Security, environment, farming: These three words are central to the magic mantra of the rapidly growing biofuels industry. Each is inextricably linked to a unique and politically powerful reason to stand behind the movement. Along with the growing acceptance and positive national attention biofuels now receive, however, comes considerably different reactions from the masses-reluctance, apprehension, fear. That is, a significant number people genuinely believe biofuels are hurting the world more than they're helping it. 
 
 Put all those unanswered emissions questions aside for now. This is a whole separate issue-a squabble over the legitimacy of a debate known as "food versus fuel." 
 
 The question at hand is this: Some biofuels opponents believe the biofuels industries could grow so big, and consume such a large percentage of available land and crops that the world's food supply would be affected. They say the situation could get so bad, in fact, that hunger levels in developing countries around the globe could rise as a direct result. 
 
 Fortunately, it's not necessary to agree with this bleak assessment in order to fairly address questions related to it. Will biodiesel plants eventually demand so much of the U.S. soybean crop that there won't be any left for food production or export? Overseas, will all the rapeseed grown in Europe, for example, be turned into fuel, leaving none left to make food products like margarine? The answer today, of course, is no. Whether it could happen in the future, however, is a question that simply can't be ignored. 

 With all the national attention on biofuels lately, it's only logical that people start asking questions, says Neil Caskey, director of industry and public relations for the American Soybean Association (ASA). It's not necessarily a bad thing. "I think folks are beginning to ask questions and really taking note of the renewable fuels industry-and I think that's a good thing," he says. 
 
 At press time, there were two conferences scheduled for the purpose of tackling that exact topic. The Soya Summit 2006: Food and Energy for the 21st Century, is scheduled for Sept. 18-20 in St. Louis, Mo. In March, the Edible Oil organization plans to have a conference, titled, "Sustainability of Oils and Fats to Meet Global Demand on Food and Biodiesel" in Seville, Spain. 
 
 The Soya Summit is organized by Soyatech, a subsidiary of HighQuest Partners (see Talking Point, page 70). The goal of the summit is to get professionals from the food, agriculture, biofuels and larger energy complex together to talk about the challenges and opportunities presented by the growth of the biofuels industry, says Jacob Golbitz, director of research at High Quest Partners. Of primary concern is that burning question: Will reallocating more food resources, such as corn, soybeans and rapeseed, for fuel production potentially increase world hunger? While that situation isn't happening now, it is a theoretical possibility, Golbitz tells Biodiesel Magazine. 
 
 At this point, no one knows for sure what will happen, however. "This is potentially such a profound change that it's really hard to see how it will work out," Golbitz says. 
 
 The Food and Agriculture Organization of the United Nations (FAO), which is also carefully studying the issue, agrees that there's no definitive answer to the question right now. What is known so far is that it's an issue that can't be generalized, according to Gustavo Best, FAO senior energy coordinator. Biofuels production is going to have different effects in different areas of the world. "You cannot say all over the world it is positive, or all over the world it is negative," Best tells Biodiesel Magazine. 
 
 Biodiesel Under the Microscope 
 Joe Jobe, CEO of the National Biodiesel Board, sees the biofuel as benefiting the food supply, not harming it. Utilizing surplus agricultural commodities, such as soybean oil, enhances food supply and adds value to agriculture economics. 

 
 Several comprehensive studies on biodiesel have been conducted in the past few years, Jobe says. The studies, though they used different economic models, had similar conclusions. Using fats and oils to a greater degree for biodiesel production increases the value farmers get for their crops. It also has the effect of lowering the cost of protein meal, making domestic livestock feed cheaper and more competitive in international markets for food and feed. "Not only does this allow farmers to more profitably supply global food markets, it may have the effect of increasing ag processing in the United States," Jobe says. 
 
 It's a misconception that U.S. soybean production will not be able to grow to fill the tall orders of both food and fuel, Caskey says. A host of new technologies, including biotechnology, better crop protection, farm management systems and more, will help soybean farmers keep producing more soybeans on the same amount of land in the future. "At the ASA, we don't view it as an 'either-or' proposition," Caskey says. "We know that we can provide enough feed for animal agriculture, food for people and fuel for consumers."
 
 Along with the food market, exports are also critically important to soybean farmers. The industry typically exports about half the value of its yearly crop-about $9 billion last year, according to Caskey. The ASA doesn't lean more strongly toward promoting either the soy oil or export markets. "Those are both markets we are going to aggressively fight to defend and expand, not at the expense of the other, but together," Caskey says.
 
 On the other hand, Golbitz disagrees. With the way the industry is looking to expand production, he predicts a shortfall of soybean supply for biodiesel production-probably sooner rather than later. He sees the industry eventually turning to imported palm oil and rapeseed oil. "I would not be surprised to see us become an importer of soy oil," he tells Biodiesel Magazine. 
 
 Golbitz shot down the misconception that the increased use of food resources is the only thing that's driving rising prices, however. There are a lot of factors putting general pressure on commodity prices, including energy prices, for example. "At least for right now, we're kind of a long way from biofuels determining prices because it's such a small industry compared to the energy industry and the agricultural industry," Golbitz says. "Maybe 10 years from now, but not now." 
 
 Media Coverage 
 The food versus fuel debate is something that has cropped up in the news repeatedly. So far, those engaged in it haven't exactly reached a consensus-even among executives from companies involved in the biofuels business.
 

 Agribusiness giants Archer Daniels Midland Co. (ADM) and Cargill Inc. sparred over the food versus fuel debate through the mainstream media in May. It started when The Associated Press reported that Warren Staley, chairman and CEO of Cargill, said agricultural land should be used to produce food, feed and, lastly, fuel. G. Allen Andreas, chairman of ADM's board of directors, responded the next day, saying there is plenty of capacity in the world to grow food. 
 
 Bill Brady, Cargill spokesman, tells Biodiesel Magazine that from a general strategic standpoint, the company's position on biodiesel is the same as its view of ethanol. Cargill recognizes that biofuels have a role to play in meeting national energy needs. However, even if the entire U.S. soybean crop were converted to biodiesel, it would amount to less than 5 percent of the total current diesel use. 
 
