Michigan-based company using grant money to convert fleet of trucks to compressed natural-gas powered engines for one of its divisions, while anticipating one day its service center business may follow suit.
Long before the rest of the metals industry discovered terms such as sustainability, carbon footprint and greenhouse gas emissions, Schupan & Sons was awash in green. The Michigan company was founded as a nonferrous scrap processor, when recycling metal was the manufacturing’s primary concession to environmental friendliness.
Through the years, the company has evolved to become a multipronged enterprise, adding a service center division in 1978, 10 years after its founding. All the while, it has remained committed to being at the forefront of environmental issues.
“Our company was in sustainability before there was sustainability,” says Chris Milani, vice president of operations and logistics for Kalamazoo, Mich.-based Schupan & Sons. “Our president says if we were any greener, we’d be frogs.”
That president is Marc Schupan, the son of company founder Nelson Schupan, who passed away not long after starting the business. Marc Schupan says his company’s environmental bona fides go beyond the simple act of handling scrap metal. Some of the company’s divisions provide recycling education to its local communities. The company is fanatical in its treatment of waste oils and fluids. And all of its divisions were ISO registered “12 or 14 years before it was fashionable,” he says.
The president says the company’s attitude on the green front is modeled after the philosophy of hockey legend Wayne Gretzky, who said, “don’t go where the puck is; go where the puck is going.”
And in the world of transportation, the company has decided, diesel fuel is where the puck has been. Natural gas is where it’s going. And Schupan & Sons is leading the way.
Through one of its recycling divisions, UBCR, the company has recently launched an entire natural-gas powered fleet of trucks. The conversion was paid for in part by a $2.2 million grant funded by TARP money and administered through the Clean Energy Coalition in Michigan.
UBCR, which handles pickup of aluminum, plastic and some glass containers at the company’s Grand Rapids and Wixom operations, is ideally suited to meet the current state of natural gas-powered transportation. The trucks employed in the collection have a lower gross combined weight than other metal hauling semis, plus each truck route begins and ends at the same point.
“We looked at a lot of different alternatives for reducing our carbon footprint in terms of technology,” says Milani, who oversaw the conversion. “We settled on natural gas for a number of reasons,” a list that includes simplicity of conversion, existing diesel fuel usage and the quality of the partners they’ve worked with in the conversion.
Schupan and Sons has joined forces with Ryder Leasing, which handles the maintenance of the equipment. The company has existing knowledge of the requirements for natural gas-powered vehicles through a similar effort in California. Another partner includes DTE Energy MichCon, the energy utility that helped install compressed natural gas filling stations on Schupan’s property in Wixom and another nearby the company’s Grand Rapids location. The Wixom station is a private station, while the station in Wyoming, Mich., is a public one.
Funding for the stations, plus some of the conversion costs from switching to the diesel-powered engines to the GNC-fueled machines, was included in the grant. The grant was made for the purpose of displacement of petroleum.
Milani had already gone through grant process at other companies before coming to Schupan & Sons. He says there are grants like this available for other companies who might benefit from a similar conversion.
“The Clean Cities Coalition is a great place to start to see what’s available from a transportation perspective,” he says. “They were very helpful in this whole process and another strong partner to help shepherd us through.”
Once the grant was in place, Schupan and Sons turned to some major players in the trucking world to meet their equipment needs. The new semis are powered by Cummins’ 8.9-liter engine. It also comes with an Allison automatic transmission, making it the first fully automatic transmission vehicles the company has used. The transition has been remarkably smooth, Milani says.
“There are a lot of misconceptions regarding natural gas and the safety to it. If there’s a spill, it vents and dissipates, but with diesel it’s on the ground and pools. We’re very comfortable with the safety element of it,” Milani says.
He notes that it’s the company’s drivers that were the key to successful implementation. “They’re the ones who were going to make it a success or not, and so far they’ve been really terrific. They were really sold on doing something that can help the economy, the industry and our country by using domestically sourced energy.”
And the transition is already paying dividends. The company’s move to natural gas is saving about $1.55 per gallon compared to the diesel equivalent. As for its footprint, “we’re saving about 9,000 barrels of oil annually,” Schupan says.
Besides those costs advantages, the move to compressed natural gas provides more certainty. The company is able to go out five years on its fuel contract, as opposed to a single year with diesel. “There’s so much volatility with petroleum,” Milani says. “That was another reason we really liked natural gas.”
That the company can save costs while also doing its part for the environment makes it a win-win situation. “We want to reduce our footprint, but we like to do so where it’s economically practical,” says Milani. “The economics are really very good.”
Right now, the benefits are limited to this particular division of Schupan & Sons. The 8.9-liter engine is rated at 80,000 gross combined weight, which makes it suitable for the requirements of the UBCR segment but wouldn’t work for its service center or other operations.
Schupan’s service center business segment, which grew out of its recycling operation, offers sales of aluminum and plastic products to a variety of end users. On the aluminum side, it sells plate, bar, rod, pipe and sheet. Additionally, sales of extrusions have become the fastest growing part of the business.
On the equipment front, Schupan has a variety of precision saws, including two MetlSaw precision plate saws, cutoff saws from MetlSaw, Rohbi and B&O, band saws from W.F. Wells and Powermatic and a semiautomatic Kaltenbach saw. The company also offers a variety of CNC machines, plus bending, drilling and other fabrication services.
In time, both Milani and Schupan believe the distribution business will be able to use natural gas-powered vehicles in its fleet. Cummins is already testing an 11.9-liter engine that would power semis with larger GCW requirements. Additionally, the engine maker offers a 15-liter bi-fuel engine that utilizes both natural gas and diesel fuel.
The more significant impediment to widespread adoption of the technology by major haulers is the infrastructure. “When it comes to infrastructure, there are two primary challenges: location and range,” Milani says.
The current scarcity of filling stations makes it almost impossible to use a natural gas-powered semi on long-haul runs. Exacerbating the problem is the limited range the average vehicle can travel before refilling.
But there is hope. At February’s MSCI Carbon Conference, American Trucking Associations President Bill Graves pointed out Flying J Truck Stops is working to develop a nationwide grid of natural gas filling stations, compressed or liquefied natural gas. When such a network is in place, the transition to natural gas by major haulers will be much more rapid. And Schupan and Sons fully expect to be among the pioneers expanding its fleet options once these challenges have been overcome.
“There are some potential fits with our van operations, especially when the new 12-liter comes on line. As more people become familiar with it and the barriers start to come down, which is the infrastructure, we see natural gas as a transportation energy source. It will be something we seriously consider as we spec equipment going forward.”
His boss agrees.
“As time goes on, we’ll have more opportunities,” Schupan says. “We have the potential to change another 65 semis in the next few years to natural gas.”