Setting Up Controls For Fuel Theft

A variety of methods are available to help your customers manage their fleet requirements.

By Doug Dunlap

With fuel prices at an all-time high, the incentive for fuel theft and misappropriation is also peaking. A recent inquiry to a product support center illustrated this clearly as the question asked by a customer was why the fuel island management computer (fuel management unit or FMU) should record and then display the message “Hose 1 into Manual: 12:43AM 8-31-2008” followed by “Hose 1 into Auto: 12:52AM 8-31-2008.”

Automated fuel and vehicle control systems provide assurance that unauthorized vehicles are not fueled.

The person making the inquiry was new and had just taken over the administration of the fuel monitoring system. The quick answer was that someone had gained access to the FMU and placed hose #1 in manual override. While in this mode, fuel could be pumped through this hose and not be recorded by the FMU. The installation of a camera exposed the identity of the thief and a review of the history recorded by the FMU revealed seven prior occurrences and a total estimated loss of $777.60.

In the world of fuel security, the term “misaccounted fuel” is commonly used to identify fuel whose use is unknown. This does not mean that it was misused, but that there is a discrepancy between amounts “purchased” and amounts which can be identified as “used.” Like ice cream, which seems to disappear mysteriously from the freezer, the pilfered fuel in the example above could very easily have become an unresolved difference. A reconciliation of the dispenser totals to the FMU totals could also have alerted the customer to a problem, but these procedures are often not executed properly.

Levels of Fuel Control
How much theft or misuse actually occurs? Direct experience shows that even fuel users with moderately effective control systems experience about 7 to 7.5 percent in the misaccounted fuel area. Some data indicate that about half of this amount is actually misused. What levels of control are fuel managers utilizing in practice? Every conceivable method, from the “honor system” where there are no controls, to the latest “passive tank ring” technology, which provides the highest level of security and accountability. Although there are no studies available to directly measure the effectiveness of each method, it is probably accurate to say that there is a direct correlation between misuse and the level of control being utilized. A quick review of various methods and their characteristics are below.

Honor System — There are no controls and no documentation of use. Amounts purchased and used in aggregate are the only management information available. This method may be appropriate for cases where fuel usage is so small that it can be controlled purely by monitoring purchases.

Clipboard Recording of Transactions — This is an extension of the honor system where management wants some additional information on the fuel user. Unfortunately, this method of collecting data is highly unreliable, as errors in the recording process often exceed 20 percent. To be usable, the data must be input into a computer program and sorted in a meaningful manner. Exceptions are usually difficult to trace, and management information is very limited.

Handheld Recording Devices — These devices provide a method for recording fuel transactions, but entry is manual (20 percent error again!), and there is no control of fuel flow. Used for mobile fuel deliveries, data are generally not reliable without labor-intensive checking, and reconciliation to total quantities pumped requires additional effort.

Automated Fuel Control Systems — By using computer automation on the fuel island and in fuel delivery trucks (FMU), a methodology is provided for fuel control, around which automation of the dispensing process can be built. Problems still remain in that while authorization and recording are controlled, the ultimate use of the fuel (which vehicle) is not controlled. Fuel is easily placed into an unauthorized vehicle.

Automated Fuel and Vehicle Control Systems — These systems, referred to as passive systems, remove any data recording by the driver and also take fuel accountability and extend it to the vehicle by allowing fuel flow only when the fuel nozzle is inserted into an authorized vehicle. This provides the greatest assurance that unauthorized vehicles are not fueled.

The most advanced passive systems also provide the added benefit of an interface to the vehicle computer. The Federal Government, along with the auto industry, developed standards for collecting and communicating vehicle operating data from the vehicle computer, or Electronic Control Module (ECM) as it's commonly known. Data are passed directly from the ECM to a data bus, sometimes referred to as OBD or Onboard Diagnostics data bus. This bus is accessed through a direct connect cable under the vehicle dash. Within the OBD is a vast amount of data including Miles per Gallon, Idle Time, Top Speed, Engine Hours, Engine Warning Lights, and Emission Controls, among many others. The major disadvantage is that access to this data through the direct cable hook up generally has to be performed by a mechanic in the maintenance shop. Fortunately, the most advanced passive systems capture this data automatically during vehicle operation and communicate it to the FMU during the refueling process.

Fuel Attendant — Some large organizations still utilize this method, and while control over the process is generally very high with great accuracy and timeliness, its disadvantage is the high cost, which is why many large users (including the Department of Defense) have moved away from it.

Choosing a Method of Control
Which method is recommended for customers operating their own fleets and dispensing fuel? This is, of course, a matter of judgment and is almost entirely dependent upon exposure. How much fuel cost is being incurred and what is the financial risk of loss? How effectively are vehicles being monitored for maintenance, operational efficiency and driver abuse?

At around $4.00 per gallon and no long-term relief in sight, the financial risk for fuel alone has increased to a level where, for most users, a strong system of controls is mandatory. Fortunately, controlling fuel is extremely cost-effective.

Today's systems yield such accuracy, cost-effectiveness, timeliness and overall convenience that the fueling and vehicle surveillance process should be automated to the greatest practical extent, and this will generally provide the highest return on investment. It's certainly a recommendation your customers will appreciate and one which will enhance your partnership role.

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The PEI Journal • Fourth Quarter 2008 • Volume 2, No. 4 • Contents are Copyright © Data Key Communications, Inc.
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