 Overall, the company wants advocates for caution and rationality. "We have publicly cautioned against over-exuberance and have called attention to the challenges of meeting both food and fuel needs in the event of a short crop," Brady says. 
 At press time, ADM had not fulfilled requests for an interview on the subject. 
 
 Yet another corporate executive was heard chiming in on the debate in July when The Associated Press quoted Eric G. Holthusen of Royal Dutch Shell saying that turning food into fuel was "morally inappropriate." In a subsequent newspaper article, another Shell representative distanced the group from the comment made by Holthusen, an Asia/Pacific fuels technology manager. 
 
 Steve Brown, a Shell spokesman who is familiar with commercial aspects of biofuels, tells Biodiesel Magazine that Holthusen's comment was "unfortunate" and not fully representative of Shell's policy on ethanol or biodiesel. 
 
 Shell, which handles 3 billion liters (800 million gallons) of biofuels yearly, mostly in the United States and Brazil, is concerned with providing its customers with sufficient energy supplies in a sustainable way. "There is no one solution to the world's demand for energy, but biofuels are one part of that package," Brown says. 
 
 The Margarine Factor 

 While the debate remains hot in other European Union (EU) countries, food and fuel producers in Germany have near-total agreement on the issue, according to Petra Sprick, managing director of the Biofuels Industry Association, a lobbying organization in Germany. After a long dialogue with the food industry, particularly margarine producers, earlier controversy over the subject has died out. "The food industry has learned, meanwhile, that they cannot kill the bio-industry movement," Sprick says. 
 
 Perhaps it makes sense that Germany has come to terms with the biodiesel industry before others in the EU. The country is the EU's largest biodiesel producer. In 2005, 501 million gallons of biodiesel were produced there-behind only France with 147 million gallons, according to the European Biodiesel Board. 
 
 Natural marketplace dynamics help ensure there will be enough rapeseed supply for the food industry, which is better situated to handle rapeseed price increases. "There will always be enough rapeseed oil for the food industry," she says, adding that, that's generally understood now in Germany. 
 
 Currently, the food industry uses only 600,000 metric tons of rapeseed oil yearly, compared to 1.8 million metric tons for biodiesel production. However, neither industry needs to be totally dependant on that one feedstock. Sunflower and palm oils, for example, can be suitable for food use as well, Sprick says. Biodiesel producers could also use soy or palm oil, though current legislation-and fuel quality specifications-favor rapeseed oil. Together with the German food industry, the Biofuels Industry Association supports allowing producers to use a wider variety of feedstocks, including imported supplies. Both industries are opposed to legislatively dictating what feedstocks should and shouldn't be used as biofuel feedstocks, Sprick says. Suppressing the biofuels industry to keep prices down for other industries wouldn't be fair. "It's a competition which we need to have in the marketplace," she says. 
 
 The Real Culprit
 Food First, a California-based organization with the goal to obtain access to food for humans worldwide, doesn't see biofuels as the bad guy, according to Marilyn Borchardt, development director. While many people don't have the finances or resources to purchase or grow food, including 11 percent of Americans, ethanol or biodiesel production isn't the problem. "We know that there is more than enough food produced in the world to make everyone fat," she says. 
 
 Hunger is caused primarily by nations run by governments that haven't made it a priority to make sure all of their citizens have access to food. For example, some African nations have exported food while their own citizens have starved during famines, Sprick says. 
 
 Furthermore, Food First views the U.S. food-aid program as a costly, inefficient system that perpetuates the problem. By sending food rather than finances like other countries, inexpensive food supplies are dumped on the market, putting farmers in those countries out of business. "All that public fighting about [how] there's not going to be enough food, it's really about profits, nothing more than that," Borchardt says. 
 
 Holly Jessen is a Biodiesel Magazine staff writer. Reach her at hjessen@bbibiofuels.com or (701) 746-8385.

It's a subject that has come up over and over: Will the growth of the biofuels industry take food out of the mouths of the world's hungry? While experts say it will take more time for the truth to unfold, it's certainly not as simple-or as sinister-than the picture some paint.

Food or Fuel:Where Does Vegetable Oil Have More Value?

Imagine an island in the middle of the ocean devoted exclusively to biodiesel production. On this island, everything that is needed to grow soybeans and transform them into methyl esters-down to the energy and nutrients needed to support farmers, laborers and processing plants-is imported onto the shores. All that ever leaves is the renewable fuel. 

 
 This is the conceptual model that led researcher Jason Hill and his team from the Department of Applied Economics and the Department of Ecology, Evolution and Behavior at the University of Minnesota (UM) and the Department of Biology at neighboring St. Olaf College used to explain principles of their lifecycle analysis of the predominant alternative fuels. "The Environmental, Economic and Energetic Costs and Benefits of Biodiesel and Ethanol Biofuels" was funded in part by UM's Initiative for Renewable Energy and the Environment, and first published in the Proceedings of the National Academy of Sciences in July. 
 
 Perhaps looking to ground bandwagon politicians and the agricultural community that have been accused of being in a euphoric, if not delusional, renewables "haze," academic research aims to review the legitimacy of ethanol and biodiesel as crucial alternatives in a world looking to transition away from its overzealous petroleum use. Few if any, however, in the ethanol or biodiesel industries have touted either fuel as a panacea destined to solve the world's energy problems. 
 
 Setting the Proper Boundaries 
 The parameters of the study proceeded from the following thesis: "To be a viable substitute for a fossil fuel, an alternative fuel should not only have superior environmental benefits over the fossil fuel it displaces, be economically competitive with it and be producible to make a meaningful impact on energy demands, but it should also provide a net energy gain over the energy sources used to produce it." 
 
 Everything down to the energy used to support the laborers should be included in the machinations of the green island cycle, the researchers decided. "This has been debated back and forth in the literature, [whether to] include these sorts of inputs," Hill tells Biodiesel Magazine. "We settled on the conclusion that, yes you should … to be fair and do it properly." 
 
