Billed as "controversial," Josh Tickell's new book, Biodiesel America, challenges the oil industry's century-long grip on America's transportation fuels infrastructure-along with the auto industry and government policies that have sustained it-and offers a new energy roadmap to wean America from fossil fuels forever. 

 
 It's true. The book does all that-and, yes, it's the type of literary quest that might rub some folks the wrong way. However, don't presume Biodiesel America is just another anti-petroleum, half-truth-laden piece of renewable fuels propaganda that speaks only to the far left. 
 
 It's not. 
 
 To Tickell's credit, Biodiesel America is an engaging history lesson, a renewable fuels primer and biodiesel industry backgrounder all wrapped into one. It's also an authentic call to action, a perspective-building page turner, and a must-read for anyone interested in renewable fuels. The book explores the social, economic and political ramifications of biodiesel's global rise, and it allows its readers to envision a pathway to greater-if not complete-energy independence in America. 
 Tickell, arguably one of the nation's leading experts on biodiesel, authored From the Fryer to the Fuel Tank: The Complete Guide to Using Vegatable Oil as an Alternative Fuel, a bestseller written five years ago that helped jumpstart the U.S. biodiesel industry. His non-profit organization used biodiesel-fueled relief ships to deliver 20,000 meals, clothing and medical supplies to victims of Hurricane Katrina and was recognized by President Bill Clinton as part of his Initiative on Global Climate Change. Tickell is also the director and creative force behind a feature-length documentary film about biodiesel, "Fields of Fuel," which is currently in the final stages of production. 
 
 Exactly how Tickell managed to write a book in between globetrotting stints with his "Fields of Fuel" crew is remarkable-the type of thing that makes regular Joe writers look bad. What the dynamic young author managed to tap out is a book that speaks not only to biodiesel advocates, but a whole generation of Americans who are growingly fed up with the nation's reliance on foreign oil and ready to do something about it. As National Biodiesel Board CEO Joe Jobe says in the book's forward, "Our personal impact on the world-our allocation of resources, our footprint on the environment, our development and use of energy and new technologies, and our level of awareness-is something we can all affect and have a moral obligation to affect. … The task is ours." 
 
 Jobe's words portend Tickell's overarching message. Indeed, page by page, "rising to the challenge"-using the book as a springboard for action-progressively becomes the author's forthright ambition. 
 
 Authors of nonfiction sift through volumes of data, interviews and historical references when compiling a book. They are often forced to omit important but expendable information, and choosing what to keep in and what to toss out can be a tricky endeavor. Fortunately, Biodiesel America seems to get it right. Tickell clearly understands that to illustrate the role biodiesel might play in America's energy future, it is necessary to shed light on the nation's historical reliance on petroleum. Tickell takes the reader on a trip back in time, starting with the origins of fossil fuels in prehistoric algal life to the Western world's dependence on whale oil and the eventual "discovery" of crude oil in Pennsylvania. He explains the rise of Rockefeller's Standard Oil, and the monopoly breakup that led to the creation of what became the 20th Century's major oil companies-Exxon, Mobil, Chevron, BP/Amoco, Conoco and ARCO. "At their height, these companies would grow into a family of seven large oil companies," Tickell writes. "But like the oil industry itself, they would eventually plateau and decline." 
 
 Tickell describes how America's access to petroleum helped the Allied Nations win World War II and create a higher standard of living for the rising Baby Boomer population. It all builds up to the foreign oil dependency America now endures. "The situation came to a head in 1960 when worldwide oil production began to outpace demand, creating a buyer's market," Tickell writes in a preface to what came next-the rise of OPEC and America's peak oil production. 
 
 Tickell draws a fascinating and alarming picture of the world's oil resources, using Saudi Arabia's Ghawar oil field as a benchmark for global peak oil predictions that some experts say look ominous. All this paves the way for Tickell's introduction of a man who offered a solution to the world's oil crises a century before it occurred. That man, of course, was Rudolf Diesel, the inventor of the diesel engine and a one-time advocate of vegetable oil as a fuel for his motor. "Diesel foresaw his engine as a key component of the industrialization and prosperity of the agrarian communities not endowed with fossil fuel," Tickell writes. "He spoke about 'growing' fuel using the sun's energy as the main input. He was also skeptical about the long-term viability of fossil fuel itself." 

 
 In fact, Diesel was an extraordinary visionary who made several accurate predictions about energy and its impact on the world. For example, he predicted that his engine would be poorly accepted in the United States because the nation had a "lack of cultural attention to efficiency." In 1911, referring the promise of vegetable-oil-based fuels, Diesel made another telling prediction, saying, "Motive power can be produced even when our total store of solid and liquid fuel will be exhausted." 
 
 In a sense, it is Diesel's own message that Tickell carries on with Biodiesel America. One gets a sense that if Diesel himself were able to read the book, he would be awestruck and pleased with the developments of modern diesel vehicles and the gradually increasing acceptance of clean diesel technology worldwide. Tickell highlights the marvel of the diesel engine's modern day evolution-from turbochargers and common-rail injection to diesel-electric hybrids-and illustrates the excitement that vehicles like the Jeep Liberty CRD and the all-aluminum Audi A2 represent for an industry that's reliant on the future popularity of light-duty diesel vehicles. "While the United States still enjoys low fuel prices relative to Europe, U.S. diesel sales have already begun an upward trend," Tickell reports. "With prototype diesels reaching over 250 miles per gallon and hybrid diesels already in production for buses, we can be assured that the U.S. consumer diesels are on the verge of a sharp increase in market share."
 
 Tickell is a broad thinker who understands that biodiesel alone cannot solve the world's energy challenges. So he allows the book to highlight other forms of renewable energy, and he describes the role each might play in the years ahead. "Unlike fossil-based alternative fuels, renewable fuels offer concrete options for long-term sustainable domestic energy production," he writes. "Widely misunderstood (and in most cases underestimated), these fuels represent a formidable technological and economic leap toward energy independence." 
 
 "Growing" feedstock for biodiesel, as a means for not just greater energy independence, but as an economic boost for rural America becomes a key message in Biodiesel America. Tickell dedicates a significant portion of the book to describing America's "farming crisis" and the promise biodiesl holds for agriculture. "Given the importance of agriculture to the economy, it seems prudent to look toward biodiesel and other crop-based fuels to create strong domestic markets for agricultural goods and stabilize the American farm economy," Tickell suggests. From there, he goes on to highlight six oilseed crops that have particular promise in the United States: soybean, rapeseed/canola, mustard, peanut, sunflower and corn. 
 
 Interestingly, Tickell points out a U.S. DOE report that identified 14 criteria for a new crop that could be slowly introduced into the U.S. market as a source for biodiesel production. "According to NREL, mustard meets all of the criteria," Tickell writes, before explaining that waste vegetable oils (yellow grease), animal fats and algae also hold great promise as biodiesel feedstocks. 
 
 Three distinct scenarios are presented in Biodiesel America that, according to Tickell, represent progressively hopeful roadmaps for the industry's future. The first scenario assumes that if the biodiesel industry and the petroleum industry continue to cooperate-and if government support stays strong-domestic biodiesel use will continue to ramp up to a production capacity of somewhere between 500 MMgy and 1 billion gallons per year. The second scenario assumes that, within the next decade, oil availability will decrease and land now fallow will be used to grow biodiesel feedstocks such as soybeans or canola. "In this climate, we might expect to see production of as much as 5 billion gallons of biodiesel (8 percent of our total diesel fuel usage) by 2010-an extremely optimistic but technologically feasible achievement," Tickell writes. 
 
 In the last and most ambitious scenario, Tickell acknowledges the United States could probably never muster the resources needed to displace 100 percent of its diesel fuel through conventional biodiesel feedstock production. However, he offers, if the social and economic motivators were great enough, the United States could feasibly reappropriate all of its cropland currently used to grow export crops to biodiesel feedstock production, yielding enough oilseed crops to produce 10 billion to 15 billion gallons of biodiesel per year. 
 
 Biodiesel America eventually covers the past, present and future of the U.S. biodiesel industry itself, including the challenges that it now faces. Tickell doesn't skate the tough issues like cold flow, fuel quality standards and nitrous oxide emissions, but rather offers insight into how these problems are currently being tackled. 
 

 In the end, Tickell leaves the ultimate question up the reader. Acknowledging that the concepts of "clean energy" and "alternative fuels" are often associated with sacrifice, Tickell asks, "Are we as Americans prepared for a national effort to steer the bow of our great country away from the iceberg toward which we are currently headed?" Tickell reminds the reader that there is no "silver bullet" fuel-a disclaimer often iterated by others in the biodiesel industry. He says, "We have to work with every other form of energy and energy supplier to dig ourselves out of this mess." 
 
 Tickell closes with a message of hope, saying America has not lost its ability to innovate … to be great. He ultimately leaves the challenge up to the reader. "I've taken you this far," he says. "The rest of the journey is up to you." 
 
 For more information about Biodiesel America, go to <a target="_blank" href="http://www.biodieselamerica.org">www.biodieselamerica.org</a>. 
 
 Tom Bryan is editorial director of Biodiesel Magazine. Reach him at <a href="mailto:tbryan@bbibiofuels.com">tbryan@bbibiofuels.com</a> or (701) 746-8385.

In his new book, Biodiesel America, energy expert and author Josh Tickell shatters the myth that America must remain dependent on Middle Eastern oil. Tickell shows how biodiesel could help invigorate the rural U.S. economy and create a stable domestic fuel source, while leaving our lifestyle and food supply completely untouched.

A Call To Action

Throughout the country, more and more biodiesel production plants continue to go from concept to reality. While the plants differ in size and technologies, one thing remains constant: capital is needed to take the project from concept to groundbreaking. This article explores issues concerning the raising of "seed capital" in financing initial development project costs.
 
 Specified time frame and amount
 

 "Seed capital," as the term implies, is the beginning capital necessary for the growth of a business concept. A primary question in raising seed capital, which seems intuitive but often is not, is how much money is needed? While each project is unique, biodiesel projects should count on raising anywhere from $500,000 to $1 million for initial capital needs. While some of this initial capital may come from federal or state grant programs-not to be overlooked-most of it will likely come from investors' pocketbooks. 
 
 For example, a project in the very early planning stages that has yet to conduct a feasibility study will not likely be in a position to conduct its primary equity offering for three to four months. Depending on the investment opportunity and the investor market, it may be an additional six or more months before the company could access any funds from that primary offering. Therefore, a rule of thumb is that a biodiesel project should estimate its initial capital needs for six months to a year, or more. 
 
 Some uses of seed capital include: 1) feasibility study ($15,000-$30,000); 2) business plan ($30,000-$45,000); 3) accounting and legal expenses ($150,000-$200,000); 4) printing and office expenses ($30,000-$45,000); and 5) site development, pre-engineering and permitting ($250,000-300,000). The costs add up quickly, and while a project could require significantly less seed capital if it were to wait until after permanent financing to purchase a site and begin site development, most projects are not willing to wait for fear of losing their slot on their selected builder's construction schedule. Thus, purchasing a site increases the project's capital needs (upwards of $500,000).
 
 Who from and how
 
 Early on in the seed capital decision-making process, developers must consider who the potential investors are and how investment may be solicited from them in compliance with federal and state securities laws. One scenario is that one to a few "angel investors" fund the entire seed capital requirement. In these instances, compliance is relatively straightforward, and the parties will negotiate the terms of the investment, including liquidation preferences, board seats and other preferential rights.
 
 The more likely scenario, however, is that the start-up will need to solicit numerous investors to raise the necessary amount of initial seed capital. In this instance, compliance with the regulations is more burdensome, as the company will need to prepare a prospectus that discloses all material information including risks of the project. Notice filings would also likely be required at both the federal and state level, and some states may have specific pre-offer or post-sale filing requirements.
 It is also crucial that seed rounds be planned with an eye on subsequent or permanent financing rounds. For example, it is important that seed rounds not be inadvertently "integrated" with subsequent, more permanent financing rounds, which may cause the seed round that was initially in compliance at the time money was raised to subsequently be non-complaint.
 
 Mark Hanson and Todd Guerrero are members of the Agribusiness and Alternative Energy Practice Group of Lindquist & Vennum PLLP, a leading provider of legal assistance on bioenergy projects throughout the country. They can be reached at (612) 371-3211. Ron McFall, a senior securities partner in the group, contributed to this article.

Considerations When Contemplating The Use Of Seed Capital For Initial Project Funding

LegalPerspective

U.S. ethanol producers have come to the realization that, for some 25 years now, they've been virtually giving away corn oil contained in distillers grains for pennies on the dollar. 

 
 Finally, it looks like that's going to change.
 
 Extracting all or a portion of the corn oil seems to not only have a positive effect on the ethanol production process, but also on the resulting distillers grains. It also reduces coproduct drying costs, a big plus when natural gas prices are high. Most importantly, it adds a new revenue stream to the ethanol dry mill set up. 
 
 Not long ago, BBI International conducted a study for Natural Resources Canada to evaluate corn oil extraction technologies, potential synergies in integrating those technologies with biodiesel production, and the impact it would have on the resulting distillers grains coproducts. BBI worked in cooperation with Canada's leading ethanol producer, Commercial Alcohols Inc., and soon-to-be Canadian biodiesel producer Biox Corp., along with the U.S. Department of Agriculture. What we found, while not totally surprising, was impressive.
 
 There are a number of current and evolving technologies for corn oil extraction. The two basic options are front-end removal, which removes the oil before processing the corn and the back-end process which removes the corn oil after fermentation and distillation. The front-end extraction process produces a cleaner corn oil and captures 50 percent more product. However, as one might expect, the cost is at least triple that of back-end extraction processes. So for the ethanol producer, it becomes a matter of analyzing the intended end use and the capital cost required for implementation.
 
