Annalloyd Thomason, Executive Director of the Alternative Fuel & Vehicle Institute provides takeaways from this year’s AFVI Conference and discusses importance of educating companies with large fleets about the different alternative vehicle options.
Stephen Oppenheimer: We really, really appreciate your time. And, as you know, I’m really passionate about seeing these changes in the transportation sector, and it was so refreshing to come to your conference which was so well done and see not a think-tank but what I like to call a do-tank.
Annalloyd Thomason: Yeah, exactly.
Stephen Oppenheimer: And I got to tell you I was blown away. I just didn’t know that these kinds of things were going on. About how many people attended the conference?
Annalloyd Thomason: We had just over twelve hundred which was very exciting.
Stephen Oppenheimer: Wow. That’s fantastic.
Annalloyd Thomason: Yes, it was.
Stephen Oppenheimer: And do you see the conference growing?
Annalloyd Thomason: It was growing very steadily up until 2009. In 2009, we took a dip. And we are back to the 2008 levels in 2010. So that’s encouraging. I think the dip was just primarily because of what’s going on with the economy in general.
Stephen Oppenheimer: Sure. So at the conference, you referenced an AFVI survey that when you surveyed companies, that they already have or on track to have or plan to add alternative fuel vehicles to their corporate or municipal fleets. Was that like a three-year timeframe by 2012 or 2013?
Annalloyd Thomason: Oh, boy, you’re going to ask me like details. I’m going to have to look. We surveyed commercial fleets only because we feel like we talk to government fleets quite a bit just because they’ve been ahead of the curve in a lot ways with alternative fuels and transportation projects. So this particular survey was done with commercial fleets, and it was a random survey. So we didn’t just select them because we knew already that they had alternative fuel plans, or they were already using them but more just to ascertain whether they were planning to use the fuels or had any experiences, et cetera. Pulling up in a folder. It may take me just a minute. If you want to chat about something else while I’m opening it, I’ll try to multitask.
Stephen Oppenheimer: So why do you think the companies are looking to do this? Is PR image being green? Is it savings? Is it corporate mandates?
Annalloyd Thomason: I think it’s a combination of things, and I think it depends upon kind of what they’re corporate culture and philosophy is. A lot of fleets are very bottom-line–oriented and they’re willing to entertain a discussion about using alternative fuels through advanced technologies. But they’re primary concern is the bottom lines. So pretty quickly in that conversation they need to be able to see that there is a possibility that they can improve their bottom lines. That’s kind of one thing. And then when you add the layer on top of that of this whole unrest that we have in the world regarding oil and the fact that we import over sixty-five percent of our transportation fuel use at this point from countries that may or may not like us very much, I think that they are beginning to hear that message a little more consistently. So I think that plays in their minds. And then they’re truly concerned about air quality and the environment. And as a result of that, they also see the ability to take the public relations benefits of implementing alternative fuels and advanced technologies into their fleets. So I think it’s a layered approach for them.
Stephen Oppenheimer: So it kind of begins with the green of currency and then the green of the environment is a by-product in this, corporate efficiency.
Annalloyd Thomason: Yes, and that’s not the case for every fleet. Some fleets have the financial luxury of saying, “Look, we know this is going to cost us more money in the short-run or the mid-run, but we’re going to do this anyway because it’s good for the environment.” But the majority of experience that I have with fleets is that eventually it has to make a positive impact on their bottom line.
Ben Lack: Annalloyd, I curious to know what organizations are kind of on the forefront to really adopting alternative fuels and vehicles in their fleets.
Annalloyd Thomason: The most well-known probably are FedEx and UPS, and they’ve been using these fuels and technologies in their fleets for a while. I’m going to estimate somewhere in the fifteen-year mark. They’ve been pretty quiet about it. Exactly. And then some of the newcomers would AT&T who is a relative newcomer. They did their analysis and made their announcement last year about what they’re going to do. We’re seeing now evidence of other telecommunications industry biggies who are following suit. So I think they’re kind of watching what they’re peer AT&T is doing, and they’re pondering getting into it as well.
