Biodiesel

Biodiesel is a domestic, renewable and low CO2 fuel with benign tail pipe emissions. In the Pacific Northwest, B99 was the fuel of choice for dozens of fleets.

greenhouse gas emissions reduction graphic by Star Oilco
Why diesel fuel in Oregon may go up in 2025 940 788 Star Oilco

Why diesel fuel in Oregon may go up in 2025

What are the market forces impacting diesel in Oregon for 2025?

There are some big changes coming for diesel fuel in Oregon and it is not widely reported. The biggest likely change being a smaller supply of renewable diesel in the first quarter of 2025.  Renewable Diesel is expected to see a shorter supply than in recent years as imports drop off with the removal of subsidies.

Contact Us Today

Oregon is going to see several major market forces impacting the wholesale, as well as retail cost of diesel to those that buy it.   To list them simply, the following events will converge on New Years Eve:
– The end of the $1 a gallon US Blenders Tax Credit (BTC) subsidy on biodiesel and renewable diesel.
– The subsidy replacing the BTC, the Producers Tax Credit (PTC), blocks imported biofuels such as Neste Renewable Diesel.
– Oregon is relaunching its Climate Protection Program which will cap the market allowance for fossil fuels.
– Portland has a Renewable Fuels Program that requires the blending of Biodiesel and Renewable Diesel under a 60% reduction in CO2 emissions from petroleum diesel (biofuels sold in Portland must be below a 40CI under Oregon’s Clean Fuels Program).
– California has mandates for Renewable Diesel in many uses raising the cost of R99 renewable diesel throughout the US.

These forces will raise the cost of fossil fuel diesel, renewable diesel and biodiesel while at the same time Oregon and Portland are requiring the use of these biofuels.  This will mean a higher retail and wholesale price inside Oregon compared to the rest of the United States. We cover the details of these trends below in depth.

THE OREGON CLIMATE PROTECTION PROGRAM

The biggest change impacting the price for on-road diesel is the return of Oregon’s Climate Protection Program (CPP). The program’s more common name is Cap and Invest, in fuel pricing it is referred to as “Cap at the Rack” as its allowance requirements are priced on a gallon of fossil fuel.  The program caps the total fossil fuel allowed to be sold inside Oregon. Then, revenue generated from selling the allowances to import CO2 contributing fossil fuels into the state, is invested to reduce future needs for these fuels.  In 2025, this program will return and fuel importers into the state of Oregon will have to capture the cost of reducing their CO2 emissions under this program.

Oregon previously had a “Cap and Invest” program limiting the total market share allowed for petroleum diesel fuels.  This created a higher cost for diesel fuels refined from petroleum compared to renewable diesel and biodiesel. This program was stopped by an Oregon court decision in 2023. The Oregon Department of Environmental Quality (DEQ) just finished and published the new rules for this program correcting the issues the court had with the program.

The way the Oregon Cap and Invest works on the market is similar to musical chairs. If you imagine the market for diesel is limited just like seats in musical chairs, every year they will take a few of the fossil fuel chairs away.  That means that anyone maintaining their existing customer gallons or trying to grow their volumes must meet this demand with renewable diesel, biodiesel or some other fuel.  The limited market for fossil fuels is represented by “Allowances” provided by the Oregon DEQ.  If a fuel seller cannot reduce their fossil fuel dependency, they need to buy a CPP Allowance in an Oregon DEQ curated market for them.

The value of these CPP Allowances is actually charged on each gallon of fuel sold by the regulated parties.  It is commonly called “Cap at the Rack” and can range in cost from nothing to over $.50 a gallon depending on how hard it is to meet the need of the program.  The biggest impact on the Cap at the Rack cost is how much renewable diesel or biodiesel is being used by those selling fuel.   Prior to the stoppage of Oregon’s CPP program, the Cap at the Rack cost usually ran around $.05 to $.30 a gallon.  It is expected we will see a return to this cost starting January 1st, 2025.  OPIS reports have an adjusted and non-adjusted option to capture the cost of this program.

The way the CPP program is designed is that if a fuel seller brings in a lower CO2 fuel like renewable diesel or biodiesel into the state of Oregon those gallons do not count towards the fossil fuel market cap.  So a R99 seller has no CPP Allowance obligations for those gallons.  A B20 biodiesel blender, as well, picks up 20% more gallons available to sell as those biodiesel gallons do not count against their CPP Allowances.  This facet of the CPP is why the market of renewable diesel in particular is a big deal for diesel prices.

The intent of Oregon is for consumers, fleets, farmers, municipalities, and industry in Oregon to grow their energy needs, they will need to use more low carbon energy.  If this energy use is a fleet running over 32,000 GVW this will mean low CO2 biomass based diesel fuels.   At the same time, the CPP program is kick-starting back into existence, the world of these biofuels is seeing some major market changes.

Secure Your Low Carbon Fuel Today

OREGON CLEAN FUELS PROGRAM

Oregon has another program to reduce the CO2 of the liquid fuels sold inside the state.  This program is additional and works in conjunction with the CPP.  It is the Clean Fuels Program (CFP) and is extremely similar to the California Low Carbon Fuel Standard (LCFS).  This program creates a market for Carbon Credits that are traded and required by fuel importers into Oregon.  OPIS also shows this program’s cost per gallon on their reporters.

Where the Climate Protection Program is like musical chairs with market share as the allowed market for fossil fuel shrinks year over year, the Clean Fuels Program is like a coupon required with sales of fossil fuel.  The major importers of fossil fuels into Oregon must show they are blending lower CO2 biofuels by presenting CO2 credit generated under the CFP program.  Users of fuel inside Oregon also see a benefit for bringing in low CO2 fuels when the market needs the credits so that voluntary users of high blend biofuels like R99, B99, B20 or E85 (85% ethanol) get financial support via a reduced final cost per gallon if using those fuels.

The reason we see renewable diesel in Oregon compared to the rest of the United States is because of this program.  This value of a Carbon Credit is usually taken to buy down the competitive price of these biofuels.  The concept is that if a fuel importer is bringing low CO2 fuels into Oregon, the reduction in CO2 these fuels represent can generate a CO2 credit.  That credit being sold on an open market to help reduce the cost of a low CO2 fuel compared to a fossil fuel.  The market for these credits is banked and has been building for years. Currently, the CO2 value is low as there are plenty of credits.

If the market availability of renewable diesel and biodiesel is dropping, the value of these credits should be rising.  The overall market will be bearing this cost though consumers will likely never see it.  In effect these regulatory market impacts of less renewable diesel in Oregon will mean a higher Carbon Credit price under the CFP program.  That will help lower the blended or delivered costs of B99 biodiesel and R99 renewable diesel hitting the end consumer.

RENEWABLE DIESEL AND BIODIESEL SUPPLY IN OREGON

Biodiesel and renewable diesel are called “Biomass Based Diesel” as a respective class of biofuels.  Where fossil fuel diesel is made from crude petroleum, biomass based diesels are diesel fuels made by several technologies from biomass feedstocks. The most widely used feedstock being fats, oils, and greases from virgin vegetable seed oils (soy and canola) or waste streams like recycled deep fryer oils, meat processors rendering fats, recovered trap greases, and many other sources of fat waste streams.

The 2025 Oregon Fuels Forecast for Oregon predicts a 199+ million gallon need for R99

The Oregon Department of Administrative Services Office of Economic Analysis produces a Clean Fuels Forecast which describes the size of the market need in Oregon.  In 2023, Oregon used 133.3 million gallons of R99 inside the state. The fossil fuel diesel used in 2023 was 577.6  million gallons by comparison.  So R99 and B99 blended with those gallons is a substantial 26% of the diesel burned in Oregon by the most recent total data.  The forecast for 2024 Renewable Diesel is 46.6 million gallons of R99, which appears to be exceeded by quite a bit.

We do not have total consumption numbers for 2024 yet, but we do know thanks to the US Energy Information Agency, that imported R99 from Neste Singapore by itself through October was roughly 62 million gallons rounding up.  The Oregon Clean Fuels Forecast expects 199.5 million gallons of renewable diesel in 2025.  As the program ramps up with this expectation, the imports of previous years will be far less competitive without subsidies.  This means the price of renewable diesel will be higher, unless US production scales to not only fill this market void but also add tens of millions of gallons into the state.

Of that 133.3 million gallons of R99 used in 2023 in Oregon, a third, more than 40 million gallons of it was imported Neste Renewable Diesel.  973,000 barrels of renewable diesel was shipped from Singapore to Oregon that year.  Other renewable diesel refiners such as Diamond Green, HF Sinclair, Marathon, Montana Renewables, Phillips 66 and Chevron also had R99 product sold into Oregon.  Regardless of the expansion of US domestic Renewable Diesel production in recent years, the Neste product no longer receiving subsidies will have a real impact to maintain these 133+ million gallons of R99 inside Oregon.

This same projection reports that Oregon’s B99 Biodiesel use inside the state in 2023 was 78.8 million gallons.  With a projection of Biodiesel to rise 83.8 million gallons in 2025.  Given these market needs, Star Oilco predicts R99 to be expensive compared to petroleum diesel. Biodiesel will be more competitive given the available product and no substantial change in suppliers.  Biodiesel will also need to be used to replace R99 gallons under the CO2 reduction programs of Oregon. Due to these market forces Star Oilco has contracts for supply at reasonable prices for our existing customers.

R99 is mandated in certain diesel uses in California by the California Air Resource Board (CARB) which make for an inelastic price.  Diesel equipment operators in California will have to buy R99 at any price.  This will raise the prices we in Oregon can expect to see renewable diesel at.  The other low CO2 diesel fuel biodiesel will not be impacted by CARB the same way and we can expect to see B20 become more widely sold because of its more competitive price.

Biodiesel has a much more widely used market development around the US, especially in over-the-road trucking.  The plants that make biodiesel also tend to be co-located, owned in collaboration with feedstock producers, and integrated within the Soy industry that produces the feedstock.  Expect that biodiesel will continue to be more competitive with diesel than renewable diesel if price is the concern.

It is worth mentioning that the CARB mandates for R99 use in California will have impact to set the price for renewable diesel in other states.  If the market demand mandated by CARB continues and the market is short, the price can be expected to rise to meet this demand.  So unsubsidized imported R99 will likely continue to flow into California and other states but it will be at a full cost to make up the subsidy.  This will likely mean that incremental gallons of R99 needed to meet the market growth projected in Oregon will be at a premium over Oregon diesel to match California’s diesel market.