 A general assumption is that the front-end process is best suited for new construction and the back-end process for existing retrofits. However, there are some new ethanol plants that are opting to install back-end extraction technologies, hoping to penetrate the biodiesel market with a very competitively priced product.
 
 In fact, it seems like almost overnight that ethanol producers started thinking, "I'm getting 5 cents per bushel for my corn oil (in distillers grains) and you're telling me I can double that by adding corn oil extraction technology to my plant." Plus, they're not just increasing their revenue, their producing a whole new feedstock that's suitable for biodiesel production. Collocating plants becomes an instant option. 
 
 Already, we're seeing corn oil extraction technologies hit the ethanol industry. In 2005, we witnessed Ethanol Oil Recovery Systems (EORS) team up with ethanol producer VeraSun Energy, which is working to get several participant plants onboard with using EORS' corn oil extraction skids. In late 2005, VeraSun said its plan was to get 14 ethanol plants (40 MMgy or larger) to agree to sell their corn oil extract to VeraSun. In turn, VeraSun said it would eventually establish a 50 MMgy biodiesel plant under the name VeraSun Biodiesel. 
 
 Meanwhile, EORS' founders have launched another company, Mean Green BioFuels Corp., which will install its corn oil extraction systems into client ethanol facilities on a turnkey basis for no up-front cost. Mean Green says it will customize the design of its system to meet the desired corn oil recovery objectives of participating facilities, and then purchase the extracted oil from the plants at a premium. In turn, Mean Green intends to build five 30 MMgy biodiesel plants over the next two years. The feedstocks for these facilities will include corn oil, soybean oil and animal fats. 
 

 What's it all mean? 
 
 To an ethanol producer, this means extracting more profit out of every bushel of corn processed. To the distillers grains buyer, it means having the capability of purchasing a product that is better suited for their specific needs. For a biodiesel industry that may be somewhat strapped for raw materials in the years ahead, corn oil may provide an additional, competitively priced feedstock that will help sustain the growing industry's build-out. 
 
 Mike Bryan is CEO of BBI International. Reach him at <a href="mailto:mbryan@bbibiofuels.com">mbryan@bbibiofuels.com</a>. Information about VeraSun Biodiesel, EORS and Mean Green BioFuels presented in this article was taken from existing BBI International Media reports.

Corn oil extraction can help sustain biodiesel industry growth

Talking Point

Philadelphia Fry-o-Diesel has completed five successful runs through its pilot plant. The plant's purpose is to test various types of feedstock. "We are playing with all the ways to clean and dry various types of grease," Fry-o-Diesel spokeswoman Nadia Adawi said. The plant is currently generating small volumes of biodiesel through its one-gallon line and  is expected to move up to a 200-gallon line by the end of January.

Fry-o-Diesel starts pilot program

The Iowa Renewable Fuels Association (IRFA) is urging Iowa legislators to consider a proposed renewable fuels standard (RFS) that applies to the state's retail outlets, making them accountable for achieving a 25 percent renewable fuels (ethanol and biodiesel) inclusion rate in all of their total gasoline and diesel sales-rather than a "per-gallon" mandate. If passed into law, the RFS would be phased in from 2008 through to 2015. The incentive package will be introduced early in Iowa's legislative session, IRFA Executive Director Monte Shaw said.

Iowa producers hopeful about IRFA-backed RFS

Construction is nearing the end on a biodiesel-fueled wave-piercing boat, in which Captain Pete Bethune hopes to break the speed record for circumnavigating the globe. The project received a financial boost in January from Biodiesel Oils NZ ($50,000) and Mike Marcos ($70,000). Panasonic may also donate $20,000. Bethune said the boat could be in the water by Feb. 9 with a formal launch ceremony scheduled Feb. 15. The race is delayed until fall 2006 or spring 2007. For more information, visit <a target="_blank" href="http://www.earthrace.net">www.earthrace.net</a>.

Earthrace biodiesel boat construction nears completion

If the name AGCO Corp. doesn't ring a bell, chances are you're not a farmer. Surely, even those who've never stepped foot on a soybean field have heard of at least one of the many tractor brands owned by AGCO-like Massey Ferguson, AGCO's largest and most popular line. 

 
 "On average, there's a Massey Ferguson tractor sold somewhere in the world every five minutes," says Ryan Schaefer, product marketing specialist for AGCO High Horsepower Tractors. In other words, it's a commanding global corporation to be associated with-and biodiesel now is. 
 
 For years, AGCO has been researching, testing and, more recently, advocating the use of biodiesel in blends ranging from B5 to B100 in certain models. Why? That's easy. Supporting biodiesel just makes sense for AGCO. 
 
 Deep-rooted global history
 
 AGCO Corp. was formed about 16 years ago, but many of the brand names under its umbrella have been around for generations. According to Todd Stucke, general marketing manager for AGCO-Brand Tractors, AGCO has acquired 22 companies since 1990. "Those companies [include] Massey Ferguson, Duetz-Aliss, Hesston, Challenger, White, Ag-Chem and Fendt-and our latest ones have been Valtra and SisuDiesel," he tells Biodiesel Magazine. "That's what AGCO is. We're strictly focused on ag, and we're worldwide." 
 
 AGCO's global corporate headquarters is in Duluth, Ga., and the company has manufacturing plants across the Midwest and worldwide. In the United States, the company's manufacturing presence can be found in Jackson, Minn.; Beloit, Kan.; and Hesston, Kan. The company's European corporate headquarters is in Coventry, England, and AGCO's European manufacturing plants are located in France, Germany and Finland. AGCO also has three tractor manufacturing plants in Brazil. 
 
 AGCO bought Finland-based SisuDiesel Inc. in January 2004. "AGCO is committed to the engine business now," says Dexter Schaible, AGCO's senior vice president of product management, engines and global technologies. "We produce one of the most reliable and fuel-efficient tractor engines on the market today-SisuDiesel engines in AGCO's tractors and combines."
 
 Producing one the world's most reliable and efficient tractor engines doesn't happen by accident. It's the result of a strong, forward-thinking corporation striving to meet the needs of its customers and surpass its competition. By no small coincidence, that's where AGCO's interest in biodiesel began.
 
 Testing, testing ... 

 5, 10, 100 percent
 
 With manufacturing plants all over the world-in countries where biodiesel has already made a presence in the fuels markets-AGCO is set to spread the good word about biodiesel. "It's very important for us to support biodiesel because our customers out there demand it," Stucke tells Biodiesel Magazine. "Do all of them demand it? No, but many of them do. And the question that we get is, 'Is your engine compatible with biodiesel?'"
 
 At the 2005 National Biodiesel Conference in Ft. Lauderdale, Fla., John Deere announced its support of a B5 factory fill, which helped push AGCO to make public its support for the agriculturally derived fuel. 
 
 "We have to be competitive in the marketplace," Stucke says. "We want to be leading this competitive edge here-if there is a competitive edge or not-because if our competition is out there saying, 'We can burn 5 percent biodiesel,' then we want to be at 20 percent. And that's where we're trying to lead our design of the engine." 
 
 Before AGCO bought SisuDiesel, the two companies were collaboratively working on biodiesel testing in SisuDiesel engines. Preliminary testing began in the late 1990s. "Obviously in Europe there's a lot more rapeseed- or canola-based biodiesel as opposed to soy, so in the late 90s with SisuDiesel, we started testing in Europe with rapeseed and canola biodiesel," Schaefer says. 
 
 What the testing team was looking for is what one would expect: biodiesel's effect on the engines. "What we looked for was the performance of the engine running on biodiesel and the service intervals benchmarked against diesel fuel," Stucke says. 
 
 Most of AGCO's biodiesel testing occurs in Europe and South America. "Being that we sell a lot of tractors down there in South America, we've been doing a lot of research there," Stucke says. "That's been on our forefront for quite some time now. And in Europe, there are parts of [the continent] where biofuels are very important to the local markets over there, too. So we've been doing research there, and in Austria, we're running some tractors on 100 percent biodegradable fuels. … In South America, we're testing them at 100 percent, too."
 
 Schaible made it clear exactly what the company hopes to get out of all these years of running tests and compiling data. "We want to build an engine that can use B5 or B20 so that the tractor doesn't even know the difference," he says. 
 

 But something that does know the difference between B5 and B20 is the more stringent Tier 3 emissions regulations affecting the United States and Europe. With Tier 3 emission reduction requirements already in place as of Jan. 1, the targeted emissions reductions-and new technologies needed to achieve those targets-are, for the moment, limiting AGCO's ability to guarantee its 175-horsepower-and-over Tier 3 engines' use of biodiesel to blends of 5 percent or less.
 
 Official positioning
 
 AGCO supports the use of at least B5 in all of its different tractor brands and models. Beyond that, it's up to the level of emissions reductions (tiers) under which each model is manufactured as to how much biodiesel AGCO allows in its tractors while still remaining serviceable under warranty. "Fendt tractors with Tier 2 Duetz engines in Germany, and Massey Ferguson and Valtra tractors with Tier 2 SisuDiesel engines are covered for use of up to 100 percent biodiesel," Schaible says. 
 
 The higher the tier, the tougher the emissions reduction targets become. Tier 0, Tier 1 and Tier 2 are the most lax standards-with Tier 0 being the most lax and Tier 2 being more stringent-and applies to older U.S. or European tractors (175-horespower and above) manufactured before Jan. 1, or newer tractors in parts of the world where emissions regulations are behind the curve.
 
 AGCO officially covers under warranty all of its tractor models with SisuDiesel engines falling into Tier 0 and Tier 1 diesel engines across the board, and Tier 2 engines with Bosch P-type or VP30/44 fuel pumps, to use biodiesel up to B100 in those particular models. For blends up to B10 no changes to the service intervals are required. If B11 or greater is used, AGCO recommends changing the oil, oil filter and fuel filter twice as often as needed when using diesel fuel. Tier 3 engines are approved for use with biodiesel blends up to B5. The same goes for all AGCO-owned brands of tractors with Cummins engines, all GT and GTA series tractors, and all ST and STA series tractors-with no change to the service intervals for any AGCO tractor using blends up to B5. 
 
 "With our SisuDiesel engines, we ran Tier 2 engine tests with 100 percent biodiesel," Schaible reiterates. "We will guarantee up to B100 in those engines. What we would like to do is put out a letter and officially publish that we will support the use of at least 20 to 30 percent biodiesel-we will warranty the engine."
 
 In Tier 3, things become a little stickier. "With the (Bosch) high-pressure common rail injection systems necessary for Tier 3, Bosch has limited us to blending up to B5," Schaefer tells Biodiesel Magazine. B5 is the maximum that we can use because they're running into issues with soy-based biodiesel polymerizing in that high pressure environment, and that polymerization causes problems with the injection systems." Even so, Schaefer says he's sure this limitation will be overcome in the not-so-distant future. 
 
 AGCO expects to bring a strong biofuels presence to this year's National Farm Machinery Show and Tractor Pull in Louisville, Ky., in mid-February. Schaible says he'd like to see an AGCO tractor there with a sticker declaring the company's support for biodiesel. Stucke agrees, saying, "As the marketing manager, what I want to do is put a sticker on the tractor saying, 'We support biofuels,' or 'Biofuel-compatible, filled with B5,' or whatever blend it would be." 

 
 There is no doubt that AGCO and biodiesel are a perfect pairing. "I'm a farmer myself," Stucke adds. "And I think we're just on the beginning edges here. I can see in five years that B5 will be standard. I think it is going to be very important-I hope it is because, that way, the crops that I grow are worth a little more money."

AGCO sells more tractors worldwide than any other company on the planet. Now, with its pervasive global reach, and strong commitment to customer support and innovation, it's working on establishing an edge with biodiesel.

Compatible By Design

D1 Oils plc, a U.K.-based global producer of biodiesel, agreed in December to sponsor a biodiesel-powered car in the Le Mans global series of sports car races. The D1 Lola B2K car will run on biodiesel blends made from jatropha curcas. The company will test the performance, fuel efficiency and emissions produced by different biodiesel blends. The car and engine are being developed for Le Mans Prototype racing by groupBio, a U.K.-based racing team.

D1 Oils sponsors Le Mans car

Tennessee, at first glance, wouldn't seem a likely place for dramatic biodiesel industry growth. The Volunteer State is only 16th in U.S. soybean production with an estimated 41.8 million-bushel crop in 2005-just 1.4 percent of total U.S. production. Most adjoining states aren't much higher on the soybean ladder: Missouri is 7th in soybean output, and Arkansas is 10th. Plus, Tennessee doesn't even have a soybean crushing plant within its borders. 
 
 Despite these ostensible feedstock deficits, biodiesel has become a hot topic in Tennessee, both for users and would-be producers. A major catalyst for the renewable fuel's newfound allure has been the announcement by Mean Green Biodiesel of Tennessee Inc. (a spin off of Mean Green BioFuels Corp.) to build a 31.7 MMgy plant in Humboldt, a Gibson County town just north of Jackson and about a third of the way between Memphis and Nashville. The plant would be the first of five 20 MMgy to 60 MMgy facilities Mean Green plans to build. Stephen Maupin, COO of Mean Green Biodiesel of Tennessee, says each plant will be sited in the South. Maupin says Mean Green is looking for strategically located sites that have access to good transportation routes, fuels markets and locally available production feedstocks. Simply put, Mean Green wants its biodiesel consumed in the same region where its feedstocks would be produced. "We don't really want to be in California, bringing materials all the way [there] from the Midwest," Maupin says. 
 
 Maupin worked as an environmental consultant for 24 years in Arizona before returning home 10 years ago to Dresden, Tenn., about 50 miles from Humboldt, to look after the family farm and his parents. "However," he says, "we couldn't seem to maximize our value-added … because we just couldn't do it with a small family farm." Determined to make something work, he and others formed BioEnergy Engineering, a company that designs and builds biorefineries such as biodiesel and ethanol plants-and Mean Green's process technology provider. The company's pilot-scale operation in Dresden removes micronutrients from vegetable oils and animal fats, and sells them to the biochemical and biomedical industries. Biodiesel can be produced from the extracted materials that are left over. 
 