There are some trucking companies… I’m trying to think of the name of the one. There’s Night Transportation is one of them. They’ve been involved for a while. Walmart, believe it or not, has been involved for a significant number of years. And so it’s much more widespread than you would think among the national companies.
Stephen Oppenheimer: Got it. So some companies are starting to reconcile the realities of energy security or energy insecurity of the dependence on of us having to import so much of our petroleum.
Annalloyd Thomason: Yes. I think they’re trying to fit it together in a big puzzle piece that includes all of their needs which is the needs of being able to operate their fleet and have it do what it needs to do and their economics and their corporate culture and their public image and their concern for this overarching threat of oil supply and price.
Stephen Oppenheimer: So I’m going to get a little out of order here. But when you work with them through AFVI, your consultation with them then essentially deals with all of that in the process.
Annalloyd Thomason: Absolutely. And each one of them is very different. We have to spend enough time getting to know their organization and what their corporate culture and their goals are before we can help them arrive at the solution or solutions that seem to best meet their needs.
Stephen Oppenheimer: Back to the conference. There was really a lot of excitement and enthusiasm among the participants and the audiences. Describe the mix of attendees who come together. I saw there were original equipment manufacturers, scientists, exhibitors, professors. How do you arrive at the mix?
Annalloyd Thomason: We have a database that has about 40,000 different contacts in it. And we’ve spent about eight years building that database and keeping it current. But it includes everybody that we possibly can think of as we work with companies and/or fleets and/or industry and/or government, etcetera, as well as what we read in the media about who’s getting involved or what manufacturers are getting involved. You characterized it perfectly. It’s everything. Our primary target audience is fleet. You described our conference as a do-tank, and we really do spend a significant amount of effort to make it a do-tank. We want to show fleets what’s really happening in the real world, what technologies they can buy today or the very short future, what fuels they can use, and how they can start to make this bridge to fuels and technologies other than just the traditional internal combustion engine or the diesel engine. So we try to put together the OEMs, the current users who seem to have the best stories to tell. And we don’t always have good stories to tell. Sometimes the users that we put on panels, their peers, sometimes they’ve had challenges. We want the people who come to the conference to know that too because it’s not a smooth process to make a transition always to alternative fuels.
Stephen Oppenheimer: I think that came through, the process. And there’s work by all parties to get it right. There’s going to be bumps in the road, but we got to get it right.
Annalloyd Thomason: Absolutely.
Stephen Oppenheimer: For those that didn’t show, give us an example of a user attendee that had a really good story that you were trying to convey.
Annalloyd Thomason: Oh, wow. One that comes to mind really easily because I’ve worked with them for over a dozen years, the city of Las Vegas. And actually several of the local government fleets in Clark County which is the county seat where Las Vegas is located, there is virtually every alternative fuel represented in those fleets. There is every technology represented in those fleets. Because they’ve been doing it so long, especially with the city, and because the mayor’s supportive, because management is supportive, because there’s a cheerleader in place, etcetera, they’ve been able to achieve good success with a variety of technologies. Not every technology has worked out the way they thought it would. But they just have this momentum for a positive experience overall, and they’ve really set that framework really well.
Stephen Oppenheimer: I need to tell Ben that the cheerleader was the mayor, and he’s a character.
Annalloyd Thomason: He is a character. And the other cheerleader is Dan Hyde who is the Transportation Services Manager, and he’s been there since the early nineties, and he’s a real leader. He’s a visionary, and he’s a leader, and he is not a typical “government fleet manager” because if you thought about what you would envision as a stereotypical government fleet manager, it’s somebody who’s stuck in their ways and who’s done things they way they have always done them because they’ve always done them that way and that is so not Dan. Dan is amazingly willing to look at other technologies and strategies which really shows in the leadership that the city has put forward. And then there are dozens of cases like that. I’m just really familiar with Dan and with the city because we work so closely together.
Stephen Oppenheimer: And the statistic was ninety-three percent of their fleet?
Annalloyd Thomason: Yes.
Stephen Oppenheimer: That’s remarkable. You’ve done a great job there.
Annalloyd Thomason: Yeah, it is remarkable.
