In the weeks leading up to the premiere of Biodiesel Magazine, it's been a pleasure to collaborate with some of the industry's finest professionals. It's their dedication and guidance that brought this magazine to life. 
 	
 Contributing writer Bob Stroup, author of this month's cover story, was especially generous with his time and knowledge. Stroup's article, "Feedstock Considerations for Future U.S. Producers," on page 10, sheds new light on the raw materials, soybean oil, recycled vegetable oil and animal fats, needed for production. It's a must-read for any future producer. 
 	
 You'll want to read "Bluegrass-roots Movement," on page 16, to find out how Kentucky has quietly become a biodiesel industry trailblazer. It was an honor to work with Melissa Howell, longtime executive director of the Kentucky Clean Fuels Coalition (KCFC). Howell's tireless efforts to increase the use of biodiesel in Kentucky cannot be overstated. From Mammoth Cave National Park to the Carmeuse Lime Mines, she has given new definition to the word coordination. 
 	
 On page 20, take a closer look at Russ Teall's Biodiesel Industries, a company which recently installed a modular biodiesel unit at California's Naval Base Ventura County. 
 	
 Contributing columnist Mark Hamnett of Lurgi PSI provides an interesting contrast between U.S. and European biodiesel production on page 24. 

 	
 And last, but not least, Bill Isbister, founder of the Oregon-based Club Biodiesel, revs things up with a high-performance message on page 30. Biodiesel enthusiasts like Isbister are especially important to Biodiesel Magazine because they represent the grassroots biodiesel movement gathering worldwide momentum.
 	
 Isbister uses biodiesel because he believes in it wholeheartedly. In his own words, "It's a wonderful fuel."
 	
 We could not agree more. Enjoy.

Editor's Note

Midwest Biodiesel Producers (MBP) is reviewing several sites for a biodiesel plant in southeastern South Dakota, according to MBP board member Paul Iberg. The group is more than halfway through a feasibility study for the 12-mmgy plant. Iberg said passage of the energy bill would affect the MBP's future plans.

South Dakota group looks into biodiesel production

Mid-Atlantic Biodiesel has begun the permitting process for a proposed 5-mmgy biodiesel plant in Clayton, Del., according to company affiliate Martin Ross. Ross said he expects to have all necessary permits and a construction contract finalized by March. The group also needs to raise $2 million to get the project going. Ross told Biodiesel Magazine the plant would take in 60 million bushels of soybeans per year and also use recyclable products, like oil and grease, to make the alternative fuel.

Biodiesel plant proposed in Delaware

This winter, some Maine office buildings will be heated with biodiesel fuel, according to Betty Lamoreau of the Bureau of General Services in Augusta, Maine. The pilot project includes six state buildings and will utilize B20. Lamoreau told Biodiesel Magazine that Gov. John Baldacci, D-Maine, resides in one of the buildings to be heated with the alternative fuel. The state's fuel contractor agreed to supply the blend as long as the biodiesel supply was adequate.

State uses biodiesel to heat office buildings

As consumers around the world explore the viability of clean, renewable biodiesel blends, government and private industry fleets are continuously proving its value. Fleets across America are utilizing various blends with little or no engine modification, reduced emissions and sustained performance. 
 	Biodiesel Magazine caught up with some of these fleets in November. Here's what we learned. 
 
 HILL AIR FORCE BASE, Utah-About 90 percent of vehicles here are filling up with biodiesel, according to Senior Master Sergeant Todd Esler, superintendent of the vehicle maintenance element. No engine conversions were necessary; military personnel simply cleaned the regular diesel out of the fuel tanks and replaced it with B20. The base has used 36,930 gallons of biodiesel since September. 
 
 FREEPORT, Maine-The state's Department of Transportation (DOT) is planning to run its maintenance vehicles on B20 this winter to test the fuel's cold-flow properties. 
 	
 "We want to see how [biodiesel reacts] in the winter," DOT representative Gary Williams told Biodiesel Magazine. "We'll at least see how the blend reacts and decide whether we want to continue using biodiesel in the future."
 	
 Six vehicles, including a backhoe and patrol trucks, will run on the alternative fuel. The department has received 4,500 gallons of biodiesel to blend the fuel on site.
 

 FLAGSTAFF, Ariz.-About 170 city equipment vehicles, including recycling, refuse and fire trucks, as well as graders, tractors and plows, started using B20 in October.
 	
 One of the reasons Flagstaff implemented the change was to improve exhaust emissions. According to The Arizona Daily Sun, Flagstaff's air quality has ranked in the top 15 for clean air.
 
 BRATTLEBORO, Vt.-The Windham Solid Waste Management District is starting to use biodiesel in its fleet of recycling collection vehicles in order to cut down on exhaust emissions. The switch makes the district the first municipality in southern Vermont to use the alternative fuel.
 	
 A skid-steer and a front-end loader began using B50 in September, and two more trucks will begin to use B20 in the future.
 
 MISSOULA, Mont.-The city's snowplows will be running on biodiesel this winter, according to Montana Magazine. The University of Montana already runs a "Bio-bus" on its campus shuttle route. The city will test the alternative fuel in street sweepers and possibly lawn mowers in the spring.

U.S. fleets demonstrate ability of biodiesel

Sustainable Systems LLC has installed a public B20 pump at the Cenex station on Brooks Street in Missoula, Mont.
 	
 "Cenex was kind of surprised at the reaction and excitement toward biodiesel," said David Max, vice president of operations at Sustainable Systems. "They've been getting tons of calls about it."
 	
 Max told Biodiesel Magazine that a grand opening for the biodiesel pump at the Cenex station would be held in the spring of 2004.
 	
 Biodiesel supplier World Energy, along with Carpenter Oil of Heath, Ohio, has opened up two biodiesel pumps in Newark, Ohio. Customers can purchase B2 at Perry Valley Garage and Staggers' Auto Service.
 	
 For more information about biodiesel pumps and fueling infrastructure nationwide, visit the National Biodiesel Board Web site at <a target="_blank" href="http://">www.biodiesel.org. </a>

New biodiesel pumps open

Rothsay, a Canadian rendering company, is awaiting approval of plans for a commercial biodiesel plant to be built in Quebec, Rothsay representative Claude Bourgault told Biodiesel Magazine in November.

 	
 Initially, the plant would produce 35 million liters (9.1 million gallons) of biodiesel per year with the ability to upgrade to 70 million liters (18.2 million gallons). The company has completed a feasibility study and is currently solidifying engineering plans. Bourgault said he hopes to have approval by mid-December so construction can begin.
 	
 Rothsay already runs a biodiesel pilot plant in Quebec, which currently produces four million liters (1.04 million gallons) of biodiesel per year. According to Bourgault, the pilot plant uses an original process derived from existing production technologies.
 	
 "We didn't reinvent the wheel or nuclear science," Bourgault said. "We took existing machines that are already being used for other fields of application [of biodiesel production]. It's partly a continuous system and partly a batch system, which allows us some flexibility to test the product at different stages of the chemical process."
 	
 The pilot plant was the starting point for the commercial plant Rothsay will build, allowing the company to test its process before moving to a full-scale operation.
 	
 "We had some bugs to work out of it," Bourgault said. "Once we work out a system that we want, we'll just carbon copy it somewhere else."

Canadian renderer to build biodiesel plant

In early October, the U.S. Department of Agriculture (USDA) gave a total of $960,000 in grant funds to the National Biodiesel Board (NBB) and the University of Idaho to conduct a biodiesel fuel education campaign, according to a USDA press release.
 	
 The NBB received $770,000 to develop a public education program primarily aimed at enticing government organizations and businesses to use biodiesel in their fleets. The University of Idaho was given $190,000 to provide technical support for the program.
 	
 In all, the NBB will receive $770,000 for five years, including 2003, totalling $3.85 million.

NBB, U of Idaho share education grant

The use of biodiesel fuel in Fort Madison (Iowa) School District's school buses is being considered, according to district superintendent Linda Brock. The concept, presented by board member Steve Martin, is fairly new, and Brock said the district is still trying to learn about biodiesel in general. "If it's viable and if it's going to save money for the district, we'll have to look at it," she said.

School district considers biodiesel use

The Washington Department of Ecology presented Olympia Intercity Transit (IT) with its Environmental Excellence Award on Nov. 17. IT, which currently runs 67 buses on B20, plans to increase the biodiesel blend to B40 in 2004, according to Marketing and Communication Manager Meg Kester. IT has been running buses on biodiesel for over a year, becoming the first district in the state to utilize the alternative fuel. Kester told Biodiesel Magazine no operational problems have been reported.