US BLENDERS TAX CREDIT EXPIRATION IMPACTING OREGON

The biggest unknown on how expensive diesel will be for Oregonians relates to Federal biofuel policy.  For the last twenty years the US Government has had an on-again/off-again subsidy on biodiesel and more recently renewable diesel.  There have been years the subsidy was not renewed which informs us of what probably will happen with prices on biodiesel.  Renewable diesel though is a stickier market.  The reaction of R99 renewable diesel prices in California, Washington and Oregon market is the big question and it comes down to an issue of production.  Two big issues at play are how much renewable diesel will these states continue to see from Neste’s Singapore plant and how much new US production for renewable diesel comes online to feed the market need.

The Blenders Tax Credit will be replaced with the Producers Tax Credit

The Blenders Tax Credit expired December 31st.  There are those that hope that in January the new Congress will take up an extension of this but most experts in the industry do not expect and are not betting an extension will not occur.  Meanwhile there is subsidy regime named the “Clean Fuels Production Credit” or the slang term preferred by industry the Producers Tax Credit (PTC) which ranges from $.20 a gallon to $.80 a gallon depending on how low CO2 the fuel as well as some labor practices.  The PTC also bars imported renewable diesel and biodiesels from getting any money at import.  Approximately more than 40,000,000 gallons a month of renewable diesel flows from Neste Singapore to the west coast, this will have a huge impact on Oregon.  For those accustomed to that fuel at the same price as fossil fuel diesel, the expiration of this subsidy will raise our prices for those demanding R99 renewable diesel which was already in short supply prior to this change.

There is also another wrinkle in the subsidy policy of the US with this.  The subsidy on Sustainable Aviation Fuel (SAF), basically renewable diesel meeting the Jet A fuel specification, is still in place for imported product for another year.  Europe also has some significant incentives and mandates for SAF.  Renewable diesel refiners, both domestic as well as foreign have a huge financial incentive to make renewable jet fuel over renewable diesel. This reality probably means that if a gallon of fuel can go to a jet fuel market over a transportation market it will.

So the market forces for renewable diesel in particular probably means less R99 available nationwide in the US.  While that is happening, the state of California has mandated that all off road equipment run R99 Renewable Diesel.  So regardless of what the price of this fuel is, California will have to use it in huge volumes.  Markets being what they are, for high volume fleets demanding R99 they can expect the R99 price in Oregon will track the price paid in California.  There will be exceptions of contract relationships for supply of R99 as well as retail brands moving renewable diesel blends to meet their strategic CPP requirements.  This will definitely mean anyone wanting R99 will want to line up a contractual supply agreement or can expect a higher price than in 2024.

THE FEDERAL RFS AND RINS

It should also be mentioned that the US EPA has a Renewable Fuel Standard of its own. It is a completely different regulatory system compared to the Portland RFS.  This program requires gasoline refiners as well as importers to use so much biofuel in their sales inside the United States.  Federally refiners and importers must prove they blended specifically assigned amounts of ethanol, and biomass based diesel fuels.

This program attaches a Renewable Industry Number (RIN) on every gallon of biofuel sold in the US.  As there are many unobligated users of this biofuel in the US those blending their own biodiesel, renewable diesel and ethanol generate RINs that can be sold to the refiners and importers of gasoline inside the US.

The RIN value has been low compared to historic values for biomass based diesels.  As Biodiesel and Renewable Diesel generate the same type of RIN, the reduction in imported R99 might raise the value of these RINs.  This value increase for the Renewable Industry Number is expected to slightly off set the hard subsidy.  It will be a market based value so it can not be relied upon for lowering the cost of biofuels, but can be expected to help with price.

As more US produced renewable diesel is coming online, hopefully enough to replace the lost imported gallons before the busy summer diesel season, these RIN values may not have a major contribution to the wholesale price of R99.

CONCLUSION

We predict diesel prices to rise in Oregon compared to the US in the first quarter of 2025

Star Oilco’s team saw these market conditions coming during the summer of 2024.  We have locked in contractual supply of R99 renewable diesel for our existing customers and have additional supply for customers seeking R99 renewable diesel by Star Oilco owned cardlock sites, mobile onsite fueling or smaller volume bulk delivery.

Star Oilco expects a Cap at the Rack price from the Oregon CPP to be between $.10 and $.40 a gallon by the end of January depending on biofuel supply. With unofficial conversational predictions with several large fossil fuel refiners and brokers, there is an expectation of over $.25 a gallon as a Cap at the Rack price.  We think it will be higher than that with the removal of millions of gallons of R99 from Oregon’s market.  In the first quarter with the removal of imported R99 hitting the state we expect the Cap at the Rack price to start in the higher $.30 a gallon range where it left off when the program was ended by a court. As the low CO2 exempt renewable diesel gallons shrink in the first quarter a heavier reliance on fossil diesel will be required.

We expect quite a bit of biodiesel to be loaded up ahead of the $1 a gallon subsidy being ended on December 31st.  Renewable diesel will be in short supply due to disruptions in supply of imported product.  So first quarter R99 will be at a premium and B99 for blending with diesel will be a deal to be had as fossil fuel diesel prices rise.  Expect to see far more B10 and B20 offered in the market place as either a more common than not fuel at retail gas stations, truck stops, and most cardlock stations, especially in Portland.  Star Oilco will have options for our customers of either B20, R99, or R20 blends of diesel all complying with the City of Portland Renewable Fuel Standard inside the city.  Star Oilco’s Portland CFN and Pacific Pride locations will have both R99 and B20 hoses available for customers.

California will continue to demand any and all R99.  If the market is short R99 because of a removal of imported renewable diesel, the value of R99 in California will rise to justify foreign R99 to enter the market without a subsidy.  Star Oilco presumes that number will be between $.40 to $.80 a gallon.  If R99 in California is able to demand a premium, Oregon will have to pay that price for incremental gallons.  Oregon has a specific need for R99 and B99 for retail gasoline sellers to meet the Climate Protection Program (if you sell so much gasoline you must reduce your market share someplace and R99 diesel is the easiest way to do that).  Oregon retailers will be seeking to move a budgeted amount of renewable diesel and biodiesel to meet their fossil fuel allowance budgets under the CPP.  Each gallon beyond that will have to compete with California at a high price.

R99 will still be available but we expect incremental gallons to be at a premium.  Contractual gallons direct with a refiner of renewable diesel will have a consistent price that a business can manage fuel surcharges against diesel.  Outside of a contract for volumes, the wholesale rack price of R99 may vary wildly compared to a B5 ULSD fossil fuel diesel prices depending on how high diesel is going for are as well as the CPP and CFP values of a Carbon Credit and Cap at the Rack.

The big unknown to price is how one key importer of R99 will respond to the market without a subsidy.  It is the assumption of Star Oilco that California will continue to buy imported R99 without a subsidy for it’s off-road mandated market. If the economics of Neste are such, they can compete and open the floodgates of R99 and this could change.  This open flood of product is not expected especially given the economics of Sustainable Aviation Fuel which renewable diesel plants are expected to make more of in 2025.

The Oregon and Washington market will see a flow of new capacity of R99 for retailers mandated to reduce their fossil fuel volumes.  US production of R99 is expected to more than compensate by 2026, but 2025 will be a chasm to jump.  Chevron, HF Sinclair, Marathon, and Phillips 66 will be procuring and supplying US made biomass based diesel to the Pacific NW for their retail gas station needs.  We would expect to see R99 or blends of it sold at parity with branded diesel in the retail market in Oregon.

Commercial sellers of wholesale unbranded diesel will have a tougher time lining up R99 at a price in line with wholesale B5 or B20 ULSD.  No doubt with these higher prices we will be seeing an evolution of R20 (20% renewable diesel) as well as blends of biodiesel with renewable diesel available inside the City of Portland for it’s Renewable Fuel Standard as a premium fuel at a competitive price with diesel.

Star Oilco has R99 and R20 blends for commercial customers in the Portland, Oregon area.  We also have R99 available for Clark County Washington commercial and municipal fleets.  Star Oilco also has biodiesel blends and can support fleets seeking to succeed with it.  Call us if you would like to talk about your fuel supply in 2025.

If your fleet has an interest in a consistent and contractual supply of R99 renewable diesel or wants to develop a relationship that prioritizes a 20% of renewable diesel blended to meet Portland’s Renewable Fuel Standard compliance please feel free to reach out to Star Oilco.

Call Us Today

For further reading of news coverage of the Oregon Climate Protection Program please see the following:

KGW8 – Climate Protection Program returns after being struck down by court

KATU2 – Oregon adopts Climate Protection Program to cut fossil fuel pollution by 90% by 2050

Oregon Capital Chronicle – Redo of Oregon program to cap greenhouse gas pollution ready for public review. 

The Oregonian – Oregon restores signature Climate Protection Program to cut greenhouse gases.  

Central Oregon Daily News – Oregon commission approves redo of landmark climate program after lawsuit derailed it

Oregon Public Broadcasting – Oregon to reinstate ambitious climate program amid divided reactions from industries, environmentalists

US Energy Information Agency: Biofuels Displacing Petroleum on the West Coast

Reach Out To Our Team

Our team of fuel experts would be happy to work with you and help you understand how this affects your operations

Contact Us
home insulation representing energy efficiency for renewable fuel standard compliance in Portland Oregon
What Is The Renewable Fuel Standard In Portland? 1024 683 Star Oilco

What Is The Renewable Fuel Standard In Portland?

Did you hear about the time Portland banned fossil fuel diesel?

Portland is making a big move to provide cleaner air and reduce greenhouse gas emissions. Portland has implemented what’s called the Renewable Fuel Standard (RFS) beginning  its first phase on May 15th, 2024. The RFS policy in Portland mandates that there has to be an increase of use of low-carbon biofuels in diesel within city limits of Portland. This is part of the ultimate Climate Emergency plan. This RFS mandate was first implemented in 2006 as a B5 (5%) Biodiesel blend mandate with the goal of mandating a 20% blend. The RFS is the first of its kind not only in Oregon but in the entire United States. Portland’s reputation as a leader in environmental sustainability efforts continues. 

Portland’s Phases To Implement Almost 100% Renewable Diesel

What makes Portland’s mandate unique is the requirement that the biofuels have a CO2 value so low it bars most American made biodiesels. The blending requirement starts at 15% in 2024, and then it will steadily increase to 50% by 2026 and will reach 99% by 2030. This schedule demonstrates how Portland’s low-carbon ambition is present to transition away from fossil fuels and promote alternative energy sources.

This policy is expected to reduce air pollution and carbon emissions. It will also create new markets for biofuels, which will lead to increased economic opportunities. This will ultimately help the city become a more sustainable and environmentally friendly place to live as Portland has taken the lead in striving for sustainability over the years.

The policy will also help create jobs in the biofuel industry and provide opportunities for businesses to switch to renewable energy sources. It will also help reduce the city’s dependence on fossil fuels and protect the environment for future generations.

