IoT & Embedded Technology Blog

An Innovative Application for EICS in Petroleum Product Market Saves Transportation Costs

As part of a VDC project on level sensors I had a very interesting conversation with a UK based distributor of level sensing products. This distributor provides level sensors to oil/kerosene tank manufacturers. During the conversation he mentioning a trend away from from simple sight glass gauges to more expensive electronic level sensing units. Despite the higher price of the new technology it allows several benefits to the end users of petroleum products and the companies that sell and deliver them. By using an Embedded Integrated Computer Systems (EICS) in a telematic/networked monitoring application, a petroleum product delivery company could derive several benefits including lower transportation costs.  Let me provide a little background and explain how this connected process works:

Price Contracts: Small business and residential customers can be severely affected by rising prices. A small disruption like Iran’s activities in the Straits of Hormuz, political unrest in an oil producing country, or changes in weather patterns can cause prices to spike. On the other hand, government intervention, warmer weather and/or lower demand can cause prices to fall. As a result of this uncertainty home, small business, and farm owners will often contract with the local supply/delivery company on a fixed price basis.

Transportation/Delivery: Petroleum products like heating oil usually have to be delivered to these types of customers by truck. Often times these locations are outside urban areas and therefore the heating oil deliveries are more difficult to do efficiently because of distance and customers being less concentrated geographically. The most efficient and cost saving process is to load the truck to the exact level needed to correctly serve all the customers in a selected area and, upon doing so, return to the facility completely empty.

How the Process Works: On the end customer side the electronic level sensor connects to the delivery company’s EICS powered application via a phone or network connection and provides data on the current level of the product in the tank. By doing this the following benefits are seen:

 

• The delivery company can ensure the customer never runs out even if there is an unexpected surge in usage.
• The delivery company can efficiently set up truck loads for given sections in its service area.
• The delivery company can top off tanks when prices are low and let them run lower when prices are high - confident that they will not let customers run out.
• The customer can get a lower price particularly if they sign the contract.
• The delivery company can make sure that customers do not break an exclusive contract by taking deliveries from a lower priced competitor. If customers did this, the level sensor would inform the delivery company of an unexpected rise in level in their customer's tank.

And there you have it.  Networked tank level sensors and an EICS controlled application can actually decrease transportation and other costs for petroleum product delivery firms as well as their customers.