Intercity Transit wins biodiesel award

The Colorado company, EarthRoamer, is promoting biodiesel with the release of the country's first four wheel drive motor home that runs on the alternative fuel. The Xpedition model consists of a Ford F-450 with a turbo diesel engine. The home is powered by solar panels that charge batteries. The vehicle is totally independent of external water or power hookups, according to the company's Web site, making it "the responsible way to enjoy the outdoors." For more information, visit <a target="_blank" href="http://">www.earthroamer.com.</a>

Biodiesel motor homes hit the market

As biodiesel becomes more mainstream, some companies are starting to test the water of the alternative fuel industry. 
 

 In Idaho, where modern biodiesel was originally developed, the Idaho Biodiesel Initiative Steering Committee has asked Intrepid Technology and Resources Inc. to prepare a grant application for a $480,000 biodiesel plant feasibility study. The proposal was submitted to the USDA, said Intrepid Technology and Resources representative Dennis Keiser. He hoped to hear a response in early December.
 	
 "The next step would be to organize a team of farmers and experts to work with us in laying out requirements for building a biodiesel industry," Keiser told Biodiesel Magazine. "We think we have a good handle on those requirements."
 	
 The Idaho-based plant proposal includes the evaluation of oilseed crops from Idaho, Utah and Washington.
 	
 "The first thing we have to do is find out if farmers would be interested in growing feedstock such as canola and safflower to fire up the plant," Keiser said. "Then we'll have to find out what the energy bill will say in regards to subsidies of biodiesel."
 	
 According to Intrepid's grant application, the planned 10-mmgy plant would require an additional 100,000 acres of oilseed production. The venture would support 400 producer-owners.
 l In Wisconsin, Global Engineered Systems Inc. has emerged, planning to fabricate equipment for biodiesel production and, in the future, produce th
 e alternative fuel at its own plant.
 	
 Company President William Stone said biodiesel matters will be handled under the sub-company Global Edge.
 	
 "We're currently trying to get some investors," Stone told Biodiesel Magazine. "At the moment, we're privately funding this."
 	

 Stone said one unique facet of Global Engineered Systems will be the company's on-site fabrication facility, which will make piping, liquid storage tanks, grain handling equipment, automated equipment and more. Making its own equipment will save the company money when it builds its own plant.
 lIn Fargo, N.D., a group of soybean farmers has formed the North Dakota Biodiesel Steering Committee. The 12-member alliance held its first meeting in September and is currently conducting a feasibility study for a biodiesel plant in the state, The Associated Press reported.
 	
 The closest biodiesel facility is in Ralston, Iowa, which is 470 miles south of Fargo. North Dakota produces about three million acres of soybeans per year.

High interest shown in new plants

In March 2002, Minnesota passed a mandate requiring that all diesel fuel be blended with at least 2 percent of biodiesel beginning July 1, 2005. Before the law can be enacted, however, the state must have a production capacity of 8 million gallons of biodiesel per year. Helping meet that demand, the Minnesota Soybean Growers Association has announced its plans for a 30-mmgy biodiesel plant in Brewster.
 	
 According to The Associated Press, the plant could be up and running by 2005.
 	
 Brewster is already home to a soybean-crushing plant, which opened in early December. The $75-million facility will take in 100,000 bushels of soybeans per year and turn them into cooking oil and soymeal for livestock feed. The crushing plant is owned by 2,300 Midwest farmers, who make up the Minnesota Soybean Processors.

Minnesota plans first biodiesel plant

A new system of formal nominations and voting was employed for the first time by the National Biodiesel Board (NBB) to elect officers and board members at a meeting in St. Louis, Nov. 10-13. 
 	
 In addition to elections, NBB members, along with affiliated Biodiesel Alliance members, heard reports from the three standing committees of the NBB: legislative, technical and marketing working groups. 
 	
 Held three to four times a year in different cities, NBB member meetings include a formal assembly of the board of directors and a more general meeting to update members on important issues. Elections were added to the most recent meeting. 
 
 New election system implemented 
 Prior to the November gathering, the NBB established a new system of formal nominations and weighted voting to be used to elect new members. The new system was explained in detail and implemented in St. Louis. 
 	

 The first order of business on the second day was electing new officers of the board. 
 	
 Bob Metz, a farmer representing the South Dakota Research and Promotion Council, was elected chairman; Gary Haer, representing West Central Soy, a large biodiesel supplier based in Ralston, Iowa, was elected vice chairman; Fred Wellons, representing Baker Commodities, a biodiesel supplier based in Los Angeles, Calif., was elected secretary; and John Heisdorffer, a farmer representing the Iowa Soybean Promotion Board, was elected treasurer. 
 	
 The organization's new board members are: Darryl Brinkmann, a farmer representing the American Soybean Association; John Campbell, representing Ag Environmental Products, a division of Ag Processing Inc., a biodiesel fuel supplier based in Sergeant Bluff, Iowa; Bob Clark, representing Imperial Western Products, a biodiesel supplier based in Indio, Calif.; Gene Gebolys, representing World Energy, a biodiesel supplier based in Chelsea, Mass.; Michael Langenhorst, representing Anamax, a biodiesel supplier based in Green Bay, Wis.; Jeff Nelson, representing Stepan Company, a soy biodiesel supplier based in Northfield, Ill.; Jerry Osterholt, a farmer representing the Indiana Soybean Board; Richard Prascher, representing the Nebraska Soybean Board; Peter Reimers, representing ADM, a multinational conglomerate producing biodiesel in Europe; Robert Stobaugh, a farmer representing the Arkansas Soybean Promotion Board; David Womack, a farmer representing the Tennessee Soybean Promotion Board.
 
 Standing committees report
 NBB members and affiliates were briefed on the status of the pending U.S. energy bill, reported to currently include a version of the proposed Renewable Fuels Standard containing language that is favorable to the biodiesel industry. The actual language in the bill had not been released to the public at the time of the meeting and was still unavailable at press time. Speakers at the meeting expressed optimism that the bill would pass. At press time, the bill had passed the U.S. House and was under consideration by the Senate.
 	
 Steve Howell of MARC IV Consulting presented an update for the NBB Technical Committee. Howell reviewed a number of technical points regarding the ASTM approval process. He also noted that the NBB is officially opposed to labeling pumps that have blends of B20 or less. 
 	
 Further news is the start-up of a biodiesel fuel quality survey. The survey will help verify fuel quality by testing 25 samples of B100 and 50 samples of B20. Funding for the project is being provided by the National Renewable Energy Laboratory, administered through the office of Robert McCormick. 
 	
 The legislative committee reported that significant progress was made in the most recent round of state legislative sessions. This year, 18 states passed legislation that, in some way or another, has an impact on the biodiesel industry. The NBB continually tracks state legislation and can provide sample language for legislators proposing new bills. Those interested in taking steps to promote legislation that encourages biodiesel production and use can contact NBB Regulatory Director Charles Hatcher at (800) 841-5849.

NBB elects officers, board members in St. Louis

Fort Morgan, Colo., will soon have its own biodiesel pump provided by Blue Sun Biodiesel, according to Blue Sun CEO Jeff Probst.
 	
 "Before the end of this year (2003), we'll have a grand opening scheduled with the pump up and running," Probst told Biodiesel Magazine.

 	
 Blue Sun's latest pump opening, which will offer both B20 and B100 blends, focuses on Fort Morgan's farming community since farm equipment is capable of being run on biodiesel.
 	
 On Nov. 14, Blue Sun opened a biodiesel pump in Commerce City, Colo., in conjunction with SHOCO Oil. The Denver metro area is the largest retail site for petroleum products, Probst said.
 	
 Blue Sun opened its first biodiesel pump in Boulder, Colo., on Sept. 12. The company collaborated with the University of Colorado, which converted its campus buses to run on the alternative fuel.
 	
 "Everybody needs to know there's an opportunity to build the [biodiesel] marketplace at the consumer level," Probst told Biodiesel Magazine. 
 	
 For more information about Blue Sun Biodiesel, visit<a target="_blank" href="http://"> www.gobluesun.com.</a>

Blue Sun Biodiesel growing in Colorado

On a rudimentary level, biodiesel production is not a highly complex process. Given a bottle of 200-proof alcohol, cooking oil left over from deep-frying the holiday turkey and a small amount of Drano, a person with only basic knowledge of organic chemistry could mix up a rough batch of fatty acid methyl ester. 
 	
 However, it would be a waste of good whiskey and the product certainly would not meet the specifications set forth by the American Society for Testing and Materials (ASTM). 

 	
 Rather, biodiesel production should begin with the guidance of a reputable process-design firm, along with a professional assessment of available production feedstocks-based on price, availability and quality.	Of course, the feedstock used for biodiesel production is "fat" derived from vegetable or animal sources. Natural oils and fats are triglycerides-esters of glycerin-and three molecules of fatty acids. From triglycerides, biodiesel is produced in a process called transesterification, during which oil or fat is reacted with an alcohol-usually methanol-in the presence of a base catalyst, such as sodium hydroxide.
 	