Want to learn more about meeting Portland’s requirements for the Renewable Fuel Standard mandate?

Contact Us
landscape view of Mount Hood representing Star Oilco’s fuel delivery service area in Oregon

Focus on Lower-Emission Biofuels

Uniquely, Portland’s RFS goes beyond just the biofuel blend. It also sets a strict carbon intensity (CI) standard for the biofuels themselves. This ensures the biodiesels used have a significantly lower carbon footprint compared to traditional options. Biodiesels produced domestically often fall short of this CI requirement, prompting many suppliers to look to renewable diesel sources. This focus on biofuels with a lower lifecycle carbon footprint makes Portland’s RFS even more impactful in reducing greenhouse gas emissions.

Iconic Portland sign on Broadway at dusk with city buildings in the background

Exemptions and Implementation Details

The initial phase of the RFS targets on-road diesel sales. This applies to diesel purchased at gas stations, by mobile fueling companies, and for use in large stationary tanks. However, the long-term goal includes all diesel use within the city. Some temporary exemptions apply to off-road diesel uses such as heating oil, generator fuel, aircraft fuels, watercraft fuels, and other dyed fuel users. One local truck stop, Jubitz Truckstop, was granted a temporary exemption. This is likely due to concerns about disrupting critical transportation operations. Daimler (the manufacturer of Freightliner and Western Star trucks) has a research facility in Portland. Daimler was also granted an exemption to meet their specific fuel needs for testing purposes. 

The RFS enforces compliance through fuel sampling and requires documentation proving the fuel meets the minimum biofuel content and CI standards. Businesses that purchase diesel need to be able to show their compliance through bills of lading (BOLs) or similar records from their fuel provider, like Star Oilco. If a business does not comply and provide this documentation, it can result in pretty hefty fines. First offenses can be a fine of $10,000 per day. Repeat offenders will end up facing even bigger penalties of up to $15,000 per day. These fines can really show the impact of how serious Portland is taking this initiative. 

Impact on Businesses and Consumers

While residential consumers who don’t purchase diesel directly are not directly impacted, businesses purchasing diesel, especially in bulk, will need to adapt to the new regulations. This may involve acquiring documentation from fuel suppliers or entering into contracts guaranteeing compliant fuel blends. Wholesale fuel distributors, who sometimes purchase from multiple vendors and blend fuel mid-route, may face additional challenges in tracking the biofuel content and CI of their product. However, as the program matures, the industry is expected to adapt and streamline these compliance procedures.

Contact Us Today To Discuss What This Means For Your Business

Contact Us

A Step Forward for Cleaner Transportation

Portland’s ambitious RFS sets a new expectation for sustainable transportation. Promoting low-carbon biofuels allows Portland to aim to significantly reduce its reliance on fossil fuels and be able to contribute to cleaner air for its residents. The RFS program will be able to serve as a model for other cities that are looking at implementing similar initiatives. Great job Portland for paving the way to a sustainable future for other cities! Although challenges will remain, as businesses adapt to this new norm, Portland’s RFS represents a significant step forward in creating a more sustainable transportation sector.

The RFS program is an important step in the fight towards sustainability and lower carbon fuels. It sends a clear message that cities are willing to take action to reduce emissions and protect the environment. We anticipate that other cities will follow Portland’s lead and create similar initiatives. This will have a significant impact in reducing emissions and helping to protect the environment.

It is a positive step towards a more sustainable future. Alternative fuels have become more and more readily available. Investing in alternative fuels and reducing carbon emissions is essential for protecting the planet for future generations. Governments should prioritize investing in renewable energy sources and incentivize communities to switch to alternative fuel solutions.

Thank you for choosing Star Oilco as your preferred fuel provider in Portland and Vancouver, Washington. Give us a call to discuss how the RFS mandate can affect your business and one of our team members would be happy to discuss this with you.

JOIN THE FUEL MARKET REPORT NEWSLETTER FOR YOUR WEEKLY FILL OF UPDATES!

Name
Ceramic house with red winter hat and pinecones
Every question Star Oilco has been asked about heating oil 1024 683 Star Oilco

Every question Star Oilco has been asked about heating oil

Heating Oil FAQ (and not so FAQ)

heating-oil-tank

When it gets cold in the Pacific Northwest, it’s time to take a look at some common questions we have been asked about Heating Oil.  If you don’t see an answer to a question you have, please feel free to call, email, or message Star Oilco and we will gladly answer. We especially welcome questions  that require research.

Get A Heating Oil Quote

What is Heating Oil in Oregon?

Heating Oil in Oregon is diesel and can have a biodiesel blend as well.  Diesel fuel has several grades either #1 or #2 Diesel.  The number refers to the grade with #1 being called either “stove oil” or “Kerosene” as another term for it.  Typically when someone is requesting or talking about heating oil they are talking about #2 Diesel dyed red to denote there are no on-road fuel taxes associated with the fuel.

How Does a Furnace Work?

There are several types of oil furnaces.  The most common is a vaporizing burner.  These furnaces typically work by taking a liquid combustible fuel, vaporizing it into a fine mist through a fuel oil nozzle, and igniting that mist into fire. That fire heats either air or water for your home’s comfort.

Heating Oil Fired Air Furnaces

Air furnaces usually move the air through a heat exchanger where a blower then moves air over the heat generated by your furnace, and finally the air is pushed through your home’s vents. 

Heating Oil Fired Water Furnaces and Boilers

Boilers and Water furnaces heat a tank of water which is then distributed several different ways to heat your home.  Either by moving hot water to radiators, radiant plumbing under your floor, or to a heat exchanger and blower which transfers the heat from the hot water into vents blown throughout your home. 

Heating Oil System prior to the combustion system

The parts leading up to the Burner of of an oil furnace system are simple. There is a tank to hold a reservoir of oil, a line from that tank (and sometimes a line back to it), a fuel filter, a fuel pump, and a vaporizing burner that combusts the heating oil into fire. Combustion of the fuel takes place in a fire box next to the heat exchanger. The heat exchanger takes on the heat of the flames to heat either air or water. In an oil furnace, the heat exchanger is assisted with a blower that pushes the hot air throughout your home to keep you comfy.

How Do I Check the Volume of Fuel in My Tank?

If you have an above or below ground heating oil tank you can confirm your fuel volume by the inches of fuel in the tank.  If you have an above ground tank there is probably a tank gauge that can tell you an approximate volume in the tank.  If you have an below ground tank you can confirm how many gallons are in the tank by putting  a measuring stick or tape-measure into the tank.

You will want to confirm the size of the tank you have. Your oil provider will probably have an idea of what size your tank is by looking or historic deliveries. Star Oilco has a tank chart which will help.  If you place a stick or tape measure into your tank and see how much fuel is in it you can compare that to a tank chart found on Star Oilco’s website.  When delivering fuel you can “stick” measure the tank before and after the delivery. Compare these volumes with the delivery and you can often figure out your tank size based on the before and after volume lining up with how much fuel filled your tank.

To view Star Oilco’s Tank Chart please click HERE. 

What is “Home Heating Oil” or “Residential Heating Oil?”

Home heating oil can be either a petroleum diesel fuel, bio-synthetic diesel fuel, or biodiesel fuel. In Oregon and Washington, home heating oil is typically ultra-low sulfur diesel fuel often containing between 5% and 20% biodiesel. Star Oilco’s standard home heating oil fuel is B5 dyed ultra-low sulfur diesel. Oregon mandates require that all diesel fuel sold contain a minimum 5% biodiesel. For that reason Star Oilco carries B5 or 5% biodiesel blends in our heating oil.

(NOTE: Kerosene sold by Star Oilco contains no biodiesel due to the reality that wick heaters cannot handle even a minute amount of biodiesel in them.) Star Oilco also carries a 20% biodiesel blend, called B20 Bioheat, for customers who want a cleaner burning low carbon fuel for their home.

What is Kerosene?

Kerosene is a heating oil product that is capable of being picked up and fed consistently by a wick heater. Kerosene is a diesel product that is very similar to the fuel used for over the road trucks. The big difference is that kerosene is a “lighter end” distillate fuel, which means it has a lighter specific gravity. This lighter characteristic means that it also works better in certain systems like wick heaters, pressure washers, and pot burner stoves.

Can Heating Oil be Used in a Kerosene Heater?

It depends on what type of system the kerosene heater is operating with. If you have a wick heater it will not work with heating oil. You will likely have to replace the wick to get it to work again as diesel will not readily drawn into the wick. Even if it does, it will burn far dirtier. If it is a pot burning system like a Toyostove or Monitor heater, then it will burn ultra low sulfur heating oil. Increased maintenance is to be expected on the pot burner, as there is a likelihood of more coking (crusty black soot build up) to occur inside that system.

What is “Bio Heating Oil” or Bioheat?

Bio heating oil and bioheat refer to heating oil products with a blend of biodiesel in them. Typically bioheat is a blend between 5% to 20% biodiesel with ultra low sulfur diesel for a clean burning and low CO2 heating fuel.

For a really in-depth look at biodiesel used as a heating oil check out this article. 

Will Heating Oil Run a Diesel Engine?

Yes, heating oil will run in a diesel engine. Heating oil is diesel. Be aware though that on-road vehicles must only run clear diesel fuels. If caught using heating oil in an on-road vehicle in Oregon and Washington, the fines can run in the tens of thousands of dollars. Heating oil can also be dyed to signify it isn’t for on-road use. 

Also be aware that even many off-road pieces of equipment and generators need ultra low sulfur diesel to operate without very expensive maintenance. Heating oil can have low sulfur or even high sulfur contents that could cause real issues for modern clean diesel engines. Some consideration is needed prior to burning a fuel marked “heating oil” in a diesel engine.

What Fuel Do I Need?

Consult your furnace, stove, boiler or water heater’s factory recommended specification. Typically it’s Number 2 Diesel unless it is a stove pot or wick heated system. If you have a furnace or a boiler in your basement, you can assume it’s heating oil. Call a licensed and bonded heating oil furnace technician to tune up your furnace to confirm for sure. If you do not have one, Star Oilco can refer you to a number of reputable long-time firms who can help.

What Are Additives and Are They Worth it?

Heating oil additives are added to fuel in order to improve it’s long term storage and performance.  They are worth it and most reputable heating oil providers additize their fuel without an extra charge.  This is because most heating oil customers store their fuel for long periods of time.  If you are planning on storing heating oil for years you will need a fuel additive to keep that fuel in the quality needed for your furnace.

Star Oilco provides a premium diesel additive called Hydrotex PowerKleen to every gallon of heating oil we sell.  Beyond this stabilizers, if you are planning on storing fuel for years we recommend ValvTect Plus 6.  You will want to treat your fuel with a biocide like ValvTect Plus 6 to will kill any bacteria, yeast, algae, or other biological organism that can grow inside your heating oil tank.

