EPAct

Fleet Information & Regulations

State & Alternative Fuel Provider Rule Success Story

It took a little more than a decade for the State of North 

Carolina to become one of the nation’s largest users of 

biofuels—ethanol and biodiesel.

In 1994, when the state acquired its first alternative 

fuel vehicles (AFVs), North Carolina wasn’t using 

biofuels. Like most fleets covered under the Energy 

Policy Act of 1992 (EPAct), North Carolina started its 

fleet of alternative fuel vehicles with cars powered by propane or natural gas.

By the late 1990s, E85 (85% ethanol, 15% gasoline) 

was well established as an EPAct-approved fuel, but 

it was virtually nonexistent in North Carolina. E85

stations were far more common in the corn belt than 

in the Southeast. But the state would soon change that.

One Man’s Vision

North Carolina’s shift to ethanol is largely credited to 

the influence of one state official. Since 1997, Carlton 

Myrick had served as Deputy Secretary for Government 

Operations—essentially second in rank at the Department 

of Administration. The agency oversees state business 

operations in a diverse array of activities such as 

construction, contracting for goods and services, 

distribution of surplus property, and purchasing and 

maintaining vehicles.

In 2000, alternative fuel advocates in the state were 

working to form a Clean Cities coalition in association 

with the U.S. Department of Energy. The coalition would 

encompass the Research Triangle anchored by Raleigh, 

Durham, and Chapel Hill. To qualify, the group needed to 

prove the presence of a minimum number of AFVs in the 

region. To help meet that requirement, the advocates 

moved to get the state government on their side. Founders 

of the Triangle Clean Cities Coalition worked with the 

governor’s office to draft a proclamation promoting 

ethanol in North Carolina. 

That proclamation cited the potential of ethanol 

“to diversify crop production and offer an alternative 

to tobacco cultivation” in the state. Corn was a crop of 

interest, but not the only one, says Larry Shirley, director 

Biofuels Boost AFV Credits and Awareness in North Carolina

North Carolina boasts more than 25 biofuels stations—all private. 

The majority of the sites dispense biodiesel, but ethanol makes a 

good showing.

North Carolina Motor Fleet/NREL PIX 13882

A driver fuels a State of North Carolina FFV with ethanol. Use of 

ethanol is growing in North Carolina, a “corn deficit” state.
0

1,000

1,500

2,500

3,000

3,500

2,000

500

1999 2000 2001

Year

1,148

2002 

2,015

2003 

2,997

2004

396

795

Number of Vehicles

1,025

,

of the State Energy Office. Cornfields are not uncommon 

in North Carolina, but it is a “corn deficit state,” he says. 

More corn is consumed—largely as feed for hogs, 

chickens, and turkeys—than what is produced there. 

Researchers at North Carolina State University are 

also investigating the use of sweet potatoes, barley, 

and other forms of biomass as a feedstock for ethanol.

Ethanol or blends of the fuel, such as E85, can be used 

in specially equipped cars and trucks called flexible fuel 

vehicles (FFVs). Several million FFVs have been sold in 

the United States since model year 1998, according to the 

National Ethanol Vehicle Coalition. Over the years, offerings included pickups and sport utility vehicles from 

General Motors and Ford; minivans, pickups, and small 

sedans from DaimlerChrysler; and the sedans and station 

wagons from Ford.

Green Keys

Sparking the state’s first big surge in AFV credits, 

North Carolina in 1998 purchased 90 new flexible 

fuel Ford Taurus sedans. The following year it bought 

430 FFVs including 295 Tauruses, 120 Dodge minivans, 

and 15 Ford pickups.

The state’s accumulation of EPAct credits settled down 

in the next two years, as the fleet was well-stocked with 

AFVs. But acquisition surged again in 2003, with FFVs 

accounting for nearly all of the 889 conventional AFV 

credits earned in that year. From 1999 through the end of 

calendar year 2004, 

the state had purchased almost 

3,000 FFVs, including almost 1,000 

FFVs in model year 

2004.

Danny Willis is 

assistant director 

of the state’s Motor 

Fleet Management 

Division, which is 

one of nine divisions of the North Carolina Department of 

Administration. Its vehicle fleet includes nearly 9,000 

vehicles. Most are assigned to specific agencies, but 

approximately 300 vehicles are part of a motor pool from 

which any agency may borrow a car for a short time. All 

motor pool vehicles are FFVs, and their tanks are filled 

with E85 when they leave the lot, says Willis.

