreen System with CARB Certification. This system is a complete vapor recovery and monitoring system that meets California’s state mandated April 1, 2009 Stage II EVR upgrade deadline. Veeder-Root claims this is the "simplest, most cost-effective solution available for retail petroleum station owners in California who need to comply with new EVR regulations." Gas stations owners can expect installation times to be cut in half, with seamless operation from the start.

For complete details or to order this solution contact your Veeder-Root distributor today. Veeder-Root is offering informational sessions for Enhanced Vapor Recovery at several locations in California. Contact your Veeder-Root distributor to learn more about these sessions. You can also register for more information and updates from Veeder-Root at http://www.veeder.com/page/EVR_Solutions.

Steve Lee is an Equipment Finance Specialist at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Steve is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

How Much Will Your Station Cost?

With the deadline around the corner, many gas station owners are asking how much their station's upgrade will cost. The best way to know is to have a contractor visit your station and give you a quote. Nonetheless, ARB of California has give a few estimates as to how much the upgrades could cost.

Phase II Franklin/Healy EVR equipment (*assuming labor costs are $75 per hour):

For 2 Dispensers:
Dispenser Equipment $7,240
Dispenser Equipment Installation* $600
Clean Air Separator $7,245
CAS Installation* $2,000
TOTAL $17,240

For 4 Dispensers:
Dispenser Equipment $14,480
Dispenser Equipment Installation* $1,200
Clean Air Separator $7,245
CAS Installation* $2,000
TOTAL $24,925

For 6 Dispensers:
Dispenser Equipment $21,720
Dispenser Equipment Installation* $1,800
Clean Air Separator $7,245
CAS Installation* $2,000
TOTAL $32,765

For 12 Dispensers:
Dispenser Equipment $43,440
Dispenser Equipment Installation* $3,600
Clean Air Separator $7,245
CAS Installation* $2,000
TOTAL $56,285

The numbers may seems overwhelming at first. Shop around with different contractors, but keep in mind: You get what you pay for. Sometimes the labor is much cheaper, but the equipment may not be installed correctly costing you more in the long run.

Steve Lee is an Equipment Finance Specialist at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Steve is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Benefits of EVR Upgrade

Many gas station owners have been asking us what the new Phase II EVR upgrade will actually do. How will it help the environment?

According to evrhome.org, the EVR systems reduce gasoline vapor emissions. By reducing the emissions, this will save gasoline. California's total throughput is about 16 billion gallons of gasoline per year.

The Phase II EVR systems in California alone will:

• Reduce hydrocarbon emissions by 372 tons/day. Hydrocarbons, which make up the gasoline vapors, react with other air pollutants in the ozone's atmosphere.


• Save 120,000 gallons of gasoline each day


• Station owners and consumers save $360,000 each day

So the upgrade will save gas, money, and improve the atmosphere. This is something that is both valuable, and at our present time, needing to be preserved as best as possible.


Steve Lee is an Equipment Finance Specialist at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Steve is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

EVR Meetings in August 2008

It is always important to continue learning, especially when it comes to state-mandated regulations.

There are a couple of free meetings in California where you can go and find answers to all your Phase II EVR Upgrade questions. Here is the information for the two meetings in August (provided by evrhome.org):

August 27, 2008 - Anaheim, CA
EVR/ISD Informational Meeting
Hosted by Shields-Harper
Meeting
Notice

August 28, 2008 - Burbank, CA
EVR/ISD Permitting Workshop
Hosted by Shields-Harper
Meeting
Notice

Steve Lee is an Equipment Finance Specialist at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Steve is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Finding Contractors

As time goes on, it will be harder and harder to have a contractor work on your gas station. Here is a helpful list of contractors specialized in the Stage II Enhanced Vapor Recovery Upgrades:

Franklin Fueling/Healy Certified Installation Contractors list:
www.franklinfueling.com/CertifiedInstallers/CertifiedInstallers.asp

Franklin Fueling/INCON ISD Certified Installation Contractors list:
www.franklinfueling.com/CertifiedInstallers/CertifiedInstallers.asp

Veeder-Root Certified ISD Contractor list:
www.veeder.com/cfusion/veeder/ascsearch/index.cfm

VST Inc. Certified Contractor list:
www.vsthose.com/cert_contractors.shtml

Having trouble finding equipment or a Certified Contractor? Use this form:
www.arb.ca.gov/vapor/equipcontavail062207.pdf

Steve Lee is an Equipment Finance Specialist at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Steve is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

The Countdown to EVR/ISD Deadline

Although 236 days seems like quite a while, upgrading your station as soon as possible is vital.