For more on storing diesel or heating oil for long periods of time please read this article on long term fuel storage.

What Does Heating Oil Smell Like?

Heating oil smells like diesel. It is a diesel product and often, depending on location, it is the same as on-road diesel. It may be dyed to denote that it is an off-road fuel with a untaxed use. Heating oil is dyed red in the Pacific NW to show it is off-road diesel.

What is Heating Oil #2?

Heating Oil #2 is number 2 diesel or the standard diesel sold in most places for on-road diesel use. Heating Oil #2 is a slightly different specification than on-road diesel that allows for more sulfur. That is a big difference as far as the EPA is concerned. On-road and off-road vehicles in the U.S. are required to use ultra-low sulfur diesel. Heating oil systems can use low or high sulfur diesel fuels. Ultra low-sulfur diesel is the most common Heating Oil #2 fuel that is delivered by Star Oilco since it is a superior and cleaner burning fuel, in our opinion.

Where can I buy heating oil at the pump?

In the Pacific NW heating oil is ultra low sulfur diesel. Therefore, you can buy any diesel sold at a retail gas station, truckstop, farm supply or other liquid fuel seller.  Heating oil is dyed red to show that it is not taxed for on-road fuel use.  Other than that red dye, typical auto-diesel will work in your oil furnace if you need to supply it from a diesel can.

At What Temperature Does Heating Oil Freeze?

Heating Oil Gel Point:

In the Pacific NW we expect number 2 diesel heating oils to be operable beyond -10 degrees. The record cold weather in the Willamette Valley is above 0 degrees (recent decades 16 degrees was our record low in Portland). We do test and add additives to our fuels to ensure they meet this specification even if they contain 5% biodiesel blended into heating oil.

Kerosene Gel Point:

Kerosene fuels (Number 1 Diesel, Number 1 Stove Oil, and Kerosene labeled fuels) are expected to be good below -30 degrees and are designed to be used in high altitude applications. (Kerosene and jet fuels are often the same specification in the Pacific NW.)

B20+ Biodiesel Gel Point:

Biodiesel blends of B20 and above are assumed to be good to 20 degrees but if Star Oilco expects below-freezing weather, we highly recommend B5 as your delivered fuel. B99 biodiesel typically gels at 40 degrees, so it’s not a winter fuel unless you have a system designed to keep the fuel warm in the middle of winter.

What do “Oil Heating,” “Oil Fired Heater,” or “Oil Furnace” Mean When Referring to a House?

“Oil Heat” or “Oil Fired” refers to a heating system reliant on burning heating oil. Typically this is by use of a vaporizing burner that takes the combustible liquid that is heating oil and vaporizes it through a nozzle into an igniter that causes it to burn.  This system burns the heating oil, creating a great deal of heat that can warm air, water, or both to heat a home or commercial space.

Can Heating Oil Fumes Make You Sick? Are the Fumes Harmful, Dangerous, or Toxic?

NOTE: IF HEATING OIL HAS BEEN INGESTED PLEASE SEE A MEDICAL PROFESSIONAL.

Heating oil by itself is not dangerous or toxic if it come in contact with your skin.  It is easily washed off with soap and water.  A small amount of diesel spilled on the surface of the ground, typically will break down on it’s own in the presence of the environment.  A small amount spilled on concrete or asphalt can be cleaned up easily with dish soap and water. If your tank leaks and heating oil is soaked below ground this will not break down easily and will take professional help to treat.

The exhaust from heating oil systems contains carbon monoxide and carbon dioxide as well as particulates.  Heating oil and other diesel exhausts are very dangerous and toxic and should be avoided.  Do not allow exhausts of any kind to collect in an enclosed space.

Can Heating Oil Evaporate?

Heating Oil’s vapor point (the temperature it turns to vapor and evaporates) is around 140 degrees Fahrenheit.  Heating oil ignites at 160 degrees.  Typically in the Pacific NW the temperature (especially outside) is well below the vapor and flash point of diesel fuels including heating oil and kerosene. If spilled it will not usually evaporate. You can clean heating oil and diesel up with regular dish soap and water.

Can Heating Oil Vapor Explode? Can They Ignite?

Heating oil ignites at 160 degrees.  So unless the temperature is that high an explosion is not a risk.  Fire Code regulating heating oil tanks and placement takes this concern into account.  So typically except in extreme scenarios heating oil vapor does not pose an explosion risk.

If you drop a match into a cup of heating oil at room temperature it will go out.  If you hold a match to the surface of the heating oil in that cup the flame will get large and bright but the heating oil itself will not ignite.  Heating oil needs to be vaporized before it will ignite. It is a combustible fuel so it must be in a vapor form to light.  The vaporizing nozzle of your heating oil furnace turns diesel into a vapor mist easily ignitable.

Can Heating Oil Go Bad? How Long Can I Store Heating Oil?

Yes, heating oil can go bad. If you are planning to store heating oil for longer than a year, you should use a diesel additive that stabilizes fuel for long term storage. If you are storing the fuel as a back-up where you might go years without using it, you should also consider adding a biocide to ensure nothing grows in your tank. The two biggest threats to your fuel staying in specification are water and biological growth. Biological growth occurs inside the water that can collect in your tank bottom naturally through condensation over time.

Star Oilco treats 100% of our dyed fuels with Hydrotex Powerkleen to ensure that it is stable for storage for over a year. If you need to store it longer than that, we further recommend adding a desiccant breather to scrub moisture out of the air when your tank breaths, which protects it from additional water.

For more on additizing your heating oil for long term storage please follow THIS link.

Can a Heating Oil Tank be Outside?

Yes, heating oil tanks properly installed outside are perfectly safe and capable of ensuring your fuel stays clean and dry.

Are Oil Tanks Regulated?

Yes, at several different levels. With residential use, there are local jurisdictions’ building permit requirements for installation and safety. With commercial use, there is the same building permit regulation and usually an added level of Fire Marshall sign-off for siting of any tanks. In rural areas, regulations are different if the tank is associated with an agricultural use.

In Oregon and Washington, a 90 day temporary tank for construction purposes (to move from one tank to another in a formal process) is usually allowed, but you should ensure the temporary tank is a double wall tank and is in a safe place. If your tank leaks (or even if there is a suspicion of a leak), the Oregon Department of Environmental Quality and Washington Department of Ecology have an involved process to close out a leaking oil tank.  

Do I Need to do Maintenance on My Furnace? How Often?

Yes, you need to ensure you maintain your oil furnace. Star Oilco recommends getting a tune up annually or at least every other year.  If you are seeking a referral to a HVAC company that specializes in oil heat, call Star Oilco’s office 503-283-1256 and ask for a list of qualified license and bonded companies we recommend. You also want to check your oil furnace for water annually. Star Oilco can stick your tank for water at no charge upon request with a fuel delivery.

One of the great benefits of oil heat is that oil furnaces are known to last for over fifty years if maintained properly. Natural gas and propane furnaces typically wear out every ten to twenty years dependent on their construction. The primary wear consideration on any furnace is the heat exchanger. The heavy steel part takes the flame of burning fuel, transmits this heat to the air, and is then pushed to heat your home. Oil furnaces must be tuned up every year or two to ensure the heat exchanger is cleaned.

If you do not service the heat exchanger, it will collect soot. Soot insulates the heat exchanger unevenly and causes wear that will eventually lead to a crack. If a heat exchanger is cracked, the furnace is no longer safe to operate. Additionally, an annual tune-up will pay for itself by ensuring your furnace is burning at peak efficiency. You will want to replace your furnace air filter regularly on an annual basis.

How Do I Reduce My Consumption of Heating Oil?

Tuning your furnace annually or every other year is highly recommended. Adjusting the fuel air mixture for the most efficient combustion goes a long way to ensure you use as little heating oil as possible. Star Oilco has witnessed fifty and even seventy year oil furnaces operate at modern efficiencies when maintained regularly over their lives. Today, there are a host of high efficiency oil furnaces manufactured and supported to reduce your cost of fuel.  Additionally, confirming the envelope of your home is not drafty or needlessly wasting heat can go a long way in reducing your heating expenses.

How Can I Reduce the Cost of My Heating Oil?

The price of heating oil fluctuates frequently due to market conditions. Comparison shopping is your best way to ensure you pay the best possible price. One web based tool we have heard customers like to use to save time while shopping for heating oil is Fuelwonk.com.  It is free and easy to use.

Best Practices with a Fuel Tank

Even though the cost of fuel is dependent on the market and out of our control, there are best practices to reduce the amount of oil you’ll need. The temperature you keep your house will affect how much oil you go through. Keeping your temperature higher will lead to more oil burned during the winter months. How insulated your home is will also affect the amount of oil you burn. Having poor insulation will result in having your furnace running hotter for longer periods of time, increasing fuel use. Annual maintenance of your furnace will keep your furnace operating at top efficiencies. Having a well working and operating furnace will keep costs down by not wasting oil on an underperforming unit.

Heating Oil Discounts

Star Oilco also has a number of discounts and programs for price reduction. We offer $.05/gallon veteran and senior citizen discount. We frequently have discounts on Google and our social media pages so make sure to check those out. Mention where you saw it to receive the discount.

Heating oil customers at Star Oilco have the opportunity to enroll in our Equal Pay program. The program allows you to make equal monthly payments on future heating oil deliveries. As an Equal Pay customer, you will receive a discount of .20 cents per gallon on all heating oil deliveries. We also have an Autofill program which dictates you receive our best price as well as automatic deliveries. You don’t have to keep track of your fuel or when you need a delivery. We do the work for you!

If you do not like our price and someone else is cheaper let us know.  We will match their price.

Will Heating Oil be Phased Out?

Heating Oil is a modern fuel that uses today’s heating oils and biofuels.  The investments in research and development for heating oil furnace by the National Oil Research Alliance to use a wider variety of biofuels in higher lower CO2 blends have kept heating oil relevant in many applications.  As a heating fuel, it’s use will become more rural than urban rather than a phase out. As it is today, the use of heating oil will be used where natural gas is not available especially if the temperatures get below zero. Urban adoption of natural gas has increased, as it’s cheaper than heating oil due to increased fracking development of petroleum.

What are "Degree Days?"

Star Oilco uses a Degree Day system for our customers on Automatic Keep-Full Service.  We fill your tank before it needs it automatically. A statistical regression analysis correlates your typical use of heating oil in your home and the weather.  Our systems will track your usual fuel usage and we automatically schedule delivery to keep your tank full.

What is The Energy Content or "BTU's"?