Ben Lack: Well, there’s obviously even more stories that we can talk about at another time that show the evolution of kind of this whole process. Talk to us about the types of changes that you observed in the, either issues or advancements or knowledge of the participants of this year’s conference compared to previous years.
Annalloyd Thomason: I think this year’s conference attendees seemed more involved and more knowledgeable and yet more confused at the same time. Because as more and more technology and more and more information about the various technologies come out, the fleet managers are just overwhelmed sometimes with, “Oh, my gosh. Look at all these technologies. Do we choose natural gas? Do we wait for hydrogen? Although that’s not a current subject, but the federal government is really banking on electric vehicles. Maybe we should just wait until we have electric vehicles in virtually every class.” And so while they’re more knowledgeable than ever because there’s more information out there, in many cases, it’s more difficult for them to kind of come to conference, sort through all the information, and then help them choose fuels and technologies that really make sense for their fleets.
Stephen Oppenheimer: So I’m assuming it’s got to be really important that the leadership of the cause per se is, A, knowledgeable about everything so that they can aid all these new constituents or stakeholders that are now getting themselves more involved in the process.
Annalloyd Thomason: Absolutely. And navigating that process just from our standpoint and from the show and from working with fleets, it’s almost daunting for us, and that’s all we do. You can imagine from a fleet manager’s perspective who is managing everything from staff to budgets to outsourcing to cost, etc., it’s a very time-consuming process, and that’s one of the things we try to do is separate the sheep from the goats, if you will, and try to help fleet managers really see what’s realistic and what might be realistic but too far in the future to tell or really doesn’t seem to be realistic based on everything we’ve been able to gather.
Stephen Oppenheimer: So they move forward based on the current set of circumstances, not anecdotal information?
Annalloyd Thomason: Absolutely, which is hugely important because it would be shocking to you to know in the early days the number users who did move forward based on anecdotal information and then managing the expectations on the back end of that is hugely difficult.
Stephen Oppenheimer: So we talked about the dynamic mix that you creative speakers and attendees. A couple names drew my attention on the program: T. Boone Pickens and James Woolsey. Why does an energy entrepreneur and a former CIA director show up a transportation conference?
Annalloyd Thomason: It’s quite fascinating, isn’t it? T. Boone has been a leader in alternative fuels for at least fifteen, twenty years. He’s well-known as being an oil man and certainly made a buttload of money doing that. But he is so much more than an oil man. And so in the early nineties, he started a company called Masa, and it was located in Dallas. And they were focusing primarily on natural gas. And actually that’s kind of the genesis of clean energy today. And so while he is most famous maybe for being on television, talking about his wind advocacy. He’s such a wise man, and he gets it. He gets that we have a mix of energy sources in the world, and we need to use energy sources for the things that it makes the most sense to use them for. And so his wisdom just comes across so well that he just makes an ideal speaker.
James Woolsey, on the other hand, is so passionate. I loved working with him because just to get to be backstage with him the morning he was on general session for half an hour and listen to him talk about his experience is when he was with the CIA, his focus was on security clearly and also on energy as it relates to security. And he knows things that I’m sure I don’t even want to know. And he’s very passionate about convincing our country, our politicians, our government leaders, our fleet managers, etcetera, how vitally important to the security of this nation and even the world, but let’s just focus on the nation for a minute, how important it is that we get off of imported oil.
Stephen Oppenheimer: Yes. Coincidentally, I mentioned to you that I’ve kind of been an activist-volunteer in this space for a while, and I actually interacted with him in a energy security conference in Chicago in 2008. And he was around for the whole day, and we got to spend some time and visit with him. And he’s just fascinating.
Annalloyd Thomason: Yeah. He is fascinating.
Stephen Oppenheimer: Just committed.
Annalloyd Thomason: Yeah, absolutely. And he does a lot of different things. But my sense is that the core of his heart and the core mission of his life is to, without sharing international secrets, really making the world understand how important energy security is.
Stephen Oppenheimer: It is. Regarding the conference, you have kind of a collaborative relationship with the U.S. DOE’s Clean Cities which I didn’t even realize was so heavily into the alternative vehicle program. Can you talk about that a little bit?
