The Ubiquitous Diesel, Positive Biodiesel News
November 20, 2009
BY Ron Kotrba
Waiting at a red light at the edge of town this morning as I drove in to work, I couldn't help but notice all of the diesel truck traffic. BBI International Media and Events is headquartered in Grand Forks, N.D., which borders the Minnesota state line. While at this stop light on the Minnesota side, I realized I was seeing what must have been five diesel semi trucks for every gasoline-powered passenger car. For the minute or two I sat at the light, 30 diesel rigs must have driven by. Some of the trucks were hauling loads of soybeans, sugar beets or potatoes; others were utility trucks equipped with cherry pickers or other specialty devices made for one task or another; and some were carrying merchandise to local stores. It's a sight I must see every morning, and it's a phenomenon most drivers must see every day but seldom pay attention to.
In Minnesota, all diesel fuel sold is B5-and that will eventually be upped to B20. Ostensibly, these trucks were all powered by a biodiesel blend. Often times people discount how important diesel power and diesel fuel are in our society, especially when it comes to passenger vehicles. But for those who think diesels in general are obscure machines that do not affect their lives, they should just pay attention the next time they are driving around or sitting at a stop light. On-road trucks transport virtually all the goods we purchase. They carry industrial equipment from the point of manufacture to the point of use. Diesels plow our streets and take children to schools. Transit buses transport city populations from one place to another. Off-road diesels build our roads and construct new buildings and destroy old ones. And trains powered by diesel, which convert diesel power to electricity, carry goods, people and equipment short distances or across the country. Marine vessels traverse the globe with grain, products and more. So the next time a person tries discounting the importance of diesel fuel or power, tell them to open their eyes and simply look around once in a while. They might be surprised at what they see.
On another note, there have been some positive signs that the economic situation for biodiesel might be turning around. For one, the Ag Marketing Research Center's soy biodiesel plant profitability chart, a hypothetical soy bio plant model that costs can be plugged into to determine how profitable-or unprofitable-biodiesel production is, indicated good news recently. For many months, the model showed negative profitability but in September it went into the black. Perhaps the economics of the hypothetical soy methyl ester plant is a sign of things to come for real biodiesel producers. Secondly, NBB recently conducted a survey that found people are more aware of biodiesel than ever. The third piece of good news is that the latest energy balance numbers, computed by USDA and the University of Idaho, show that biodiesel is energy positive 4.5:1, meaning for every unit of fossil energy put into biodiesel production, 4.5 units of energy are produced. For years that number was 3.2, which was always considered very good, and it's only getting better thanks to agronomic efficiencies, consideration of coproducts like glycerin, more efficient production and so forth. And finally, we're coming up on 2010, and as soon as the U.S. EPA releases its final rule for implementation of RFS2, the combined required blend volume of biomass-based diesel for 2009/2010 (500 million gallons for 2009 and 650 million gallons for 2010) is an amount that is greater than the 2012 volume requirement of 1 billion gallons. Once this rule goes into effect and obligated parties feel pressure to blend the required volume of the renewable fuel, I anticipate we will see a rash of idled biodiesel plants start producing again, and those that are producing, but not at capacity, will push production up due to the increased demand.
Ron Kotrba
Editor
Biodiesel Magazine
rkotrba@bbiinternational.com
In Minnesota, all diesel fuel sold is B5-and that will eventually be upped to B20. Ostensibly, these trucks were all powered by a biodiesel blend. Often times people discount how important diesel power and diesel fuel are in our society, especially when it comes to passenger vehicles. But for those who think diesels in general are obscure machines that do not affect their lives, they should just pay attention the next time they are driving around or sitting at a stop light. On-road trucks transport virtually all the goods we purchase. They carry industrial equipment from the point of manufacture to the point of use. Diesels plow our streets and take children to schools. Transit buses transport city populations from one place to another. Off-road diesels build our roads and construct new buildings and destroy old ones. And trains powered by diesel, which convert diesel power to electricity, carry goods, people and equipment short distances or across the country. Marine vessels traverse the globe with grain, products and more. So the next time a person tries discounting the importance of diesel fuel or power, tell them to open their eyes and simply look around once in a while. They might be surprised at what they see.
On another note, there have been some positive signs that the economic situation for biodiesel might be turning around. For one, the Ag Marketing Research Center's soy biodiesel plant profitability chart, a hypothetical soy bio plant model that costs can be plugged into to determine how profitable-or unprofitable-biodiesel production is, indicated good news recently. For many months, the model showed negative profitability but in September it went into the black. Perhaps the economics of the hypothetical soy methyl ester plant is a sign of things to come for real biodiesel producers. Secondly, NBB recently conducted a survey that found people are more aware of biodiesel than ever. The third piece of good news is that the latest energy balance numbers, computed by USDA and the University of Idaho, show that biodiesel is energy positive 4.5:1, meaning for every unit of fossil energy put into biodiesel production, 4.5 units of energy are produced. For years that number was 3.2, which was always considered very good, and it's only getting better thanks to agronomic efficiencies, consideration of coproducts like glycerin, more efficient production and so forth. And finally, we're coming up on 2010, and as soon as the U.S. EPA releases its final rule for implementation of RFS2, the combined required blend volume of biomass-based diesel for 2009/2010 (500 million gallons for 2009 and 650 million gallons for 2010) is an amount that is greater than the 2012 volume requirement of 1 billion gallons. Once this rule goes into effect and obligated parties feel pressure to blend the required volume of the renewable fuel, I anticipate we will see a rash of idled biodiesel plants start producing again, and those that are producing, but not at capacity, will push production up due to the increased demand.
Ron Kotrba
Editor
Biodiesel Magazine
rkotrba@bbiinternational.com
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