Borderless Biodiesel

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The 2006 World Biofuels Symposium (WBS) in Beijing featured a tour of an ethanol plant and attracted a number of large, multi-national companies seemingly linked more to enzymes and fuel alcohol than vegetable oils and methyl esters. But there was a palpable biodiesel buzz at this international meeting-and it really got people talking.

Organized by BBI International, Tsinghua University in Beijing; China National Cereals, Oils and Foodstuffs Corp.; and the Minnesota Department of Agriculture, the second annual WBS was well-attended-more than 225 people participated-and offered a mix of technology- and policy-oriented biofuels presentations on ethanol and biodiesel. The event was, of course, international in scope, and many attendees were reportedly eager for information about the growth of the U.S. biodiesel industry.

Sharing the U.S. Experience
On behalf of U.S. biodiesel producers, United Soybean Board Director Jim Call told the international audience that increased domestic soybean production, a trend toward lower oil- and animal-fat laden human diets, and growing world competition in the vegetable oil markets have been a boon to biodiesel in the United States. Primarily, though, high crude oil prices-and resultant high diesel prices-as well as effective federal policy, are driving the U.S. industry's remarkable expansion, he said.

Specifically, the extension of the federal biodiesel excise tax credit in 2005, as well as complementary state incentives, have propelled the industry forward. Likewise, the support of the worlds' major automakers-DaimlerChrysler, in particular-has been a step in the right direction for the once fledgling industry. Call pointed out the significance of DaimlerChrysler's decision to factory fill certain vehicle models with B5 and approving its Dodge Ram pickup trucks for B20 use in fleet applications. He also informed the crowd that iconic American tractor maker John Deere is factory filling diesel-powered machinery-including tractors, combines and self-propelled sprayers-with B2. In addition, Call talked about the marked increase in the number of U.S. filling stations offering biodiesel blends.

With several new U.S. biodiesel plants scheduled to come on line in 2007-there were 33 U.S. facilities under construction at press time-the United States will have a capacity to produce 1.6 billion gallons of biodiesel per year by 2008, Call told the international audience. Meanwhile, experts continue to uncover enhanced possibilities for the fuel. Research and development trends include genetic manipulation of plant oils to achieve higher oil content and improved cold-flow properties. At the same time, Call said, biodiesel process technology advancements are continually being achieved by U.S. producers.

Small, Challenged Market in Australia
Like the United States, Australia is a gasoline-powered nation-and not a very populous one at that. Therefore, while ethanol has a great deal of promise in the Land Down Under, the potential market for biodiesel is both small and constrained, according to Bill Elliot, director of BBI Biofuels Australia and a speaker at this year's WBS.

Elliot said Australia is unlikely to keep pace with the global rise of biodiesel production and use. The nation consumes 15 billion liters (4 billion gallons) of diesel annually-a rather small market in itself-and the Australian federal government has been reluctant to take the necessary steps to implement effective biofuels legislation, Elliot said. Additionally, the Australian biodiesel market is handicapped by the fact that only 10 percent of current diesel suppliers in the nation are required to pay the full fuels tax of AUS$0.38 per liter (US$0.20 per gallon).

Europe Stills Leads
Compared to nations like Australia, where biodiesel is as exotic as the nation's wildlife, Europe is light years ahead in production, use and consumer acceptance of the renewable fuel. And even though the U.S. biodiesel industry is experiencing exponential growth, it still lags behind Europe, where diesel vehicles rule the roads.

Will Thurmond, author of "Biodiesel 2020: A Global Market Survey," wasn't able to attend the 2006 WBS, but his report helps put the global biodiesel picture in context. His Houston-based company, Emerging Markets Online, began researching alternative energy markets for its clients a few years ago. Today, Thurmond keeps a close eye on the rising global biodiesel market, and he's impressed with what he sees. In particular, he's interested in "where it started and where it's going" worldwide.