 Transesterification yields two products: fatty acid methyl ester (FAME), and glycerin. 
 	
 FAME is biodiesel, and it can be labeled as such, and sold as fuel, if it meets ASTM standards. Note: Crude, de-gummed soybean oil will burn in diesel engines, but such oil is not considered biodiesel, nor would it meet ASTM standards, and it could damage or foul the engine. To become biodiesel, the lipid, or fat, must first be chemically changed into a methyl ester. 
 
 Feedstock sources
 Although biodiesel can be produced from any triglyceride, the popular fats and oils most commonly used worldwide are:
 	
 The predominant feedstock used in the United States is soybean oil. Other vegetable oils, such as corn, cottonseed, canola (rape seed), flax, sunflower and peanut, also can be used. These seed oils generally are more expensive than soybean oil. However, on several days in October 2003, the cash price of soybean oil did exceed that of corn oil.
 	
 Animal-derived products such as tallow, choice white grease (lard), poultry fat and yellow grease are also triglycerides and are used as a biodiesel feedstock. These products, when compared to plant-derived oils, often offer an economical advantage as a feedstock. There is also some indication that these sources, which are high in saturated fats, produce less nitrous oxides compared to plant oils. However, this research is ongoing.
 	
 The third main source of triglycerides is recycled oil and grease, usually from restaurants and food processing plants. Although more pre-treatment is required for this feedstock compared to virgin vegetable oils, economically it can be a very attractive feedstock. The use of a recycled product such as used cooking oil is an environmentally friendly process since it solves a waste disposal problem. 
 	

 On October 30, the U.S. Navy announced a project in which it will produce biodiesel from used cooking oils at Naval Base Ventura County (NBVC) in Port Hueneme, Calif. (see article on page 20). Animal-derived feedstock and recycled cooking oils are readily available from 200-plus renderers in the United States, including such companies as Griffin Industries, Darling, Wintzer, Georgia Protein, National By-Products, Moyer Packing, etc.
 
 Production from soybeans 
 The main sources of soybean-derived biodiesel feedstocks are:
 
 1. Solvent extraction plants that process 2,000 to 5,000 tons of soybeans per day. These plants are set up to meet both domestic and export markets for protein meal and soybean oil. Most soybean meal for export is shipped from extraction plants with good access to the Port of New Orleans via the Mississippi River and its tributaries. Many large extraction plants also incorporate a refinery operation or have reasonable transportation to a refinery at another site. 
 
 2. Mechanical extraction plants set up primarily to produce expeller-type meal, which has bypass protein advantages for ruminating animals. These plants usually are set up to process 24 to 800 tons of soybeans per day. Most small plants do not have in-house refineries. Several new mechanical plants that have been constructed during the past several years do have their own refineries that produce specialty oils. One of the largest mechanical extraction plants in the United States is West Central Cooperative in Ralston, Iowa. In addition to being the largest U.S. producer of bypass protein meal, it is the largest producer of biodiesel in the nation.
 	
 The following factors have contributed to the use of soybean oil as the dominant biodiesel feedstock in the United States:
 -Soybean oil is readily available in many regions of the country.
 -The composition of soybean oil is a relative constant, compared to by-products of food preparation, particularly recycled restaurant grease.
 -Historically, soybean oil is less expensive than other vegetable oils.
 -There is a high domestic production of soybean oil, compared with other vegetable oils and animal fats. Soybean oil represents almost 60 percent of the total fats and oils produced in the United States.
 -Many subsidies and grants in the past have been based on vegetable oils, although most of the new governmental programs are feedstock neutral.

 -National soybean associations have done an effective job in promoting the product.
 	
 It should be noted that any consideration of biodiesel feedstock supply should include soybean oil, since most of the biodiesel currently produced in the United States uses soybean oil as the feedstock. 
 	
 A potential biodiesel producer should also be aware of the changes during the past four to five years in the "soybean complex." The soybean complex is the global relationship between the various factors influencing the price of soybeans, soybean meal and soybean oil including supply, transportation, demand, alternate protein and oil sources, animal production and, sometimes, political considerations.	
 	
 For a better understanding of the dynamics of supply, consumption and prices of whole soybeans and soybean products, the following tables show the changes in the soybean complex domestically and internationally since October 1999. These tables include the latest USDA forecasts for the new marketing year that began October 1, 2003, and ends September 30, 2004.
 
 The influence of China
 The most significant influence on the U. S. soybean crushing business since 1995 has been the changes in the import mix of our largest single customer, China. China has changed from being an importer of soybean meal to an importer of whole soybeans. China is now the largest single soybean customer of the United States, with exports expected to reach 7.7 million metric tons in 2002-03. 
 	
 Brazil is expected to rival the United States' market position in China with exports of 7.4 million tons during this past year. Chinese import mix, mainly from the "big three" Soybean Producers-United States, Brazil and Argentina-has changed dramatically from 1995-96 through 2002-03. 
 	
 Astonishingly, whole soybean imports by China increased 25-fold between 1995 and 2003. In contrast, soybean meal imports dropped to zero. 
 Why did this happen? 

 By 2001-02, China had sufficient crush capacity to export over one million metric tons of soybean meal. Chinese soybean imports hit a record high of 20.3 million tons in 2002-03, nearly doubling the 2001-02 level of 10.4 million tons. This figure is even more remarkable when compared to the 1995-96 level of 800,000 tons. 
 	
 The Chinese market has changed because several dozen new crush plants have been built in China since 1995, giving China sufficient crush capacity to produce enough protein meal to meet its domestic demand. This more than offsets the previous importation of soybean meal, mainly from the United States.
 
 U.S. crush capacity increased As a result of what's happened with China, numerous U.S. soybean-crushing plants located on the Ohio and Mississippi Rivers have experienced reduced meal demand. Several plants have been shut down, leading some people to conclude that U.S. crush capacity has been reduced. However, crush capacity has actually increased with the construction of several new large solvent extraction plants in Iowa, Minnesota and South Dakota. 
 	
 In addition, several new small-capacity mechanical screw or expeller press plants were built on the East Coast and in the Midwest between 1997 and 2003. This is not surprising, since domestic demand for soybean meal continued to increase between 1996 and 2001, driven by U.S. meat production, which increased 8.5 percent during the same period.
 
 Soybean production low, prices highFor the short term, it appears there will continue to be upward pressure on prices of soybean products based on the USDA forecast for the crop year 2003-04.
 	
 The USDA forecasts that the crush will drop to 1.510 million bushels (41.1 million metric tons) and soybean oil production for 2003-04 will drop to 17.02 billion pounds (7.72 million metric tons). Ending stocks of soybean oil by the end of September 2003 are estimated to be only 710,000 metric tons and are forecasted to drop to 550,000 metric tons by October 2004.
 	
 The changes in the soybean complex, along with drought in Indiana and Ohio in 2002 (which affected ending soybean stocks in 2002), and drought in the other parts of the Midwest and upper Midwest during August 2003, resulted in very high price levels. Cash prices, as of October 22, 2003, compared to the same period in 2002 were:
 	
 This is a huge market shift since February 2001, when soybean oil (at Decatur, Ill. prices) was $0.124 per pound.

 	
 For the near term, it appears that the October USDA forecast for soybean production for 2003-04 of 2.468 billion bushels (67.18 million metric tons) will result in the lowest soybean supplies since 1996-97. This has resulted in a lower crush for October 2003, mainly due to higher meal prices and the use of alternative protein sources. Because of this, there will be a reduced supply of soybean oil. This near term shortage of vegetable oil will be partially offset by increased imports of canola oil from Canada. 
 	
 You can be assured that market prices will change, up or down. The consumption of soybean oil for biodiesel feedstock at present is only a minor influence on the price. At a projected production of 25 million gallons of biodiesel for 2003, 17 million bushels of soybeans could provide the necessary feedstock (based on solvent extraction) assuming a biodiesel yield of 1.4 gallons per bushel. 
 	
 Other biodiesel market drivers such as the Energy Policy Act, possible passage of the 2003 energy bill and various environmental programs-for school buses, marinas, ski lifts, etc.-will continue to influence biodiesel consumption. However, the big looming potential for biodiesel is the use of biodiesel blends for transportation fuel. If the EPA mandate to reduce sulphur in transportation diesel fuel from 500 parts per million (ppm) to 15 ppm in 2006 remains on schedule, a new influence on soybean demand could come into play.
 	
 The proposed reduction in sulphur will cause lubricity problems in the diesel fuel injection system. Adding 1 percent to 3 percent biodiesel to the petroleum diesel can restore the lubricant qualities of the fuel. Based on approximately 35 billion gallons of diesel fuel used in over-the-road transportation, this addition, using a B2 blend, would require 700 million gallons of biodiesel just for this program. This represents 500 million bushels of soybeans (based on 1.4 gallons/bushel) or about 20 percent of a 2.468 billion bushel crop, which is the 2003-04 forecast.
 	