 New Jersey's GreenShift Corp., parent company to Mean Green, bought a 30 percent stake in BioEnergy Engineering late last year and will finance the construction of Mean Green's proposed biodiesel plants. 
 
 Now, the company's No. 1 priority is acquiring land. Maupin says a five-year tax abatement-and the right to build in Humboldt-are all Mean Green is asking of the Gibson County Industrial Development Board. "We're not chasing grants, and we're not chasing free money from the counties and the states," he says. "We can go to Wall Street. There's plenty of people there that have money and will invest in this new industry. … I don't believe that, as capitalists, we should be going to a city or a state, especially here in the South, that already has severe economic problems, and putting our hand out." 
 
 Maupin says he'd rather see counties invest their money in public works such as fire protection, law enforcement, public schools and playgrounds. He says other towns in west Tennessee have offered to host their facility, but Mean Green thinks Humboldt has the suburban lifestyle that would appeal to the facility's future employees. 
 
 Multi-feedstock plan
 
 Maupin says the plant would not rely exclusively on soybean oil as a feedstock. Three large companies, he says, are "like OPEC" in the way they dominate the U.S. oilseeds industry, and he fears those companies would regulate the price of the vegetable oil used to make biodiesel. "I see that if we use an alternative material … animal tallow or fatty acids from waste processes, it would reduce our dependency and make [soybean oil] more competitive," he says.

 
 Parks Wells, executive director of the Tennessee Soybean Promotion Board (TSPB), says the multi-feedstock strategy Maupin advocates doesn't bother soybean farmers. "We've always looked at doing things in biodiesel, and we also know that this is one place that we can influence the market more than anywhere else," Wells says. 
 
 Mean Green is one of several potential bioenergy investors in Tennessee. "There is a surge of people wanting to get into the business across the Mid-South," Wells explains. "Tennessee is no exception." For example, Wells says Nashville commodities broker Michael Tarr has built a plant in Lewisburg. Plus, there are several unnamed investors in Memphis who want to "get into a 20 million-gallon plant." In fact, Maupin lists Memphis as a potential location for one of Mean Green's own plants. 
 
 Wells concedes Tennessee's minor status as a soybean producer and the lack of crushing facilities are a hindrance to biodiesel, but he says his farmer-members aren't deterred by the fact that vegetable oil for biodiesel production will have to be brought in from out of state. He says TSPA has been involved in the effort to support biodiesel since 1992 and spends about $20,000 a year to promote the renewable fuel. 
 
 Tennessee's three Clean Fuels Coalitions have further stimulated biodiesel use in the state. TSPA also works with those organizations, which are arranged geographically. The West Tennessee coalition was just recently formed, while the Central and East coalitions have been around for about four years. In December, famed blues singer Bonnie Raitt put on a biodiesel education benefit concert in Knoxville, with proceeds going to the promotional efforts of the TSPB and the East Tennessee coalition. Wells says, "She has two of her buses and at least two trucks that use … a B20 blend this year." 
 
 Consumption picking up
 
 Jonathan Overly, executive director of the East Tennessee Clean Fuels Coalition (ETCFC), says the organization started getting interested in biodiesel a couple years ago. "At the time, there was one gentleman using biodiesel-we're talking one single person in a passenger vehicle," he says about the organization's 33-county region. In contrast, Overly estimates that 2005 biodiesel use in the region was at 500,000 gallons of B100 equivalent. 
 
 Overly, who works for the Energy, Environment and Resources Center at the University of Tennessee-Knoxville, says when he learned about the Clean Cities organizations, he knew it was something he needed to get involved with. "I said, 'You know, this looks like what I was built to do' because I'd spent about seven years doing life-cycle [analysis] work in advanced fuels in vehicles," he says. Specifically, Overly was interested in the twin "hooks" of improving air quality and reducing dependence on foreign fuels. When other groups like the Tennessee Valley Authority and the U.S. DOE's Oak Ridge National Laboratory (ORNL) signaled their support for the program, Overly told himself, "Jonathan, please, go for it." 
 
 The region's biggest biodiesel users are "a fairly small group"-Knoxville Area Transit, Knoxville Utilities Board, Alcoa Inc. and Eastman, Overly says. The federal and state governments are starting to come on board. The Tennessee Department of Transportation will use B20 in Knoxville and Johnson City. Overly says Oak Ridge's Y12 National Security Complex "is looking to be the leader in getting on board with biodiesel, and hopefully ORNL will follow." 

 
 There are 16 public stations in eastern Tennessee offering biodiesel, but Overly says public use only makes up 10 percent to 20 percent of consumption in Tennessee. One of ETCFC's goals is to get trucking fleets to use the renewable fuel, and that's been problematic. For one thing, only a couple of the public stations currently offering biodiesel blends can accommodate an 18-wheeler. Then, Overly says, there's a plethora of misinformation to deal with. One local outlet for a national fleet had started using B5 and was pushed by its main office to discontinue it. "We'll tell people your big 'cons'-if you exclude cost-are wintertime gelling and maybe [fuel filter] clogging as you start up. ... But anybody who looks at the long list of 'pros'… over 90 percent of the fleets and individuals we've talked to have started using the fuel here." 
 
 Johnny Dodson gladly recites that list of "pros." The Dyersburg, Tenn., farmer, a vice-president of the American Soybean Association, says, "There's no reason why not only farmers but consumers in general shouldn't be using it. It's a renewable fuel. It burns cleaner. There's less pollution out the exhaust. It adds lubricity to the fuel." 
 
 Dodson practices what he preaches. When he began using biodiesel five years ago, he could only get it in Nashville, 170 miles away. "Whenever I had a meeting or needed to travel to Nashville, I had a mini bulk-tank I'd put in the back of my truck, and I'd bring home a truckload of methyl ester," he says. "You know, I was determined that I was going to use it, and yes, I went to some trouble. After some arm-twisting with some local fuel jobbers here at home, they started handling it in bulk, and so it made life a whole lot easier." 
 
 Dodson says west Tennessee farmers are using biodiesel more than ever. "Where they started out at a 2 percent blend, some are going to 5 percent, and some have already gone on up to a 20 percent," he says. On the other hand, "There's a few that, you know, if it costs a penny more per gallon, they wouldn't even think about using it-even though they grow soybeans. So, those are the ones we've still got to work on." Dodson says farmers still raise questions at soybean association meetings, but the groups counter with information based on National Biodiesel Board research, as well as testimonials. "John Deere's blending at the factory. … Chrysler, in their new Liberty vehicle, is blending at the factory. So, those instances in some respects reassure folks that this is not something that's going to do damage to your engine." 
 
 What the American Soybean Association can add to the process, he says, is its political clout. The farm group was instrumental in getting the $1-per-gallon excise tax exemption for biodiesel blenders through Congress; the next goal would be to get the tax break extended past the current sunset of 2008. It doesn't hurt, of course, to have the Senate Majority Leader from your home state. "Sen. [Bill] Frist has been supportive of biodiesel," Dodson says. "He's been to a couple of meetings here in the state where he's talked about supporting biodiesel." 
 
 Overly says the ETCFC wants to see a statewide requirement that all diesel be blended at B2. "It's probably a long way off before that happens, but we need to start the dialogue and have legislators discussing it now, so that maybe in a couple of years we actually implement something like that," he says. 
 
 In the meantime, The EFCFC will stick with its short-term goals-doubling biodiesel use this year in its 33-county region to 1 million gallons, and having biodiesel used by a substantial fleet in every county in east Tennessee by the end of 2006. Tennessee, overly vows, is doing its best to put "biodiesel at the forefront."
 
 Gary DiGiuseppe is an Arkansas-based freelance writer. He has authored several articles for Biodiesel Magazine, including "First Impressions" in the January issue.

Tennessee is not known for growing soybeans, but biodiesel advocates are determined to make the renewable fuel work in the Volunteer State. Relying on alternative feedstocks-or shipping soybean oil in-will likely be part of the plan.

Tennessee Steps It Up

Biodiesel America, a new book from author, filmmaker and biodiesel guru Josh Tickell (see "A Call To Action," page 64), offers a new energy roadmap that includes a precipitous increase in the production and use of biodiesel and other renewable fuels. Tickell tosses up various scenarios that could lead to the production and use of as much as 5 billion to 15 billion gallons of biodiesel in the United States in the next decade. Getting there would require a massive shift in American agriculture-or the cultivation of a miracle feedstock. 
 
 Surprisingly, some experts believe the feedstock that may hold the most promise is not a conventional cash crop like soybeans, canola or corn, but algae. 
 
 As outlined in Biodiesel America, the U.S. DOE and NREL spent $25 million from 1978 to 1996 on a study that investigated, developed and tested highly oleaginous strains of algae that could be grown for biodiesel production. As Tickell explains, algae grows more rapidly and consumes more carbon dioxide than any other form of plant life. All it needs is sunlight, carbon dioxide and water to grow-and there may be places in the American Southwest that offer just that sort of climate. NREL's study, which took place on shallow ponds in New Mexico, found that large quantities of oil could be produced from algae. In fact, the variety grown by NREL had a daily yield of 50 grams of algae per square meter. Utilizing 1,000 square-meter ponds, this type of algae produced 20,075 pounds of oil per year-2,640 gallons for every 1,000 square meters-an exponentially larger per-meter yield than any other production feedstock on earth. 
 
 Still, NREL didn't actually produce biodiesel from algae, and there are some serious hurdles standing in the way of algae-to-biodiesel commercialization. There's a limited number of suitable sites in the Southwest (each site would need both water and excess carbon dioxide). Evaporation and cross-contamination remains a problem, as does cost-efficient oil extraction. Plus, building the first commercial-scale algae-to-biodiesel plant would require a mammoth financial commitment-and nerves of steel. 
 
 These obstacles are not insurmountable, though, and at least one American company is already chasing the dream. As described in this month's cover story, "Everything Under the Sun," page 28, GreenFuel Technologies Corp. is developing a novel way to exploit algae for biodiesel production. GreenFuel's approach to growing its own feedstock consists of installing its tube-like modular units in line with, for example, a power plant's effluent streaming smokestack (i.e., a carbon dioxide source). Currently, GreenFuel is deploying field trials in the United States and abroad to validate the process. 
 
 If companies like GreenFuel succeed-and if their processes turn out to be commercially viable-Tickell says it could be nothing less than transformative to the U.S. biodiesel industry. The author notes that Michael Briggs, a University of New Hampshire researcher who's been working with the algae research originally generated by NREL, believes enough "fuel could be grown" from algae in a 15,000-square-mile section of desert to completely support the nation's transportation energy needs. 
 
 Briggs and his team say the cost of building such an algae oil infrastructure would run upwards of $300 billion, and another $50 billion a year to maintain. That's a monstrous bill, and perhaps a far-fetched dream, but considering America's $100 billion annual expenditure on foreign oil-not to mention hundreds of billions spent stabilizing oil-producing regions of the world and protecting our nation's interests abroad and at home-someday it might be worth the price tag.

Editor's Note

Australian Biodiesel Group Ltd. (ABG) reached an agreement in December to license its production technology to the Calgary Biodiesel Centre in Alberta. The contract, worth A$8 million (US$5.92 million), states that ABG will fabricate a biodiesel plant near Calgary that would produce 22 million liters of biodiesel per year, according to the Australian company. It would take in used cooking oil, new vegetable oil and tallow as a feedstock. Plant commissioning is planned for the first half of 2007.

Australian company aids Canadian biodiesel project

The Betin Group, one of Brazil's leading cattle farmer groups, is constructing an $18 million plant that will process beef tallow into biodiesel in São Paulo, Brazil. The plant will produce 100,000 metric tons of biodiesel annually from the same volume of tallow. The input cost will be 30 percent less than using soybeans, plant officials say. When on line in June, the plant will provide 14 percent of the biodiesel required to meet Brazil's looming B2 mandate.

Brazil builds first tallow biodiesel plant

In December, the Tennessee Department of Transportation (TDOT) launched a biodiesel Pilot Fleet Program at its maintenance facilities in Knoxville and Johnson City. The pilot program will involve more than 130 on-road vehicles, including dump trucks and snowplows. TDOT will use an estimated 13,500 gallons of B20 each month during the study that will run through 2006. The department plans to bring off-road construction equipment into the program sometime this spring.

Tennessee DOT tests biodiesel

Bristol Virginia Utilities (BVU), which provides utility services to local residents and businesses, has announced its decision to start using soybean-based biodiesel in a majority of its fleet vehicles, ranging from heavy-duty to lighter utility trucks. According to the company, BVU will start its pilot program with a 5 percent biodiesel blend with the intent to work up to B20 by mid-2006. If successful, BVU will expand its B5 use to all fleet vehicles.

Virginia utility starts biodiesel pilot program

After two years of planning, Jason Masters, president of Northern Biofuels, can see the light at the end of the tunnel. Northern Biofuels has secured all the financial pieces for the Newark, N.Y., biodiesel plant and is now waiting on final bids from area contractors. "We are waiting to see which contractor can hold to our schedule, and then we will be underway," Masters said. The plant is scheduled to be on line by June.

New York plant to start construction

GreenShift Corporation, through its portfolio company Mean Green BioFuels, announced that it will construct a 30 MMgy biodiesel plant in northeastern Indiana. The proposed Indiana plant will be one of five 20 MMgy to 60 MMgy plants that Mean Green Biofuels plans to build, operate and own by the end of 2006. The Indiana plant will create 100 new jobs and generate about $70 million in revenues once operational.