 The study states: "Biofuel production requires energy to grow crops and convert them to biofuels. We estimate farm energy use for producing corn and soybeans, including energy use for growing the hybrid or varietal seed planted to produce the crop, powering farm machinery, producing farm machinery and buildings, producing fertilizers and pesticide, and sustaining farmers and their households." Some experts believe that these inputs are unnecessary and, even when included, don't drastically change the outcome of a lifecycle analysis. "There are formulae that estimate how much energy individual households use on a daily basis with transportation costs and so forth," says Jim Duffield, senior agriculture economist for the USDA. "In my mind, you need to do that anyway to sustain life; no matter what their occupation is, they're going to use that energy."
 
 The amount of energy it takes to grow and harvest soybeans, and to transport them either to biorefineries or processing outlets, requires irrigation, the application of fertilizers and pesticides, and many other steps that are all rather straightforward in terms of data collection. "When [researchers] go beyond that to look at how much energy it takes to produce machinery, equipment, facilities and labor, then it gets pretty murky," Duffield says. "In the work I've been involved with in the past, we haven't gone that far, and [data] is pretty scarce in that area. I don't agree that you should include labor in a lifecycle analysis."
 

 The good news is that even though all of these inputs are included in the formula that Hill and his colleagues used in calculating the net energy balance for ethanol and biodiesel, the results were still favorable to both fuels. 
 
 Standing Up to the Competition
 In an analysis of an alternative fuel, the subject should be compared with the mainstream products. "They don't talk about the lifecycle analysis of petroleum diesel," Duffield says. "If they did not include similar research on the lifecycle analysis of comparable petroleum products in their story, than it's biased."
 
 Bruce Dale, professor of chemical engineering at Michigan State University who has published extensively on this subject, agrees with Duffield that "net-energy talk" can be deceptive because it doesn't take place in the context of a comparison with petroleum-based products. "The fact is, if you accept the argument and the assumption that bio-ethanol and biodiesel provide positive energy balances, they both compare very, very favorably to petroleum," Dale says. "That's the point."
 
 The work of David Pimentel and others who have reported a negative energy balance have misled people, Dale says. "If you apply the same approach that they apply using the exact same numbers and the exact definitions that they use and apply it to gasoline and diesel, you find out that gasoline and diesel have a worse net energy than ethanol does." 
 
 Duffield says he remembers a lifecycle analysis of petroleum diesel performed by Michael Long of the Argon Corporation several years ago. "He did an excellent job on that study, and as I recall, it showed that petroleum diesel had a [negative energy balance] of about 17 percent," Duffield tells Biodiesel Magazine.
 
 "Ethanol and biodiesel will both have a better net energy balance than either gasoline or petroleum diesel," Dale says. "That is the key part as far as I'm concerned, and that is that both ethanol and biodiesel are much better than their petroleum counterparts."
 Nevertheless, petroleum is going to be around for a lot of years and will continue to be used. How it will be used is the linchpin for Dale. "You can take a barrel of petroleum and use it to support the production of ethanol or biodiesel, either one," he says. "Or you can take that barrel of petroleum and use it to make gasoline or diesel." Ultimately, Dale says the more intelligent application of the petroleum product is when it is used to support the production of renewable energy. 
 

 Asking the Appropriate Questions
 Getting back to Hill's conceptual model, a green island has no energy or a limited amount of energy, and it wants to produce more. Of course, energy is never created or destroyed; it only changes form. "We want to find a process that gives us more energy out than we put in," Hill says. "That is how we can produce more energy. Essentially, we identified the energy inputs that would be directly or indirectly related to that process that gives you more energy out. Then, you look at how much energy you actually get out of the process, so we look at this whole energy process." 
 
 A product can be analyzed in terms of its energy content, but to understand the "energy return," all inputs and outputs should be considered. Dale says the question is, "How much liquid fuel do you get out, if you use petroleum to support ethanol production or you put the petroleum into gasoline or diesel?" He says nearly 20 times more liquid fuel is produced if the petroleum is used to support ethanol production to make gasoline or diesel. "It's a huge multiplier," Dale says. "It's a huge leverage."
 
 Soy-based biodiesel, however, is ultimately the superior biofuel, Hill's report states. This is primarily because of two factors. One is that soybeans are less energy-intensive to grow and require less harmful pesticides, herbicides and fertilizers. Secondly, far less energy is required in the processing of soybean oil to biodiesel. "Among current food-based biofuels, soybean biodiesel has major advantages over corn grain alcohol," the report says. 
 
 As for the future of biofuels, the UM study recommends that "synfuel hydrocarbons or cellulosic ethanol that can be produced agriculturally on marginal lands with minimal fertilizer, pesticide and fossil energy inputs, or produced with agricultural residues, has potential to provide fuel supplies with greater environmental benefits than either petroleum or current food-based fuels."
 
 Some of the conclusions in the paper could be drawn from the wrong position, from the wrong perspective, Dale says. There are different measures of efficiency used in the paper, but this information is not pointed out very well. The paper draws its conclusions based on per-mile-driven impact in a comparison of ethanol and biodiesel in the reduction of greenhouse gases and petroleum displacement.
 
 "In other words, what they're saying is that when you compare those two fuels on per-mile-driven, it looks as if biodiesel is better than ethanol, and it is somewhat," Dale says. "A much more appropriate basis is to compare those two fuels per acre of land devoted to production, and then the conclusion changes dramatically if you talk about total petroleum or greenhouse gases you can place per acre of cropland."
 
 With an acre of available cropland, there is the choice to either plant soybeans or devote it to corn or other ethanol feedstocks. When the question is, "How much petroleum savings or how much fossil fuel or greenhouse gases are being saved per acre of land?" the conclusion changes completely. "Now ethanol looks better, and until we get biodiesel yields up per acre, you just can't make enough of it to have an impact on our total liquid fuel use," Dale says. "We're not limited to miles driven. What we're limited in is the amount of land we can devote to these biofuels; for me, that is the more appropriate question to ask." 
 
 Nicholas Zeman is a Biodiesel Magazine staff writer. Reach him at nzeman@bbibiofuels.com or (701) 746-8385.