France has a nationwide B5 mandate and B100 use is widely accepted in Germany, Thurmond tells Biodiesel Magazine. He says Germany currently has more than 1,800 biodiesel fueling stations and last year produced 80 percent of all the biodiesel in Europe. In 2005, Germany produced 1.7 million tons (460 million gallons) of biodiesel, France produced 492,000 tons (135 million gallons), Italy produced 396,000 tons (108 million gallons) and the Czech Republic and Poland were close behind with 133,000 (36 million gallons) and 100,000 metric tons (27 million gallons), respectively, Thurmond's report reveals.

Germany has an advanced biodiesel infrastructure rooted in a framework of cooperation among government, farmers' unions, and refinery and distribution companies. Thurmond says other nations would do well to learn from its example. "Germany is the model China, Brazil and India are going to follow, which is a massively centralized government enterprise [that involves] farmers, the oil and gas refineries, and distribution outlets in one program," he says.

Will Biodiesel Be Big for China?
Although ethanol is the most high-profile renewable transportation fuel in China, the nation is one of the biggest diesel users in the world, consuming approximately 60 million to how it should look: 70 million tons (16.5 billion to 19 billion gallons) per year, according to Thurmond's report. Production of biodiesel, however, has not yet caught up with the country's appetite for diesel. In 2004, China produced only 60,000 tons (16 million gallons) of biodiesel, which is less than 1 percent of the country's total diesel production in the previous year, according to Thurmond. The gap between fuel production and consumption is growing, and any country in this situation has a serious energy security dilemma and must diversify its energy supplies, Thurmond says.

The Chinese government is encouraging-if not pushing-the production and use of biofuels in order to meet its mounting transportation fuel needs. It's ethanol ambitions are taking flight, but a lack of available plant oils is hindering the proliferation of biodiesel. China doesn't have enough arable land resources available to produce the crops commonly used to produce biodiesel: soybeans, rapeseed, palm and castor beans, for example.

In fact, China is already the world's No. 1 importer of vegetable oil, according to Zongbao Zhao, a professor at China's Dalian Institute of Chemical Physics. Despite this fact, China is making advances. Last year, the country increased biodiesel production to somewhere between 100,000 and 200,000 metric tons (30 million and 60 million gallons); under current biofuels development policies, the country is expected to increase its biodiesel production to 2 million tons per year (540 MMgy) by 2010, according to Thurmond's report. The federal government of China is expected to release a new implementation plan for the biofuels component of its 2006-'10 planning period by the end the year, Thurmond says.

With vegetable oils in tight supply, 80 percent of China's biodiesel is currently made from recycled waste oil from restaurants. Mark Soutter, an analyst for BBI International and an attendee of the 2006 WBS, recalls speaking with a Chinese citizen at the conference who owns and operates a small biodiesel production facility in southern China that uses duck fat as its principal feedstock. Duck fat is easy to obtain and has a low value as a recycled fat because it tends to have an undesireable flavor, Soutter explains.

The country also has successfully used human sewage as a biodiesel feedstock. "China has made some pretty major advances in terms of recycling human sewage into biodiesel," Thurmond says, explaining that metro buses have been powered with a fuel derived from the unsavory raw material.

According to Zhao, the key to China's biodiesel industry lies with the use of innovative triacylglycerol resources. Zhao and his biomass conversion team have begun looking at the use of microbial oil in place of vegetable oils or animal fats for biodiesel production. In addition, the Huazhong University of Science and Technology is researching the use of lipases-enzymes that catalyze, or initiate, the hydrolysis of monoglycerides, diglycerides and triglycerides to glycerol and fatty acids-to make biodiesel.

Like the work Zhao is undertaking, other novel biodiesel production technologies emerging in China are still in the research and development stages. Thurmond says few, if any, novel processes have been ramped up to commercial scale. "Since it's such a new market for biodiesel, finding the kind of data that can be useful for forecasts was very difficult, but putting together the argument for the use of biofuels was not," he says.

For more information about the WBS, visit www.worldbiofuelssymposium.com or contact [email protected]

Lindsey Irwin is a Biodiesel Magazine staff writer. Reach her at [email protected] or (701) 746-8385.