Fueled for the future

Written by Emily Battmer

Thanks to the innovative use of alternative fuels like natural gas and biodiesel, DFA and its partners are now able to power their fleets while protecting the environment.

DFA-owned Oakhurst Dairy, based in Portland, Maine, conducts business with sustainability in mind. As its slogan suggests, the company is dedicated to providing, preserving and enhancing the “Natural Goodness of Maine,” a concept Oakhurst management has taken to heart.

“As our late president, Stan Bennett, said many times, ‘Oakhurst cows literally breathe, eat and drink the Maine environment, so we have a commitment to that environment’,” says David Green, Oakhurst’s fleet and facilities manager. “That was the driving force behind his work.”

Green has been with the company for 28 years, and he says that being environmentally aware has always been a top priority for Oakhurst Dairy. Green has often been involved in these efforts, searching for eco-friendly technology to incorporate into his fleet.

In 2004, the governor of Maine issued the Governor’s Carbon Challenge, a voluntary carbon dioxide emissions reduction program. The goal was to reduce greenhouse gas emissions by 20 percent by 2010. Oakhurst Dairy leapt at the opportunity and was one of the first corporations to sign up for the challenge. Green says it was up to him and the plant manager to meet the goals.

That’s when Green began reading about biodiesel, a fuel alternative that is manufactured with vegetable oils, recycled cooking grease or animal fats. By 2006, Green had made his first biodiesel purchase. He started with a 5 percent blend, and then gradually transitioned the fleet to 20 percent biodiesel.

“At that time, the price was 10 to 15 cents per gallon higher than diesel, but our president was willing to do that,” Green says.

But being forward-thinking was not without its challenges. The company originally used a soy-based animal fat product. Through trial and error, Green says they quickly discovered that any time the temperature dropped below 40 degrees, this product would cause the fuel filters to become clogged. They couldn’t use a high blend when the weather was cool, and so from 2006 to 2010, the company could only use a 5 to 20 percent biodiesel blend, depending on the market price.

“We blended as much as we could afford at the time,” Green says.

Oakhurst wanted to do more. In 2010, Green says he stumbled across a local supplier called Maine Standard Biofuels, which produces biodiesel from locally sourced, used restaurant kitchen oil. Maine Standard Biofuels delivers the biofuel directly to its customers, and the fuel is produced less than 10 miles from Oakhurst Dairy’s processing facility.

“They were a startup, and so we got really creative as far as partnering with them,” Green says. “We very quickly became their largest customer.”

The following year, in 2011, Oakhurst Dairy purchased 77,000 gallons of biodiesel, which they blended with regular diesel in their fuel tanks. In 2012, that amount nearly doubled to 135,000 gallons, and rose to 138,000 in 2014.

Since making the switch, Green says they have eliminated the quality issues they were having early on. The partnership with Maine Standard Biofuels has allowed Oakhurst to decrease its diesel fuel emissions up to 70 percent annually while reducing total fuel costs.

The partnership has been so successful that Green says he has recommended Maine Standard to other biodiesel users who have had filter issues. He convinced one supplier at his New Hampshire depot to make the switch to Maine Standard for its superior quality, environmental and cost benefits.

“We’ve helped this vendor out, and at the same time we’re paying 10 cents per gallon less than traditional diesel,” he says. “So not only are we getting it cheaper than regular fuel, we’re getting all the emissions savings as well.”

Now, Green says he is using a 20 percent biodiesel blend for Oakhurst’s New Hampshire trucks year round. In Portland, he is blending 25–35 percent biodiesel during the winter, and increasing the blend to about 50 percent during the summer.

Almost 2,000 miles away, DFA’s Southwest Area is also enjoying the benefits of alternative fuel. John Ebert, director of sales and marketing in the Southwest Area, says environmentally friendly practices are becoming increasingly important as customers and consumers become more interested in sustainable food production.

Ebert has worked on a project to convert a portion of the Area’s fleet in Texas to compressed natural gas (CNG). In addition to reducing DFA’s carbon footprint and overall fuel costs, Ebert says the switch could give DFA a competitive edge.

“We have been getting interest from end-customers who are worried about their carbon footprint,” he says. “Doing this project could eventually help us market our milk as having a reduced carbon footprint. This might be something that allows us to meet the demands of our customers and supply them with milk that is more environmentally friendly.”

CNG is an odorless, colorless, tasteless gasoline and diesel alternative made by compressing natural gas — mostly methane — to less than 1 percent of its volume at standard atmospheric pressure. The fuel is drawn from domestic natural gas wells or produced in conjunction with crude oil, and it produces 90 percent fewer emissions, depending on the make and model of the vehicle, according to cngnow.com.

The Area made the commitment to convert a portion of its diesel fleet to CNG-powered trucks in fall 2013, when DFA signed a deal with AMP Americas agreeing to purchase a certain amount of fuel from AMP, which in turn is building seven public-access fueling stations along major intersections serving routes throughout Texas. The first CNG-powered trucks began hauling milk in February 2014.

Currently, Ebert says haulers are primarily using two stations, located in Waco and Sweetwater. Forty trucks hauling DFA milk are currently running on CNG, accounting for about 7 million miles per year — more than 10 percent of the Southwest Area’s annual 60 million miles of travel. AMP officials estimated that the deal would displace carbon emissions equal to removing 2,400 cars per year from the road and could save the supply chain as much as $2 on every gallon sold.

The deal DFA signed is for a seven-year period, and there is always room for expansion, Ebert says.

“We view this as a long-term commitment,” he says.

While the Cooperative is committed to its use of alternative fuel in the Area, the road to a CNG-powered fleet was not an easy one. DFA had to negotiate a fair deal with its contracted hauling company, Western Dairy Transport, to establish pricing based on natural gas. And because part of the deal guarantees certain volumes of milk carried on CNG truck lanes, Ebert says the logistics of transporting milk from the farm to the plant have gotten more complicated.

“We’ve guaranteed to the hauler a certain number of loads or routes each day, and we’ve agreed to purchase a certain amount of fuel from AMP,” Ebert says. “You’re tied to specific volumes on lanes, which is hard to manage sometimes when you don’t know what a customer’s demand is going to be. You lose some flexibility.”

In addition, the transition to CNG wasn’t cheap, with CNG-powered trucks costing as much as $50,000 more than regular diesel trucks — and with recent low diesel prices, the Cooperative hasn’t started to see the economic advantages yet. But Ebert says he anticipates the CNG project to be economically advantageous over the long term.

“It’s not making us a lot of money right now, but it’s not costing anything additional either, and if diesel prices go back to recent historical norms, it will make us some money and reduce our fuel expense significantly,” he says. “The other benefit is the ability to fulfill the potential needs or wants of our consumers by providing a more sustainable product.”

As sustainability continues to be a focus for customers, consumers and the dairy industry, DFA’s use of biodiesel and CNG places the Cooperative at the forefront of alternative energy practices and positions DFA for future success.

“I can see a day where the reduced carbon footprint could be something we use to our advantage, and maybe something our customers will request from us,” Ebert says. “I can see a world where that becomes a requirement.”