328-1294329458.jpg

A recently published study conducted by researchers at the University of Minnesota and St. Olaf College in Northfield, Minn., blows fresh air on the smoldering "net energy" debate for biodiesel and fuel ethanol. Ultimately, the results are favorable to renewable fuels and their ability to provide more energy than the sum of their inputs.

Defining the Balance

Despite biodiesel's status as a safe, nontoxic substance, the production process can be dangerous and should be treated like any other chemical process-with utmost precaution and care. Hazardous materials, such as methanol, can leave plants vulnerable to fire and explosion if the plants are not properly engineered and operated. In this industry, skimping on employee safety training or explosion-proof equipment could have disastrous or even lethal consequences. 

 
 Though these cautions may seem elementary, they are unfortunately necessary. Three different fires that occured in biodiesel production or storage facilities between February and July demonstrate the potential consequences. Of course, safety standards are not new to the chemical industry. Most experts agree that the standards already in place are sufficient to maintain a totally safe production facility, as is evidenced by numerous biodiesel plants in production.
 
 The safety issue is more of a matter of shortcuts being taken out of ignorance or to cut time and cost, according to Rocky Costello, professional engineer with R.C. Costello & Associates Inc., a design engineering firm. He notes that safety is most likely to be compromised in smaller, start-up plants in which entrepreneurs are trying to get into the industry at minimal costs. "Compliance costs money," he says. 
 
 "There will be future safety incidents unless buyers start asking the right questions," Costello says. The questions he suggests asking address code compliance both in preconstruction and operation (see sidebar). Because it is a relatively simple chemical process, he acknowledges the temptation to cut costs on design. However, he emphasizes that it is necessary to hire qualified, knowledgeable engineers. "Any technology can be made safe if engineered properly," Costello says. The additional cost for proper engineering and equipment will pay off-especially in the face of human error. "To correct a problem plant costs more than to design it right the first time," he says.
 
 Costello says that the effects of human error could be less serious if everything is built to code. For example, ignited methanol vapors may not have dire consequences if operators have been properly trained and appropriate fire suppression systems are designed into the plant. Clearly, being in compliance with construction codes goes hand-in-hand with compliance of personnel safety training codes. 
 
 In the overall manufacturing industry, safety training often gets put down on the hierarchy of importance, according to Robert Weston, safety professional at South Central College, a Minnesota community and technical college. "Past performance is no indicator of future performance," he cautions. "We deal with a lot of reactive, rather than proactive." Too often, an emphasis on safety is established after an accident, he adds.
 
 Weston offers various types of customized training on compliance with Occupational Safety and Health Administration (OSHA) standards. His team offers an assessment of hazards within a facility or process, and then provides training for these hazards, as required by OSHA. "Awareness is what we're looking to raise," he says. "This is our largest hurdle."
 
 Greg Dolan, vice president for communications and policy at the Methanol Institute, gives a similar message as to the importance of education and awareness. "Be aware of the properties of methanol," he says. "Once you're aware of those properties-that it is toxic-and take precautions with handling, it can be a safe and effective fuel for biodiesel production." 
 
 Safety as an Industry Priority

 Safety is especially compromised with backyard blenders, some of whom use products like blenders and electric drills, potentially creating sparks that could ignite methanol vapors. "This whole thing is just a recipe for disaster," says Paul Bloom, manager of new industrial chemicals at Archer Daniels Midland Co. Safe or not, the backyard blending trend is not losing steam. Because the ingredients are accessible and recipes are exceptionally easy to come by (especially on the Internet), many biodiesel lovers have been born.
 
 Unfortunately, the ease of production detracts from its serious nature. "I'm not sure how much guidance is provided with Internet kits," Dolan says. He notes that his organization gets calls from backyard blenders wondering where to get five gallons of methanol or where to buy feedstock. Dolan says the National Biodiesel Board (NBB) is good about providing training and resources, but he thinks the industry could be more involved. "If you want to see people [produce biodiesel] on an individual or smaller commercial basis, the industry needs to police itself and provide better guidance to these people," Dolan says, adding that a program similar to quality control program BQ-9000 would be helpful.
 
 What the industry has learned from the quality issue is that self-regulation works regardless of production capacity, and a lack of self-regulation could result in overall lost credibility with each new accident. The industry has rallied to make quality a top priority but has left production safety wanting for similar attention. The NBB will be giving more attention to safety at the upcoming National Biodiesel Conference in San Antonio, according to NBB Communications Specialist Amber Thurlo Pearson, a step that demonstrates the recognition of safety as an industry-wide issue.
 
 However, the biodiesel industry has yet to unite with a specific focus on safety, such as a working committee. Such a committee could enforce compliance with codes and act as a forum for exchanging safety suggestions, violations, remediation and investigative reports, as exists in the chemical industry. Uniting to adopt best safety practices will be on par with similar industries. For example, Costello suggests that safety violations, like fires, undergo professional investigations so that the actual cause is identified and then reported to the rest of the industry for overall safety improvements. "The chemical industry does it, the refining industry does it, and we have to do it now, too," Costello says, adding that size is not a factor for other plants in regard to compliance.
 
 Bloom agrees that the biodiesel industry should hold itself to the same standard as any other segment of the chemical industry. "All of these things have to be handled in a professional manner by people who are trained in safe methods in handling different materials," he says. "Just remember that it's a chemical operation. It's no different than if I wanted to go into my garage and start my own chemical company. I can't do that. The [U.S.] EPA would be knocking on my door and asking me for my permit. Biodiesel production should get the same type of treatment." 
 
 Anduin Kirkbride McElroy is a Biodiesel Magazine staff writer. Reach her at amcelroy@bbibiofuels.com or (701) 746-8385.

In any industry, an accident is a serious issue. More serious are repeated accidents, such as three biodiesel plant fires within six months, one which ended fatally. It is time for the industry to get serious about enforcing safety code compliance.