Permitting and installation can take much longer than expected. Equipment and installation contractors are currently available. Planning ahead pays off seeing that the installation contractors are getting booked further and further in advance. If you wait too long, it will become extremely difficult to get the upgrade before the deadline.

Upgrading soon also benefits the owner because it will save money. Costs are expected to rise as the deadline approaches. Equipment prices have already risen by 10% to 15% this year.

Upgrade your station soon to save yourself the money and the headache.

Steve Lee is an Equipment Finance Specialist at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Steve is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Avoid EVR/ISD Penalties

The mandated EVR/ISD upgrade has costly consequences if not installed in time. The deadline is April 1st, 2009, and will not be extended. There will be strict and expensive penalties for noncompliance.

After March 31, 2009, it will be illegal to operate without the Phase II EVR upgrade.

There will be monetary penalties and non-compliant facilities may be tagged out-of-service until the upgrade is completed. The fines could be anywhere from $1,000 to $70,000 a day. It is more likely that they will shut down your gas station until the upgrades are completed.

Upgrade your station soon to avoid these penalties.

Steve Lee is an Equipment Finance Specialist at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Steve is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

Benefits of Leasing The EVR/ISD Equipment

Meeting state mandates can be time consuming, frustrating, but most of all – costly. The gas station business has changed a lot over the last decade. Margins have steadily been squeezed by higher taxes and rising credit card fees to a point where most stations are only earning $.01 - $.03 per gallon of fuel sold.

Instead of tapping your company’s savings / retained earnings or running up a short term bank line of credit, explore an equipment lease. It makes sense to have a manageable monthly payment that can be depreciated over the useful life of the equipment. In addition, the benefits of leasing are tax deductions, write-offs, and improved cash flow. Cash is king and liquidity is crucial in good economic times but this is especially true in a soft economy. Preserve your bank lines for an emergency or short notice revenue generating opportunities.

Steve Lee is an Equipment Finance Specialist at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Steve is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

EVR/ISD Links

On February 1, 2001, the California Air Resources Board adopted revisions to now require all gasoline dispensing facilities (GDFs) that dispense over 600,000 gallons per year to upgrade. All gasoline dispensing or fueling operations with underground storage tanks must have both Phase II Enhanced Vapor Recovery (EVR) equipment and In-Station Diagnostic (ISD) monitoring systems.

This is a very important upgrade for all gas stations.

Here are some links that give more information on the EVR/ISD upgrades:

• EVR Phase II Executive Order
  www.arb.ca.gov/vapor/eo-evrphaseII.htm
• Help with understanding EVR Phase II
  http://www.evrhome.org/
• EVR Financing Information
  evrhome.org/finance.htm
• Contact information for the 35 California Air Quality Management Districts
  www.arb.ca.gov/capcoa/roster.htm

Steve Lee is an Equipment Finance Specialist at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Steve is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.

The Importance of Upgrading Your Station

The deadline for the California-required Phase II EVR upgrade is April 1, 2009. The deadline for the ISD installations is September 1, 2009 and September 1, 2010 depending on the facility’s annual throughputs. It is vital to start this process now if you haven’t already.

Many gas station owners are delaying for some of the following reasons:

• Waiting on additional EVR systems to become available
• Thinking there is still plenty of time
• Thinking the deadline will be extended
• Thinking the deadline will not be enforced

The reality is:

• Competing EVR systems wont be available until late 2008 at the earliest
• Permitting and installation can take much longer than expected
• The deadline will not be extended
• There will be strict and expensive penalties for noncompliance

Act now to get a installation contractor before they are all booked.

Steve Lee is an Equipment Finance Specialist at a leading financing company, First Star Capital (http://www.firststarcapital.com/ ). Steve is a frequent contributor to online publications and newsletters, and is the author of this blog on commercial financing topics.