The technical term “BTUs” refers to “British Thermal Units” which is a measure of energy content of a fuel. The energy content of diesel fuels can vary slightly by regions and specifications of those regions.  In the Pacific Northwest, heating oil is typically Ultra Low Sulfur Diesel with a blend of biodiesel content. This can range from 5% to 20% biodiesel added to the fuel. This means the exact BTU measured for a gallon of heating oil an slightly vary.

Source: US Alternative Fuel Data Center Fuel Properties Comparisons
Ultra Low Sulfur Diesel: 128,488 BTUs to 138,490 BTUs per gallon.
B5 Biodiesel is presumed to be about the same BTUs as ULS Diesel.
B100 Biodiesel: 119,550 BTUs to 127,960 BTUs per gallon.
B20 Biodiesel: 126,700 BTUs to 136,384 BTUs per gallon.

Get A Heating Oil Quote Today

  • This field is for validation purposes and should be left unchanged.
Diesel fuel flowing into a dark reflective liquid surface
What Are Our Options for Alternative Fuels? 1024 578 Star Oilco

What Are Our Options for Alternative Fuels?

What are our options for alternative fuel?

Biofuels are eco-friendly fuel choices because they are made from renewable resources and produce fewer emissions than fossil fuels. Biofuels and biodiesel can also be used to improve air quality. They also allow us to reduce the dependence we have on using fossil fuels. 

Biofuels are liquid fuels produced from biomass, which is organic matter such as plants, algae, and agricultural waste. Biofuels can be used to power vehicles, generate electricity, and heat homes and businesses.  Biofuels are renewable and can reduce emissions of greenhouse gases. They provide an alternative to fossil fuels and help to conserve natural resources. Reducing the emissions of greenhouse gases is an important factor in helping to combat climate change. Biofuels have the potential to be a significant part of the solution. Biofuels can reduce emissions of greenhouse gases by replacing fossil fuels, which are made from non-renewable sources. Using biofuels instead of fossil fuels can also help to reduce air pollution. 

Some common types of biofuels include: 

Ethanol

Ethanol is a type of alcohol that is made from fermented corn, sugarcane, and other crops. It is blended with gasoline to create E85, a fuel that can be used in flexible-fuel vehicles.  This type of fuel is cheaper than regular gasoline, and it is more environmentally friendly. It is also safer to store and transport than other types of fuel. The benefits of using ethanol fuel include reduced emissions of carbon dioxide, improved air quality, and increased energy security. It is also renewable and biodegradable, making it a more sustainable fuel choice. Additionally, the production and use of ethanol fuel can create jobs and support local economies. 

 

Biodiesel

Biodiesel is a type of diesel fuel that is made from vegetable oils, animal fats, and waste grease. It can be used in unmodified diesel engines as a drop-in solution. It is a renewable fuel and emits less carbon dioxide than petroleum-based diesel. Biodiesel is also less toxic and it’s biodegradable. The benefits of biodiesel include reduced emissions of carbon dioxide, sulfur dioxide, carbon monoxide, and unburned hydrocarbons; improved combustion efficiency and power output; improved lubricity; and improved fuel economy. Additionally, biodiesel is biodegradable and has a lower energy content than petroleum-based diesel, making it safer to handle and transport in the Portland, Oregon metro area as well as Vancouver, Washington. 

Biodiesel can be used in a variety of applications, including transportation, heating and electricity. Biodiesel is used in transportation to power diesel engines in cars, trucks, buses, and other vehicles. Biodiesel can also be used to heat homes and businesses. Biodiesel also can generate electricity in power plants.  

Biodiesel is a promising alternative to petroleum diesel, and its use is growing around the world. The United States is the world’s largest producer of biodiesel. 

Algae-based biofuels

Algae-based biofuels are a new type of biofuel that is made from algae. Algae are a rapidly renewable resource that can be grown in a variety of environments. Algae is a group of photosynthetic organisms that grow in water. Algae have the potential to produce significantly more oil than traditional biofuel crops, such as corn and soybeans, and they can be grown on non-arable land, such as saltwater or wastewater. This makes algae an attractive potential source of renewable fuel. 

When algae are grown in the right conditions, they can produce up to 77% oil, which can be converted into biodiesel, renewable diesel, or other biofuels such as ethanol, butanol and jet fuel. Algae-based biofuels have the potential to significantly reduce greenhouse gas emissions from transportation, electricity generation, and other industries. However, there are still challenges that need to be overcome before algae-based biofuels can be commercially viable. These challenges include scalable production, costs, efficient harvesting and efficient processing to extract the oil. There is a lot of research and development underway to overcome these challenges and with continued investment, algae-based biofuels have the potential to become a major source of renewable fuel in the future. 

 

Hydrogen

Hydrogen is a versatile energy carrier that has the potential to play a significant role in the transition to a clean energy future. It is the most abundant element in the universe and can be produced from a variety of sources, including natural gas, biomass, and renewable electricity. When used in a fuel cell, hydrogen produces only water and heat, making it a clean and efficient fuel source. 

Using hydrogen as a fuel provides clean burning, a high energy density, efficiency, among many other benefits. Hydrogen doesn’t produce any emissions of harmful pollutants which makes it an attractive option as a fossil fuel alternative. Hydrogen’s high energy density means that a relatively small amount of hydrogen can provide a lot of energy. Using hydrogen fuel cells to generate electricity are 2-3 times more efficient than internal combustion engines. It can also be used in a wide range of applications, including transportation, electricity generation as well as industrial processes.  

Some of the challenges we face with hydrogen as a fuel are its current methods of production. They are not always as clean or sustainable currently. Storing hydrogen, being a gas, requires specialized storage tanks. The infrastructure for transporting and distributing hydrogen is not yet fully developed.  

Overall, there is a growing interest in using hydrogen as a fuel source with very promising results and possibilities in our future. Governments and businesses all over the world have been investing in research and development to figure out solutions to these challenges in order to make hydrogen a more viable energy source.  

Renewable Diesel

Renewable diesel can also be known as hydro-treated vegetable oil (HVO) or green diesel, and is a type of biofuel that is chemically identical to petroleum diesel. It is produced from a variety of feedstocks, including vegetable oils, animal fats, and waste oils. Renewable diesel can be used in any diesel engine without modification, and it offers a number of environmental benefits over petroleum diesel, including: 

 

Reduced greenhouse gas emissions 

Renewable diesel (R99) reduces greenhouse gas emissions by up to 90% compared to petroleum diesel. R99 being cleaner and more efficient, makes it an attractive option for many transportation companies. 

 

Improved air quality 

Renewable diesel produces fewer harmful pollutants, such as particulate matter and sulfur oxides, than petroleum diesel. Additionally, renewable diesel is lower in carbon than petroleum diesel, making it a more sustainable option for transportation. Renewable diesel is also more efficient, reducing the amount of energy needed to produce the same amount of fuel. 

 

Biodegradability  

Renewable diesel is biodegradable, meaning that it breaks down naturally in the environment.  This helps to reduce the amount of harmful pollutants in the environment. Renewable diesel also reduces emissions of carbon dioxide, a major contributor to climate change. 

Renewable diesel is a promising alternative to petroleum diesel, and its use is growing around the world. The United States is the world’s largest producer of renewable diesel, and the European Union has a mandate to use 10% renewable diesel by 2030.  

Even more of the benefits of using renewable diesel:  

The use of renewable diesel helps reduce our dependence on fossil fuels since it is a renewable fuel.  

The local economy can be supported by renewable diesel, which is often produced from local crops.  

A number of sectors, including agriculture, manufacturing, and transportation, create jobs in the renewable diesel industry.  

Ultimately, renewable diesel is a clean and sustainable fuel that offers environmental and economic benefits. Around the world, its use is growing as an alternative to petroleum diesel. Renewable diesel helps to reduce air pollution, reduce greenhouse gas emissions, and reduce dependence on foreign oil. It is also a renewable and sustainable fuel source that can be used to produce electricity. As such, renewable diesel is an important option for reducing carbon emissions and improving sustainability overall. 

When we look at the variety of renewable and biofuel opportunities, there are a variety of ways that we can reduce our carbon footprint today without any modifications to our current engines. However, long term, we have opportunities that we can explore for where we believe that our future is going and the solutions that can allow for an even greater impact to our Pacific Northwest carbon footprint and reducing greenhouse gas emissions. Among all of the renewable resources, we can reduce air pollution, increase economic benefits and create a more sustainable future for the Portland, OR and Vancouver, WA metro areas. As technology continues to improve and the production of biofuels and biodiesel becomes more efficient, these fuels are likely to become more affordable and widely available. Feel free to give Star Oilco a call today to discuss your fueling needs today and how we can provide you with renewable sources today as a drop-in solution. 

JOIN THE FUEL MARKET REPORT NEWSLETTER FOR YOUR WEEKLY FILL OF UPDATES!

Name

3D illustration of a gas pump icon made from green leaves symbolizing biofuel
Renewable Diesel vs Biodiesel for Heavy-Duty Trucks 1024 753 Star Oilco

Renewable Diesel vs Biodiesel for Heavy-Duty Trucks

The Fuel Revolution

In the realm of sustainable energy, the race for cleaner and more efficient fuels is a top of mind priority for the majority of the industry. As heavy-duty trucks continue to dominate our highways and play a pivotal role in transporting goods across the country, the choice of fuel is paramount. The two most common fuels used throughout the PNW for greener transportation are: Renewable Diesel and Biodiesel. In this blog, we’ll take a deeper look into the power generation of these fuels, highlighting the key differences between them and citing relevant studies that illuminate their qualities. 

3D illustration of a gas pump icon made from green leaves symbolizing biofuel

Renewable Diesel: The New Age Wonder Fuel 

Renewable Diesel, often referred to as “green diesel,” or R99 is a high-quality alternative fuel that shares many characteristics with traditional diesel. However, it is derived from renewable feedstocks, such as vegetable oils, animal fats, and waste greases, through a process called hydrotreating. This process not only produces a cleaner-burning fuel but also eliminates impurities and aromatics found in traditional diesel. The result is a fuel with significantly lower emissions and enhanced performance. 

The Power of Renewable Diesel

Lower Emissions:

Perhaps the most significant advantage of renewable diesel is its environmental footprint. Studies, like the one conducted by the National Renewable Energy Laboratory (NREL), have shown that renewable diesel can reduce greenhouse gas emissions by up to 80% compared to standard diesel. This drastic reduction in emissions makes it a vital fuel in the efforts to combat climate change. 

Better Fuel Economy:

Renewable diesel boasts a higher energy content than biodiesel, allowing vehicles to travel more miles per gallon. A study by the California Air Resources Board (CARB) demonstrated that renewable diesel can improve fuel efficiency by 5-7% compared to biodiesel. For the trucking industry, this translates to significant cost savings. 

