2022 Fuel Costs Review and Fuel Savings Tips

Portable restroom rental companies have rapidly diversified over the past decade. So many have shored up their business models with vast arrays of new revenue channels. They’ve taken on everything from security barricade rentals, to table cloths and chairs, to supplying entertainment stages. The point here is there are countless complications in forming apples-for-apples comparisons between fuel costs for individual portable restroom rental service operators with such widely diverse types of revenue lines. So, we’ll take a different approach to examining the current fuel cost issues for this industry.

For a more stable basis of comparison that can yield more meaningful information, let’s look at some industry fuel cost reports and insights, and expert recommendations for cutting fuel costs provided by a couple of sister industries. Taking this approach, one thing becomes apparent immediately in the process:

In 2022, moving forward in the liquid waste hauling industry and all related industries is all about overcoming the convulsive experience of the pandemic, and the labor shortage left in its wake, while now reeling from the economic shock of fuel prices.

Liquid Waste Industry Impacts from Skyrocketing Fuel Costs

According to Mordor Intelligence global market research and advisory firm, the broader liquid waste handling business subsector (including all wastewater handling business types) is projected to realize a Compound Annual Growth Rate (CAGR) of above 5% from 2021 to 2026.

So, despite the negative impacts of the COVID-19 semi-shutdown of the U.S. service business economy in 2020 and the 2022 escalation of fuel prices, the indicators bode very well for the liquid waste management market overall for the next four years or so at least.

It’s fair to say that almost all economic sectors were virtually pervasively affected by the 2020-2021 lockdown. During that time, petroleum refineries slashed production due to the plummeting fuel demand, down 30% to 40% worldwide through much of the quarantine.

Naturally, liquid waste at refineries took a commensurate nose dive. But, the demand for an array of pharmaceuticals soared during the same period of the pandemic, raising the liquid waste production overall.

Q2 2022 National Fuel Price Outlook

The U.S. Energy Information Administration (EIA)’s short-range energy overview published last month (June 2022) shows the U.S. retail average price per gallon for regular gasoline was $4.44, and $5.57 for diesel. The EIA cites low inventory levels associated with the soaring prices which have reached near record high prices per gallon.

The EIA expects the retail price per gallon to drop by about $0.17 per gallon to $4.27 in Q3. The forecast shows wholesale diesel margins dropping by $0.46 per gallon and the retail diesel average is predicted to drop to $4.78 per gallon in Q3, a reduction of $0.79 per gallon.

Fuel Cost Business Effects – Insights from Sister Industries

Again, data on fuel efficiency in our industry is taken across the many radically diverse service models of the U.S. portable restroom industry. So, for a more coherent analysis, we’ve drawn some insights from the sister industry to the liquid waste industry — the solid waste industry. In their WasteExpo annual event held May 9-12 2022, the recurring theme was a lack of labor, wage hikes, supply chain delays, and, above all, the extreme spike in diesel prices.

The overall condition has led many small operators in that parallel industry to the liquid waste industry to shut down and others to strongly consider it at this time. Of course, as in the liquid waste business, there are many others still reporting strong net revenues, and yet others that are realizing impressive growth despite the industry-wide economic struggle.

Inflation was another topic, and the rising interest rates, along with labor and inflation. But, fuel cost was recognized as the largest impact on businesses in the solid waste handling industry, with diesel jumping an alarming 60% from $3 to $5 per gallon. Haulers have been forced to raise prices by 10% to even 20% in some cases.

Consumers’ Acceptance of Soaring Fuel Prices

Even with the staggering increase in fuel costs passed on to consumers in price hikes of up to 20%, consumers’ willingness to accept higher bills has been “very high” — the same public response reported by publicly held corporations. So, people are not complaining to the businesses that are escalating their prices.

Further, among the companies in that industry, there were no indications cited or expressions of worry about the economy slowing. As in the liquid waste hauling industry, a lack of work is not a problem for many of the service providers, because necessary service businesses are necessary.

How to Reduce Your Company’s Fuel Costs

Fuel costs in many businesses involved in wastewater hauling can be thousands of dollars per month. Company owners may not be able to control fuel prices, but there are many things you can do to improve fuel mileage and minimize fuel waste in other ways. For some examples:

• 1,200 gallons of water in a portable toilet truck tank add up to 2,200 lbs to the truck weight, depending on temperature, drastically increasing fuel use. So, schedule during strategic hours, and be sure you’re using the closest dumping location possible.
• Top off diesel truck fuel tanks to keep water from building up in your fuel systems.
• Remind all drivers of your fleet vehicles to use overdrive during open highway driving.
• Use remote driver monitoring technology to train drivers to improve fuel-conservation habits, such as avoiding excessive acceleration, etc.
• Emphasize turning off engines while parked, or while dumping waste, taking breaks, eating lunch, etc.
• Change spark plugs as needed to prevent up to 30% less fuel efficiency.
• Keep radiators in all vehicles clean. Hot engines are less fuel-efficient.
• Clean the filters and change them as needed to maintain engine efficiency.
• Replace faulty fuel injectors to prevent fuel waste.
• Maintain proper tire pressure to reduce road friction that cuts fuel efficiency.

On the Horizon…

Electric vehicles are coming. In many industries, there is now a lot of anticipation about electric vehicles. For example, there were a few fully functioning EV garbage trucks displayed at the solid waste haulers event mentioned above. However, it is widely acknowledged that commercial EV capacity needs to be well beyond the current maximum of 60 to 100 miles, and purchase prices need to come down. But, the consensus appears to be that the potential for improved EV performance is high, and broader adoption is anticipated over the coming years.
In the meantime, the liquid waste industry goals for fuel savings must focus on optimizing each field service vehicle and all equipment for maximum fuel efficiency, consider conversions to natural gas, if feasible, and add revenue channels that increase customer service product options without adding to fuel costs.

Sources

https://www.waste360.com/business/trends-insights-and-highlights-wasteexpo-2022
https://www.eia.gov/outlooks/steo/pdf/steo_full.pdf
https://www.marketwatch.com/press-release/industry-liquid-waste-management-market-2022-price-sales-revenue-in-depth-global-opportunities-by-regions-trend-and-analysis-dominant-sectors-and-countries-data-2022-03-29
https://www.mordorintelligence.com/industry-reports/liquid-waste-management-market

Please follow and like us:

No comments yet... Be the first to leave a reply!

RSS
Follow by Email
LinkedIn
Share