 Of course, this assumes that biodiesel remains the additive of choice for diesel fuel and that 100 percent of the feedstocks for this potential market come from soybeans. 
 	
 This will not happen. 
 	
 Market forces will dictate that other feedstocks will be needed to supplement soybean oil.
 
 Animal-derived feedstock sources

 One logical substitute for a portion of the soybean oil used for biodiesel feedstock is animal-derived sources and recycled restaurant grease or oil. In some regions of the country, other vegetable oils can be considered.
 	
 Based on information published by Dr. Gary Pearl, president of the Fats and Proteins Research Foundation (FPRF), the United States produces over 11 billion pounds of animal fats and recycled cooking oils, which account for over 30 percent of the total U.S. fats and oil production.
 	
 A 1998 study by Appel Consultants reported that there are about 1.4 restaurants in the United States per 1000 people. It is estimated by FPRF that the amount of recycled cooking oils and fats (yellow grease) from the restaurant and food service industry exceeds 2.75 billion pounds. This supply of triglycerides should continue to increase as the restaurant industry grows.
 	
 The message: A well-planned biodiesel facility should be designed to handle not only soybean oil, but multiple feedstocks, including locally available vegetable oils, fats from animal sources, and yellow and brown grease from restaurants. For example, although there are additional processing costs associated with yellow grease, the current cash price of 14 cents to 16 cents per pound (depending on location) makes it an attractive alternative.
 
 Vegetable oil soapstock provides option 
 Another potential feedstock is vegetable oil soapstock, an inexpensive coproduct of vegetable oil refining with a typical dry matter price 20 percent to 25 percent more than that of soy oil. An esterification process that utilizes soapstock has been developed at the USDA's Eastern Regional Research Center (ERRC). The method used for FAME synthesis from soapstock involves these steps:
 -Hydrolysis of all fatty acyl ester bonds by saponification.
 -Removal of water via standard industrial methods used to prepare an acid oil, a current product used in the animal feed industry.
 -Acid-catalyzed esterification of the resulting free fatty acids.
 	
 While the above description seems complicated, the process is simple and efficient, and can operate at ambient pressure and relatively low temperature in simple equipment. This process appears to have promise, particularly if the market spread between soybean oil and products such as recycled grease continues to increase. 

 
 
 Processing considerationsAll biodiesel feedstocks, including soybean oil, require some amount of pre-conditioning, often chemical refining, before being processed into biodiesel. For example, crude soybean oil must be degummed to remove sources of phosphorous, which degrades the catalysts employed in biodiesel production. 
 	
 Free fatty acids should also be removed from the feedstock before transesterification, especially if recycled cooking oils, which are high in free fatty acids due to their exposure to high temperature during frying, are used. Free fatty acids are corrosive, and therefore hard on fuel storage facilities, fuel systems and engines. ASTM standards set forth tight tolerances on the allowable levels of free fatty acids in biodiesel.
 	
 A common approach for removing free fatty acids from the feedstock is via acid catalyzed esterification in the presence of methanol. This converts the free fatty acids to methyl esters (e.g., biodiesel). Acid esterification equipment requires the use of stainless steel equipment due to the corrosive nature of the process.
 	
 Crude oil from a crushing operation also may be pre-treated by caustic refining to remove free fatty acid. The soapstocks generated in this step are then removed by washing the oil with hot water. The oil must be dried to remove the water before transesterification, since water inhibits the biodiesel-producing reaction. In at least one large biodiesel plant, the feedstock is RBD soybean oil (refined, bleached and deodorized).
 	
 As mentioned previously, soybean oil or other virgin vegetable oils are reasonably consistent. The feedstock used today will be approximately the same as the feedstock tomorrow. This usually is not the case when using recycled oil. Recycled oil requires accurate chemical analysis to determine what pretreatment may be required.
 	
 Used cooking oil may also contain sulphur compounds, often the result of frying sulphur-bearing foods such as onions. There are several proven methods to strip out any unwanted sulphur compounds during pretreatment.
 	
 Obtaining used cooking oil for use as a biodiesel feedstock involves more than just driving up to your local McDonalds and filling a tank truck. The recycling process includes not only the pickup of the cooking oil, but also the proper removal of food particles and other physical contaminants. In addition, used cooking oil contains water, and the oil must be dried. An experienced rendering company is in the best position to do these pre-process steps and then deliver a cleaned and dried recycled product to the biodiesel plant.
 	

 The use of feedstocks other than soybean oil may involve extra processing steps and more equipment. But to be financially successful, a biodiesel plant needs to be prepared to process multiple feedstocks based on regional availability, market prices and processing costs. 
 	
 When processing multiple feedstocks, consideration should be given to using a blended feedstock. Instead of processing feedstock "A" for a few days and then switching to feedstock "B" for another period of time, various feedstocks can be pretreated and temporarily stored in separate agitated storage for final blending prior to transesterification. In this way, feedstocks can be analyzed and monitored, yielding a final blend that will be more consistent and result in a more efficient and controlled process.
 	
 In conclusion, remember that the goal is to produce biodiesel that will help reduce America's dependence on imported oil, and at the same help the environment. To accomplish this, the primary cost of biodiesel production-the feedstock-must be carefully considered. Over the long term, economics will dictate that the use of multiple feedstocks will be a significant factor in the development of a successful alternate fuel business. 
 
 Bob Stroup, president of Ohio-based R.L. Stroup Co. LTD, is an oilseed and biofuels consultant. He can be reached by e-mail at <a href="mailto:rlstroupco@earthlink.net">rlstroupco@earthlink.net</a>

Multiple factors influence biodiesel feedstock choices for American producers. From virgin soybean oil to recycled restaurant grease, price, availability and quality are vital-and continuous-assessments. 
Over the longterm, multiple feedstock production might prove to be the safest route for U.S. producers.

Feedstock Considers for Future U.S. Producers

Mining, even by new standards, is a profession not void of risk. Miners must deal with low light, dicey subterranean environments and occasionally precarious conditions. 
 	
 Fortunately, diesel exhaust is one less hazard facing miners today, thanks to new filtering equipment and, in some cases, the use of biodiesel. 
 	
 Kentucky is home to the second and fourth largest lime mine operations in the United States. Both are using B35 in equipment and vehicles, achieving significant air pollution reductions.
 	
 The Carmeuse Lime Mine Co. has worked with the Kentucky Clean Fuels Coalition (KCFC) and the Kentucky Division of Energy to address new mining industry regulations for underground air quality. The regulations, established in 2001 by the Mine Safety and Health Administration (MSHA), adopted new limits on human exposure to diesel particulate matter in underground mines. A pilot biodiesel program, launched late last year, was conducted in two phases, using two different biodiesel blends (B20 and B50) with No. 2 diesel. 
 	
 Synergistically, Kentucky's own Griffin Industries, which manufactures ASTM-specified biodiesel from recycled vegetable oil, and the Kentucky Soybean Association were able to supply biodiesel for the project. 

 	
 The Carmeuse mine in Maysville, Ky., along with the company's Black River facility, carried out emissions testing. Alternating in two-week intervals between biodiesel made from recycled vegetable oil (yellow grease) and biodiesel made from virgin soybean oil, mine operators and MSHA officials carefully recorded results. Testing at the nearby Black River site in January 2003 revealed a 31-percent reduction in diesel particulate matter from the mine's exhaust airflow when a 35-percent biodiesel blend was used. 
 	
 Today, each mine has nearly 75 pieces of underground equipment running on B35.
 	
 "The Carmeuse biodiesel program is a great example of the responsible and beneficial fuel choices industries can make," said Melissa Howell, longtime director of the KCFC. "The tests set a precedent that applies to all underground mines-not just lime mines here in Kentucky."
 	
 After the Carmeuse mines met success with B35, Joe Jobe, executive director of the National Biodiesel Board (NBB), praised Kentucky for being a national leader in biodiesel development efforts. 
 	
 "Kentucky has been a leader in building broad, effective coalitions to advance biodiesel use in the state," Jobe said, attributing the state's success to the enthusiasm and leadership of Kentucky soybean growers, the KCFC's proactive involvement and the engaging presence of Griffin Industries.
 	
 The lime mine is a shining example of the vast biodiesel network that is developing in Kentucky. But what's happening at the lime mines is only a fraction of what Kentucky is achieving with biodiesel. 
 	
 Due in large part to the tireless efforts of the KCFC, the commonwealth has been a trailblazer, funding biodiesel programs and fostering market development statewide.
 
 KCFC coordinating success	

 Using the state's Clean Cities designation as a springboard for success, the KCFC has spearheaded statewide efforts to broaden public acceptance of biodiesel and encourage use of the alternative fuel in fleet vehicles and equipment. 
 	