Annalloyd Thomason: The conference, as you know, it started at DOE in whatever year, seventeen years ago was, and they kept it for the first ten years. And it was created as a result of the Energy Policy Act of 1992. The Clean Cities Program was created as a result of that act, and then one of the outcomes of that was they decided they needed to have an annual conference every year. For the first several years, it was kind of a let’s all of us clean-cities-and-alternative-fuel advocates get together and let’s have a pep rally. That’s what I call it. And let’s educate ourselves and each other about what we’re doing. And let’s kind of get stoked up for the next year and then let’s go out and fight the good fight.
In 2004, DOE passed some internal regulations that were going to prohibit them from holding the conference the way they had in the past. And so they approached me and said, “Do you think this would be something you’d be interested in taking over?” And I said, “Gosh, I don’t know. I’ll look.” And so for the 2005 conference, we began working together. And that was the first that AFVI took over the management of the conference. So we have continued to work very closely with them because it is the annual event where their stakeholders and their Clean Cities coordinators and everybody who is doing business in their areas, it’s the one conference that they can come to and find out about all the fuels and all the technologies. They don’t have to go to four or five different conferences. And we try to put some special focus and emphasis on what they’re doing on the highlights of their work because they’re down where the rubber meets the road, so to speak, in these ninety local communities. So we work as collaboratively with them as we can to make sure that we help advance their issues in the right way and in a way that makes sense for the messages that need to get out to the fleet operators who might not be part of Clean Cities but who might benefit from it in the long run.
Stephen Oppenheimer: So you kind of hit the next point. You verbalized this and the speakers verbalized this. We’re not about trying to pick winners and losers.
Annalloyd Thomason: No.
Stephen Oppenheimer: Elaborate. What does that mean?
Annalloyd Thomason: Well, I think that we have seen over the last ten years with the different directions that the federal government has chosen or have chosen. You remember the years when the feds declared hydrogen. “It’s all hydrogen.” And so they put significant amount of money into hydrogen, and everybody dropped what they were doing… I shouldn’t say it that way. I would say there was a significant reduction in R&D and the other technologies, and everybody put money into hydrogen and efforts into hydrogen. Somewhere in that timeline was the “Oh, we got to do renewable agricultural fuel. So let’s do ethanol biodiesel.” Okay, cool. Way cool.
Then there was a time when natural gas was the flavor of the month with the feds, and now it’s electricity. And I’m a pretty conservative business person, and so I believe the government’s job is not to pick winners or losers. And neither is it our job when it comes to the conference. We need to present all the options that are viable and let the characteristics of those options advance themselves without putting artificial emphasis or R&D money or PR efforts or whatever one particular fuel or technology. But let them all come to the forefront and compete. I personally think it’s going to take all these fuels and technologies to get us where we need to go. And even then it’s probably not going to be as fast as it needs to go.
Stephen Oppenheimer: As you referenced before, there are appropriate applications for each of them.
Annalloyd Thomason: Absolutely.
Stephen Oppenheimer: And not a silver bullet.
Annalloyd Thomason: Right. And that’s why I think when the average person reads, the average Joe Q. Public reads the federal government’s really behind electric vehicles, the impression they get is, “Oh, that’s what we’re going to do. We’re just going to have electric vehicles.” Well, we’re not just going to have electric vehicles. We’re going to have a lot different kinds of vehicles and iteration of vehicles before we get to the year 2050 or 2075 or 2100 and find ourselves, hopefully, in a new transportation world.
Stephen Oppenheimer: I understand the municipalities, the governments have more coming down from the top to steer them in this direction. How’s corporate America finding out about this and the available resources via Clean Cities or AFVI or other companies doing what you’re doing?
Annalloyd Thomason: I think that in the ninety cities where there are Clean Cities Coalitions, they are an amazing advocate for alternative fuels and they hold a lot of educational events and outreach. And they really do their best to get the word out. I think that corporate America, other than big corporate America, is very slow at hearing the messages and being able to react to them. If you look at the average small businessperson, they have so much on their plate, especially now with the economy of just trying to make their businesses make sense. What fuels they use to run their fleet is just not really on their radar. And that’s unfortunate. And our target is not only the bigger fleets, but we really strive to try to help the medium and smaller fleets who need help sorting through the mountain of information and try to help them dabble their toe in the water a little bit in terms of experimenting or trying out some different fuels and technologies and just seeing what might work.