Compatibility:

One of the standout features of renewable diesel is its compatibility with existing diesel engines and infrastructure. Heavy-duty trucks can make the switch to renewable diesel seamlessly, without requiring any engine modifications or special storage facilities. 

Reduced Maintenance:

Studies like the one from the University of California, Riverside, have indicated that renewable diesel can lead to reduced engine wear and lower maintenance costs. The fuel’s superior lubricity and cleaner combustion help extend the lifespan of engine components. 

In 2015, NREL ran a study in partnership with the UPS and the Clean Cities Coilation to compare the fuel economy and overall impact of renewable diesel compared to petrelem diesel in 12 USP delivery vehicles operating out of Houston. The results of this study were that renewable diesel reduced carbon emissions by 4.2% comparatively to petroleum diesel. This finding is a result of the properties of renewable diesel given its higher mass-based heating value and lower carbon-hydrogen ratio. 

The UPS is one of the largest user of renewable diesel in the world. In 2015 UPS announced their plans to purchase over 40 million gallons of the sustainable fuel over the next three years (2015-2018). UPS was supplied this renewable diesel by Solazyme (now known as TerraVia).  

Below is a breakdown of the vehicles used in the study.

https://www.nrel.gov/docs/fy18osti/68896.pdf

BIODIESEL

Biodiesel, often derived from vegetable oils or animal fats through a process called transesterification, has been around for a while and has made significant strides in reducing emissions compared to traditional diesel. However, when pitted against renewable diesel, there are some critical differences.

The Limitations of Standard Biodiesel

Emissions:

While biodiesel is undoubtedly cleaner than traditional diesel, studies like the one published in the Journal of Environmental Science and Technology show that its greenhouse gas reduction potential is not as remarkable as that of renewable diesel. The production process of biodiesel also consumes substantial energy, offsetting some of its environmental benefits. 

Performance:

Biodiesel’s energy content is lower than that of renewable diesel, resulting in decreased fuel efficiency. Research from the University of Nevada, Reno, indicates that biodiesel can lead to a 3-10% reduction in fuel economy compared to renewable diesel. 

Cold Weather Performance:

Biodiesel has a higher cloud point and gel point than renewable diesel, making it less suitable for cold-weather operations. Trucks operating in regions with harsh winters may encounter issues with fuel gelling, potentially causing operational disruptions. 

Compatibility Challenges:

Biodiesel’s higher viscosity can lead to filter plugging and injector coking in some older diesel engines. This issue necessitates additional maintenance and potentially costly modifications. 

Close-up of green, yellow, and blue fuel nozzles at a diesel pump station

The Road Ahead: Renewable Diesel’s Triumph 

In the comparison of Renewable Diesel vs. petroleum diese for heavy-duty trucks, renewable diesel emerges as the clear winner. Its lower emissions, superior fuel economy, compatibility with existing infrastructure, and reduced maintenance requirements make it a game-changer in the transportation industry’s quest for sustainability. 

Studies across the board indicate that renewable diesel outperforms standard biodiesel in terms of environmental benefits and cost savings. For heavy-duty truck operators looking to reduce their carbon footprint and improve their bottom line, renewable diesel is undoubtedly the fuel of the future. 

In the quest for a greener future, renewable diesel has firmly taken the lead. Its remarkable reduction in emissions, better fuel economy, and seamless integration into existing diesel infrastructure make it the go-to choice for heavy-duty truck operators. While standard biodiesel has made commendable progress in reducing emissions, renewable diesel emerges as the winner in the arena of cleaner and more efficient fuels. 

The studies quoted in this blog are just the tip of the iceberg, illustrating the overwhelming evidence in favor of renewable diesel. As we move forward in our pursuit of sustainable transportation, it’s clear that renewable diesel will play a pivotal role in driving us toward a cleaner, more environmentally friendly tomorrow. 

Sign up for our newsletter to stay up to date

Name(Required)

lose-up of a red fuel nozzle at a green diesel pump
Renewable Diesel vs Biodiesel 683 1024 Star Oilco

Renewable Diesel vs Biodiesel

What’s the difference and how do they compare in price? 

If you are looking for a cleaner and greener alternative to diesel fuel, you might have come across two options: renewable diesel and biodiesel. Both fuels are made from organic sources, such as vegetable oils and animal fats, but they have different production processes and properties. In this blog post, we will compare renewable diesel and biodiesel in terms of their pros and cons, as well as their prices and incentives in Oregon. 

What is Renewable Diesel? 

Renewable diesel is a fuel that is chemically identical to petroleum diesel, but it is made from renewable raw materials through a process called hydrotreating. Hydrotreating removes impurities and oxygen from the feedstock, resulting in a pure and refined fuel that can be used in any diesel engine without modifications or blending. Renewable diesel (R99) has a high cetane number, which means it ignites easily and burns efficiently. It also has a low cloud point, which means it can withstand cold temperatures without gelling or clogging filters. 

What is Biodiesel? 

Biodiesel is a fuel that is made from renewable raw materials through a process called transesterification. Transesterification converts the feedstock into fatty acid methyl esters (FAME), which are then blended with petroleum diesel at various ratios. Biodiesel can be used in most diesel engines, but it may require some modifications or adjustments depending on the blend level and the engine type. Biodiesel has a lower cetane number than renewable diesel, which means it may not ignite or burn as well. It also has a higher cloud point than renewable diesel, which means it may gel or clog filters in cold weather. 

The cost of renewable diesel and biodiesel depends on various factors, such as the type and availability of feedstock, the production process, the market demand, and the government incentives. In general, renewable diesel is more expensive than biodiesel, as it requires more complex processing and higher quality feedstock. According to the U.S. Energy Information Administration (EIA), the average wholesale price of renewable diesel in California was $3.06 per gallon in October 2021, while the average wholesale price of biodiesel was $2.76 per gallon in the same month. However, both renewable diesel and biodiesel can benefit from federal RIN’s and state credits such as the low carbon fuel standards, which can lower their effective prices and make them more competitive with petroleum diesel. As of July 10th of 2023 renewable diesel (R99) in Portland Oregon was 60 cents higher than biodiesel (B99). 

 Renewable Diesel vs Biodiesel Carbon Intensity 

According to CARB, the carbon intensity of biodiesel ranges from 14.85 to 67.45 gCO2e/MJ and, renewable diesel ranges from 15.84 to 62.86 gCO2e/MJ, depending on the feedstock and production pathway. The lowest carbon intensity for biodiesel is achieved by using waste cooking oil as the feedstock and renewable methanol as the transesterification agent. The highest carbon intensity is associated with using soybean oil as the feedstock and fossil-based methanol as the transesterification agent. The lowest carbon intensity for renewable diesel is achieved by using waste cooking oil as the feedstock and renewable hydrogen as the hydrotreating agent. The highest carbon intensity is associated with using soybean oil as the feedstock and fossil-based hydrogen as the hydrotreating agent. 

Fuel-Pathways-Carbon-Intensity-Values

Pros and Cons of Renewable Diesel and Biodiesel 

Both renewable diesel and biodiesel have some advantages and disadvantages compared to petroleum diesel. Here are some of the main pros and cons of each fuel:  

Renewable Diesel Pros: 

– Reduces greenhouse gas emissions by up to 75% compared to petroleum diesel 

– Reduces tailpipe emissions of particulate matter, nitrogen oxides, carbon monoxide, and hydrocarbons 

– Improves engine performance and efficiency with fewer regeneration cycles of the emissions system 

– Compatible with existing infrastructure and vehicles 

– Biodegradable and nontoxic 

Renewable Diesel Cons: 

– More expensive than petroleum diesel 

– Limited availability and supply 

– May increase emissions of sulfur dioxide 

Biodiesel Pros: 

– Reduces greenhouse gas emissions by up to 78% compared to petroleum diesel 

– Reduces tailpipe emissions of particulate matter, carbon monoxide, and hydrocarbons 

– Biodegradable and nontoxic 

– Supports domestic agriculture and energy security 

 Biodiesel Cons: 

– May increase emissions of nitrogen oxides 

– May cause engine problems such as injector coking, filter plugging, corrosion, and reduced lubricity 

– May degrade over time or when exposed to water or microbes 

Oregon Prices and Incentives for Renewable Diesel and Biodiesel 

Oregon is one of the states that has adopted a Clean Fuels Program (CFP), which aims to reduce the carbon intensity of transportation fuels by 10% by 2025. The CFP creates a market for low-carbon fuels such as renewable diesel and biodiesel by requiring fuel suppliers to either blend them with petroleum diesel or buy credits from low-carbon fuel producers. The CFP also provides incentives for consumers to use low-carbon fuels by reducing their fuel taxes. 

According to the Oregon Department of Environmental Quality (DEQ), the average price of diesel in Oregon as of November 2021 was $3.87 per gallon. The average price of biodiesel blends ranged from $3.88 per gallon for B5 (5% biodiesel) to $4.01 per gallon for B20 (20% biodiesel). The average price of renewable diesel was $4.05 per gallon. As of July 2023 the price of renewable diesel (R99) in Oregon was 50 to 60 cents higher than biodiesel (B99). 

The DEQ also provides a Fuel Cost Calculator that allows consumers to compare the costs and benefits of different fuels based on their vehicle type, fuel efficiency, annual mileage, fuel price, carbon intensity, and tax rate. According to the calculator, using renewable diesel instead of petroleum diesel would save an average consumer $34 per year in fuel costs and reduce their carbon emissions by 1.6 metric tons per year. Using biodiesel instead of petroleum diesel would save an average consumer $12 per year in fuel costs and reduce their carbon emissions by 0.8 metric tons per year. 

Renewable diesel and biodiesel are both viable alternatives to petroleum diesel that can help reduce greenhouse gas emissions and support renewable energy sources. However, they also have some trade-offs in terms of cost, availability, performance, and emissions. Consumers should consider their vehicle type, driving habits, fuel preferences, and environmental goals when choosing between these fuels. Oregon offers some incentives and programs to encourage the use of low-carbon fuels such as renewable diesel and biodiesel, which can help consumers save money and reduce their carbon footprint. 

Star Oilco fuel delivery truck parked beside commercial fleet vehicles on a wet asphalt lot
Star Oilco Speaks On Decarbonizing Heavy Duty Trucks 1024 768 Star Oilco

Star Oilco Speaks On Decarbonizing Heavy Duty Trucks

Decarbonizing Heavy Duty Fleets By Using B99 Biodiesel.

Mark Fitz joined the Clean Cities Coalition Mindful Mobility Tech Talk series for their High GHG Reductions webinar. Mark spoke on the benefits of B99 and how fleets can begin decarbonizing their emissions today!
On September 28th, 2022, three representatives were invited to speak on how they are not only saving large amounts of energy but are also having a big impact on reducing greenhouse gas emissions.