Aside from its E85 efforts, the department stopped dispensing traditional gasoline at its two facilities in October 

2003 and now offers E10 (10% ethanol, 90% gasoline) 

instead. The switch was not announced to fleet drivers, 

and so far there have been no complaints, says Willis.

Vehicles in the Department of Administration fleet 

are equipped with electronic fuel keys to activate fuel 

dispensers at state-operated stations. The key is colored North Carolina Motor Fleet

Department of Administration drivers 

carry this green key, which reminds 

them to use E85 and activates onsite 

ethanol pumps.

Cumulative E85 FFVs Aquisitions

North Carolina’s FFV Inventory

The acquisitions of E85-capable FFVs by the State of 

North Carolina has steadily increased since 1999. 

The state experienced its biggest increase in fiscal 

year 2004, when its FFV acquisitions jumped by almost 

50%—bringing the total FFV fleet to almost 3,000. 

The majority of North Carolina’s FFVs reside in Raleigh 

and Wilmington—the locations of the state’s three 

ethanol fueling facilities. Many fleets—including the 

Department of Administration—require drivers to use 

E85 in the vehicles when possible.

State & Alternative Fuel Provider Rule Success Story

April 2005
green, encouraging the drivers to choose E85 

whenever possible. Other vehicles (non-FFVs) 

are equipped with black electronic keys that can 

be used only to purchase gasoline. 

E85 is sold at three state-operated stations—

two in Raleigh and one in Wilmington. The 

stations are open only to government fleets. 

The Department of Administration’s fleet 

consumed nearly all of the 170,954 gallons of 

E85 sold in the state in 2003. The remainder 

was used by the state’s Department of 

Transportation (DOT). 

That agency, meanwhile, contributed mightily 

to North Carolina’s alternative fueling success 

story through the use of another biologically 

derived fuel—biodiesel.

A Boost from Biodiesel

In the United States, biodiesel is predominately made 

from soybean oil. Another increasingly common feedstock is restaurant waste grease, which is typically made 

from corn or canola oils. In Europe, canola (also called 

rapeseed) is the most common biodiesel feedstock.

Beginning in 2001, biodiesel use was approved as a 

means to help EPAct-regulated fleets satisfy their AFV 

acquisition mandates. Under EPAct, one credit is issued 

for every 450 gallons 

of pure biodiesel purchased. The use of 

B20 (20% biodiesel 

and 80% petroleum 

diesel) earns one 

credit per 2,250 gallons. 

In 1997, the North 

Carolina DOT started 

using B20 as a test 

and evaluation pilot 

program in WinstonSalem. The state now 

boasts roughly 22 

biodiesel fueling stations in 20 counties 

scattered throughout 

the state. Most of 

these sites also 

dispense other alternative fuels, including E85, propane, 

and compressed natural gas.

Through biodiesel use, North Carolina earned 53 

EPAct credits in 2001, followed by 128 in 2002, and 377 

in 2003. In any given year, a state may earn up to half of 

its required credits with biodiesel. The state achieved that 

50% limit in 2002, 2003, and 2004. Unlike AFV credits, 

biodiesel credits cannot be banked, traded, or sold.

North Carolina’s most common use of biodiesel is in 

heavy-duty trucks operated by the state DOT. The agency 

operates approximately 11,500 vehicles, of which 8,250 

are onroad and 3,250 are off-road vehicles. Roughly 

half of DOT’s vehicles are diesel-powered, and, of those, 

approximately 25% use B20 at least some of the time. 

In fact, many of the vehicles use it all the time, says DOT 

Fleet Procurement Manager Bruce Thompson. In 2004, 

North Carolina state fleets consumed approximately 

more than 260,000 gallons of B100.

The biggest advantage of biodiesel is that it requires 

very little modification of tanks, dispensers, or vehicles. 

Use of B20 has caused no problems in the engines or fuel 

systems of DOT vehicles, Thompson reports. The vehicles 

perform with no loss of performance in terms of power or 

longevity, he says.