Ben Lack: So what’s your best estimate on how many alternative fueled vehicles are in the existing U.S. fleet?
Annalloyd Thomason: The existing U.S. fleet? Less than four percent, less than three percent. It’s very small.
Stephen Oppenheimer: Are you including light vehicles also?
Annalloyd Thomason: Yes.
Stephen Oppenheimer: Okay, less than three percent. Now that I’ve mentioned light vehicles, you’ve got twenty years of lessons learned and best practices of adding alternative fuels to corporate and municipal fleets. Do you think that’ll ease the transition for alternative vehicles for light vehicle transportation for passenger vehicles and light-duty trucks?
Annalloyd Thomason: I would hope so. Where it seems to me like light-duty is headed now is focused mainly on hybridization, electricification, and/or flexible fuels. And those technologies are available today. They’re pretty mainstream. There’s no incremental… Well, I shouldn’t say that the electric vehicles. But the SFVs and even the hybrids. Those are so commonplace now that a fleet manager doesn’t think twice generally about buying them. Trying to link the experience of the last twenty years to coming forward is a little hard because I said we have done it in fits and starts. There’s been a lot of emphasis on different fuels and if there was a bad experience with one particular fuel. Sometimes with a fleet, it tainted the whole taste of management about alternative fuels or advanced transportation technologies in general. So I would love it if I could say the last twenty years is going to make the next twenty easier. And in some respects, I think it will, but we still have some challenges ahead of us.
Stephen Oppenheimer: Next year conference, we want to spread the location and the date.
Annalloyd Thomason: Lovely. And you want me to tell you what that is?
Stephen Oppenheimer: Yeah. I think I have it here on the program probably.
Annalloyd Thomason: Yeah, the location is Fort Worth, Texas. And people keep asking me, “Why did you choose Fort Worth?” And it’s because it’s kind of in the middle of North and South or East and West, and so that’s why we chose it. And Texas has some amazing projects and supporters. And so we felt like it would be a good venue. The dates are May 15th through 18th, 2011.
Ben Lack: Okay. And I’m really curious. Did you wake up one day and say, “This is the issue that I’m going to spend most of my life working on.” Why do you do what you do?
Annalloyd Thomason: No. I always say God dragged me kicking and screaming into this industry. When I came out of college, I went to work for the Natural Gas Utility in Dallas. I worked there eight years. I was recruited to come to work for the gas company here in Las Vegas. So I did. And I met Mr. Leo there, my husband there. And he and I were kind of working in the utility industry about fifteen years ahead of our time. We’re were advocating just some marketing policies and strategies and customer relation strategies and technology development strategies that included natural gas that the utility industry as a whole wasn’t ready to embrace.
And so in 1989, we left the company we were working for, Southwest Gas. And we had been doing some project work at Southwest Gas in the area of natural gas vehicles. And so we got a call from Southern California Gas Company. And they said, “Look we got this project. We need to kind of submit this hypothetical paper to the California Air Resources Board that basically the premise was the years 2015 or 2020 and the air is pristine in Los Angeles. And natural gas was the fuel that got us there. So write the paper that describes the transition from 1989 to whatever year it was. Write that transition and show us how we got there.” And so Southern California Gas said, “Can you help us do that?” And Leo and I kind of looked at each other and scratched our heads and said, “Sure, why not.” And so we did. And that started a very long relationship that we had with the California Natural Gas Utility industry in the late eighties to through the mid-nineties. And we did a ton of consulting work for them. We did training work for them, and we just immersed ourselves in natural gas vehicles.
I used to say early on in my career, I used to say, “Oh, in ten years, we’re going to be able to see this.” And now I’m saying, “I hope in my working lifetime I see the kind of market penetration that hopefully needs to take place in order to help our country.