 Established in 1993, the KCFC, a non-profit organization, includes private and public sector companies from around Kentucky: automobile manufacturers, fuel providers and all levels of government, from local to federal. 
 	
 "We've been at this for 10 years now, and I think that's given us real credibility and allowed us to achieve a great deal," Howell said. "We redefine our role as the market and technology change."
 	
 Well known for her skillful networking, Howell said, "I don't pretend to know everything, but I always say, 'If I can't give you an answer immediately, I will find someone who can in five minutes.' That's how great our netwrok is."
 	
 That type of enthusiastic cooperation is ubiquitous in Kentucky, and has helped biodiesel achieve a broad base of support from government and private industry. 
 	
 Recently, the KCFC requested and recieved a grant from the U.S. Department of Energy (DOE) to create two biodiesel storage and distribution centers in western Kentucky. Furthermore, a joint effort with the Kentucky Division of Energy and the Kentucky Soybean Board led to the creation of a biodiesel economic impact study in Kentucky. In addition, the organization will facilitate the Kentucky Biodiesel Showcase in Frankfurt on Jan. 15, during which the KCFC plans to showcase the tremendous growth of biodiesel use in Kentucky. 
 	
 The KCFC has high hopes for Kentucky Gov.-elect Ernie Fletcher, who recently unveiled a plan to promote biodiesel use in Kentucky and secure plans for a biodiesel plant in the western part of the commonwealth. 
 	
 Fletcher, the first republican governor elected in Kentucky in over 30 years, notes Kentucky's rank as the nation's 15th largest soybean grower, producing 70 percent more soybeans than it processes. 
 	
 "We must invest in soybean processing infrastructure to realize the benefits of an expanding market," Fletcher stated in his "Restoring Hope" plan. "We will work to make sure Kentucky does not miss out." 

 
 Kids breathing easier with biodiesel-powered buses 
 	
 Meanwhile, the KCFC has teamed with the Kentucky Division of Energy and is working diligently to make sure Kentucky schoolchildren don't miss out either. 
 	
 Already, ten school districts in Kentucky have taken part in a program that funds the use of biodiesel blends-some as high as B20-and dozens more are in line for funding. KCFC administers the money, which is provided by the Kentucky Division of Energy. Howell said the awarded funds are used to buy down the cost of biodiesel.
 	
 Not surprisingly, the program has been an immediate success. 
 	
 "I have a list of schools waiting to use biodiesel," Howell said. "Many of these schools are in rural areas where people understand the need for boosting farming economies. This, coupled with the health and environmental benefits of using biodiesel, is why school bus fleets across the nation are using it."
 	
 Among other school bus-related endeavors, the KCFC has applied for placement of a hybrid-electric school bus that will use biodiesel as a secondary fuel souce. The organization will also coordinate with a middle school science class to build a hydrogen fuel cell go-cart, using biodiesel as a hydrogen source. The KCFC also published a Kentucky school curriculum that includes biodiesel.
 	
 The same sense of environmental stewardship and health saftey that is driving biodiesel use in school buses led to biodiesel use at one of Kentucky's most famous landmarks. 
 
 Mammoth Cave using biodiesel 

 Mammoth Cave National Park, the most extensive mapped-cave system on earth, is an awe-inspiring American treasure that veils 4,000 years of human history within its subterranean ridges. 
 	
 Today, those who look after Mammoth Cave, and its scenic Green River Valley, balance the responsibilities of sharing its splendor with the world while, at the same time, preserving the park's natural beauty and fragile ecosystem. 
 	
 Biodiesel is again part of the solution. 
 	
 Biodiesel is providing a clean, renewable source of fuel for the park's diesel-powered vehicles and equipment. Nearly all of the park's transit and support vehicles run on alternative fuels, many of them biodiesel-blends. Two ferries on the Green River, which carry 300 cars and light trucks over the famed waterway each day during peak summer months, run on B20. The riding lawn mowers, tractors, backhoes and graters used at the park use B20, too. 
 	
 In fact, over 10,000 gallons of biodiesel-blended fuel is used annually at Mammoth. 
 	
 Park managers have facilitated environmental workshops and recently obtained funding to install a new fueling station at Mammoth for biodiesel and other alternative fuels. For these accomplishments, park officials, along with Forever/NPC Resorts, the company that owns and operates Mammoth Cave Hotel, received the Department of Interior's (DOI) 2003 Environmental Achievement Award in early November. 
 	
 Kentucky has placed biodiesel as a priority for its economy, its environment and its energy security. From Mammoth Cave National Park to the Carmeuse Lime Mines, commitment, dedication and cooperation has made Kentucky a true Biodiesel State. n
 For more information, visit the KCFC Web site at <a target="_blank" href="http://">www.kentuckycleanfuels.org.</a>

From Mammoth Cave National Park to the Carmeuse Lime Mines, Kentucky is embracing biodiesel with open arms.

Bluegrass-roots movement

PORT HUENEME, Calif.-The largest diesel fuel user in the world is making a significant move in the drive for domestic energy security. Here at Naval Base Ventura County (NBVC) in late October, U.S. Navy leaders announced plans to recycle the Navy's used cooking oil by processing it into biodiesel. 
 	

 The Naval Facilities Engineering Service Center (NFESC) has partnered with Santa Barbara-based Biodiesel Industries Inc., a biodiesel manufacturer and technology provider. Using a modular biodiesel processing unit, the base will collect its used cooking oil and transform it into biodiesel through a chemical process known as transesterification. 
 	
 The U.S. Military is one of the largest users of B20, but this is the first attempt to create a self-sustaining plant. If the project is successful, ultimately the Navy could send portable biodiesel processing units overseas to produce its own fuel while on missions abroad. 
 	
 "This is a win-win," said Kurt Buehler, chemical engineer at NFESC. "By producing our own biodiesel from used cooking oil, we can eliminate a solid waste disposal problem on [military] bases. In return, our diesel vehicles will burn cleaner, and we'll be using less foreign oil." 
 	
 Joe Jobe, execuitive director of the National Biodiesel Board, said, "I think it is significant to note that the Navy is charged with protecting shipping routes to import petroleum to the United States. I admire the military leaders who have the foresight to use their existing resources to create cleaner burning biodiesel."
 	
 A ribbon-cutting ceremony for the Biodiesel Production Plant Validation Program was held on Oct. 30, at the naval base demonstration site in Port Hueneme. 
 	
 The modular unit can produce as much as 100,000 gallons of biodiesel annually. The base itself plans on using 20,000 gallons per year, while Channel Islands National Park and Ventura County will also use 20,000 gallons annually. 
 	
 "This is the culmination of four years of working with the U.S. Navy," said Russell Teall, president of Biodiesel Industries. "Our research and development of the Modular Production Unit has been completed and implemented in our civilian plants in Las Vegas and Australia. Now, with the cooperation of NFESC, we hope to continue making improvements so that it can soon be deployed at military installations around the world." 
 	
 The U.S. Army, Navy, Air Force and Marines all use B20 at different bases and stations throughout the country, including: Camp Lejeune U.S. Marine Corps Base in North Carolina; Air Force Space Command, Peterson Air Force Base, Colorado Springs, Colo., and Fort Leonard Wood Army Base in Missouri. Everett Naval Station, located in the Puget Sound area, has used about 50,000 gallons of B20 per year since 2001. 
 
 Sources: National Biodiesel Board, Biodiesel Industries, Naval Facilities Engineering Service Center

Project could lead to use of portable biodiesel units on missions abroad

U.S. Navy using Biodiesel Industries unit

Santa Barbara-based Biodiesel Industries, a five-year-old company founded by Russell Teall, has developed a complete line of modular biodiesel production equipment that is today being used around the world. In fact, Biodiesel Industries production units collectively represent the world's largest producer of biodiesel-or any fuel for that matter-made from used cooking oil otherwise known as yellow grease. 

 	
 After a half-decade of development, the first commercial unit was built three years ago in Las Vegas. That unit now supplies biodiesel to over 3,000 government vehicles, including 1,200 buses belonging to the Clark County School District.
 	
 Moreover, the Nevada Energy office recently opened a biodiesel fueling station that is supplied by Biodiesel Industries. 
 	
 The company's modular design emphasizes efficiency and quality control. The modular production units, or MPUs, also allow for easy and inexpensive expansion. 
 	
 Teall told Biodiesel Magazine that the modular units are designed for relatively quick deployment-to take advantage of new market opportunities. The commercial MPU's are designed to fit into a standard 8-foot by 8-foot by 40-foot ISO (International Standards Organization) container, facilitating shipment anywhere in the world. 
 	