Seek Stability

In contracting to buy the fuel, North Carolina dealt 

primarily with one supplier since the beginning, says 

Thompson. Other agencies and municipalities around the 

country have experienced problems dealing with multiple 

suppliers. At a national conference, Thompson recalls, he 

School’s in for North Carolina

The State of North Carolina fleet 

includes vehicles at 17 university 

locations throughout the state. While 

many of these campuses are just 

beginning their AFV efforts, the 

state’s over-compliance has “covered” 

these smaller university fleets so far. 

Within the next two years, however, 

the universities are expected to reach 

the 75% acquisition level on their own, 

as directed by the State Energy Office.

Charles Bensinger and Renewable Energy Partners of New Mexico/NREL PIX 13531 

The use of biofuels—E85 and biodiesel—is a priority for North Carolina 

state fleets. In 2003, fleets used 

roughly 170,000 gallons of E85 

and about 3.9 million gallons of B20. 

State & Alternative Fuel Provider Rule Success Story

April 2005
Success Story

met an official of one county that put its biodiesel contact 

out for bid on a monthly basis. Changing suppliers too 

often reduces the ability to build relationships and 

respond to problems related to fuel delivery or quality, 

says Thompson.

Thompson also advises fleets to seek stability in the 

price they pay for fuel. In its early years, North Carolina 

agreed to a fuel pricing scheme that was tied to the daily 

closing price of soybeans at the Chicago Board of Trade. 

That price was relatively low at the time, but it soon suddenly shot up. In its more recent contracts, the state was 

assured that biodiesel prices are more stable, although not 

fully locked in.

While it doesn’t figure into North Carolina’s EPActreported totals, biodiesel use has spread beyond the state 

fleet to cities, counties, and school districts. B20 is even 

available to the public at several stations in the Research 

Triangle area and in the city of Charlotte. 

Approximately 285,000 gallons of B20 are used annually by the city of Raleigh, fueling more than 300 trucks. 

It is used by school districts and fleets in Durham. The 

City of Greensboro switched its entire fleet of more than 

700 diesel-powered vehicles to biodiesel in 2002. By 

2004, Greenboro’s B20 consumption exceeded 1 million 

gallons.

The State of North Carolina has demonstrated not 

only significant over-compliance with its EPAct requirements but that its leadership can be used to move local 

nonregulated fleets, such as local governments, toward 

alternative fuel use. North Carolina maintains this strong 

commitment to alternative fuels and is currently evaluating innovative approaches to funding future efforts.

Prepared by the National Renewable Energy Laboratory (NREL)

NREL is a U.S. Department of Energy National Laboratory

Operated by Midwest Research Institute • Battelle

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Sponsored by the U.S. Department of Energy

Energy Efficiency and Renewable Energy 

FreedomCAR and Vehicle Technologies Program

For more information contact: EERE Information Center

1-877-EERE-INF (1-877-337-3463)

www.eere.energy.gov

A Strong Energy Portfolio for a Strong America

Energy efficiency and clean, renewable energy will mean a stronger economy, 

a cleaner environment, and greater energy independence for America. Working 

with a wide array of state, community, industry, and university partners, the U.S. 

Department of Energy’s Office of Energy Efficiency and Renewable Energy invests 

in a diverse portfolio of energy technologies.

DOE/GO-102005-2047 • April 2005

For more information about EPAct, visit www.eere.energy.gov/vehiclesandfuels/epact.

What is EPAct?

The Energy Policy Act of 1992 (EPAct) was passed by Congress 

to reduce the nation’s dependence on imported petroleum. 

Provisions of EPAct require certain fleets to purchase AFVs. 

DOE administers these requirements through its State & Fuel 

Provider Rule, Federal Fleet Rule, and Alternative Fuel Designation Authority.

For more information, visit www.eere.energy.gov/

vehiclesandfuels/epact, or call the Regulatory Information Line 

at 202-586-9171. 

State & Alternative Fuel Provider Rule

Bruce Thompson, Fleet Procurement Manager

North Carolina DOT

rbthompson@dot.state.nc.us

Larry Shirley, Director

State Energy Office

larry.shirley@ncmail.net

Danny Willis, Assistant Director

North Carolina Motor Fleet Management Division

danny.willis@ncmail.net