Proposed Plant List Doesn't Tell Whole Story
August 8, 2008
BY Jessica Sobolik
For this month's issue of Biodiesel Magazine, our staff compiled our third annual Proposed Biodiesel Plant List. It includes all of the proposed projects between concept and construction that we were able to verify by press time.
In the weeks leading up to this undertaking, we had a feeling the list wouldn't be as large as in previous years-and we were right. Several market factors, including but not limited to high feedstock costs, a lack of financing and high construction costs, greatly affected the industry over the past year. In 2005, the proposed plant list contained 36 projects. That ballooned to 65 projects in 2006 and 94 projects in 2007. This year, out of the 160 projects in our database, we were only able to verify that 27 were moving forward.
Presented in this way, it sounds like bad news. We hear grumblings all the time that the biodiesel industry has hit a wall, stalled and may not recover. However, we also continue to hear reports of biodiesel companies going ahead with development plans despite the obstacles, and I think those sometimes get lost in the shuffle. For example, on page 16 of our Industry News section, Staff Writer Kris Bevill details two biodiesel plants in particular that are ramping up production. A third project is continuing through the development stages. These stories are proof that the biodiesel industry isn't dead but that producers are figuring out smarter, more efficient ways to make the renewable fuel. That may involve crushing feedstocks on-site, such as the project in the "Proving the Collocation Concept" feature (see page 70) and some of the projects on the plant construction list (see page 32). It could also mean exploring cheaper feedstocks and new technologies like many others are doing. These are promising innovations.
Although many in the industry are facing tough times at the moment, our staff acknowledges that one change (e.g., soy oil prices drop, additional federal legislation is passed or enacted, etc.) can change the entire dynamic. Next year's proposed plant list may tell a different story.
In the weeks leading up to this undertaking, we had a feeling the list wouldn't be as large as in previous years-and we were right. Several market factors, including but not limited to high feedstock costs, a lack of financing and high construction costs, greatly affected the industry over the past year. In 2005, the proposed plant list contained 36 projects. That ballooned to 65 projects in 2006 and 94 projects in 2007. This year, out of the 160 projects in our database, we were only able to verify that 27 were moving forward.
Presented in this way, it sounds like bad news. We hear grumblings all the time that the biodiesel industry has hit a wall, stalled and may not recover. However, we also continue to hear reports of biodiesel companies going ahead with development plans despite the obstacles, and I think those sometimes get lost in the shuffle. For example, on page 16 of our Industry News section, Staff Writer Kris Bevill details two biodiesel plants in particular that are ramping up production. A third project is continuing through the development stages. These stories are proof that the biodiesel industry isn't dead but that producers are figuring out smarter, more efficient ways to make the renewable fuel. That may involve crushing feedstocks on-site, such as the project in the "Proving the Collocation Concept" feature (see page 70) and some of the projects on the plant construction list (see page 32). It could also mean exploring cheaper feedstocks and new technologies like many others are doing. These are promising innovations.
Although many in the industry are facing tough times at the moment, our staff acknowledges that one change (e.g., soy oil prices drop, additional federal legislation is passed or enacted, etc.) can change the entire dynamic. Next year's proposed plant list may tell a different story.
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