 At the other end of the scale, the company offers a 'Mini MPU,' like the one recently dedicated at Naval Base Ventura County in Port Hueneme, Calif. The unit is small enough to be towed by a pickup truck and can produce up to 100,000 gallons of biodiesel per year. 
 	
 All units-both the small and large modules-are made from high-grade stainless steel with electrical components designed for flammable liquids. The company makes full engineering drawings and environmental assessments available to assist future producers with permitting. 
 	
 By design, MPUs are capable of processing multiple feedstocks, including recycled cooking oils, animal fats and virgin vegetable oils. This flexibility allows processors to use locally available and inexpensive raw materials to make biodiesel at a reasonable cost. 
 	
 There is exclusivity in purchasing MPUs: Biodiesel Industries sells and licenses the units into exclusive territories to qualified affiliates interested in becoming part of a mutually supportive network of biodiesel producers worldwide. Support for production, marketing and operations is part of the package.

Biodiesel Industries offers small-scale 'Mini MPU,' commercial 'MPU 3.0

Modular production technology up close

American Biofuels LLC completed the first round of production test runs at its new Bakersfield, Calif., facility in early November. The plant, which is 35 percent owned by an affiliated investment company called Green Star Products Inc., employs a novel continuous-flow process technology and recently relocated a small production unit from Adelanto, Calif., to Bakersfield. 
 	

 American Biofuels is using a proprietary reactor/separator module designed to produce 2.5 mmgy per unit. A single module was on line in early November, according to Green Star Products, and additional plug-in modules will be added to increase capacity. In time, the plant could produce as much as 35 mmgy. Various reports, however, indicate that more immediate plans call for expanding the plant to about 15 mmgy as the biodiesel market develops in central California. 
 	
 Planning and design considerations reportedly caused some delay in the startup of the plant. The footprint of the facility was initially engineered to be quite small, but the proprietary modular design indicated that a larger plant could eventually be built at a much lower incremental cost. As a result of this change in design, the company reported, some unexpected delays were experienced in several areas, including delivery of the equipment. 
 	
 The testing completed in early November was standard: Initial production test runs are required by all commercial and industrial plants to set relays, circuits, alarms, samples of intermediate production steps and other parameters, according to Green Star Products. The Bakersfield plant start-up process was particularly intense because of the continuous-flow process it employs. Representatives of American Biofuels claim the process reduces the footprint needed for production, while also reducing maintenance and operational costs, capital construction costs and construction time. 
 	
 In an article published by the Bakersfield Californian, an American Biofuels representative said the company believes the process is more efficient than batch fermentation because it eliminates the need to separate single batches of biodiesel and glycerin, and also eliminates the need for large heated vats used in the batch approach. 
 
 35-acre industrial facility site American Biofuels is located at a 35-acre industrial site reportedly owned by Hondo Chemical Inc., which manufactures organic fertilizers in Bakersfield. After signing a joint venture with Hondo Chemical, American Biofuels moved its former 2.5-mmgy plant from Adelanto to Bakersfield. The joint venture includes an existing 12,000-square-foot building with its own railroad spur, loading docks and railroad cars. Additional facilities include office space, fully-equipped chemical labs, biofuels storage tanks, utilities and excess heat capabilities from existing fertilizer operations. 
 	
 According to Green Star Products, the Hondo Chemical site offers space for vast expansion. The existing facility could reportedly support production in excess of 50 mmgy.
 	
 Bakersfield is an ideal location for biodiesel production, a company statement said, because most of the oil refineries in California are located nearby and the area has extensive infrastructure to transport fuels throughout California, via rail, truck and pipeline. 
 	
 Hondo Chemical is not only a partner in the project, but a customer as well. 
 	 

 The first biodiesel fuel produced by American Biofuels was delivered to Hondo Chemical, which is trying to set an example by being the first industrial facility in Bakersfield to use biodiesel in its off-road equipment.
 
 Two feedstocks tested 
 During test runs, the module was reportedly tested with different percentages of recycled vegetable oil-often called yellow grease-and virgin soybean oil as production feedstocks.
 	
 Recycled vegetable oil was gathered from local restaurants and food processors. While Biodiesel Magazine was unable to ascertain the going market price of recycled oil in central California, rendering facilities in some parts of the Midwest are able to sell recycled vegetable oil by the truckload for as much as 16-cents-per-pound. 
 	
 According to one report, the facility was originally designed to use yellow grease, which is generally thought to be economical to purchase but slightly more expensive to process than soybean oil. However, it was indicated in recent company statements that federal production subsidies might make an oilseed feedstock favorable. If soybean oil is used, it will reportedly be rail-transported in from outside the region. Joseph LaStella, president of Green Star Products, said in a company statement that the plant's feedstock choice will come down to economics.

Continuous-flow process utilizes 'plug-in' modular units

American Biofuels tests new Bakersfield plant

Due to issues related to project financing, Southern States Power Company has had to postpone its plan to build a 30-mmgy biodiesel plant in Riverside, Calif., a spokesperson for the company recently told Biodiesel Magazine. 
 	
 "The project isn't dead," said Andrew Beyer, SSPC director of communications. "There are just a lot of uncertainties right now-in terms of the financing, and in terms of market demand."
 	
 Last year, SSPC signed Lurgi PSI Inc., a technology-driven biofuel plant contractor located in Memphis, Tenn. The two companies partnered with the signing of a memorandum of understanding for the construction of a 30-mmgy biodiesel plant near Riverside, Calif. Lurgi signed to provide preliminary process engineering for the continuous/fixed production facility using a Lurgi production process for refined soybean oil. Lurgi PSI's scope of services for the engineering phase included plant layouts, process design, site plan drawings, process flow diagrams, equipment lists and process drawings. 
 	
 A short time later, SSPC announced that it had formed a company called Agua Mansa Bioenergy LLC to coordinate the development of the plant. Agua Mansa Bioenergy would, according to SSPC, oversee planning, construction and all other facets of the proposed plant. 
 	

 SSPC announced that it planned to build the facility on 7.73 acres of land located in the Agua Mansa Enterprise and Recycling Market Development Zone in Riverside. The zoning designation would have qualifed the plant for state subsidy financing programs. 
 	
 EXL Group LLC and Impact Capital Management LLP were named as participants in Agua Mansa Bioenergy LLC. Last year, a spokesperson for SSPC said the EXL Group has extensive experience in developing and operating industrial facilities, including chemical process facilities, making it an ideal partner in Agua Mansa Bioenergy. 	
 	
 SSPC previously identified a source of funding as Impact Capital Management, a private equity and venture capital firm with investment funds sponsored by three major financial institutions.
 	
 If built, the plant would have the capacity to produce 30 mmgy of fuel-grade biodiesel that meets both ASTM specifications and German DIN specifications. The project, valued at about $15 million, is based on a state-of-the-art Lurgi Life Science technology (Frankfurt, Germany) and would use up-to-date environmental control systems.
 	
 The plant would be the second biodiesel project SSPC has been involved with. SSPC was involved as a investment company in Imperial Western Products, a "small-budget" ethanol project in Cochella Valley, Calif. 
 	
 SSPC plans to develop additional biodiesel production facilities in the United States, and has stated previously that Lurgi PSI will participate in these projects.

SSPC signed Lurgi PSI to build the proposed 30-mmgy plant

Riverside, Calif., plant temporarily on hold

ALBERT LEA, Minn.-The SoyMor soybean farmer cooperative has broken ground on a vitamin-processing plant-a sort of biorefinery-near the EXOL ethanol plant, with the possibility of producing biodiesel here within two years. 
 	
 SoyMor's plans come less than a year after the Minnesota Legislature passed a law requiring diesel in Minnesota to contain 2 percent biodiesel by 2005. When built, the vitamin plant will employ six to eight workers and the proposed biodiesel plant could employ 20, if built. 
 	
 Plans call for the plant to produce as much as 25 mmgy. The EXOL ethanol plant, owned by many of the same farmers invested in SoyMor, currently produces 40 mmgy of ethanol and employs 38 people. 
 	
 A representative of the investor group said the biorefinery is the first phase of SoyMor's plan. Biodiesel production is considered "phase two" of the plan, and involves the construction of a facility to crush raw soybeans into meal and oil. 

 	
 SoyMor is made up of 500-plus southern Minnesota members. The proposed biodiesel plant would be considered a "sister site" to EXOL, and would utilize much of the ethanol plant's existing infrastructure: roads, rail, electricity, natural gas and sewer. 
 	
 For now, SoyMor will focus on processing raw lecithin, a soybean component, into high-value, nutraceutical ingredients without using toxic chemicals. Lecithin will be refined into phospholipids like phosphatidylcholine and phosphatidylserine, which have been shown to lower cholesterol and improve the immune system and brain performance.