Close-up of fuel nozzles at a gas station, with focus on green diesel handle

B99 Biodiesel reduces CO2 footprint of a 105,500 GVW truck and trailer by more than half at a lower cost than petroleum diesel.

How Can I Utilize B99 or B100 for Decarbonizing My Own Fleet?

Star Oilco uses The Vector System developed by Pittsburgh-based Optimus Technologies. The Vector System allows upgrades for any medium or heavy-duty engine to operate on 100% biodiesel. This is the only EPA-compliant biodiesel engine system and can be installed in as little as 12 hours. Contact Optimus Technologies or reach out to Star Oilco locally to learn more about The Vector System.

Star Oilco’s Field Test

Star Oilco fielded the Optimus Technologies system on our 105,500 GVW truck and trailers.  We began with a single Freighliner truck and trailer operating a Cummins ISX as a trial.  This truck’s typical route was approximately 305 miles round trip from Portland, Oregon to Grays Harbor, Washington.

Over the last year and a half this truck has performed amazingly well. The only maintenance concern is swapping the fuel filters more regularly with every oil change.  Neither drivers nor our Elog system noticed differences in mileage and power.  On a few occasions a loss of power was experienced requiring an in between service fuel filter swap.

Follow the links below for more information on B99 Biodiesel and Star Oilco’s field test of the Optimus Technologies System:

B99 Biodiesel As A Heavy Duty Fuel

Biodiesel As A Heavy Duty Low Co2 Solution

This event is part of the Columbia Willamette Clean Cities Coalition’s Mindful Mobility Tech Talk series.  A series designed to educate and expand on the evolving trends in fleet technology relevant to fleets seeking to decarbonize their miles traveled.

Row of school buses using heavy-duty biodiesel fuel
Biodiesel as a Heavy Duty Low CO2 Solution 768 1024 Star Oilco

Biodiesel as a Heavy Duty Low CO2 Solution

Save money with Low CO2 Biodiesel in your heavy duty fleet.

In Oregon the state ensures there is a cost associated with the CO2 intensity of a fuel.  This is why Biodiesel is consistently lower cost than petroleum Diesel fuels on the West Coast.  Get ahead of this curve and ensure your fleet benefits.


Why B99 Biodiesel was used in the past?

Prior to 2007 emission systems on modern diesels B99 Biodiesel was commonly used by fleets.  The fact that Biodiesel is a domestic, renewable and low CO2 fuel with a benign tail pipe emission made it popular.  B99 was the preferred fuel of dozens of fleets in the Pacific NW.  After the EPA requirements starting in 2007 which added particulate traps, SCR, their dosing systems, and the general complexity of these clean diesel systems on modern diesels, B99 became problematic.  Specifically the Tier 3 and Tier 4 diesel emission systems had a habit of choking on high blends of Biodiesel approaching B99.  This issue has been solved by Optimus Technologies Vector System.

Why B99 Biodiesel is the solution for Heavy Duty Diesel fleets seeking a Low CO2 solution today?

The Optimus Technologies Vector System provides the solution by enabling two tanks of fuel.  One tank dedicated to the diesel or R99 Renewable Diesel and the other tank dedicated to B100 or B99 pure Biodiesel. These systems optimize the systems of your modern Diesel fleet while also optimizing the performance and realities of the emission systems.

Star Oilco at the National Biodiesel Conference in Las Vegas

Mark Fitz, the President of Star Oilco, was invited to speak in front of a bunch of soy bean farmers on the subject of decarbonizing Heavy Duty diesel fleets.  Below is a walk through of his view on where diesel fleets can go to cut their CO2 emission in half or more today. NOTE: Mark Fitz’s portion begins at 18 minutes.

 

Please reach out to Star Oilco if you have further questions about using B99 or other blends of Biodiesel to reduce your fleet’s operating cost while cutting CO2 emissions in half.

Contact Form

  • This field is for validation purposes and should be left unchanged.

 

Close-up abstract image of diesel fuel with suspended droplets and fluid motion
What is Heating Oil? 1024 512 Star Oilco

What is Heating Oil?

In the Pacific Northwest heating oil is diesel.

Star Po;cp Crest

New heating oil customers often ask us, “What is heating oil?” Heating oil is diesel fuel and there are several grades and types. For Star Oilco our standard heating oil product is a ultra low sulfur diesel with a 5% biodiesel blend in order to meet Oregon mandates for off-road diesel fuel. That way our heating oil trucks can also serve construction fueling, emergency back up generators, and other common off-road diesel uses.

Star Oilco has a simple Heating Oil FAQ available.

For full on fuel nerds though, check out this more in depth deeper technical dive below.  If we leave anything out please don’t hesitate to ask for those seeking a nerd-level understanding of heating oil, kerosene and bioheat.

There are three typically grades of heating oil you can order.

Number 1 Diesel

Number 1 diesel is also called Kerosene or Stove Oil. This fuel has a lighter specification than typical heating oil which enables it to burn better in a “pot burner” or wick heater. Kerosene has its own specification as the fuel used by wick heaters. Kerosene is typically Number 1 diesel but not all Number 1 diesel’s are kerosene due to the need to be taken up by a wick heater. Any biodiesel content in a kerosene product WILL NOT work in a wick kerosene heater. So be very aware of confirming that your kerosene has never come into any contact with a biodiesel blend of fuel.

Red Number 2 Diesel

Red dyed diesel also called Heating Oil, Dyed Diesel, Off-Road Diesel is the default heating oil fuel. The fuel is dyed red to denote no on-road fuel taxes are attached to it. When you call and ask for heating oil, this is the fuel you are requesting. Clear or Green Number 2 Diesel is the fuel sold at retail gas stations and truck stops. That fuel will also work in your furnace, you just are paying for on-road taxes attached to that fuel.

Bioheat or Biodiesel Heating Oil

“Bioheat” is a blend of biodiesel and petroleum diesel to make a lower emission and lower CO2 heating fuel.  Typically Bioheat is Number 2 Heating Oil with a 20% blend of biodiesel or higher in it. It is a drop-in fuel for your heating oil furnace. There is no change other than routine maintenance is required. It is a cleaner burning fuel with a significant drop in CO2 emissions associated with your heating oil fuel consumption.  If you would like more information on biodiesel as a heating oil you can follow this link.

B20 Biodiesel Heating oil provider

Where do heating oil companies get their fuel?

In the Portland, Oregon market, diesel is fungible. Everyone buys or is expected to mix their fuel from each other in some way. Primarily this is due to the Portland/Vancouver market receiving most of its fuel down the Kinder Morgan-operated Olympic Pipeline. Which means all the refiners transporting fuel are mixing their product in transit. Additionally, there are shared terminal locations, which also have co-mingled owned diesel products.

Every refiner is typically expecting to mix their diesel and gasoline products. The difference is in the care a vendor takes to filter the fuel, using additives and continuously check their fuel quality. If you are buying at the absolute lowest price possible, know that there is an incentive to skip any added value of quality assurance.

Star Oilco buys our diesel products from a variety of vendors. The source refiner typically being either BP, Shell, Marathon(formerly Tesoro), Phillip 66, or a number of other refiners.

Portland, Oregon and Vancouver, Washington are not unique in in having fungible diesel and heating oil fuel specifications. Through its Pacific Operations unit, Kinder Morgan operates approximately 3,000 miles of refined products pipeline that serves Arizona, California, Nevada, New Mexico, Oregon, Washington and Texas. With roots dating back to 1956, it is the largest products pipeline in the Western U.S., transporting more than one million barrels per day of gasoline, jet fuel and diesel fuel to our customers. The company-owned terminals also provide additional services, such as liquid petroleum product storage and loading facilities for delivery trucks.

The heating oil and biofuel blends Star Oilco sells its customers

Heating oil is essentially off-road diesel. You can legally use a higher sulfur content for boilers and heating systems than you can off-road equipment and back-up generators. Regardless, we sell the lowest sulfur fuel available and optimize our fuel to be as versatile to our customers as possible. Construction equipment, back up generators and a host of others systems use off-road diesel, as do heating oil systems. Star Oilco sells the same diesel fuel specification for all of our off-road uses.

We also blend this fuel with biodiesel for our customers that want higher blends of low CO2 biodiesel fuels and heating oil. Star Oilco carries nothing but ultra low sulfur diesel fuels. In fact, our minimum blend of biodiesel is a B5 biodiesel blend (5% biodiesel and 95% petroleum diesel) and we also offer B20 (20% biodiesel blend) and B99 (99% pure biodiesel) for our customers.

About Diesel Fuels Specifications 

In the United States, diesel fuel is controlled according the American Society for Testing and Materials Standard D975-97. This standard describes a limited number of properties that diesel fuels must meet. It should be noted that the requirements are all performance-based, meaning they do not mandate the composition of the fuel, only the specific performance related requirements demanded of a fuel for a diesel engine. The requirements of D975 are described below.

ASTM Specifications for Diesel Fuel Oils (D975)*

*More info on ASTM specifications

Diesel fuel is characterized in the United States by the ASTM standard D975, which identifies five grades of diesel fuel. We are only going to talk about the two most popular commercially diesel fuel used — No 1 and No. 2 diesel. The ASTM D975 standard is made up of a series of different tests that check the characteristic ranges of a fuel to confirm it is adequate to operate in your equipment.

In simple terms, they are checking for specific gravity, the vapor point (when it turns into a gas), the flash point (when it catches fire), the dirt content, water content (how much microscopic entrained water) and a host of other requirements diesel must meet in order to be legal to be sold for use in your engine.

Grade No. 1-D and Ultra-Low Sulfur 1-D:

This is a light distillate fuel for applications requiring a higher volatility fuel to accommodate rapidly fluctuating loads and speeds, as in light trucks and buses. The specification for this grade of diesel fuel overlaps with kerosene and jet fuel, and all three are commonly produced from the same base stock. One major use for No. 1-D diesel fuel is to blend with No. 2-D during winter to provide improved cold flow properties. Ultra-low sulfur fuel is required for on-highway use with sulfur level < 0.05%. 

Grade No. 2-D and Ultra-Low Sulfur 2-D:

This is a middle- or mid-grade distillate fuel for applications that do not require a high volatility fuel. Typical applications include high-speed engines that operate for sustained periods at high load. Ultra-low sulfur fuel is required for on-highway use with sulfur level < 0.05%.

Biodiesel Fuels for Heating Oil

Biodiesel is a renewable fuel produced from oil seed crops, used cooking oil, and/or animal fat waste. It is chemically similar to petroleum diesel, and is produced by combining the oil stock with catalysts and then heating it. Biodiesel is not the same as vegetable oil or SVO (straight vegetable oil) and can be used in any diesel engine.