Indiana to get biodiesel plant

For the second time since Minnesota's new B2 standard was implemented in October, the state commerce department issued a temporary suspension Dec. 23 to investigate widespread allegations of fuel filter plugging. The suspension was scheduled to end Jan. 13, but biodiesel producers asked for more time to comply, so the suspension will be lifted Feb. 10.

 
 Although unseasonably mild temperatures graced Minnesota during the time surrounding the variance, Ralph Groschen, agriculture marketing specialist with the Minnesota Department of Agriculture, said most of the complaints occurred weeks before the variance went into effect when temperatures were much colder.
 
 The Minnesota Trucking Association (MTA) led the charge by sending Minnesota Gov. Tim Pawlenty a request for the temporary cessation after some of its members reported problems with filter clogging, according to MTA President John Hausladen. 
 The state commerce department also received complaints directly from users corroborating MTA complaints, Hausladen said. Furthermore, refiners' preliminary test data provided additional weight to the MTA's request allegedly showing that off-spec product made its way into the state's diesel fuel supplies. Finally, on Dec. 23, the commerce department's weights and measures division-in an attempt to isolate the problems-issued a moratorium on the statewide biodiesel mandate. 
 
 "There are at least two dynamics here," Hausladen told Biodiesel Magazine. "First, some product may be out of spec." The second dynamic he mentioned was a specification that may be insufficient, resulting in claims of not just off-spec biodiesel but of an off-spec ASTM D6751 biodiesel specification. According to Groschen, performance problems aren't expected so long as quality remains within the current specification. 
 
 "There seems to be a recipe to the problem now, so we think the guys in the white coats will figure this one out," Hausladen said. "It seems to be that the glycerin levels in the tested biodiesel samples are higher than engines and fuel systems can handle." Groschen backed that up, saying the focus is now on free and total glycerin. 
 
 Additionally, Hausladen referenced a parallel issue under investigation-that of black scum and sludge found in the fuel filters. "It appears to be some sort of microbial growth," Hausladen told Biodiesel Magazine. Microbes grow in petroleum diesel too, and whether or not this contamination is directly attributable to biodiesel is uncertain to say the least. "There are a lot of questions in my mind," Groschen said. "Microbes grow at the interface between water and petroleum diesel, and with all of the diesel outages the state has seen recently, who knows whether or not this stirred up [bacteria] in the storage tanks." Although he gave other possible sources of the problems, Groschen said he's not suggesting there aren't problems with some of the biodiesel in Minnesota, but any time a new fuel is used and problems are experienced-like with ethanol years ago-fingers inevitably point to the new fuel as the problem.
 
 Hausladen said the MTA is not against using biodiesel. "We just want a fuel that works consistently," he said. "If you're a biodiesel producer, one of your biggest assets is a bunch of truckers saying good things about biodiesel. Conversely, if you're a biodiesel producer, one of your biggest liabilities is a bunch of truckers saying bad things about biodiesel."

Sticky start for Minnesota B2 standard

In a Dec. 22 press conference, U.S. Sen. Maria Cantwell, D-Wash., announced an agreement between SSA Marine, the world's largest privately held cargo terminal operation and cargo handing company, and the Port of Seattle to use a total of 1 million gallons of Washington-made biodiesel per year in their respective Seattle businesses, starting in 2006.
 
 According to Cantwell's office, the agreement is the largest venture of its kind and, once completed, will represent the highest concentration of biofuels being used in one place in the United States. "The Northwest's ingenuity demonstrates once again that it makes economic sense for America's businesses to use environmentally friendly alternative fuels," Cantwell said at the press conference.
 
 SSA Marine currently uses approximately 800,000 gallons of diesel annually at its Terminal 18 and 25 operations, according to Andy McLauchlan, senior vice president at SSA Marine. By mid-April, the company plans to start using B5 blends in 176 of its dockside loading and container moving equipment, and then increase to B10 and eventually B20. SSA Marine has signed an agreement with biodiesel producer Seattle Biodiesel to supply the renewable fuel. "We have been very impressed with [Seattle Biodiesel's] blend, production and quality control," McLauchlan said. "We have a lot of confidence that we'll be getting pure biodiesel, and we won't have a problem with our engines."

 
 The Port of Seattle plans to consume 20,000 gallons of B20 annually in various heavy-duty service trucks in its seaport division (the company also manages an airport). The change will occur gradually according to Port of Seattle spokesman Mick Schultz. Starting in February, the company will use B5 for one month, then B10 for two months, before starting to use B20. Again, Seattle Biodiesel will be the supplier and blender.
 
 Currently, Seattle Biodiesel is one of few biodiesel producers in Washington, with a 5 MMgy capacity. However, the company announced in January plans to build a much larger plant that could be on line by this summer.
 
 
 SSA Marine has 150 operations around the world. On the West Coast alone, has seven large container facilities: two in Seattle, two in Oakland, Calif. and three in the port of Long Beach, Calif. "There's a huge fuel market [in southern California]," McLauchlan said. "Where we use 800,000 [in Seattle], we use 2 million gallons there, and that doesn't include our trucking company."

SSA Marine, Port of Seattle agree to increase biodiesel use

The Biodiesel 49 Degrees Border Project (Bio49), a U.S. and Canadian initiative to reduce diesel emissions from utility trucks with biodiesel, went into full effect in January. in response to the U.S. EPA's West Coast Collaborative, an initiative working to reduce air pollution, the project will focus on vehicles operating around the Washington and British Columbia borderwith biodiesel through efforts from a number of local biodiesel producers and commercial fleets to make it a success. The project is named for the 49th parallel latitude that creates the two nations' borders. 
 
 Bio49 will use 144,000 gallons of biodiesel in the first year of operation, replacing 12,000 gallons of diesel fuel each month. There are currently 11 U.S. and Canadian partners in the program that will help create a market by using biodiesel in the Pacific Northwest. For example, Puget Sound Energy will be fueling all of its fleet vehicles that run along the U.S.-Canada border with biodiesel ranging from B5 to B100. Also, biodiesel processors will be built at Bellingham Technical College, where students will be trained in biodiesel production. Eventually, biodiesel processing will be incorporated into the college's academic curricula. 
 
 A similar set-up has been spurred in Canada. BC Hydro and its partners in British Columbia will be running fleet vehicles on various biodiesel blends with biodiesel supplied by Biodiesel Works. The project, in both countries, will be managed by the Northwest Energy Technology Collaborative (NWETC). When the project is finished, NWETC will create an outreach and education program from Bio49 data with the help of the Washington Technology Center.
 
 The Bio49 project got its start when the NWETC received a $69,777 grant from the EPA. In addition to that, funds totaling $280,000 will be used to run the project for one year. The NWETC is part of the Washington Technology Center that is working to create growth of the energy technology industry in the Pacific Northwest.

U.S, Canadian Bio49 initiative underway

For years, Canadians have spoken proudly about doing more to combat global warming than their American neighbors. As it turns out, that rhetoric may be little more than hot air, some experts say. Statistics show Canadians actually produce more greenhouse gases per capita than any other country except Australia. And when it comes to renewable, eco-friendly fuels such as biodiesel, Canadian production has lagged far behind the United States and Europe.

 
 With no government-provincial or federal-subsidizing or mandating the use of biodiesel in Canada, the country produced just 1.3 MMgy (5 MMly) in 2004, compared to nearly 30 MMgy (114 MMly) in the United States and approximately 530 MMgy (2 billion litres) in Europe. In fact, Canada has historically imported most of its biodiesel from the United States.
 
 That's starting to change. Canada has committed $2 billion to implement a Climate Change Action Plan. Under this plan, renewable fuels like biodiesel will play an important role in reducing greenhouse gases. Large-scale plants are now producing biodiesel in both Quebec and Ontario, and biodiesel use is starting to take off in several areas of the country. 
 
 Municipal and transit fleets in Toronto and five other large southern Ontario communities are now using 1.8 million gallons (7 million liters) of biodiesel per year, and demand is expected to increase to 5.6 million gallons (21 million litres) by next year. Add to that demand the growing usage requirements of both corporate and government fleets, and the volumes start to make a biodiesel industry viable in Canada.
 
 British Columbia jumped on the biodiesel bandwagon just 18 months ago. Under the auspices of Fleet Challenge B.C., key players worked together to develop the B.C. BioFleet Project-a unique, collaborative program to jumpstart biodiesel market development in greater Vancouver and throughout the province.
 
 Remarkably, over the past year, British Columbia went from having almost zero users to over 1,000 vehicles using biodiesel in over 40 fleets. 
 
 Boosting biodiesel up there
 
 So, what's driving biodiesel north of the border?
 
 According to Christine Paquette, former executive director of the Biodiesel Association of Canada (which recently merged with the Canadian Renewable Fuels Association) and now Canadian sales director for World Energy Alternatives, environmental concerns about greenhouse gases and their impact on global warming are the main drivers for biodiesel in Canada. "From a Canadian perspective, it's easy to see why biodiesel has taken the United States by storm-and also why Canada has lagged behind," Paquette says. 

 
 Industry experts say that since the United States imports much of its oil and gas, Americans are concerned about energy security and their reliance on foreign oil. American farmers are also looking for ways to augment their income in an era of sagging prices and rising costs. They have used their collective clout to ensure that energy legislation has favored home-grown alternative fuels like biodiesel. "Those concerns aren't significant factors here," Paquette says. "North of the border, no one talks about energy security. Canada has huge oil and gas reserves. Canada is not only America's largest trading partner, but also its largest energy supplier by far. Even greater than Saudi Arabia, Mexico or Venezuela."
 
 Paquette continues, "In Canada, municipal governments, transit authorities and private companies are driving an emerging biodiesel industry as a way to reduce greenhouse gases and improve local air quality and health."
 
 As part of its commitment to the Kyoto Accord, Canada is using a wide range of programs to reduce greenhouse gases, including energy conservation, carbon credits trading, the promotion of fuel-efficient vehicles and the use of renewable fuels. It has also set a target of producing 132 MMgy (500 MMly) of biodiesel by 2010.
 
 "British Columbia arrived late to the biodiesel party," says Joe Valeriote, vice president of business development at 4 Refuel Canada Ltd. (formerly Minitankers), a major Canadian distributor of biodiesel. "But after just 18 months, [British Columbia] has chalked up an impressive list of accomplishments."
 
 After extensive pilot testing, biodiesel is now being used by many British Columbia municipalities with a combined population of over 3 million people. Almost 40 corporate, provincial and federal government fleets are also using biodiesel blends.
 Agri-Green Biodiesel Ltd. has just opened the first small biodiesel plant in eastern British Columbia, and two other companies have announced plans for larger plants. At the first biodiesel truck stop cardlock and other retail pumps, business is growing steadily. 
 
 Revving up a provincial biodiesel program
 
 How did British Columbia ramp up its biodiesel program so quickly?
 

 First off the mark was the B.C. Municipal Fleet Managers Group (BCMFMG) that decided to take action to collectively reduce emissions of their member fleets. In 2003, the group was introduced to biodiesel as a practical way to reduce emissions from heavy-duty vehicles. They decided to "kick the tires" with a biodiesel pilot program.
 
 Six large municipalities-Vancouver, North Vancouver, Richmond, Burnaby, Delta and the resort community of Whistler-signed on.
 
 "The original six were very strategic," says Curtis Rhodes, fleet manager for the city of Delta and chair of the BCMFMG. "First we had to prove that biodiesel worked in our fleets, and we needed experience and accurate data to confirm this. We also wanted assurances that reliable supplies of ASTM quality biodiesel would be available. And we required a high volume to benefit from economies of scale."
 
 When emissions test results from the pilot program confirmed U.S. EPA test data, the group included biodiesel in its next fuel-buying contract. The government of British Columbia also agreed to exempt the provincial fuel tax on the biodiesel portion of B5 to B50 blends. At about the same time, Fleet Challenge B.C. was established as the provincial arm of Fleet Challenge Canada. The national federally funded program works with partners to achieve reductions of both greenhouse gas and tailpipe emissions from fleets across Canada. Biodiesel was of great interest to many of the fleets working with the program.
 
 Dennis Rogoza, director of Fleet Challenge B.C., says the need for a collaborative strategy on biodeisel quickly became obvious. "Users, producers, distributors and three levels of government all recognized that without a market for biodiesel, producers would not build plants," Rogoza says. "And without a reliable supply, fleet managers and individuals who use diesel would not make the switch to biodiesel. We had to work together to make things happen."
 
 Jumpstarting the market
 
 In October 2004, Fleet Challenge B.C. convened a meeting of government, corporate and other stakeholders who were interested in purchasing, using, producing and distributing biodiesel in British Columbia. Everyone wanted to do things right and avoid some of the pitfalls other jurisdictions experienced. To jumpstart greater market demand, the group prepared a unique biodiesel market development strategy that included workshops, case studies, demonstration projects and public awareness activities. 
 
 Building on the success of the initial pilot program, the B.C. BioFleet Project-Canada's largest biodiesel demonstration project-was launched at the first biodiesel workshop in Vancouver in March. The strong level of public interest surrounding the use of biodiesel was evident by the numerous federal and provincial government ministers and mayors who participated.
 

 The six municipalities agreed to purchase up to 21 million gallons (80 million liters) of biodiesel blends for use in their fleets over the next five years. This purchase was made by the B.C. Petroleum Buyers Group, a unique organization that oversees a collective fuel-buying program to reduce energy costs for member municipalities and school boards. The agreement ensured sufficient volume to begin bringing biodiesel in bulk to municipal terminals.
 
 The B.C. BioFleet Project then developed a number of tools to build the biodiesel market and raise industry awareness. The B.C. BioFleet Web site (www.bcbiofleet.ca) soon became one of the premier biodiesel Web sites in Canada (with a growing American audience). A unique Biodiesel Emission Reduction Calculator enabled fleet managers to easily calculate emissions reductions. The 1st User Incentive Program attracted 30 new corporate and government fleets to the program, and a series of educational biodiesel videos is being produced to answer issues about biodiesel use.
 