Phase two' of the project is a proposed biodiesel plant

SoyMor breaks ground on soybean biorefinery

Most agree that today the United States needs to maintain its commitment to clean air programs and develop a long-term energy plan that includes renewable resources. 
 	
 Whether right or wrong, Canada and European Union nations have promptly embraced renewable energy and enacted meaningful legislation that will increase the usage of renewable fuels over the next 10 years. Subsequently, international automakers and diesel engine manufacturers have become involved in both developing and endorsing the use of biodiesel.
 	
 In terms of renewable fuels, Europe and North America are virtually polar opposites today insofar as Europe produces more biodiesel than ethanol. This fact can be attributed to the availability of large quantities of oilseed feedstock for biodiesel and the lack of large quantities of starch for ethanol in Europe. Moreover, the auto industry is committed to the development of high-performance diesel vehicles. 
 	
 A visitor to Germany will arrive at an airport and be faced with a long line of diesel-powered limousines at the taxi stand. This is nothing new: For many years, Mercedes and Volkswagen have monopolized the diesel vehicle market and, more recently, have taken advantage of the added lubricity that biodiesel offers, using it to clean up the environment and extend engine life. 
 	
 This advanced commitment to diesel engine technology has allowed Europeans to buy high-performance diesel vehicles that handle like their gasoline-powered equivalents. These modern diesel vehicles offer all the power, speed and performance of gasoline engines, but with less emissions and fuel efficiency that's easy on the wallet.
 	
 The production of fatty acid methyl ester, or raw biodiesel, is not new. 
 	
 Technology leaders have been building large-scale methyl ester plants in North America for years. These production facilities serve the detergent industry, and there is plenty of evidence to support the use of these facilities to produce high-performance lubricants. In fact, synthetic esters have been used in the crankcases of tractors and off-highway equipment for years; these esters are the base for high-specification lubricants used in the aviation industry where extremes of temperature and performance are demanded. Biodiesel is a logical progession for some of these plants. 
 	

 Affordable feedstock availability, some argue, remains one of the greatest challenges to the biodiesel industry in North America. Today, while most U.S. biodiesel is produced from soybean oil, recycled oils and fats are also popular because these feedstocks are cheaper than virgin oils such as soy and canola. However, in the long term, there won't be enough recycled oils and fats available to satisfy projected demand. A great number of producers will continue to rely on oilseed feedstocks. 
 	
 Quality cannot be understated when it comes to biodiesel. Unlike distilled alcohol, there are many residual chemicals that affect the quality of the finished product. Using the computer maxim of "garbage in, garbage out," it is critical to treat feedstock with respect. To meet U.S. ASTM blending specifications is one thing, but perhaps raising the bar to the higher European DIN and EN specifications would require a change in handling. 
 	
 The education of consumers, along with increased availability of diesel-powered automobiles and biodiesel blends at the gas station, will be critical to getting over that hurdle of regularizing usage. The current trends in truck and municipal fleets, school buses and military usage are collectively a great start. The energy bill provisions would have helped level the playing field overnight.
 	
 Last, but by no means least, is the issue of money. 
 	
 As a fledgling industry with many start-up companies, lenders will certainly be conservative with financing. Proven technology, commodity risk management and solid off-take agreements will be the order of the day.
 	
 With the hindsight of witnessing the growth of the U.S. ethanol industry, it is not difficult to imagine that in 10 years time the United States could lead the world in biodiesel production.

Environmental concerns, widespread diesel engine acceptance put European Union nations on top

Will U.S. production climb to European levels

In late October, the European Council of Ministers unanimously and definitively approved a new directive promoting the use of biofuels-mainly influencing biodiesel-in EU member nations. In particular, the directive establishes pan-EU rules for the "detaxation" of biodiesel. 
 	
 The directive essentially calls for excise tax exemptions, or reduced tax rates, on sales of biodiesel and other biofuels. Once tailored by individual member nations, tax exemptions should take effect in 2004 and provide member nations with flexibility in defining the incentive. 
 	
 This decision follows the European Parliament's initial approval of the directive in March, with a 531 out of 536 vote in favor of tax breaks for biofuels. The legislation is expected to pave the way to the establishment of a "clear and solid" legal framework promoting the use of biofuels in EU member nations. 
 	
 Previously, the EU approved a provision requiring member nations to establish national plans in order to increase the use of biofuels to a minimum target of 2 percent of all the gasoline and diesel fuel sold for transport purposes by December 2005. This percentage should progressively increase to reach 5.75 percent by 2010. These promotion measures concern biodiesel sold pure as well as in blends. 

 	
 The Directive also requires EU member nations to report regularly on the way in which these indicative targets will be met. Furthermore, along the lines of the new directive, national administrations will have to inform EU citizens and consumers about the possibility of using biofuels. Member states will have to incorporate this directive into their national legislation by the end of 2004. 
 	
 The EU is currently the world's leading producer of biodiesel, with more than one million metric tons produced in 2002. The European biodiesel industry is well consolidated: Beginning this year, its production capacities were already above two million metric tons per year and prepared to handle the forthcoming market increase. 
 
 Source: European Biodiesel Board (EBB)

EU adopts new rules for biodiesel 'detaxation'

Arkansas
 Referred to as the "Biodiesel Incentive Act," Arkansas recently passed legislation that provides an income tax credit to biodiesel suppliers equal to 5 percent of the cost of facilities and equipment used for wholesale or retail distribution of biodiesel or biodiesel-blended fuel. Suppliers of biodiesel derived from both plant oil and/or animal oil qualify for the tax break. The legislation also provides a 10-cent-per-gallon grant to qualified producers. Grants are limited to the first five million gallons of biodiesel produced, not to exceed five years. Biodiesel is defined by the ASTM specification.
 More details online: <a target="_blank" href="http://">www.arkleg.state.ar.us</a>
 
 Illinois
 The state's renewable fuels tax incentive trims the 6.25-percent per gallon diesel fuel tax to 5 percent on blends of B1 to B10. For biodiesel blends over B10, the sales tax is totally removed. Another piece of legislation offers grants to alternative fuel producers (both ethanol and biodiesel) for plant construction or modification. However, it requires the facility to have at least a 30-mmgy capacity. 
 More details online: <a target="_blank" href="http://">www.legis.state.il.us </a> 

 
 IndianaIndiana has income tax credits for producers, blenders or retailers of biodiesel. The legislation is capped at $1 million per incentive over two years (2004-2005). The producer credit is equal to $1 per gallon of biodiesel produced in Indiana and used to make blended biodiesel (B2-B99). The blender credit (above B2) is 2-cents per gallon, if using Indiana biodiesel. The retailer credit is 1-cent-per-gallon. There is no restriction on state production.
 More details online: <a target="_blank" href="http://">www.in.gov/legislative </a>
 
 Kansas
 Recent Kansas legislation restricts claims of biodiesel to blends of B2 or higher. Also, all of the state's diesel-powered vehicles and equipment must use B2, but only if it costs no more than 10-cents per gallon more than No. 2 diesel fuel.
 More details online: <a target="_blank" href="http://">www.kslegislature.org</a>
 
 MaineRecent legislation defines biodiesel by EPA registration and ASTM specification. The law states: "Biodiesel fuel" means renewable fuel composed of mono-alkyl esters of long chain fatty acids derived from vegetable oils or animal fats that is registered with the United States Environmental Protection Agency as a fuel and a fuel additive under the federal Clean Air Act … and as otherwise specified in the American Society for Testing and Materials (specification).
 More details online: <a target="_blank" href="http://">www.maine.gov </a>

 
 Mississippi 
 Recent legislation in Mississippi has added biodiesel to "cash payment law" for producers of ethanol, wet alcohol and others. However, biodiesel is undefined and there is no implementation language. Biodiesel supporters hope to see that clarified in the state's next legislative session but question whether it will happen.
 More details online: <a target="_blank" href="http://">www.ls.state.ms.us </a>
 
 Michigan
 Michigan recently legislated a tax abatement for biodiesel production plants. Plant rehabilitation and industrial development districts may be established to provide property tax abatements for up to 12 years. "Industrial property" would include the creation or synthesis of biodiesel fuel. Additionally, until 2007, an electric generating plant fueled by biomass would qualify.
 More details online: <a target="_blank" href="http://">www.michiganlegislature.org </a>
 
 North Dakota

 North Dakota has a 10-percent tax credit on equipment for biodiesel producers and/or blenders. The legislation also includes a 1.05-cent excise reduction on B2 after eight million gallons of annual capacity is established in the state. The excise language was already law, but was scheduled to sunset June 2003.
 More details online: <a target="_blank" href="http://">www.state.nd.us/lr/assembly </a> 
 
 Nevada
 Nevada lawmakers added biodiesel to the definition of alternative fuel, but only B5 to B20. The language says fuels that meet ASTM specifications are eligible.
 More details online:<a target="_blank" href="http://"> www.leg.state.nv.us </a>
 
 South Dakota
 Recent legislation in South Dakota outlined the definition of biodiesel under ASTM specifications and put the definition into law.
 More details online: <a target="_blank" href="http://">www.legis.state.sd.us/index.cfm</a> 

 
 Texas
 Texas now provides a net grant of 16.4-cents-per-gallon to producers for a period of 10 years. The grant is capped at $3.6 million per plant. 
 More details online:<a target="_blank" href="http://"> www.capitol.state.tx.us </a>
 
 Washington
 The state of Washington provides tax incentives for biodiesel and alcohol fuel production. The legislation provides a tax incentive for investments associated with distribution and retail sale of biodiesel. There are no taxes on equipment and ingredients until 2009, granted the equipment is used for at least 75 percent biodiesel distribution. Additional legislation encourages state agencies to use B20 and creates a state agency mandate to use B2 starting in 2006. Furthermore, lawmakers created a biodiesel-ultra low sulfur diesel pilot project for school transportation. 
 More details online: <a target="_blank" href="http://">www.leg.wa.gov </a>

A report circulated by the National Biodiesel Board has identified 18 states that, collectively, passed 25 biodiesel impact bills in 2003. Below, Biodiesel Magazine has compiled an abridged state legislation list, providing summaries of bills that most directly affect production.

