How to control what’s in your tanks & how much you’re spending on it
by Jenny Shiner
November 28, 2018

How to maintain controllable fleet operating costs—assessing the cost of preserving assets and rightsizing the fleet to ensure optimal cost-efficiency, all while improving management and efficiency—is an important conversation for construction organizations. How to reduce fuel use and costs should also come into play. The answer is simple: Excessively high fuel costs cut into profits. While fuel is a consistent overhead cost and is likely to fluctuate, construction fleets are now stabilizing fuel spending by using technology to optimize their use of it.

Organizations that believe their fuel costs are higher than they should be must work to better understand their baseline costs and potential areas for savings. Do this by focusing on a few aspects. First: dive into the fuel itself and the options available to power the fleet. Second: use fuel management technologies to track fuel spending, correct driving behaviors that increase fuel expenses and monitor fuel card transactions to identify fraud. Third: identify specific challenges that increase fuel costs for the fleet and make connections with the data to solve these issues.

What's Powering Your Fleet?

To start the conversation about reducing fuel costs, it’s important to ensure vehicles and equipment are powered by the optimal energy source. In deciding which fuel is best for a fleet’s vehicles and equipment, construction organizations should consider their fuel efficiency and sustainability goals, operational needs, and the frequency and distance between times assets are used and in travel. The most common fuel and energy options include:

  •  Gasoline—Gasoline is the most commonly used fuel for vehicles and is the least expensive. The three main grades of gasoline include regular, midgrade and premium. 
  •  Diesel—According to the United States Energy Information Administration, “Diesel fuel powers most of the construction equipment in the U.S. Diesel engines can do demanding construction work, such as lifting steel beams, digging foundations and trenches, drilling wells, paving roads, and moving soil safely and efficiently.” Though it retails at a higher price point than gasoline, the higher power-to-weight ratio of diesel offers better fuel economy.
  • Hybrid—Hybrid vehicles capture energy for their batteries through regenerative braking and use the energy to provide power to the wheels, reducing emissions and improving fuel economy tremendously. Hybrids still rely on either gasoline or diesel to generate power.
  • Electric—Electric vehicles run 100 percent on electricity supplied from a rechargeable battery, offering a clean form of transport, completely absent of tailpipe emissions.
  • While fuel and energy-efficient vehicles are likely to gain popularity for commercial fleets in the coming years, construction fleets are dominantly utilizing gasoline and diesel in today’s current landscape.

    Monitoring Fuel Use

    While the cost of fuel will vary relative to the real or expected demand or consumption, it’s common for fleets to use an unnecessary amount of fuel if they are not monitoring it. Using fuel-management technologies allows construction organizations to achieve significant savings. Some of the most common ways fleets use telematics and fuel-card systems to reduce fuel use are increasing route efficiency, reducing excessive engine idling, coaching drivers on more efficient driving, and identifying fuel-card fraud.

    Optimizing Route Efficiency

    Taking the scenic route to jobsites not only wastes time, it also extends the time of use of the vehicle, increasing the fuel it takes to operate it. To avoid the unnecessary fuel expenses that route inefficiencies cause, construction fleets are using telematics to ensure drivers take the best route to every jobsite, with the shortest and quickest distance between locations. Along with proactively sending drivers on the best routes, reviewing the historical routes taken provides insight into potential fuel savings.

    Reducing Excessive Idling

    The worst mileage a vehicle gets is during idle times. Reducing excessive idling is one of the fastest ways to reduce unnecessary fuel costs. Paying attention to idle reports and alerts allows organizations to act as soon as vehicles or equipment surpass acceptable thresholds. In doing so, West Coast Sand and Gravel, a construction materials delivery fleet, was able to reduce fuel usage by 5,205 gallons and costs by 37 percent, saving the organization over $18,000.

    Coaching Efficient Driving

    In addition to the safety implications of monitoring driver behavior, telematics can be used to review inefficient driving and identify potential fuel savings. According to the U.S. Department of Energy, aggressive driving wastes gas and lowers gas mileage by roughly 15 to 30 percent at highway speeds and 10 to 40 percent in stop-and-go-traffic.

    Using driver behavior data for coaching helps reduce speeding, rapid acceleration and harsh braking, while diminishing excessive fuel use in the process. Telematics can send alerts directly to drivers, helping managers by proactively correcting these behaviors.

    Preventing Fuel-Card Fraud

    Using telematics to report fuel-card transactions provides driver and vehicle information, fueling location, date and time, and the number of gallons pumped. One of the main data points in this reporting displays the fuel capacity of the vehicle compared with the amount of fuel pumped, allowing for quicker fuel-card fraud identification. If a higher number of gallons are pumped than the vehicle’s tank can hold, it can indicate that the person pumping gas was filling up an unauthorized vehicle.

    Another important piece of information revealed in this reporting is the location the fuel card was used compared to where the vehicle of the associated card was located at the time. For example, if the fuel card was used at a gas station, but the vehicle was still parked in your yard, the fuel card was potentially stolen or being used for nefarious purposes.

    Connecting Issues With Data

    High fuel costs are one of the hardest line items in a fleet’s finances to correct because many of the waste goes unnoticed at the time. It’s easy to see when fuel costs are higher than they should be, but it takes more insight to understand where unnecessary costs can be eliminated. To identify these unnecessary costs, start asking:

    • Is distance taken into consideration when dispatchers select a vehicle to send to a jobsite?
    • Does our organization review historical routes taken by drivers to ensure that they are the most efficient?
    • What’s our policy for idling?
    • How often are acceptable thresholds of idling surpassed?
    • Who is our best driver?
    • Who is our worst driver?
    • What data are we using to coach drivers?