 One measure of B.C. BioFleet's success is the number of companies that have stepped up to the plate. Canadian Bioenergy, West Coast Biodiesel, 4 Refuel and others are now distributing biodiesel to municipalities, school boards and corporate fleets.
 
 In July, United Petroleum Products Inc. opened Western Canada's first cardlock truck stop, selling biodiesel to commercial truckers. 
 
 First to "fill 'er up" with biodiesel was West Coast Biodiesel Ltd., whose 40 vehicles are the largest commercial fleet in British Columbia to make the switch to a biodiesel blend.
 
 "When it comes to biodiesel, we don't just talk the talk," says Ridley Bestwick, chief information officer of West Coast Biodiesel Ltd., a division of West Coast Reduction Ltd. "We walked the walk by switching our fleet of on-road trucks to B5, while vehicles at our plant use a B40 or B50 blend. Many of our customers are now using biodiesel, and we're charging forward with plans to build a 7 MMly to 10 MMly (2.6 MMgy) plant. As the market for biodiesel increases, we hope to build a much larger plant in the near future."
 
 Where rubber meets the road
 
 British Columbia and Canada still have a long way to travel on the road to viable and sustainable biodiesel industries. First, more customers are needed to increase biodiesel volumes. Feedstock supplies must be identified and secured. Capital must be raised. Canadian oil companies must come onboard, particularly in blending and distributing biodiesel. Distributors must ensure that only biodiesel that meets ASTM specs will be distributed. "Most importantly, Canada needs a level playing field in order to compete with U.S. biodiesel producers," says Ian Thomson, CEO of Canadian Bioenergy Corp. "For the biodiesel industry to prosper in [British Columbia] and Canada, we need a mandate for B2 to B5 in all diesel-powered vehicles, a blender's or producer's credit similar to that in the [United States], and continuation of the relief of provincial and federal fuel taxes on the biodiesel portion of fuel blends."
 

 It appears that a renewable fuels mandate is in Canada's future. Leading politicians in Canada have indicated broad support for a strong and effective national policy on renewable fuels. British Columbia and Canada may have been slow out of the gate, but biodiesel has taken off "up north" and the future looks bright.
 
 For more information on the BC BioFleet Program, see www.bcbiofleet.ca.
 For more information on 4Refuel's biodiesel delivery services, visit <a target="_blank" href="http://www.4Refuel.com">www.4Refuel.com</a>.
 
 Raymond McAllister is a British Columbia-based freelance writer. He authored this article on behalf of B.C. BioFleet and Fleet Challenge B.C. This is McAllister's first Biodiesel Magazine story.

Canada may lag behind the United States and Europe in biodiesel production and use, but well-organized municipal fleet groups-and companies with a stake in production and distribution-in British Columbia are helping to get the nation up to speed quickly.

Up To the Challenge

On Nov. 11, the U.K. government announced plans to implement a renewable fuels standard, called the Renewable Transport Fuels Obligation (RTFO), mainly to achieve carbon reductions much sought by U.K. and European Union (EU) governing bodies. 
 
 According to John Waltham, chairman of Wessex Grain Ltd. and its spin-off company Green Spirit Fuels, the RTFO originated as an amendment to the U.K. 2004 energy bill, which became law in July 2005. The RTFO is a 5 percent renewable fuels standard targeted to launch in April 2008 with full compliance expected by 2010, Waltham said. "The final date is 2010, and the '5 percent' is a global figure that may be achieved in a number of ways," he explained. "It gives us a tool to enable us to aim to achieve the EU target, which is currently indicative but will become mandatory if the EU Commission feel that some countries are not achieving reasonable progress toward achieving the targets." 
 
 According to Graham Prince, head of Corporate Communications at London-based D1 Oils plc-a company with modular biodiesel production units and a global reach in its jatropha oilseed planting and processing partnerships-U.K. domestic oilseed production can satisfy approximately 75 percent of demand under the 5 percent blend requirement by 2010. This would equal approximately 750,000 metric tons of domestic biodiesel available to satisfy a 1 million-metric-ton need, if replacing 5 percent of the U.K.'s 20 million metric tons of diesel used per year. Of course, as Waltham said, 5 percent is a "global" figure, meaning high volumes of E85 sales, for example, can reduce biodiesel's role in the renewable fuels standard to less than 5 percent. 

 
 Nevertheless, Prince believes imports are inevitable to satisfy RTFO requirements. "Imports are going to be required," he told Biodiesel Magazine. "We'll be producing jatropha and biodiesel on a sustainable basis to meet that demand." Exporting D1 Oils' African-produced surpluses of biodiesel to the U.K. by 2010 is highly likely, according to Prince.

RTFO to boost U.K. renewable fuels usage

On Jan. 7, representatives of Agra Biofuels Inc. presented Pennsylvania Gov. Edward Rendell with a voucher, promising 10,000 gallons of biodiesel to Rendell's "Stay Warm Pennsylvania" initiative that supplies heating oil to low-income families. It was a positive first step for Pennsylvania's newest and largest biodiesel facility.
 
 The plant was dedicated Jan. 10 with production soon to follow, according to Agra Biofuels spokesman Joe Benish. Located in a warehouse complex, it will produce up to 3 MMgy of soy-based biodiesel. Benish said the raw soy oil will be shipped to the plant by rail, and the finished biodiesel will be shipped out by rail and truck to fleets, blenders and home heating oil dealers within the state. This satisfies another of Rendell's initiatives, "American Energy Harvest."
 
 The plant was built by company founders Don Coccia, CEO, and Bill Harnsberger, president. The company's future plans include building 10 additional biodiesel plants in Pennsylvania over the next five years. Each will produce between 20 MMgy and 30 MMgy. "Our ultimate goal is within five years to replace 50 percent of Pennsylvania's home heating oil needs," Benish told Biodiesel Magazine. "Pennsylvania is the No. 2 consumer of home heating oil in the country at about a billion gallons per year." Benish added New York is the No. 1 home heating oil consumer, using about a billion and a half gallons annually.

Agra Biofuels starts biodiesel production

Biodiesel started flowing at Agri-Energy's plant in Lewisburg, Tenn., in early January. Construction for the plant started Nov. 1 and was completed in three months. All of the design and construction duties for the plant were done in-house by Agri-Energy partners.
 
 "We have our own engineers and own a construction company, which allowed us to keep our plans somewhat secretive," said Mike Tarr, president and CEO of Agri-Energy. The company plans to build as many as 20 5 MMgy plants in the future.
 The plant's nameplate capacity is 5 MMgy, but it could produce as much as 7 MMgy. "In a perfect world, our capacity could be 20,000 gallons a day," Tarr said. "Today we can easily do 15,000 gallons a day." 
 
 Agri-Energy will use a refined crude, de-gummed and bleached soybean oil as its primary feedstock. With three major crushing facilities within 50 miles of the plant, Agri-Energy is able to acquire the oil at only 4 cents above the price of crude soybean oil. "Location was key for this plant," Tarr said. "With a crushing plant nearby, it provided a massive opportunity to cut shipping costs and provide a high quality product." 
 
 Agri-Energy is close to signing an agreement with Nashville, Tenn.-based Tri-Star Energy to market its biodiesel. "It pretty much is a done deal," Tarr said. "We are just waiting for them to get their blending license." Agri-Energy has its own blending permits but wants to concentrate on producing a quality fuel. 
 
 Unlike many producers, Agri-Energy takes its time to produce each gallon of biodiesel. "From start to finish, it takes us three days to make biodiesel," Tarr said. "We age the fuel, like a fine wine, and let it sit in storage tanks for at least one day." To make sure the fuel produced is to Agri-Energy's quality standards, there are no plans to speed up its production process. "That is why we chose to build multiple smaller facilities versus one larger one," Tarr said.

Agri-Energy begins production in the Volunteer State

North American Biofuels Corporation, a pilot plant currently producing 1 MMgy of biodiesel, will begin an expansion project this spring, bringing total capacity to over 5 MMgy.
 
 The Long Island, N.Y., facility currently produces 3,000 gallons of biodiesel per day from trap grease collected in New York City. After expansion, it will also take in yellow grease and fish oil, but not the popular soybean oil feedstock. "We are different," said Allen Ellenbogen, executive vice president of Business Development for North American Biofuels. "The city is our farm."

 
 The pilot plant is located adjacent to Russell Reid, a wastewater management company based in Keasbey, N.J., that provides wastewater transportation and disposal, grease trap pumping, and other non-hazardous wastewater services to the local area. These feedstocks are relatively cheap, according to Ellenbogen, who said an average biodiesel plant spends roughly $1 per gallon produced, while North American Biofuels spends 50 cents per gallon.
 
 Because it is a modular plant, measuring 9 feet high by 8 feet wide by 40 feet long, adding another module to the existing plant will be fairly easy, Ellenbogen said. "These modules are designed so they can be stacked up like a small skyscraper," said David Butler, CEO of North American Biofuels. "They are also very mobile. The modules can be dismantled and moved to another location in very little time." Each module is capable of producing 12,000 gallons of biodiesel per day or 4 MMgy. North American Biofuels plans to add a third module, which is already under construction, after the second addition.
 
 North American Biofuels' unique feedstock is matched by its unconventional production process. The plant uses low heat and a chemical process to produce its biodiesel. "We use a low-temperature process with no live steam," Butler told Biodiesel Magazine. 
 
 Ellenbogen and Butler stumbled across biodiesel while trying to find a solution to the city's grease problems. New York City creates over 64 million gallons of trap grease each year, Ellenbogen said. North American Biofuels plans to place a number of module plants in New Jersey and the New York City area in the future.

North American Biofuels plans pilot plant expansion

With Canada's January national elections set to take place at press time, both the Liberal and Conservative Parties are supporting a renewable fuels standard (RFS) of 5 percent in their 2006 election platforms. 
 
 According to Tim Haig, chairman of the Canadian Renewable Fuels Association (CRFA), getting this much bipartisan support has taken a lot of effort. "Kory Teneycke and others here at the CRFA have worked hard for this," Haig told Biodiesel Magazine. "There's probably been at least one or two meetings with senior staffers once a week for the past two years. We have also hired a government relations group that has been working toward this full-time."
 
 The CRFA drafted the RFS into both parties' platforms, but an RFS bill hasn't been drafted yet, Haig said. With both parties making promises of a renewable fuels standard, the CRFA intends to seek swift action once the elections are over, no matter which side might win. "We're not going to be shy about holding them to this," Haig said. "Hopefully a priority will be sent to the new government to get this legislation drafted." 
 
 If the Liberals and Conservatives agree on a renewable fuels standard, that doesn't mean their reasons for supporting it are the same. "There's no difference in the end product of a 5 percent RFS, but the drivers are different," Haig said. "The Liberals are more Kyoto-oriented while the Conservatives are more interested in stimulating and developing the rural economy. The effect is the same." 
 
 As a nation, Canada has different reasons to support an RFS than the United States. U.S. support for renewable fuels is primarily to increase energy security, while Canada is more concerned with carbon and greenhouse gas reductions-and the Kyoto Protocol.
 

 2010 is the target date to implement the anticipated RFS. If an RFS does become law in Canada, it will take about four years to fully develop the biodiesel and ethanol industries there-depending on whether available agricultural products could supply the needed renewable fuels industries. According to Haig though, that shouldn't be a concern. "Canada absolutely produces enough domestic feedstock to meet the 5 percent biofuels demand- without needing grain imports," he said. "It's clear we need to be, and are getting, further along with cellulose technologies and wheat-based technologies (for ethanol) … but for biodiesel, there's plenty of canola and animal fats produced in Canada to supply enough biodiesel." According to Haig, there has never been as good of an opportunity on this grand of a scale to articulate the need for an RFS in Canada than in the party platforms nearing a national election. "It was the perfect storm," he said. Provided a Canadian RFS passes federal muster, it would then have to go through provincial ratification.

Canada readies for nationwide RFS in 2006

Greenergy International Ltd., the United Kingdom's leading importer, blender, trader and marketer of diesel fuel, has started construction on a $23.4 million biodiesel facility that will initially produce 100,000 metric tons of the renewable fuel annually. The company expects to increase production to 150,000 metric tons after it comes on line in fall 2006.
 
 Construction started in early December near the city of Immingham in Humberside, England. "We have established, alongside our core fuels business, a commercially successful and fast-growing biofuels operation that stands behind the production of more than 1.8 billion liters of blended biofuels every year," said Andrew Owens, chairman of Greenergy International. 
 
 Desmet Ballestra will design and build the plant, which will be owned by Greenergy International subsidiary Greenergy Biofuels Ltd. The brownfield site on the eastern coast of England already has existing sea, rail and road access, as well as pipeline links to local petroleum oil refineries. The facility is ideally adjacent to Simon Storage, the U.K.'s leading independent operator of bulk liquid and gas storage terminals, while the port of Immingham is one of the largest petroleum ports in Europe with two world-scale refineries handling about 20 million metric tons of fuel products per year. 
 
 The plant will use rapeseed grown by more than 1,000 farmers under Greenergy's "Field to Forecourt" contract. Cargill will manage the rapeseed supply through Frontier Agriculture, a jointly owned venture with ABF Holdings Ltd. The facility will help the country meet its new Renewable Transport Fuels Obligation, requiring all road fuel to contain five percent biofuels by 2010 (see page 15 for more information).

Greenergy starts biodiesel plant construction

The most prevalent process for the production of biodiesel-or chemically, the conversion of triglycerides to the corresponding methyl ester-is transesterification by homogeneous alkaline catalysis. Catalysts that can be used in this process include caustic soda (sodium hydroxide), caustic potash (potassium hydroxide) and sodium methylate.
 