Major 'biodiesel impact' bills of 2003

January 16, 2004
 Seattle, Washington

 University of Washington
 Co-sponsored by the American Lung Association of Washington and the University of Washington-Pediatric Environmental Health Specialty Unit, this conference examines the link between diesel engines and environmental and health problems. The conference will focus on solutions to reduce pollution from diesel exhaust with improved fuels and engine technology. 
 ONLINE: <a target="_blank" href="http://">www.depts.washington.edu</a>

Diesel Exhaust & Human Health

January 20-21, 2004
 Portland, Oregon 
 Oregon Convention Center
 Harvesting Clean Energy brings together the agriculture and energy industries to explore rural economic opportunities in clean energy production. Discussions will focus on successful project design, financing and marketing for locally-owned commercial wind power, biodiesel and ethanol plants and complementary bio-based products, biogas and biomass digesters, on-farm renewables, and energy opportunities for food producer-processors. 
 ONLINE: <a target="_blank" href="http://">www.harvestcleanenergy.org</a>

Harvesting Clean Energy

February 1-4, 2004
 Palm Springs, California
 Wyndham Palm Springs
 The new flagship event of the National Biodiesel Board (NBB), this conference evolved out of the NBB's annual Biodiesel Brainstorming Workshop. This year's agenda will include a comprehensive set of topics in the technical, regulatory and marketing areas. The technical Brainstorming Workshop will be held in conjunction with the conference. The winter National Biodiesel Board meeting will take place immediately following the conference on Feb. 5. 
 ONLINE: <a target="_blank" href="http://">www.biodiesel.org</a>

2004 National Biodiesel Conference & Expo

March 4-6, 2004

 Biloxi, Mississippi 
 Beau Rivage Resort 
 The Mississippi Biomass Council, Mississippi State University and Alcorn State University are organizing this program. The conference is supported by a U.S. DOE award to the Mississippi Development Authority-Energy Division. Other sponsoring agencies are Mississippi Alternative Energy Enterprise and Mississippi Farm Bureau Federation. The program continues to focus on products produced from biomass materials. As in the past, the conference will include research papers, updates on important federal bio-programs, equipment and service exhibitors, as well as discussions on the latest commercial technologies.
 ONLINE: <a target="_blank" href="http://">www.ms-biomass.org</a>

Southern Bio-Products Conference

March 2-4, 2004
 Las Vegas, Nevada
 Las Vegas Hilton Hotel
 One of the most anticipated conferences and trade shows of the year for the corn and soybean industry, this year's Commodity Classic is being held in the "Entertainment Capital of the World," Las Vegas. The event is coupled with a large trade show that last year brought together 160 exhibitors. 
 ONLINE: <a target="_blank" href="http://">www.commodityclassic.com</a>

Commodity Classic

May 10-14, 2004
 Rome, Italy
 Palazzo dei Congressi
 Part of the European Series of Conferences on Biomass, this event is touted as a "formidable meeting." The aim of the conference is to arrive at "distinct conclusions" with respect to the future of using biomass for energy.

World Conference & Technology Exhibition on Biomass

June 22-25, 2004 

 Madison, Wisconsin
 Monona Terrace Convention Center
 Register today for the "Biodiesel 101" session of the 20th Annual 2004 FEW. Over 1,400 industry representatives from around the world are expected to attend this milestone industry event. Conceived as a service to ethanol producers, the International Fuel Ethanol Workshop & Trade Show is designed to provide the ethanol industry with the latest information on technology and services for improving production, product yields and operations of an ethanol facility using grain, sugarcane, cellulosic materials and other biomass feedstocks. Biodiesel 101, a pre-workshop seminar that serves as an introduction to biodiesel production and use, is now on its second successful year. In addition, attendees will have a chance to meet and get to know over 190 companies exhibiting at the 2004 Trade Show. Exhibitors will be displaying the latest technology, equipment and services to the industry.
 ONLINE: <a target="_blank" href="http://">www.bbibiofuels.com/few</a>

Biodiesel 101 / 20th Annual International Fuel Ethanol Workshop & Trade Show

"If you can prove it on the race track, it will sell down the road." 
 	
 This has been the axiom of fossil fuel performance and we plan on using the same formula for biodiesel. Once we do, we're taking our case to the American people!
 	
 I've been a lifetime fan and sometime participant of motorsports. Globally, motorsports has a huge following. In Europe, racing shares top billing with soccer and cycling. Every weekend, when NASCAR is aired on television, 75 million Americans are watching. This venue is now the No.1 marketing forum for American corporations, and the fans are very loyal to their sponsors. Imagine if we fueled a support series with biodiesel in NASCAR … or how about a biodiesel pace car in front of the field at the Daytona or Indy 500s? This can happen. A Cummins diesel actually sat on the pole in the 1952 Indy 500. To see it happen again could be monumental for public acceptance of biodiesel. 
 	
 There is also political motivation in what we are doing here. Advocates for biodiesel need clout and that requires preaching beyond the choir, on a grand scale. 
 	
 First it was soccer moms, now it's NASCAR dads. Politicians pay very close attention to these folks or they don't get re-elected. They are often the very same legislators that turn a blind eye to bills in support of biodiesel. Or for that matter, support for the new, lean, clean diesel technology on the market place. In Europe, over half of the new car sales are diesel; in America it's less than 1 percent. These new vehicles can be up to 60 percent more fuel efficient than spark ignition engines. This is power for the 21st century.
 	

 We chose drag racing to make our initial foray into motorsports with B100 and various biodiesel blends as fuel. The event is called the "CLEAN AIR QUARTER MILE" and anyone with a street/racing diesel engine automobile can participate in the event at their local drag strip. We've had great success, but we need more people out there to log times and get biodiesel in front of the public. We are also now building a street-legal diesel two-seater, called the Locost BioD-7, for track events. Assembly plans for this vehicle will be made publicly available upon completion. 
 	
 Ken Rakoz from Centralia College, in Centralia, Wash., made the first significant run on B100 at Portland International Raceway on Oct. 19, 2002. A Portland TV station televised this event live, and it made a lot of believers out of naysayers. The fastest biodiesel performance vehicle time to date, not including jet cars, is 9.301 seconds-139 mph in the quarter-mile-set by the Cummins Racing Team this October. 
 	
 We hope to work closely with the National Hot Rod Association (NHRA) to get our events officially sanctioned. We plan on getting into all forms of racing-the sooner the better. Please contact us to find out how you can help. Like anything else in America, marketing is the key to success. Biodiesel is a wonderful fuel. Let's get it on track.
 
 Bill Isbister is founder of Club Biodiesel in Aloha, Ore. He can be reached by e-mail at <a href="mailto:clubbiodiesel@yahoo.com.">clubbiodiesel@yahoo.com.</a>

Jan/Feb 2004

Columns

Editor's Note

Talking Point

Featured

Feedstock Considers for Future U.S. Producers

Bluegrass-roots movement

American Biofuels tests new Bakersfield plant

Riverside, Calif., plant temporarily on hold

Will U.S. production climb to European levels

Jan/Feb 2004.css-7jxktu{position:absolute;bottom:0px;left:0px;right:0px;height:3px;border-radius:3px;background-color:var(--chakra-colors-brandBlack);}

Columns

Editor's Note

Talking Point

Featured

Feedstock Considers for Future U.S. Producers

Bluegrass-roots movement

American Biofuels tests new Bakersfield plant

Riverside, Calif., plant temporarily on hold

Will U.S. production climb to European levels

Jan/Feb 2004