Getting Serious about Safety

Kline & Co. has compiled a study, titled "Global Business Opportunities in Biodiesel Fuels 2006." The company asserts that this report, which costs $44,000, provides a comprehensive analysis of the global market for biodiesel, including supply and demand, price forecasts, and economic viability assessments. Kline & Co., which began as a consultant for the chemicals industry, has grown to provide consulting services across the "full value chain."

Kline & Co. reveals biodiesel market potential

I'm writing this month's editor's note from Minneapolis, Minn., where BBI International, publisher of Biodiesel Magazine, is hosting the inaugural International Distillers Grains Conference & Trade Show (IDGC). The conference will draw more than 350 people, predominantly from the United States but also from other nations. That, by most counts, makes it the largest distillers grains event in the world, not bad for a first-time conference.
 
 If you're not familiar with distillers grains, it's the primary coproduct of dry-grind grain ethanol production. It is, by and large, an animal feed ingredient that's gaining increasing acceptance as a significant regular staple-one that is cost- and nutrient-competitive with soy meal and corn itself-in the rations of dairy and beef cattle, swine, and poultry. With the rapid expansion of the U.S. ethanol industry, distillers grains production is expected to hit 17 million tons by 2012, and perhaps 25 million tons by 2016. This massive level of production is expected to create market opportunities for the product that prompt feed manufacturers and livestock producers throughout North America and abroad can take advantage of.
 
 As the international biodiesel industry continues its fast-paced expansion, parallels can be drawn between its primary by-product and distillers grains. As you will read in this month's cover story, "Combating the Glycerin Glut," which begins on page 38, many existing and would-be U.S. biodiesel producers are grappling with business plans affected by the growth of crude glycerin on the world market. As Biodiesel Magazine staff writer Dave Nilles points out, with up to 400 MMgy of additional biodiesel production being built or on the drawing board, glycerin is becoming a big issue. 
 
 The U.S. biodiesel industry is expected to produce an estimated 1.4 billion pounds of glycerin between 2006 and 2015, and could produce as much as 200 million pounds this year alone. Where's it all going to end up? Replacing petroleum-based chemicals appears to be the real prize for glycerin producers-and the direction many industry experts say offers the best solution to avoiding a glut of product on the world market. While companies begin to commercialize technologies and processes that use biodiesel-derived glycerin for products such as polyols, dust suppressants and pharmaceutical products, another more basic use for the by-product is emerging. 
 
 As the article points out, the floor value of any material can be determined by the point at which it can be used as an energy source. The same thing has been discussed in the distillers grains business for years, and people are still talking about burning the ethanol coproduct to supplement ethanol plant power. Of course, burning distillers grains and glycerin is a sort of last resort that is best avoided, and that's precisely what the ethanol/distillers grains industry is trying to accomplish with events like the IDGC. 
 
 The conference is expected to become an annual forum for industry stakeholders to learn about and discuss distillers grains marketing, process technology, analytical measurement and terminology, and animal feed nutrition-as well as non-feed applications for the product. It's all about bringing end users, producers, marketers, animal health professionals, researchers and service providers together to network and build valuable new relationships in a booming young business. I can clearly envision a future event that seeks to accomplish the same thing for glycerin. I'm not sure if that will happen in the near-term, but in the meantime, we should embrace industry events that shine a spotlight on glycerin market development. It's an issue that's not going away.

The industry needs to make glycerin market development a top priority

Editor's Note

Iowa's largest petroleum pipeline and terminal company, Magellan Midstream Partners LP, is adding biodiesel storage and blending capabilities to its Mason City, Iowa, petroleum terminal. The $1 million project, which could be finished by late 2006, would be the state's first terminal capable of blending biodiesel, offering B2 to B20 blends at the rack. The project will help meet Iowa's new renewable fuels standard, which requires 25 percent of the state's petroleum supply to be renewable fuels by 2019.

Iowa biodiesel infrastructure expands

According to Home Farms Technologies USA Inc. (HFTU), a U.S. subsidiary of Manitoba, Canada-based Home Farms Technologies Inc., it will be supplying FUMPA Biofuels, a 2.8 MMgy biodiesel plant in Redwood Falls, Minn., with process steam energy obtained from a municipal solid waste (MSW) gasification system. HFTU is building the $35 million system adjacent to the biodiesel plant. It will use waste collected from southwestern and south-central Minnesota, including metro-Minneapolis. The system will be owned by an independent company.

FUMPA to use process steam from MSW

In response to high gas prices, President George W. Bush asked the U.S. EPA to submit a report on improving fuel-supply decisions between federal and state governments, along with reducing the number of boutique fuels. The EPA's report gives the president an optimistic outlook on U.S. fuel distribution capacity, stating current infrastructure can handle a variety of boutiques, save any major supply disruptions. Additional information can be found in the complete report at <a target="_blank" href="http://www.epa.gov/OMS/boutique/resources/bftf62306finalreport.pdf">www.epa.gov/OMS/boutique/resources/bftf62306finalreport.pdf</a>

EPA submits boutique fuels report to President Bush

The Canadian government is developing a strategy to increase the production of biofuels with CAN$11 million in funding initiatives. Canada is planning to spur biodiesel production at local or "grassroots" levels by providing the means necessary to conduct business proposals and feasibility studies. Canadian Minister of Agriculture Chuck Strahl announced in July that the Biofuels Opportunities for Producers Initiative was designed to ensure the greatest possible benefit to the agricultural community from biofuels manufacturing. For more information, contact the Canadian Ministry of Agriculture at (613) 759-1000.

Canada offers funding for biofuels projects

Australian Biodiesel Group Limited (ABG) announced that production began at a more than 42 MMgy biodiesel plant located in a suburb of Brisbane, Australia. The Narangba Production Facility is the largest operational biodiesel plant in Australia, according to Brian Stewart, ABG corporate affairs manager. Animal fat is its main feedstock. The company also operates a 10.5 MMgy biodiesel plant north of Sydney. ABG is currently working on project proposals in the United States and Canada, Stewart said.