 Sodium methylate has become the catalyst of choice for modern large-scale biodiesel production accounting for more than 70 percent of the biodiesel produced in North America. All major technology providers including Lurgi PSI, Desmet Ballestra and Crown Iron Works offer biodiesel process technologies and plant designs that utilize sodium methylate. In addition, an increasing number of biodiesel producers are switching to superior water-free sodium methylate solutions from traditional solid catalysts like sodium or potassium hydroxide.
 
 What is sodium methylate?
 

 Sodium methylate is referred to by many names including alcoholate, methoxide and sodium methoxide. It is a versatile chemical reagent used for many decades in various industries to produce high-value end products like pharmaceuticals, food ingredients, pigments and crop protecting agents. In recent years, the production of biodiesel has become an exciting, new and fast-growing application for sodium methylate. In the future, biodiesel production will have a significant share of the overall sodium methylate demand worldwide. BASF is one of the world's leading providers of high-quality alcoholates, such as sodium methylate, and produces the catalyst in a dedicated world-scale facility in Ludwigshafen, Germany. From there, the corporation ships the product all over the world-from Europe to the United States to Asia to Australia. 
 
 In addition to its production facility in Germany, BASF operates large storage facilities in all major regions of the world. Typical packaging for sodium methylate solution can include drums, totes, isocontainers, bulk trucks and railcars. The company also provides customized and innovative customer service and logistical solutions for biodiesel plants worldwide.
 
 Safe handling of sodium methylate
 
 Sodium methylate is typically supplied either as a solid (crystal) or as solutions in methanol. For biodiesel production, solutions in a concentration range of 25 percent to 30 percent have proven most advantageous. Safety and handling practices for sodium methylate solutions are very similar to safety and handling practices for methanol. Like methanol, sodium methylate solution is flammable and is handled safely by many people on a daily basis. When handling sodium methylate, it is important to remember that:
 <ul>
 <li>Sodium methylate solution needs to be stored in a dry place.</li>
 <li>Bulk storage of sodium methylate solution should conform to the general requirements for methanol. </li>
 <li>Sources of ignition like sparks, flames, heat and electrical discharges should be avoided.</li>
 </ul>
 

 For any questions or concerns, the sodium methylate manufacturer should be consulted and/or the material safety data sheet should be reviewed. In addition, BASF has a product stewardship group that can answer safety and handling questions, and provide training to personnel that handle this catalyst.
 
 High yields, efficient, simple processing
 
 Sodium methylate functions as a catalyst to accelerate the biodiesel chemical reaction process by reducing the energy needed to initiate the reaction. It is successfully used in large-scale production facilities for all major feedstocks like virgin vegetable oils, animal fat and/or yellow grease. The major advantage of sodium methylate is the virtually water-free character of the catalyst solution. This results in higher yields, lower purification costs and more consistent biodiesel quality. When mixing traditional hydroxides with methanol, hazardous solid handling is inevitable, and as a result, water is generated that will initiate unwanted side reactions.
 
 Table 1 highlights the main benefits of using sodium methylate instead hydroxides. These advantages make it obvious why most producers rely on sodium methylate, especially since it has proven its favorable effects over the hydroxides in many reference plants. A 2004 NREL study, titled Biodiesel Production Technology, compared several catalysts including sodium methylate. The report concluded that sodium methylate, as a 25 percent solution in methanol, was a more powerful catalyst on a weight basis than a mixture of caustic soda and methanol. Another study titled Integrated Biodiesel Production: A Comparison of Different Homogeneous Catalysts Systems, conducted by the University of Madrid in 2004, found similar results. That study compared the effectiveness of sodium methylate, sodium hydroxide and potassium hydroxide in a reaction of sunflower oil and methanol. Table 2 summarizes the results. 
 
 Although all of the catalysts produce a high-quality biodiesel product, the sodium methylate catalyst provides the highest yield of biodiesel. Since feedstock costs of the vegetable oil or other triglyceride sources account for most of the variable cost of biodiesel production (up to 90 percent), a higher yield of a few percent usually translates into substantial savings that more than compensate for the higher catalyst cost.
 
 To obtain more information about the BASF portfolio of biodiesel production catalysts, visit <a target="_blank" href="http://www.basf.com/alcoholates">www.basf.com/alcoholates</a>. 
 
 Susan Jackson is BASF product manager for standard alcoholates. Reach her at <a href="mailto:jacksos1@basf-corp.com">jacksos1@basf-corp.com</a> or (724) 538-1374.

Sodium methylate is a versatile chemical reagent that's been used for many decades in various industries to produce high-value end products like pharmaceuticals, food ingredients, pigments and crop-protecting agents. It's also the catalyst of choice for most biodiesel producers.

Standard-For Good Reason

Those who are looking for a vehicle test facility on the East Coast will soon have access to one in North Carolina. The Advanced Vehicle Research Center (AVRC) will be starting track construction in February with the hopes of opening by the end of 2006, according to Executive Director Dick Dell.
 
 In December, a 630-acre site was acquired by Northampton County, outside of Roanoke Rapids, N.C., and five miles south of the Virginia border. Located in a heavily forested area, land clearing was underway in January. With the site right off Interstate 95, Dell said the facility is easily accessible to anyone in North Carolina or Virginia. "Actually, it's convenient for anyone up and down the East Coast, which is probably where we'll do most of our business," Dell told Biodiesel Magazine.
 
 The AVRC is an independent, non-profit company with a mission to provide a vehicle test site with an emphasis on renewable fuels. Indeed, hydrogen and biodiesel fuel will be available at the site's refueling stations. U.K.-based Lotus Engineering will be designing the facility, which will first include a riding and handling course, along with offices and garages that can be leased by participating entities. It will also include a vehicle dynamics area (VDA), essentially an open slab of cement where cones can be placed to perform vehicle maneuvers while testing such things as sway and suspension. Dell said he hopes to add a durability course later in the future.
 
 The facility will be able to provide data results through dynamometers and other testing equipment on-site. Companies that are testing a fuel's ASTM standards, for example, could accomplish that here. The AVRC is currently setting up contracts for the refueling stations.
 
 Funding for construction of the facility came from the state ($7.5 million), and other federal and private sources ($7.6 million). "That gives us just over $15 million for our first year of operation," Dell said. For more information, visit <a target="_blank" href="http://www.avrnc.com">www.avrnc.com</a>.

AVRC plans vehicle, fuel testing facility

The current success of biodiesel has brought up some important questions. For example, how big can the biodiesel industry become, given our existing feedstock base? How big could our industry become if we actually tried to produce vegetable oils and animal fats directly rather than relying on byproducts of food production for humans and livestock? Sustainable growth for biodiesel will be dependent upon a number of factors: consumer confidence; petroleum pricing; public policy to catalyze growth, such as the biodiesel tax incentive; and improved efficiencies (i.e., processing and distribution). Growth will also be a function of raw material availability.

 
 Although I love to quote our former chairman when he says "never underestimate the ability of farmers to overproduce," facts do not cease to exist because they are ignored. Two recent independent studies have found that modest growth in biodiesel demand will cause upward pressure on vegetable oil prices. The reality is that raw material availability could become a natural brake for significant future growth.
 
 So, how do we increase potential raw material supplies in the United States when arable land is a finite resource? In simple terms, we will need to do one or all of the following:
 
 <ul>
 <li>Grow more beans</li>
 <li>Raise the means</li>
 <li>Change the genes</li>
 </ul>
 
 Soybeans represent the largest vegetable oil source for biodiesel in the United States. Increased soybean prices due to biodiesel usage could indeed lead to the planting of more soybeans, thus increasing soybean oil supplies. Increased corn prices due to ethanol usage will also have to be taken into account. 
 
 Increased soybean oil supplies can also be generated by increasing yield per acre. Yields are certainly higher today than 20 years ago; however, soybean yields would need to increase significantly to reach governmental goals like 5 percent to 20 percent of the diesel market. Another approach would be to increase the oil content in soybeans. This strategy, if accomplished without negatively impacting protein levels (i.e., feeding value) of soybean meal, could generate greater quantities of soybean oil. For example, increasing the oil content of soybeans by only 1 percent could generate almost 250 million gallons of potential biodiesel feedstock per year.

 
 I have highlighted soybean oil, but the same is true for other vegetable oils. The approach of the National Biodiesel Board is that a balance of feedstocks is more likely to be sustainable than a single feedstock focus. While we are immersed in fuel quality issues, vehicle and engine manufacturer approvals, and federal rulemakings, we must also consider the need for additional raw material supplies in the future. Like farmers, we need to remember that we can't sow and reap in the same day. We need earnest efforts today to achieve sustainable industry growth.

NBB In Sight

Three producers are now accredited under the industry's voluntary quality control program, with a handful of others in the process. Johann Haltermann Ltd. is the most recent company to join the ranks of biodiesel producers meeting the highest quality standards in the industry. The biodiesel producer in Houston, Texas, achieved its BQ-9000 accreditation under the National Biodiesel Accreditation Program-a cooperative and voluntary fuel quality program adopted by both the National Biodiesel Board (NBB) and the Biodiesel Association of Canada. 
 
 "The BQ-9000 program is designed to promote the commercial success of biodiesel and to provide consumers with the utmost confidence by recognizing biodiesel producers and marketers who demonstrate compliance with high-quality standards," said Leland Tong, chairman of the National Biodiesel Accreditation Commission (NBAC). "With such rapid industry growth, ensuring that only a quality product reaches every consumer is more critical than ever. The NBAC and NBB commend these three companies who first took the initiative to become BQ-9000 accredited."
 
 BQ-9000 is a quality assurance program that includes auditing and procedures for fuel storage, handling and management aimed at ensuring fuel quality throughout the distribution system. The program creates a comprehensive quality system whereby fuel is consistently produced in accordance with ASTM D 6751 specifications and maintains its quality all the way to the customer's fuel tank.
 
 "We have only been producing biodiesel for a year, and to be recognized as an accredited producer really speaks to our contract manufacturing capabilities and our commitment to quality," said Simon Upfill Brown, general manager of Dow Haltermann Custom Processing (DHCP), a Dow business unit comprised of operations within the Dow Chemical Company and Johann Haltermann Ltd. 
 
 Achieving BQ-9000 certification complements the ISO 9001:2000 certification previously received, said Russell Johnston, DHCP quality manager. "The value and versatility of the strong quality management system at DHCP shows our customers that all of our processes, including production processes, are driven toward continual improvement," Johnston said. "Minor enhancements to ISO 9001:2000 certification allows us to meet other quality standards that drive further improvement for specific projects."
 
 Accreditation under the BQ-9000 program is open to all companies that produce, distribute or market biodiesel either in its pure form or for use in blending with petroleum diesel fuel in North America. There are two types of designation under the program: accredited producer and certified marketer. 
 
 Peter Cremer North America of Cincinnati, Ohio, and West Central of Ralston, Iowa, have also achieved this designation. More information on the BQ-9000 program is available at 
 <a target="_blank" href="http://www.BQ-9000.org">www.BQ-9000.org</a>.

Industry standard's quality program gains momentum

Biodiesel production is growing worldwide. In fact, one U.S. company recently announced that its parent company will be developing one of the world's largest biodiesel plants in Germany. Lurgi PSI Inc., a National Biodiesel Board member in Memphis, Tenn., is part of Lurgi AG, which will build this facility.

 
 Frankfurt, Germany-based Lurgi is building the Piesteritz biodiesel plant and has also been working with nine other such biodiesel projects since July. The company has said its German production will be between 70 percent and 80 percent of that country's biodiesel needs.
 
 The new plant will use rapeseed to produce more than 200,000 tons of biodiesel per year (approximately 60 MMgy), according to Lurgi's Web site. The facility is due to come on line in December.
 
 The plant will be the first in Germany to provide an end-to-end production process, starting with the introduction of the seed. The biodiesel producer is Neckermann-Renewables GmbH, a firm based in Würzburg, Germany. In Europe, Neckermann runs biodiesel plants with a total capacity of approximately 350,000 tons, which makes it one of the continent's largest biodiesel producers. 
 
 For more information, visit <a target="_blank" href="http://www.lurgi.de/english/nbsp/index.html">www.lurgi.de/english/nbsp/index.html</a>.

Lurgi to implement one of world's largest biodiesel plants

In December, the USDA awarded more than $18 million in Small Business Innovation Research (SBIR) grants, which included funding for biodiesel projects. Among the grants are five that specifically fund research into biodiesel.
 
 The primary objectives of the SBIR program are to stimulate technological innovations in the private sector and to strengthen the role of small businesses in meeting federal research and development needs.
 
 The SBIR grants that deal with renewable energy total more than $1.2 million, and the biodiesel projects are as follows:
 <ul>
 <li>"Biosolids for Biodiesel," Emerald Ranches in Sunnyside, Wash. </li>

 <li>"A New Process for Biodiesel Production Based on Waste Cooking Oils and Heterogeneous Catalysts," United Environment & Energy LLC in Orchard Park, N.Y.</li>
 <li>"Improved Quality Soy-Oil Based Biodiesel Fuel," Bioplastic Polymers & Composites LLC in Midland, Mich.</li>
 <li>"Camelina Sativa: A Multi-Use Oil Crop for Biofuel, Omega-3 Cooking Oil, and Protein/Oil Source for Animal Feed," Great Northern Growers Cooperative in Sunburst, Mont.</li>
 <li>"High Yield, High Efficiency Bio-Refining," Advanced Materials and Processes in San Marcos, Texas</li>
 </ul>
 
 More information on the funded projects can be found at <a target="_blank" href="http://www.csrees.usda.gov/funding/sbir/sbir_abstracts.html">www.csrees.usda.gov/funding/sbir/sbir_abstracts.html</a>.

