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Retailing Biofuels in AlabamaThe I-65 Clean Corridor Experience

Biofuels…Moving Alabama Forward Workshop

Dothan, AlabamaMarch 17th, 2010

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The Beginning

• “These cleaner, more secure American sources of energy are going to be available to most Alabamians for the very first time. Alternative fuels are not only better for our natural environment, they also help make us more energy independent. They open up new markets for our farmers. This is a win-win situation, and Alabamians can be proud of the steps our state is taking as America searches for a more secure, less dependent energy future.”

Gov. Bob Riley

• The initial locations included service stations in four cities-Athens, Cullman, Vestavia Hills and Mobile.

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The Beginning-cont’d

• These locations will provide motorists with E85 and B20 Biodiesel.

• Federal Grant-Alabama received a Department of Energy Federal Grant in 2006 for $312,000 to be used to add alternative fuel pumps at Alabama gas stations along I-65.

• A second Federal Grant from the Appalachian Regional Commission for $112,500 was awarded to the state to add 30 service stations along Corridor X and V providing Biodiesel to motorists.

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The Beginning cont’d

• The Alabama Department of Economic and Community Affairs (ADECA) partnered with the Alabama Clean Fuels Coalition to select the locations where alternative fuel pumps were added.

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Why Alternative Fuels?

• “With record high oil prices this week, Alabama motorists will soon have the opportunity to reduce our dependence on foreign oil by having American produced renewable fuels, E85 ethanol and B20 Biodiesel, available at retail service stations in Alabama,” said Mark Bentley, Executive Director of the Alabama Clean Fuels Coalition. October 31, 2007

• E85 is a cleaner burning mix of 85 percent ethanol and 15 percent gasoline. The fuel can be used in “flex fuel” vehicles that are capable of running on either E85 or conventional gasoline. Most flex fuel vehicles have an indicator near the gas cap and all have an E85 indicator contained within their Vehicle Identification Number.

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Why Alternative Fuels-cont’d

• Biodiesel is produced from soybean and other crops that produce oil and can be used in conventional compression-ignition engines like diesels without engine modifications.

• A U.S. Environmental Protection Agency study from January showed that ethanol made from switchgrass lowered dangerous emissions by over 94 percent. The report is positive news for an alternative fuel source currently being researched by Auburn University.

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The First Station Opens

• Four months was all the time needed between Governor Riley’s announcement of the grant and the opening at the Dogwood Shell station near the junction of I-65 and U.S. 31 in Vestavia Hills. The station is owned by Birmingham-based McPherson Companies, a leader in the fuel business in Alabama for over 37 years and strong supporter of the state’s initiatives to increase alternative fuel use.

• Consumers will be able to refuel their flexible fuel vehicles (FFV) with E85 and their diesel vehicles with B20 biodiesel all the way from the Great Lakes to the Gulf of Mexico.

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The First Station Opens-cont’d• Governor Riley (center), Ken McPherson (left) and Charles “Mac” McPherson (right)

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The First Station Opens-cont’d

• Governor Riley

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The First Station Opens-cont’d

• Governor Riley and Charles “Mac” McPherson

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The First Station Opens-cont’d

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The First Station Opens-cont’d

• General Motors E85 vehicle provided to Governor Riley.

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Grand Opening

• On March 10, 2008 McPherson held a grand opening event for the FIRST biofuels station in the state of Alabama. Our Dogwood Shell station, located in Vestavia Hills, Alabama began selling both E85-Ethanol and B20-Biodiesel on a test basis in February, and on March 10, we officially opened this biofuels station.

• Our first month of operation selling the biofuels has been a huge success. Sales of both the E85 and the B20 have far xceeded our expectations. The funding for our biofuels station was made possible by a partnership with TMC and the Alabama Clean Fuels Coalition which provided a federal grant from the Interstate 65 Clean Corridor project.

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Grand Opening-cont’d

Congressman Spencer Bachus (center), Ken McPherson (left), Charles “Mac” McPherson (right).

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Grand Opening-cont’d

• US Representative Spencer Bachus was the keynote speaker. Congressman Bachus said, "With oil prices at a record high, this is the time to look seriously at alternative fuels. Renewable fuels like ethanol and biodiesel will reduce our dangerous dependence on foreign oil. Biofuels are being produced in Alabama, so they help our economy. They also burn more cleanly, so they're good for the environment. We must make sure that Alabama is in the forefront of this technology, and a big part of that is having a network of stations where consumers can get alternative fuels to power their vehicles."

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General Motors-McPherson Promotion• On May 14th, 2008 McPherson and General

Motors teamed up to sponsor “E85 for $0.85/gallon for 85 minutes”.

• 1700 gallons of E85 were sold to approx. 100 customers. The majority of the vehicles were GM Flex Fuel vehicles, although there were some Dodge and Nissan vehicles present. .

• An additional McPherson-Shell location has added E85-Ethanol at the intersection of Hwy 280 and Hwy 119 in Birmingham, AL.

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General Motors-McPherson Promotion• Lines of cars were wrapped around the station, and

the Vestavia Hills police were brought in to control the traffic

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2009 Sales of E85 and Biodiesel Fuels

McPherson Owned Locations

E85 Biodiesel (B20)

Dogwood Station-Vestavia 16,643 gals. 8,681 gals.

Hwy. 280-Birmingham 13,790 gals. n/a

County Line I-65 Warrior 8,442 gals.40,522 gals.

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Conclusion

• As the worldwide consumption of petroleum based fuels continues to increase; the price of oil will continue to rise.

• U.S. produced alternative fuels offer a counter balance to dependency on foreign oil.

• Alternative fuels also offer lower emissions.• They open up new markets for our farmers.

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Questions?