Biodiesel and biodiesel blends significantly reduce tailpipe emissions, especially carbon dioxide, carbon monoxide, sulfur dioxide and particulates (black smoke). ASTM D975 standard, as of 2008, allowed up to 5 percent biodiesel to be blended into the fuel. This is the called B5 — the ‘B’ stands for biodiesel and 5 stands for up to 5 percent biodiesel.

B6 to B20 – ASTM D7467-17:

Diesel blends up to 20% and more than 6% are referred to as B20. Biodiesel is a cleaner burning fuel than petroleum diesel. Using biodiesel can help reduce the amount of harmful emissions released into the air. Emissions such as sulfur dioxide, carbon monoxide, polycyclic aromatic hydrocarbons and other compounds found in diesel exhaust. Read the ASTM D7467-17 standards.

B99 & B100 –  ASTM D6751-15ce1:

These are fuels made of up to 100% biodiesel. Due to environmental regulations, most retailers will carry a maximum of B99. The standards for B99 and B100 are identical. Unlike gasoline, biodiesel can gel at cold temperatures. This can cause stress on fuel pumps and fuel injection systems, or can clog filters or even become too thick to pump to the engine. B99 has a higher temperature gel rate – meaning that it begins to cloud and thicken at higher temperatures – than conventional diesel.

“The cloud point of soybean biodiesel is about 34°F (1°C), whereas the cloud point for No. 1 diesel is about – 40°F (-40°C) and for No. 2 diesel between -18°F (-28°C) and +20°F (-7°C).” (Biodiesel Cloud Point and Cold Weather Issues) The solutions for cold weather involve additives and lower blends to ensure continuous operations. Read the ASTM D6751-15ce1 standards.

FURTHER READING ON DIESEL FUEL:

For a question and answer format about heating oil please see: Every question Star Oilco has been asked about Heating Oil

Here is an article about: an In-depth look at Biodiesel as a heating fuel 

Read about Star Oilco’s approach to Fuel Quality Assurance: Star Oilco – Precision Fuel Management

Read about dealing with biological growth in your diesel tank: Bioguard Plus 6 biocide treatment for diesel

Get Chevron’s Technical Manual to Diesel Fuel (essentially an easy to read text book on diesel): Chevron’s Fuel Technical Review

Get a white paper from Donaldson Filtration on tier 4 engines and fuel cleanliness: Donaldson on Tier 4 Engine Fuel Contamination

Read more about Donaldson Desiccant Breathers for bulk diesel tanks: Why use a Donaldson Desiccant Breather for a bulk diesel storage tank.

Star Oilco black fuel truck parked on rural road with trees in background
Oregon Diesel Taxes Explained 1024 768 Star Oilco

Oregon Diesel Taxes Explained

How Oregon Diesel Taxes Are Calculated

As of January 1st, 2022 Oregon is raising Fuel Taxes to $.38 a gallon. (source) The prices in this article have been updated to reflect that.  There will be another $.02 a gallon fuel tax increase set in 2024 as well.

Oregon is unique in its handling of diesel. All fuel isn’t used or taxed the same in the state of Oregon. First off, there is no sales tax for any fuels. The taxes that are charged for diesel are divided into 3 categories: dyed diesel, PUC use and everyday road use or “auto diesel.”  The big difference in pricing is how the diesel is used and the size of the vehicle using the diesel.

 

Oregon Fuel Taxes in a Nutshell

Off-road diesel

If a vehicle is burning diesel “off-road” like a back-hoe, agricultural use, generators or similar use, the fuel is not taxed by either the federal government or Oregon State. This fuel is also dyed red to show it is for off-road use only. If you use dyed red off-road diesel fuel in an on-road vehicle and you get caught, the state of Oregon can and will likely fine you $10,000. Yes, we have seen them do this in recent history.

On-road diesel (auto diesel)

If your vehicle is below 26,000 gross vehicle weight, Oregon charges a per gallon vehicle tax.  This tax is paid at the gas pump, is collected by the retail or commercial cardlock location, and you do not have to consider any additional taxes other than buying on-road fuel.

On-road diesel (P.U.C. diesel)

If your vehicle is above 26,000 gross vehicle weight in Oregon, you pay a weight mile for your vehicle’s state diesel tax.  This cost per mile depends on your registered vehicle weight with Oregon. It is anecdotally assumed at the top weights over 80,000 lbs of gross vehicle weight, this tax is equivalently more than double the per gallon cost of auto diesel bought at a retail location.  This class of diesel usage requires extra P.U.C. filings and vehicles over 26,000 GVW have special P.U.C. plates denoting their class as it relates to diesel fuel tax.

Oregon Fuel Taxes for a Layperson

A small motorhome that would use On-Road Diesel

A small motorhome that would use on-road diesel

On-Road Diesel (Auto Diesel)

The easiest one to understand is on-road diesel, also known as “auto diesel.” Most non-truck vehicles driving on streets, roads, and highways around Oregon fall into this category for use, or as you can see in this picture, a smaller motor home or RV (recreational vehicle).  This fuel is the one you see at a pump at a retail station. Its price includes federal tax, state tax and any applicable local taxes.

Current auto diesel taxes in Oregon for vehicles under 26,000 GVW (gross vehicle weight):

  • Federal tax rate is $.244 per gallon
  • The state tax rate is $.38 per gallon

In addition to these, local municipality and cities have their own taxes that can be added to the price of fuel. To make it even more complicated, some cities charge a different tax amount based on time of season; specifically Newport and Reedsport who charge a few more cents during the summer months. Currently the highest additional taxes are in the city of Portland, Oregon at $.10 per gallon. Source.

Example:
Fuel price at the pump is listed at: $2.989

  • Federal                =$.244
  • State                    =$.38*
  • Portland             =$.10

For a total of                =$.724 per gallon in taxes

The actual cost per gallon would be $2.265. This includes the OPIS (Oil Price Information Service) wholesale price, transportation costs, and the margin the retail station adds to pay its bills (usually $.15 to $.40 depending on the provider).

*January 1st, 2022 Oregon State Tax fuel went up to $.38 per gallon for Oregon Motor Vehicle Fuel Tax. Oregon Use Fuel Tax also went up to $.38 a gallon.

 

Dyed Diesel also called Red Diesel is used for vehicles that don't drive on public roads.

Dyed diesel, also called red diesel, is used for vehicles that don’t drive on public roads.

Off-Road Dyed Diesel

Dyed diesel, also called farm diesel, marked fuel, or red diesel, is a fuel that has an added dye in the mix. The dye, usually solvent red 26 or solvent red 164, doesn’t cause any change in the operation of an engine versus using regular clear diesel. The dye marks the taxable status of the fuel.

This fuel is intended for only off-road equipment and vehicles. Farm equipment, construction vehicles and any other vehicles that don’t drive on public roads can use this fuel. In addition, any engine or oil heater that burns diesel is allowed to use dyed diesel. Those that have heating oil delivered are purchasing dyed diesel.

The benefit of this fuel is that you save state, federal, and city or municipal taxes. Acquiring this fuel as a customer usually requires access to a commercial fueling station or hiring a fuel company to deliver the fuel. This is likely to prevent accidental use of this fuel in an on-road vehicle. Anyone found using dyed diesel in an on-road vehicle will be fined. Fines are either $10/gallon or $1000 per violation, whichever is greatest (Source). To ensure that diesel users aren’t abusing this fuel, police officers can “dip” a tank; usually by sticking a clear tube into a tank and verifying the color of the fuel.

Oregon PUC Permit and IFTA for vehicles over 26,000 GVW

Oregon PUC Permit and IFTA for vehicles over 26,000 GVW

Oregon PUC Permit

While PUC stands for “Oregon Public Utilities Commission”,  it is the Oregon Transportation Department who regulates fuel taxes and PUC plates.

PUC plates are required by vehicles over 26,000 GVW. Oregon PUC Permit or heavy motor vehicle trip permit refer to vehicles that are at this weight and up to 80,000 GVW. They also include an Oregon PUC card number and a log book that shows fuel usage. View Table “A” tax rates.

These vehicles are only required to pay the federal tax at the pump. They are then required to log the mileage they drive and pay an amount based on weight, number of axles and miles. The heavier the vehicle, the more wear and tear on the road, so the higher the tax.

Oregon per Mileage fuel tax for vehicles between 26,000 lbs and 80,000 lbs.

Source : Oregon Department of Transportation 

The fees are applied for a whole trip. Say a truck is scheduled to drive 100 miles round trip to deliver watermelons. A vehicle driving 100 miles that weighs over 44,000 but less than 46,000 would be charged $0.0907 per mile or $9.07. Trucks that are driving a full load of product and an empty load back pay for the total miles of the trip, including the miles they are driving empty. In the above example, even if half the miles were at the 26,001 rate for the return trip, the taxable rate is the full load price.

Any commercial vehicle that is over 80,000 GVW would use the Table “B”, which is similar but includes different pricing based on the number of axles, not just weight.

Oregon per Mileage fuel tax for vehicles between 80,000 lbs and 105,500

Source: Oregon Department of Transportation

As the vehicles get heavier, the amount of axles used change the price. In the chart, 5 axles at 81,000 miles is $0.2115 a mile and a vehicle with 9 axles and the same weight is $0.162 a mile.

For any additional questions about the PUC plates, tax rates and trucking information in Oregon, please contact ODOT at 503-378-5849.

IFTA – International Fuel Tax Agreement

IFTA is for the same vehicles over 26,000 GVW if they drive into more than one state or into Canada. This helps simplify the reporting process of taxes, refunds and mileage for vehicles that travel in more than one state. These commercial motor vehicles are required to file quarterly with their base jurisdiction and the amount of taxes that they might have paid at the pump is recorded. Then they either pay the difference or receive a refund if they overpaid. Prior to IFTA, trucks would need a permit for every state they operated in.

 

Star Oilco is a supplier of Fuel for NW Oregon and SW Washington. If you have questions about fueling your fleet or your construction site we would love to talk to you.

Contact Form

  • This field is for validation purposes and should be left unchanged.

To learn more about What Oregon Requires for a Business to Use Pacific Pride and CFN Cardlock Stations

To learn more about RV Vehicles and Pacific Pride or CFN cards

Recent proposed legislation could mean more or different tax handling fees or laws in the future. We will be following these stories as they come out. If you would like to know more – Oregon Legislature proposes an end to petroleum diesel

If you would like to learn a little bit more about biofuels – Every Question We Have Been Asked About Biodiesel & Every Question We Have Been Asked About Renewable Diesel

Got questions about Red Dyed Diesel? We have answers!