Biodiesel projects funded through USDA

Stanhope-Seta, a U.K.-based company that provides measurement instruments for the petrochemical industry, released in November a new flash point tester, called Active Cool. The product offers sub-ambient testing of liquids and semi-solids using the rapid equilibrium method and rapid cool-down between tests, according to company spokeswoman Caroline Morrison. These features, along with the two-milliliter sample size and the one-minute temperature stabilization, reduce overall test time, improving throughput and reducing waste. It is an easy and safe procedure ideal for laboratory, production line or field use. For more information, visit <a target="_blank" href="http://www.stanhope-seta.co.uk">www.stanhope-seta.co.uk</a>.

Stanhope-Seta releases flash point tester

Biodiesel Industries Inc. announced in early January that the U.S. Patent and Trademark Office granted the company U.S. Patent No. 6,979,426 for its modular production unit, the application of which was filed for patent almost four years ago, according to Biodiesel Industries President and Founder Russell Teall. The newly issued patent covers biodiesel production using a modular production unit on a singular platform to ease its installation and relocation, in addition to various design particulars to facilitate the processing of various feedstocks. 

 
 The units are not available for purchase as stand-alone items, but rather Biodiesel Industries offers partnerships with interested parties to own and operate production and distribution businesses where opportunities exist.

Biodiesel Industries receives patent

Able Energy Inc. has teamed up with TransMontaigne Inc., a leading biodiesel supplier in Denver, Colo., to increase its distribution and utilization of biodiesel in the Northwest. Able Energy, a leading New Jersey-based retail energy provider, acquired several All American Plazas Inc. truck stops and started selling biodiesel fuel blends supplied by TransMontaigne at two of those stations in early December. The company plans to expand biodiesel sales to more truck stops in the future, according to Able Energy CEO Greg Frost. The company also started selling a biodiesel blend for home heating applications in early January.

Able Energy, TransMontaigne partner

Archer Daniels Midland Co. (ADM) announced many changes in its senior operations management team, which included Kevin Hess being named vice president and director of Group Operations for the Oilseed Processing division and ADM Grain. Hess joined the company in 1985 and most recently served as vice president of European Crushing and Refining Operations in Europe. He will start his new assignment at ADM's headquarters in Decatur, Ill.

ADM announces changes in senior operations management

According to Illinois Soybean Association (ISA) Communications Manager Julie Toohill, Illinois Gov. Rod Blagojevich was honored by the ISA at its annual meeting in Bloomington, Ill., in mid-November. Blagojevich was recognized for his continued work in advancing biofuels production and use in his state. Blagojevich was given the Special Recognition award for his signing of the B2 requirement to go into effect later this year. This law mandates all state-, county- and municipality-owned diesel vehicles to use 2 percent biodiesel. Other biofuels-friendly achievements like tax incentives for the production and sale of biodiesel and ethanol, plus ethanol-related research funding, were noted during the governor's recognition.

ISA honors Blagojevich as friend of biodiesel, soybeans

The Environmental and Energy Study Institute (EESI), based in Washington, D.C., recently doled out its 2005 National Clean Bus Leader awards. Three of the six award recipients were recognized for exceptional biodiesel use. Medford Township Public School District in Medford, N.J., is using B20 in 62 school buses. Cook-Illinois Corporation in Chicago, Ill., is using biodiesel in 800 of its 1,400 buses. Colorado Springs School Districts 11 and 20 in Colorado Springs, Colo., are using a combination of diesel oxidation catalysts, particulate matter filters and biodiesel to reduce diesel emissions from their fleets. The two districts are working together, allowing them to leverage resources, overcome funding limitations and provide a unique model for other school districts.

EESI awards biodiesel bus fleets

Fifteen out of 200 companies were awarded Platts Global Energy Awards in December, and the decade-long biodiesel producer-distributor, World Energy Alternatives LLC, was on the short list of honorees. Recognized for its contributions to the biodiesel industry and consumers alike, World Energy co-received Platts' inaugural Downstream Business of the Year award, sharing it with Gazpromexport of Russia. According to World Energy, this is the first time a biofuels company has won the Global Energy Award since Platts began the program seven years ago.

World Energy accepts Platts Award

Consolidated Biofuels Inc., a future renewable fuels producer, has signed a consulting agreement with Core Ventures LLC, an energy construction and service company. Core Ventures will provide experienced management in overseeing the location, construction and operations of Consolidated Biofuels' first biodiesel production facility in Iowa. Core Ventures will also assist in securing contracts for feedstock, chemical procurement, and the sale and distribution of biodiesel and glycerin. Consolidated Biofuels plans to build a total of six plants in the United States with Core Ventures.

Consolidated Biofuels teams with Core Ventures

The FPPF Chemical Company has released Biodiesel Winter Treatment, an additive to help biodiesel users overcome potential cold flow problems. The additive contains a polymer that prevents gelling well under zero degrees Fahrenheit. The product also contains a sludge dispersant that can reduce potential filter plugging, incorporating a viscosity modifier to improve flow in cold temperatures. FPPF Chemical Company tests have proven the product can be used in any biodiesel blend up to B100.

Chemical company releases anti-gelling additive

The Alberta Research Council (ARC) has teamed with Natural Resources Canada to create the Proficiency Testing Program for Biodiesel, an inter-laboratory exchange program that is fully subsidized for Canadian laboratories. The program began in December and will run through March 2007. It will test 13 different aspects of biodiesel from flash points to phosphorus content, and more. The ARC will host a workshop at the end of the program that will focus on biodiesel analytical test methods and the program's results.

Canadian groups start free B100 testing program

Virtually any lipid-bearing material can be processed into biodiesel. What determines which feedstock makes the proverbial cut depends on many things: the cost, availability, proven technologies to carry out effective and efficient processing, capital costs to handle different quality feedstocks … and more. 
 
 Within the confines of a single article, it's tough to even scratch the surfaces of a global feedstock assessment, which would include analyses of costs, pretreatments, resultant fuel properties and a plethora of other considerations. Instead, Biodiesel Magazine provides an abridged feedstock overview-and some "feed" for thought, including a look at promising alternatives to conventional oilseed crops and animal fats. 
 
 Feedstock overview: Resultant fuel properties
 
 At the risk of oversimplifying, several generalities can be made about feedstocks, their costs and the subsequent properties of biodiesel fuels made from those respective feedstocks. Naturally, within generalities is always room for anomalies, and some of those will be covered here, too. 
 
 Voluminous varieties of feedstocks are available all around the world, but most biodiesel feedstocks can be divvied up into three main categories: vegetable oils, first-use animal fats and waste greases. 
 
 Vegetable oils derived from canola, sunflowers and soybeans are generally low in saturated fats. By knowing that alone, much can be presumed about the resulting vegetable oil-derived biodiesels. 
 
 Biodiesels made from most virgin vegetable oils, being generally low in saturated fats, are considered the easiest and least expensive to process, according to NREL publication titled Production of Biodiesels from Multiple Feedstocks and Properties of Biodiesels and Biodiesel/Diesel Blends. The report states, "These oils are available in a consistently high-quality form and are the easiest to process for making biodiesels." 
 
 Additionally, these biodiesels are more likely to have better cold flow characteristics- important to keep in mind, depending on what climate the biodiesel will be produced and used-due to the lack of saturated esters. Conversely, studies have repeatedly shown that, without modification, these biodiesels generally have lower cetane numbers directly attributable to their relatively low saturated fat content. This ultimately means their combustion temperatures are higher, thus producing more NOx. Also, according to the U.S. DOE's 2004 Biodiesel Handling and Use Guidelines-put out by the Energy Efficiency and Renewable Energy Office (EERE)-the more saturated fats in biodiesels, the more stable the fuels are likely to be. This means biodiesels made from lower saturated vegetable oils are more likely to become subject to oxidation quicker. 

 
 But not all virgin vegetable oils are low in saturated fats. According to the Harvard School of Public Health Lipid Laboratory, in conjunction with USDA studies, canola oil is one of the oils lowest in saturated fats, coming in at only 7 percent in relation to its overall fat (i.e., saturated, mono-unsaturated and poly-unsaturated). Safflower, sunflower, corn, olive, soybean, peanut, palm and coconut oils respectively weigh in at 9 percent, 10 percent, 13 percent, 13 percent, 16 percent, 17 percent, 50 percent and an astounding 87 percent. 
 
 With palm oil containing 50 percent saturated fat and coconut oil at 87 percent saturated fat, it's clear that these two oils do not fit the mold when discussing general properties of vegetable-oil-based biodiesels. Also, oilseed oil yields are another consideration. According to the United Soybean Board's recent analysis conducted by Promar International Ltd., canola, sunflower and palm oils are likely to fare well for biodiesel production in the future-in the expected event that vegetable oil prices rise-mainly due to their higher oil content compared to soybeans.
 
 First-use animal fats ("virgin"), generally high in saturated fats, follow the same basic trends as vegetable oils. Being higher overall in saturated fats, animal-fat-derived biodiesels tend to cost a little less than virgin vegetable oils. They require further refining either before or after the transesterification process, but not nearly as much as required by waste greases. Also, animal fats tend to produce biodiesels with higher cetane numbers and, again on average, less NOx. But as the emissions/cold flow trade-off goes, the animal-fat-derived biodiesels have less desirable cold flow characteristics than most vegetable-oil-based biodiesels. 
 
 As with virgin vegetable oils, the variety of animal fats runs the gamut. There are edible and inedible tallows, grades of lards and various poultry fats. 
 
 Waste vegetable oils (yellow grease) and trap greases (brown greases) are the least expensive feedstocks available and require the most intensive processing due to high concentrations of free fatty acids that have become liberated at high cooking temperatures. According to NREL, yellow-grease-based biodiesels display characteristics of both vegetable-oil- and animal-fat-derived biodiesels, and therefore fall between the two in terms of fuel properties (e.g., cold flow, emissions, etc.). 
 
 Worldwide feedstock availability
 
 According to a 2004 NREL report, Biomass Oil Analysis: Research Needs and Recommendations, the world's soy oil production increased 25 percent in a five-year period beginning in 1998 through to 2003, "… from 25 million [metric tons] to over 30 million [metric tons], with most of that increase in Brazil and China. Production costs for Brazilian soybeans are 25 percent less than United States costs, and significant land and transportation improvements will continue to focus future growth in these sectors of the world." According to this publication, Latin America (Brazil and Argentina predominantly) leads the world in soy oil production, followed by the United States, Asia, the European Union (EU), Eastern Europe and others. 
 
 When feedstock availability and pricing are being looked at, it's imperative that several things be considered. For one, the biodiesel industry often competes with the food industry for feedstocks like soy oil, which is a real concern. This competition increases the cost and tightens availability. Livestock feed is another necessary consideration. For example, with a booming ethanol industry in the United States and beyond, distillers grains from starch-to-ethanol production processes offers even more feed product to the available livestock markets. Also, recent advances in technologies that extract the remaining corn oil from the distillers grains-offering multiple benefits to almost all parties involved-will help establish a lower-cost corn-oil market for biodiesel, which has been too expensive of a feedstock for biodiesel production in the past (see Talking Point, page 70). However, increased soybean oil demand would likely drive down the demand, and therefore, the price of soybean meal. 

 
 One more thing to think about is the amount of arable land needed to grow these oilseed crops. For instance, will Europe, a relatively small continent of people largely opposed to genetically modified (GM) agricultural products, have enough cropland to sustain a growing biofuels industry without draining product from the rapeseed food markets, or without compromising its widely-held position against GM crops?
 
 According to Promar International, biodiesel's demand for vegetable oils will cause significant increases in global vegetable oil prices-more so than history has ever witnessed before. The analysis also shows that by 2012 or 2013, soybean production would likely be up by 3.8 million metric tons worldwide, while worldwide sunflower production would rise 1.7 million metric tons. Rapeseed production increases are expected to hit 1.4 million metric tons higher than current production by then, and palm oil production would rise 500,000 metric tons. 
 
 Along with those findings, Promar International predicts that Europe will become a net importer of soybean, rapeseed, sunflower and palm oils. Its analysis also indicates that palm oil production will likely skyrocket, especially in regions of the world like Malaysia, Indonesia, south Asia, Latin America and Africa. 
 
 Recent reports circulating through various media outlets point to the destructive nature of proliferating palm tree plantations in developing parts of the world. The fear is that, in order to supply the growing demand for high-oil-yielding crops for biodiesel production and other needs, native species in rainforests and other precious habitats are being lost to make way for the vast tracks of cultivated land needed to sustain these growingly popular plantations.
 
 Fats and Greases
 
 On a somewhat lighter note, NREL predicts slow growth in both animal fats and waste grease supplies over the next several years. 
 
 NREL found that, over the past five years, inedible tallow and grease supplies have increased at an average of only 0.4 percent per year. Also, the domestic demand has fallen at the rate of 0.5 percent per year. NREL predicts inedible tallow supplies could increase by 58 million gallons by 2016. The production of edible tallow has risen 1.4 percent per year, and domestic demand for edible tallow has fallen by 1.3 percent per year. By 2016, NREL predicts that edible tallow supplies will increase by 68 MMgy. However, lard supplies and domestic demand have both been falling over the past five years. Future lard increases are only expected to come in at approximately 7 MMgy. 
 
 Waste vegetable oils and brown greases are the least expensive feedstock for biodiesel production, but due to their often-high amounts of free fatty acids, they typically cost the most to process. However, there are a growing number of successful producers out there using proprietary technologies for these conversions, but finding out exactly what they are doing and how they are doing it is sometimes challenging.

 
 "The supply of other greases and trap grease is assumed to remain constant over time, lacking any good information about these sources," NREL's Oil Analysis report states. "Thus, animal fats and greases will only grow by 133 million gallons by 2016 in the absence of any significant regulatory changes in these markets." 
 
 "Alternatives" and future research
 
 These series of deliberations-the "food versus fuel" competition (with respect to vegetable oils and edible animal fats), resulting higher prices when competition for oils and fats increase, livestock market ramifications, slow projected growth in the animal fats markets, arable land needed to grow the oilseed crops and more-have spurred some companies to focus on researching alternative feedstocks for biodiesel production.
 
