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Summary

When a customer uses Breakthrough Fuel Recovery (or similar lane-level fuel programs), the carrier loses a structural margin advantage that exists under traditional DOE-based fuel surcharges. BidRight’s lane-level fuel hedge is designed to protect that margin. This article explains what changes when a customer moves to lane-level fuel, why carriers need to hedge, and how BidRight handles it.

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When to use this

Lane-level FSC data

A customer’s bid includes Breakthrough Fuel or lane-level FSC data.

Lane fuel hedge value

You’re seeing a “Lane Fuel Hedge” value on your bid and want to understand it.

Hedge settings

You’re deciding what hedge amount to set in your company settings.

Extra adjustment

You want to understand why BidRight adds an extra amount on top of the lane-level fuel adjustment.

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Why Breakthrough fuel changes the economics

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The margin some carriers don’t realize they have

Under a traditional DOE-based fuel surcharge, the surcharge is pegged to the national average retail diesel price, which is what the average driver pays at the pump. Some carriers do not buy fuel at retail. You may have negotiated fleet rates, fuel network discounts, bulk purchasing agreements, or strategic fueling programs that get you close to rack wholesale pricing. That is a competitive advantage you invested in. The spread between what the DOE-based surcharge reimburses (retail) and what you actually pay (near wholesale) is real fuel margin. Depending on the region and market, that spread commonly runs 50 cents per gallon. Most carriers do not track this margin explicitly because they think of fuel surcharge as cost recovery. But the margin is there, and it matters.

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What Breakthrough does to that margin

Breakthrough Fuel Recovery replaces the DOE retail peg with a calculation built from rack wholesale diesel prices. Their formula adds fuel tax, environmental fees, and 2 cents per gallon for “Transportation Cost to Truckstop” on top of rack wholesale. If you already buy fuel near rack wholesale, Breakthrough’s reimbursement lands close to your actual fuel cost. The retail-to-wholesale spread you were earning under DOE-based surcharges is gone. In its place, Breakthrough offers 2 cents per gallon. The carriers who are best at fuel procurement, and who worked hardest to negotiate wholesale rates, lose the most.

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The math

If your fuel margin under a DOE-based surcharge was 50 cents per gallon (retail reimbursement minus your wholesale purchase cost), Breakthrough reduces that to roughly 2 cents per gallon. At a typical 6.5 MPG, that is approximately 7 cents per mile of lost margin, on every mile, every load, every lane running under Breakthrough.
If linehaul rates are not raised to compensate, that margin disappears.

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How BidRight handles lane-level fuel

BidRight’s lane-level fuel model has two components that work together.

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Component 1: The spread calculation

When a customer provides lane-level fuel data (like Breakthrough), BidRight compares each lane’s FSC to your company fuel peg. If the lane-level FSC is higher than your peg, you get a discount on linehaul because the customer is overpaying you on fuel. If the lane-level FSC is lower than your peg, BidRight marks up linehaul to cover the shortfall. This is automatic and works the same way as the standard FSC adjustment described in Fuel Surcharge (FSC), but applied per lane instead of per customer.

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Component 2: The hedge

On top of the spread calculation, BidRight adds a flat cents-per-mile hedge, always in the carrier’s favor. This hedge exists because lane-level fuel data carries structural risks that a flat customer FSC does not.

Backward-looking data

Breakthrough’s fuel estimates are based on historical pricing. By the time loads run, fuel costs may have shifted.

Minimal concession

Breakthrough adds only 2 cents per gallon beyond rack wholesale. For carriers buying near wholesale, this means almost zero fuel margin under the program.

MPG mismatch risk

Breakthrough commonly assumes 6.9 MPG. If your fleet averages 6.0 to 6.5 MPG, you burn more fuel per mile than the program reimburses. That gap alone can be 3 to 6 cents per mile.

Regional variation

You may not fuel within the origin-destination corridor that Breakthrough’s lane geography assumes.
The hedge accounts for all these risks with one simple number.

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Setting your hedge amount

The hedge is set in Company Settings and applies to all lanes where lane-level fuel data is present. You can override it at the bid level or lane level if needed.
This covers the MPG assumption gap (typically 3 to 6 cents per mile for most fleets), plus buffer for data staleness, regional fuel price variation, and the administrative burden of reconciling lane-level fuel.

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When to adjust

Lower (minimum 4 cents)

Your fleet is newer with fuel efficiency close to 6.9 MPG, you trust the customer’s Breakthrough data quality, and the market is stable.

Higher (10 to 14 cents)

Your fleet averages 6.0 to 6.2 MPG, diesel prices are volatile or rising, or the customer’s Breakthrough program is new and unproven.

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A real-world reference point

When one large carrier moved lanes from traditional DOE-based fuel surcharge to Breakthrough, the pricing team estimated the bottom-line impact at about 10 cents per mile. They raised linehaul rates by 14 cents per mile to compensate, which covered estimated margin loss plus additional buffer for uncertainty. Most carriers are not making this adjustment today.

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How it looks on a lane

Breakthrough overpays on fuel

  • Breakthrough lane FSC: $1.00/mile
  • Your company fuel peg: $0.48/mile
  • Spread: +$0.52 (Breakthrough overpays, linehaul discount)
  • Hedge: $0.08 (always in your favor)
  • Net adjustment: 0.52discountminus0.52 discount minus 0.08 hedge = $0.44 linehaul discount
You never give the full spread back. The hedge holds back 8 cents as your buffer.

Breakthrough underpays on fuel

  • Breakthrough lane FSC: $0.30/mile
  • Your company fuel peg: $0.48/mile
  • Spread: -$0.18 (Breakthrough underpays, linehaul markup)
  • Hedge: $0.08 (stacks on top)
  • Net adjustment: 0.18markupplus0.18 markup plus 0.08 hedge = $0.26 linehaul markup
The hedge always moves in your favor, whether the spread is positive or negative.

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What to watch for

Do not set the hedge to zero. Even if a lane’s spread looks favorable, the structural risks of lane-level fuel (backward-looking data, MPG mismatch, regional variance) remain. A zero hedge means you trust Breakthrough’s number completely.
  • Review the hedge when market conditions change. In a rising fuel market, 8 cents may not be enough. In a stable, low market, it is solid. Check this setting at least quarterly.
  • The hedge is separate from the spread. The spread handles the math between your peg and the customer’s lane-level FSC. The hedge handles risk the spread does not capture.
  • Lane-level overrides are available. If you have specific lane intelligence, such as unreliable data on a specific corridor, you can override the hedge on that lane without changing the company default.

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