Production begins at second ABG facility

Canadian company moves forward on biodiesel plant Canadian Bioenergy Corp. is working on plans to build a 30 MMgy biodiesel plant in Alberta, Canada, according to President Ian Thomson. The company signed a property purchase agreement for 12.5 acres of land located next to Bunge Canada's oilseed crushing and refining plant near Fort Saskatchewan. Under an agreement with Bunge Canada, Canadian Bioenergy will complete a feasibility study for the project. The plant's feedstock will be canola, which it will obtain primarily from the Bunge facility, Thompson said.

Canadian company moves forward on biodiesel plant

The biodiesel industry is poised to enter a new era as the nation calls for alternatives to foreign oil. While biodiesel production currently represents only a fraction of the nation's distillate fuel supply, a number of emerging factors may transform biodiesel from a boutique fuel for niche operations into a mainstream fuel used by millions of Americans. Four factors that will have the greatest impact on the industry are:
 
 -New sources of oil
 -Penetration of retail channels

 -Consumer education
 -Conversion of capacity
 
 The most important factor, and one that is seen as the greatest threat to large-scale biodiesel production, is the possibility of feedstock shortages. Biodiesel was initially seen as a remedy for large soybean-oil stocks and low soybean prices. The question now is whether there will be enough feedstock to satisfy demand. Unfortunately, at year's end, nearly 750 million gallons of potential oil will be sitting in storage, never extracted from the soybean. According to the USDA, another 250 million gallons of soybean oil will be sitting in commercial storage. If the industry grows at projected rates, however, a feedstock shortage is a distinct possibility over the next two to four years. To address this risk, project developers are increasingly considering the addition of extraction capacity, along with the development of feedstock sources other than soybean oil, the dominant source of today's most common feedstock. 
 
 Secondly, biodiesel will need to enter broader markets to absorb increased supply, which won't happen until biodiesel is absorbed into the mainstream retail market. Biodiesel production has grown over 100 percent per year for the past five years, surpassing expectations. Unlike ethanol, biodiesel can go into virtually any diesel engine. Despite the ubiquitous nature of biodiesel, it has yet to enter broader market channels. Fortunately, evidence suggests that biodiesel is on the cusp of reaching the mass market. At current petroleum prices, biodiesel is certainly capable of competing on price, and that is drawing interest from retail distributors. This trend should accelerate, as the industry better understands the dynamics of the fuel industry and how the price at the pump is calculated. New mechanisms are currently being developed to overcome the dichotomy between agricultural-based price risk management systems and historical fuel industry pricing strategies. This new model should allow increased revenues to flow through to distributors when fuel prices are high, and less revenue when feedstock prices increase. This model will allow biodiesel to maintain more consistent and competitive pricing in the largely untapped retail market. 
 
 The third factor is consumer education. The industry must continue its aggressive approach to education on the benefits of biodiesel. Biodiesel is the most versatile biofuel, and it possesses extremely high levels of utility. While industry veterans are familiar with the advantages and disadvantages of biodiesel's natural solvency, new biodiesel users may not know, for example, that regularly changing fuel filters is a necessary and not overly inconvenient step when using biodiesel. Continuing education on storing, handling and using biodiesel will be critical to the industry's long-term development.
 
 Finally, the factor that may have the greatest impact on the industry (in addition to fuel price) is the conversion of existing production capacity. We know that foreign competition continues to negatively impact the chemical and pharmaceutical industries in the United States. Chemical companies closed approximately 70 U.S. facilities in 2004 alone, primarily as a result of inexpensive foreign labor and high domestic natural gas prices. While the past decade has been hard for U.S. industries, a substantial amount of the idled capacity could be transformed into biodiesel production. While there are environmental and other issues that would need to be addressed in converting this existing capacity to biodiesel production, the conversion trend is already beginning.
 
 Kenneth "Pete" Moss is vice president of marketing services for FBA Consulting. With more than 18 years of professional experience in oilseed processing, biodiesel commercialization, marketing, business planning and financial analysis, he has a comprehensive understanding of the biodiesel industry, including feedstock availability, product value analysis and by-product streams.

Four factors that will transform the biodiesel industry

Legal Perspective

The 64 farmer-directors of the United Soybean Board (USB) met in Baltimore in July to discuss priorities for the next year. The group plans to continue to increase the quality, availability and use of soy-based biodiesel; support was encouraged by an 11 percent increase in biodiesel use among soybean farmers last year. "We continue to build momentum for our industry through efforts such as biodiesel promotion, support for the livestock industry and partnerships with the soybean industry," said USB Chairman Curt Raasch.

USB vows to pursue biodiesel at checkoff meeting

In mid-July, a modular biodiesel refinery designed by Lurgi Pacific was shipped to Natural Fuel Australia Ltd. in Darwin, Northern Territory, to facilitate a September production start. The AUS$11 million refinery was constructed at the Australian Marine Complex (AMC), located near Perth, Western Australia. "Given the challenging site conditions in Darwin, Natural Fuel Australia decided to take advantage of the common user facility at the AMC," said Western Australia's Science and Innovation Minister Francis Logan. Natural Fuel has three other projects under development in Houston, Texas; Singapore; and Port Botany, New South Wales.

Natural Fuel Australia ships modular biodiesel refinery

An event that industry officials called "significant" occurred quietly in late July. Countrymark Co-op, a petroleum refining and marketing company, successfully moved B5 through the company's private carrier pipeline system. 

 
 This is the first time a company has announced moving B5 through a pipeline that carries gas, diesel and heating oil, according to Steve Howell, National Biodiesel Board (NBB) technical director. The NBB considers it a win for everyone. "This represents the next step toward full integration of biodiesel into the nation's transport system," he said. "It will make biodiesel more cost effective, since pipeline transfer is the most effective way to transport fuel."
 
 A total of 210,000 gallons of B5 traveled through the 238-mile pipeline for 72 hours, according to Dennis Reynolds, manager of pipeline and terminals for Countrymark. The pipeline runs from the company's Mount Vernon, Ind., refining complex to a central Indiana terminal.
 
 Currently, Countrymark transports its biodiesel by truckload. If the company could receive larger volumes of biodiesel at its refining facility-by rail or barge-and transport it through the pipeline, it will help reduce transportation costs, Reynolds told Biodiesel Magazine. 
 