 According to Graham Prince, head of corporate communications for London-based D1 Oils plc., these reasons have led his company to investigate jatropha as a viable alternative feedstock for biodiesel production. 
 
 Jatropha is originally native to Peru and Mexico, Prince tells Biodiesel Magazine. "The South American Indians used it as a medicinal plant," he says. "The seed and its oil are high in curcin, a poison." Because of the presence of this poison, jatropha is not a food crop for animals or humans. 
 
 D1 Oils came on the scene in the late 1990s, when the company was looking into feedstocks for biodiesel production. "It's better priced than canola or German rapeseed, or a lot of other high maintenance crops that require fertilizers and pesticides," Prince says. When D1 Oils "discovered" jatropha-on the "margin of research since the 1940s after Japan initiated it during [WWII]," Prince says-they hit the jackpot. "Jatropha has some key characteristics for biodiesel production," Prince says. "Jatropha has high oil yields-up to 40 percent in the right conditions-it's competitively priced, there's no need for arable land to grow it and it's not competing with food crops." According to Prince, Jatropha sounds like the ideal biodiesel feedstock. 
 
 D1 Oils believes it can produce jatropha oil at $275 per metric ton, compared to palm oil's current price of $450 per metric ton. "Palm oil's the one to beat," Prince says. 
 

 "The problem with German rapeseed is that the price is distorted by the demand from the food industry," he continues. "If you couple the fact that jatropha is not a food crop with the idea that jatropha thrives on marginal lands, we believe it has great potential." 
 
 D1 Oils is strategically building alliances with contracted jatropha farmers, third-party jatropha oil suppliers and others in joint ventures all over the globe-especially where land remediation is needed and growing conditions are less than suitable for growing food crops. D1 Oils is partnering with growers in Africa and Asia, where the company's modular "D1 20" processing units can be set up near oil-crushing facilities located on jatropha plantations. On par with the earlier mention of Promar International's belief that Europe will become a net vegetable oil importer in the not-so-distant future, Prince says D1 Oils plans to import its African-made jatropha-based biodiesel to the United Kingdom in just a couple years. 
 
 "There is still a lot to prove," Prince says. "But as the agronomy of the seeds progresses, our numbers will get better." 
 
 Unfortunately, jatropha trees take 3 to 5 years to mature after planting, while requiring radical pruning to maximize growth, according to Prince. 
 
 As D1 Oils concentrates its efforts on honing the growth of jatropha and developing its proprietary process technologies, GreenFuel Technologies Corp. is looking at exploiting algae for biodiesel production-in a novel and environmentally constructive way. 
 
 GreenFuel's "emissions-to-biofuels" approach to "growing" its own feedstock consists of installing its modular units in line with, for example, a power plant's effluent-streaming smokestack, in which algae are cultivated and thrive on consuming carbon dioxide while breaking down nitrogen oxide bonds.
 
 "Currently, GreenFuel Technologies is deploying field trials in the United States and internationally to validate its emissions-to-biofuels process at customer facilities," says Xiaoxi Wu, GreenFuel's chief scientist. "As an indicator of future biodiesel production potential, current company projections indicate that the GreenFuel system could convert up to 40 percent of the carbon dioxide from a 1,000 megawatt power plant into 40 million gallons of biodiesel per year." According to Xiaoxi, this system is poised for wide-scale deployment by the end of this decade. 
 
 Processing biodiesel from algae isn't as complicated as it sounds either. "In the case of GreenFuel's system, we separate the algae from its growth medium, break the cell membranes and separate the oils from the other organic matter," Xiaoxi tells Biodiesel Magazine. "The oils can then be processed into biodiesel, and the remaining organic matter can be used for other valuable applications. This compares favorably against other biodiesel feedstocks, which can require several additional steps." 
 
 Although much of GreenFuel's current emissions-to-biofuels production process sounds futuristic already, the company is still looking at future R&D opportunities. "We are also working to augment [our] core process with additional features, which will make the system even more economically and operationally attractive over the coming years," Xiaoxi says. 

 
 The more traditional oilseed feedstocks and waste greases are also the subject of considerable research. Isolating desirable genetic traits in many oilseed crops to make seeds yield more oil, increase the bushels per acre, and help resist drought and other debilitating natural phenomena are just a few of the countless approaches being taken to enhance the availability of lipids for biodiesel production from these sources. Technologies are also being developed and refined, attempting to lower the costs associated with managing high free fatty acid feedstocks like waste greases, whether they are waste vegetable oils or trap greases. 
 
 Moreover, it's important not to forget researchers like Mike Haas of the USDA Agricultural Research Service, who developed and continues to sharpen in situ transesterification, a process technology that can potentially convert any lipid-bearing material to biodiesel, skipping the oil extraction phase altogether. Like any other feedstock coupled with a new technology though, the economics need to be proven before commercialization is feasible.

Europe, South America and North America have set the stage for an explosion of biodiesel production in the next few years, but as other regions of the world hop aboard the biodiesel bandwagon, feedstock choices and their availability will become increasingly important.

Everything Under the Sun

To be perfectly honest, the biodiesel industry in Manitoba is almost non-existent. 
 
 The largest biodiesel plant in the province, Bifrost Bio-Blends, produces just enough fuel to provide the provincially owned utility Manitoba Hydro with 13,000 gallons (50,000 liters) of biodiesel per year. That's a pittance compared to the production capacity of, say, bordering U.S. state Minnesota, which now cranks out more than 60 MMgy (273 MMly) annually. 
 
 On the other hand, it's potential that counts, and Manitoba's got plenty of it. Three-quarters of a million people live in and around Winnipeg alone, and Manitoba currently consumes 224 million gallons (850 million liters) of diesel fuel annually. Biodiesel blends are scarcely available in the province, and consumers have limited opportunities to use it, but at least one group is working diligently to change that. 
 
 The province's relatively large fuel market was one of many factors that spurred the formation of the Manitoba Biodiesel Advisory Council in 2004. The council was formed to review the biodiesel production industry and its potential development in Manitoba. The 15-seat council includes members from companies and associations, including the Canadian Canola Growers Association and the Manitoba Trucking Association.
 
 The council's initial purpose was to gather information and create a comprehensive report about biodiesel that would be presented to the Manitoba government. The resulting 53-page report, Biodiesel: Made In Manitoba, released in February, looked at industry awareness, consumer issues relating to biodiesel consumption, potential barriers for producers, various feedstocks and available coproduct markets. The council held a number of industry consultations, visited a U.S. biodiesel plant and looked at the biodiesel industry's short history. "It was a real educational process and knowledge-building process for both the province and the council," says Jeff Kraynyk, energy policy analyst for Manitoba's Department of Energy, Science and Technology. 
 
 The report covers almost every angle of biodiesel production and use, uncovering the opportunities and challenges that potentially lie head. It states that fleets, agriculture, mining, government and the forest department will most likely be the first to adopt the use of biodiesel. "One of the advantages we have in Manitoba is that 13 of the largest trucking firms [in Canada] are located in Manitoba," Kraynyk tells Biodiesel Magazine. "We see that as a real significant market for biodiesel." The report also looked at cold weather issues, current infrastructure limitations, fuel quality standards and feedstock accessibility. Canola is one of Manitoba's primary crops, and it just might be the province's most viable and abundant production feedstock. Plus, Manitoba is the second largest producer of hogs in Canada, so animal fats could be a viable feedstock as well, Kraynyk says. 
 
 In the report, the council derived a number of recommendations for the Manitoba government on how the province should go about expanding its biodiesel program. From these recommendations, the province released a 10-point action plan as a guideline for industry expansion. The action plan was not only a concrete sign of progress but a strong show of government support for biodiesel. "Biofuels are a real priority for our government," Kraynyk says. "We are very bullish here in Manitoba about biofuels." 
 

 The two main drivers moving the Manitoba government to promote biofuels are rural economic development and the environment. The recent 10-point action plan takes into account these factors and includes steps to boost rural economic development and maintain clean air in the province. "Biodiesel provides an opportunity for Manitoba farmers and the rural communities that serve them to capture economic benefits [starting with] the fuel they use to operate their machinery," says Manitoba Agriculture, Food and Rural Initiatives Minister Rosann Wowchuk. 
 
 In a written statement, Manitoba Transportation and Government Services Minister Ron Lemieux, expounded on Wowchuk's vision. "We want to work with Manitoba entrepreneurs to develop a new industry that keeps goods and services moving while finding innovative ways to protect our planet," Lemieux says. 
 
 Manitoba's biodiesel strategy
 
 Within the 10-point action plan, there are two points that Canadian industries and consumers will benefit from immediately. The two major points are a tax incentive on B100 fuel and a request for proposals (RFP) capital support program. When the Manitoba government announced its 10-point action plan in November, a 11.5-cent tax credit for pure biodiesel also went into effect. "What we have done is eliminate the 11.5-cent-per-liter road tax on biodiesel," Kraynyk says. Unfortunately, this tax incentive is not currently applicable to any level of blended biodiesel." Biodiesel groups, along with Kraynyk, are working closely with legislators to change the limitations on the tax incentive so all biodiesel sold in the province can benefit from the incentive. "The program has moved so quickly that we haven't had time to make that change yet," Kraynyk says. "Our intention is to change [the legislation] so blends-regardless of the level-would be tax exempt in the near future." In Manitoba, if the road tax is exempt, a provincial tax of 7 cents is still applied. Even with the provincial tax, biodiesel has been selling at a rate comparable, or cheaper than, petroleum diesel. 
 
 The RFP is a CAN$2 million program aimed at developing testing and blending facilities, creating larger markets and generating awareness on a public and industrial level. "I think the challenge, looking forward, is going to be developing future biodiesel markets," Kraynyk says. "In Manitoba, we are going to be dedicating a lot of time and money into growing these markets and in generating awareness." The Manitoba government will be holding a user seminar in March to discuss the benefits and challenges surrounding biodiesel. "We are inviting potential users, school districts, other municipal divisions, trucking companies and large agricultural users to a one-day seminar where experts will talk about biodiesel," Kraynyk explains. 
 
 A $1.5 million majority of the RFP funds will go toward a capital incentives program that will help companies, communities or agricultural co-ops finance biodiesel projects. A maximum of $250,000 or one-third of the total capital cost for projects will be given to anyone that applies for the program. Originally the RFP was going to be rolled out in a request for proposals system or a first-come-first-served system. The system had a redesign and now will be distributed to candidates who apply and meet certain criteria. "The overall capital support that will be offered is not going to change," Kraynyk says. "Just the administration aspects may be handled differently." 
 
 Other points in the action plan include:
 <ul>
 <li>A proposal to work with fleets in Manitoba to develop demand for biodiesel</li>

 <li>Development of a Biodiesel Preference Policy for use in fleet vehicles tendered by the Department of Transportation and Government Services</li>
 <li>A long-haul trucking demonstration</li>
 <li>Coordination of research on feedstocks and coproducts in order to maximize the benefits to rural Manitoba</li>
 <li>Determining the feasibility of converting "dead stock" and other specified risk materials to biodiesel</li>
 <li>Establishing a biodiesel board to advise the provincial government on implementation of its action plan and future decisions concerning continued biodiesel growth</li>
 <li>The coordination of the action plan with Manitoba's Agri-Energy Office</li>
 </ul>
 
 Now, with the action in place, the Biodiesel Advisory Council and Kraynyk feel biodiesel can go a long way in Manitoba. "I believe that Manitoba can be one of the most competitive places to produce biofuels anywhere in North America," Kraynyk says. 
 
 Not everyone is so optimistic, though, and the action plan has drawn criticism. "There are some who feel there are too many provincial mandates, which could slow growth," Kraynyk says. "We have been encouraging the federal government to implement federal mandates or harmonize all of the different mandates out there." The Canadian government is currently in its election drive where the leading parties have been supporting a national biofuels program or a renewable fuels standard on their platforms. "It is exciting to see biofuels on politicians' minds," Kraynyk says. "That's going to be important in the future."

Manitoba has been involved with biofuels since its first ethanol plant was built in 1981. Today, the Canadian province is working to create new strategies to increase the production and use of renewables-and biodiesel is a big part of the plan.

February 2006

Business Briefs

Stanhope-Seta releases flash point tester

Biodiesel Industries receives patent

Able Energy, TransMontaigne partner

ADM announces changes in senior operations management

ISA honors Blagojevich as friend of biodiesel, soybeans

EESI awards biodiesel bus fleets

World Energy accepts Platts Award

Consolidated Biofuels teams with Core Ventures

Chemical company releases anti-gelling additive

Canadian groups start free B100 testing program

Columns

LegalPerspective

Talking Point

Editor's Note

NBB In Sight

Featured

A Call To Action

Compatible By Design

Tennessee Steps It Up

Up To the Challenge

Standard-For Good Reason

Everything Under the Sun

One Step At A Time

February 2006.css-7jxktu{position:absolute;bottom:0px;left:0px;right:0px;height:3px;border-radius:3px;background-color:var(--chakra-colors-brandBlack);}

Business Briefs

Stanhope-Seta releases flash point tester

Biodiesel Industries receives patent

Able Energy, TransMontaigne partner

ADM announces changes in senior operations management

ISA honors Blagojevich as friend of biodiesel, soybeans

EESI awards biodiesel bus fleets

World Energy accepts Platts Award

Consolidated Biofuels teams with Core Ventures

Chemical company releases anti-gelling additive

Canadian groups start free B100 testing program

Columns

LegalPerspective

Talking Point

Editor's Note

NBB In Sight

Featured

A Call To Action

Compatible By Design

Tennessee Steps It Up

Up To the Challenge

Standard-For Good Reason

Everything Under the Sun

One Step At A Time

February 2006