Biodiesel Jobs and Purification

By Ron Kotrba | March 23, 2010
Few words have been repeated more than "jobs" lately, as Congress has contemplated the reissuance of the federal biodiesel blender tax credit in the first and second jobs bills early this year. As you all remember, the biodiesel tax credit-along with many other tax extenders-was stripped out of the first jobs bill in February, leading to yet another setback and disappointment for the biodiesel industry just days after the national conference concluded. By mid March, right at the time we were taking this issue of Biodiesel Magazine to print, the Senate passed the $150-billion American Workers, State and Business Relief Act, in which the biodiesel tax credit managed to remain. Now, the House and Senate versions of this bill must be reconciled before it is presented to President Barack Obama for signing into law.

Tying biodiesel tax subsidies to job creation-or preservation as the case may be-turned out to be more controversial than biodiesel stakeholders might have thought imaginable. David Swenson at Iowa State University cautioned that a 30 MMgy biodiesel plant (and blender) would claim $30 million in federal tax subsidies from the blender credit alone, and that a biodiesel plant of this size would only support about 30 jobs-so each biodiesel job would "cost" around $1 million. When Biodiesel Magazine reported on this, a flurry of emails, letters to the editor and comments were received that admonished Swenson's line of reasoning, offering alternative interpretations of what the federal blender credit means to our economy and green-collar job preservation. We cover this timely story in a featured article on page 22, called, "JOBS: Judgments on Biodiesel Stimulus." Check it out and feel free to let us know what you think.

Even though jobs and reissuance of the biodiesel tax credit have taken center stage in recent weeks, the theme of this month's issue is biodiesel purification. It's a new theme I wanted to develop for the 2010 editorial calendar shortly after becoming editor last year, mainly because it is such an important part of the biodiesel production process that ultimately determines whether the fuel meets its quality specification. Our featured article, titled, "Crystal Clear Fuel," in which we summarize some of the different products and techniques available today for producers to ensure their fuel meets the increasingly stringent biodiesel quality spec, begins on page 26. To round out this month's theme, Al Schultz from Dow Chemical Co. offered to write the Talking Point column on page 39, called, "Biodiesel Purification Options."

Lastly, I wanted to highlight the battle going on in Iowa regarding a state B5 mandate. Money from the trucking firms and Big Oil is being spent on a serious campaign against the measure under the guise of a consumer advocacy group called Iowans for Consumer Fuel Choice. The group claims it is not against biofuels, but it opposes biofuel mandates. It is scaring legislators into believing that if over-the-road truckers passing through Iowa are forced to buy B5, then those truckers will make a concerted effort to refuel out of state, causing Iowa to lose millions in fuel sales. The group has been citing fuel costs in Minnesota, where a B5 mandate exists, stating that fuel costs in Iowa would rise if a biodiesel mandate went into effect "just as it has in Minnesota." But there is disagreement with those numbers, and some say Minnesota diesel fuel costs between May 1, when the mandate in Minnesota went from B2 to B5, and Dec. 31, when the federal tax credit lapsed, were virtually the same as they were in Iowa during that same time period-perhaps even a tenth of a percent cheaper, according to Monty Shaw with the Iowa Renewable Fuels Association. Read more about this issue on page 10 of the Industry News section.
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