On The Front Lines: Facing Down Mother Nature
PEI Members battle severe summer storms and keep customers afloat
In the summer of 2008, severe weather blasted its way across the globe: A devastating earthquake in China, a rampant typhoon in the Phillipines, and in the United States, violent tornadoes and hurricanes, overflowing rivers, fires and brutal windstorms accompanied by baseball-sized hail left homes and businesses wading through a widespread path of destruction. With damage totaling in the billions of dollars, there's no question that the summer of 2008 was one to remember.
As record-breaking floods ravaged the middle part of the United States in June, PEI members were feeling the strain. Yet even in the face of extensive damage, they managed to keep their spirits high and their customers' needs in the foreground, demonstrating grit and grace under pressure.
Acterra Helps Clients Prevent Damage
The Acterra Group is located in Marion, Iowa, approximately 15 miles east of the Cedar River, which crested at a record-breaking 32 feet on June 13. Although Acterra's facility was not directly affected by the flood, many of the company's customers in Iowa City and downtown Cedar Rapids were impacted by the overflow. “Tank integrity was a huge concern,” says Terry Cooper, Acterra president. “Some of the tanks we service were under 15 feet of water. Any of those tanks could have been damaged or even crushed by the weight.” Making the damage assessment difficult were numerous road closures. “To get service techs on site, a typical 20-minute trip was taking up to four hours.” Fortunately, Acterra was able to help many of its customers take preventive measures earlier in June. Because flooding was predicted in Iowa City four days before the heaviest rainfall began, Cooper was able to dispatch service technicians to cap fuel tanks in hopes of warding off water damage. “We had techs in Iowa City working late into the night capping tanks for our customers,” he says. “That action prevented much of the damage that could have occurred.”
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| An empty fuel tank, recently installed at a downtown Cedar Rapids, Iowa, gas station, floated right out of the ground after being dislodged by high floodwaters. |
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Central Petroleum Fields Service Calls
“The phones were ringing off the hook,” says Shirley Diericks, administrative assistant at Central Petroleum Equipment. “Our customers were calling and frantically asking to have their tanks capped before the water got higher.” Located in Blue Grass, Iowa, Central Petroleum has customers in both Cedar Rapids and Iowa City, two of the cities hit hardest. Central Petroleum was inundated with service calls from clients hoping to prepare and protect their equipment when the flooding in eastern Iowa reached its peak. According to Diericks, the entire staff was dispatched to the companyís affected customers.
Customers Rely On Oil Equipment Service
When rainfall in southern Wisconsin reached record levels in mid-June, the service department at Oil Equipment Co. (Madison, WI) shifted into overdrive. “There was a huge increase in the amount of service work,” says Jim Klubertanz, service manager. “We saw lots of problems with spill containment, water getting into fuel tanks and water damage on electrical equipment.” Klubertanz notes the extreme difficulty of doing repairs when water levels were high. “Finding the cause of the problem was tough,” he says. “The ground level water was high enough that it was coming back in as fast as we could pump it out.”
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Carried by the water, the fuel tank floated 15 blocks from the station, making three turns and coming to port along the entrance to the interstate. |
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Jorgensen Petroleum Offers Early Prevention
At Jorgensen Petroleum Maintenance (Evansville, IN), prevention paid off. Overwhelmed with torrential rainfall in March, Jorgensen's customers in southwest Indiana faced a number of issues with water damage and leakage early in the spring. “All of our techs were out pumping water in March. Everybody was finding their leaks then, because the ground was so saturated with water that it was seeping in,” says Nancy Buckman, service dispatcher. As a result of all the maintenance work performed in the spring, Jorgensen's clients were happily, albeit unexpectedly, prepared for the deluge mid-June.
Junge Control Dodges Flood Damage
Junge Control, located in Cedar Rapids, Iowa, was fortunate, barely dodging the floodís destructive reach. Located on a hill just outside the Cedar River Valley, the Junge business facility was not directly affected by the riverís overflow. “We got lucky,” says owner David Junge, who notes that Jungeís previous facility in downtown Cedar Rapids, from which the company moved in 2001, would have been severely damaged had they not relocated. “If we had stayed there, our plant would have been underwater,” he says. Despite the damage, Junge observed a general optimism among the Cedar Rapids population. “That makes us feel pretty good.”
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| Whether the cause is Mother Nature or human error, disasters can jeopardize a business's staff and its assets. Would you know what to do if a disaster hit your business? Read Emergency Planning For Businesses to find out. |
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Flash Flood Hits F&W Service Company
Unfortunately, not all PEI members were able to avoid the flood's direct impact. “I lost my home and my business,” says Dick Wilkinson, president of F&W Service Co. in Marion, Iowa. Falling victim to a flash flood on June 12, Wilkinson's business facility was hit hard by the Cedar River's overflow in just a few hours. “The flood went through the building in about two hours,” he says. Although the flood has put a damper on F&W's facility, it seems to have had no effect on company morale.
“I'm taking it with a grain of salt,” says Wilkinson, who began cleanup just one day after the flood hit. “We're going to be ok.”
| Ethanol Production Slows Down
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While this summer's deluge blew through the Corn Belt with fury, states outside the Midwest's flood zone werenít completely untouched by its effects. The flood's impact may soon be felt at gas pumps across the nation.
Home to the top corn-producing states in the country, Midwesterners faced severe water damage to their crops during the summer, causing the price of corn to leap sky-high. A mere four dollars per bushel last year, prices soared to seven dollars per bushel in June 2008, when flooding ruined more than one million of Americaís top corn-producing acres.
As corn prices shot up, so did the price of ethanol. In late May 2008, the profit margin for ethanol was 20 cents per gallon distilled. Only two weeks later, producers of ethanol in the U.S. were losing 8 cents for every gallon of ethanol distilled. Simply put, ethanol makers were spending far more on raw materials than they were getting for the finished product.
The price increase impacted profits, causing several small- to mid-sized ethanol plants to shut down. Stock experts advised investors to sell their shares of publicly traded ethanol producers immediately. Nearly five billion gallons of ethanol were forced to go offline, and nearly all makers in the U.S. were forced to halt production until conditions improved.
Adding to the already grim situation was the fact that corn used for ethanol must have less than 15 percent moisture content. Consequently, even though the flooding was contained enough for crops to grow again, it was feared that the post-flood corn would still be too waterlogged to use.
In late 2007, Washington mandated the blending of 9 billion gallons of biofuels into gasoline by the end of this year, 11.1 billion by next year and nearly 13 billion by†2010. However, the damaged crop land has proven to be a significant roadblock, and according to the International Herald Tribune, some experts are predicting that the EPA will amend or even suspend alternative fuel standards if the profitable production of ethanol becomes economically impossible.
For the homegrown, renewable fuel that promised to decrease our dependence on foreign oil, the future looks bleak. Just months ago, government officials were championing ethanol, hoping its steady, inexpensive production would prove to be America's “sure thing.” But this past summer, America may have learned that there's no such thing as a sure thing. |
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