 The company has a continuing commitment to distribute biodiesel. Part of that commitment is making sure the biofuel is integrated into the liquid fuel distribution system, including its pipeline, said Jon Lantz, vice president of supply and marketing for Countrymark. For now, though, the company will go back to transporting biodiesel by truckload. "At this point in time, it was a one-time thing as we're evaluating our options to distribute biodiesel in our system," he told Biodiesel Magazine. 
 
 Reynolds also talked about Countrymark's commitment to transporting homegrown biofuels. As the biofuels industry grows, the company wants to be prepared to handle that growth in an efficient and economic way. "We want to be a leader in … Indiana and the surrounding area, the market we serve," Reynolds said. 
 
 Countrymark had every confidence that the trial run of B5 through the pipeline would go well. However, the company wanted to make sure there were no adverse effects to either the B5 or the fuel coming down the pipeline after it. Samples were pulled from the load before and after the B5 entered the pipeline. In-house testing confirmed that the company was able to maintain fuel quality. "At this point, we feel it's a success from our end," Reynolds said. "We are waiting on independent lab tests to back this up." 
 Analysis from the independent lab will demonstrate whether fuel and transportation specifications were met, Lantz said. One of the things the lab will examine is if there is any "trail back," or biodiesel residue, left in the pipe. "We don't anticipate any issues," he said. 
 
 Countrymark, a farmer-owned co-op, has been distributing biodiesel through its terminals for four years. The company operates Indiana's only 100 percent American-owned refinery, which is supplied by 100 percent American crude oil from the Illinois Oil Basin.
 
 Transporting B5 through its pipeline isn't the company's only biofuels feat, Lantz said. In 2004, the company was the first to use rack injection, a computer-controlled system, to blend biodiesel with diesel as it was loaded into a truck. This system accurately and efficiently creates B2, B5 or B20 blends, depending on what the customer wants, Lantz said.

Countrymark Co-op stores biodiesel fuel at its Jolietville, Ind., loading terminal, shown above. The company has been distributing biodiesel through its terminals for four years.

314-1294329452.jpg

Countrymark Co-op moves B5 through private pipeline

Three Ohio metro transit authorities have made the switch to biodiesel blends, ranging from B20 to B90. Though each authority had different motives and a different method, they all indicated that biodiesel's positive effects on maintenance and fuel expenses could ensure the fuel's long-term use.

 
 This summer, two transit authorities that serve the metro areas of Columbus and Cincinnatti, used blends as high as B90 and B75, respectively. After Hurricane Katrina, quality diesel became scarce, leading both groups to search for a dependable alternative. The $1-per-gallon blender's tax credit allowed them to use biodiesel at a cost equal to or lower than the cost of low-sulfur diesel. They also ensured supply and cost stability by securing long-term contracts for biodiesel from local producer Peter Cremer North America (PCNA).
 
 Southwest Ohio Regional Transit Authority (SORTA), which has a 390-bus fleet that serves 22 million riders per year in the Cincinnati metro area, first used B30 in 1993. "Cost was the only reason that kept us from running biodiesel," said Chief Communications Officer Sallie Hilvers, of the $4-per-gallon rate. Today, Hilvers said the price is comparable to petroleum diesel. SORTA used blends up to B75 this summer but will eventually go with a standard B50 blend in the summer and B20 in the winter. SORTA uses 3.6 million gallons of diesel per year, and has contracted with PCNA for 1.3 million gallons next year.
 
 After seeing SORTA use very high biodiesel blends without incident, the Central Ohio Transit Authority (COTA) followed suit. COTA averages 15 million rides per year on its 234 buses in the Columbus metro area. Don Makarius, director of vehicle maintenance and engineering, developed a blend strategy based on the area's mean temperatures. In the winter, it will use B20; B50 will be used in the fall and spring, and B90 will be used in the summer. This rate means that biodiesel will make up 54 percent of fuel consumed, or 1.2 million gallons, according to Makarius.
 
 COTA had maintenance issues with the injectors, which may have been due to the change in fuel density, Makarius said. To study this and other issues regarding biodiesel use in a transit fleet, COTA is collaborating with a team from The Ohio State University, as well as the National Transportation Research Board on a similar study. COTA is also doing an in-house study to extend oil changes. "I think we can reduce operating costs by reducing the amount of times we change oil and use our labor elsewhere," Makarius said. He predicted that big savings would be evident compared to ultra-low-sulfur diesel, which will cost an additional 20 cents per gallon over low-sulfur diesel. 
 
 The third transit authority, Toledo Area Regional Transit Authority, is halfway through the first year of its three-year testing program, which Biodiesel Magazine first reported on in April ("A Real Biodiesel Insider", April 2006). It is in the process of measuring biodiesel's long-term effect on maintenance costs.

Ohio metro transit systems utilize high biodiesel blends

In July, Western Dubuque Biodiesel LLC broke ground on its 30 MMgy turnkey biodiesel refinery in Farley, Iowa. The site puts the plant near Iowa's borders with Wisconsin and Illinois, approximately 20 miles from the Mississippi River.
 
 Construction of the large-scale turnkey plant is in full swing, confirmed Ed Recker, on-site project coordinator. Steger Construction began moving dirt as Schneider Surveying set grade stakes in mid-July. The official groundbreaking ceremony was held later that month, according to Renewable Energy Group (REG), which will design and build the facility. 
 "A storm blew through about three hours before the ceremony," Recker said, which grounded planes that some of Western Dubuque Biodiesel's invited guests were going to fly on. The plant's sign blew over as a result of the storm, he added, meaning even those who made it to town may not have been able to find the site. Luckily for those who were able to attend, the weather cleared up before the start of the ceremony. 
 
 As of July 31, near press time, crews continued to put up forms, and pour footings and walls for the process building, Recker verified. Western Dubuque Biodiesel plans to use soy oil as a feedstock, initially and primarily. After the plant begins production, Recker said it may be equipped to process other feedstocks, like animal fats. 
 
 As of early August, Recker told Biodiesel Magazine that Western Dubuque Biodiesel was still in negotiations with REG over biodiesel and glycerin marketing arrangements, so no deals had been cemented yet at that time. Recker also said with certainty that BQ-9000 certification is definitely a priority for the future biodiesel producer. 

 
 "Western Dubuque Biodiesel is responding to the overwhelming demand for biodiesel," said Monte Shaw, executive director of the Iowa Renewable Fuels Association. "This project is proof that locals can work together to develop and build a world-class biodiesel refinery. Iowa is clearly at the heart of this movement." Western Dubuque Biodiesel's anticipated start-up date is June 30, 2007.

Construction starts at Western Dubuque Biodiesel

In Pennsylvania, there is a growing interest in producing and using biodiesel, and projects are currently underway to increase the state's capacity as it looks to become more involved in the renewables fuels industry. 
 
 The Erie Management Group (EMG) of Erie, Pa., is retrofitting a site abandoned by the International Paper Company for biodiesel production. Brad Davis, president of Lake Erie Biofuels, of which EMG is the principal investor, told Biodiesel Magazine that nearly 2,000 jobs were lost when the paper mill was closed. "This is the beginning of the redevelopment of the entire industrial park," he said.
 
 Construction of Lake Erie Biofuels began at the brownfield site in mid-July, but the company hasn't held a ceremonial groundbreaking yet. "Everything has been razed," Davis said. "None of the existing structures could be used [for the biodiesel plant], except for the foundations." A crew is currently on-site from Benham Constructors of Oklahoma City, which is charged with building the 45 MMgy facility. Process technology will be provided by De Smet Ballestra of Great Britain. Davis estimated that the plant will begin producing biodiesel in August 2007. 
 
 "This is the first of several projects for the old industrial park, where the old mill [occupied] 200-plus acres," Davis said. "We're obviously not using that much for the biodiesel plant, and there is plenty of room for other industries to come in. There might be other projects with renewables, with new technologies on the site."
 
 In Shiremanstown, Pa., Keystone Biofuels, the state's first biodiesel producer, is looking to expand less than a year after its start-up. "The [equipment] is basically on order with Pacific Biodiesel," said Race Miner, president of Keystone, which is managing the construction project on its own. "We're putting new tanks in the ground in September and plan on being complete by December. We're putting in additional storage capacity right now. We do all of the auxiliary work, and the actual processing equipment is being [installed] by Pacific Biodiesel." The capacity of the plant will be 6 MMgy when the project is complete. 
 
 Currently, Keystone Biofuels directly markets its own biodiesel and also works with several petroleum distributors in the region. "The decision to expand was based on the fact that we put in the initial 1 MMgy to 2 MMgy facility and we sold out within the first three months of production capacity," Miner said. As capacity is added, Keystone is also looking to refine its glycerin into a marketable product, instead of disposing of it. "Right now, we pay to have [glycerin] removed," Miner said.

Biodiesel plants in Pennsylvania plan construction, expansion

Archer Daniels Midland Co. (ADM) announced plans to build a 54 MMgy biodiesel plant in Brazil, according to a press release. It will be the agribusiness giant's first biodiesel plant in that country. 
 
 The production facility will use soy oil as its feedstock. The site is in Rondonopolis, Mato Grosso, "strategically located" adjacent to an existing ADM soy crushing facility, which allows ADM to maximize synergies between the company's origination, transportation and processing operations in Brazil. 
 
 "The Government of the State of Mato Grosso recognizes the importance of renewable fuels, and we are pleased that ADM, a world leader in bio-based fuels, has chosen our state to build its first Brazilian biodiesel plant," said Mato Grosso Gov. Blairo Maggi, in a prepared statement.
 

 Depending on final engineering and permit approval, the plant is expected to be producing biodiesel in the first half of 2007. This is excellent timing, considering Brazil recently passed a nationwide biodiesel mandate. Beginning in 2008, all diesel sold in Brazil must contain 2 percent biodiesel, and by 2013, it increases to 5 percent, according to the press release. 
 
 The decision to pursue biodiesel production in Brazil may have had a last-minute effect on the company's record annual earnings, released a few days after the Brazil project was announced. The company said its net earnings for the year ending June 30, 2006, increased 26 percent to $1.31 billion. Its segment operating profit, including oilseed processing and corn processing, for the fourth quarter increased 82 percent. ADM said oilseed processing market conditions improved in all geographical areas, while corn processing profit increased due to improved ethanol and sweetener selling prices and volumes.

ADM announces its first Brazilian biodiesel plant

Las Vegas' skyline is ever-changing with older casinos and resorts coming down only to be replaced by larger and more extravagant buildings. A similar approach is being undertaken by the city's biodiesel plant.
 
 Biodiesel of Las Vegas is nearing the start of construction on a new 30 MMgy biodiesel plant on the city's outskirts. The new plant, which will eventually be ramped up to 60 MMgy, is expected to come on line as Biodiesel of Las Vegas' current 5 MMgy is shut down. The existing plant has been in operation for more than four years, according to Biodiesel of Las Vegas' Ben Kulick.
 
 The new plant will be located on a rail line near Nellis Air Force Base. Kulick said permits have been submitted to the city's planning commission. With the plant site near federal air base property, there isn't concern over Las Vegas eventually surrounding the plant, Kulick said.
 
 Lack of space and the strengthening of demand are the main reasons behind building a new plant. Kulick said the region's biodiesel demand is in the 10 MMgy to 15 MMgy range. The city currently has over 5,000 vehicles running on biodiesel daily.
 
 The new plant's site was previously used for loading and unloading railcars. Kulick said much of the needed infrastructure is already in place, although a tank farm and process building would be installed.
 
 Feedstock supply isn't an issue in the Las Vegas area, according to Kulick. The current plant uses a variety of feedstocks, but one of the most plentiful is the waste vegetable oil produced from the city's hotel industry.
 
 Kulick told Biodiesel Magazine that the company is planning to sell the existing facility, and several companies have inquired about purchasing and moving the plant. Kulick also said Biodiesel of Las Vegas will now offer turnkey biodiesel plant packages.

Las Vegas plant to be replaced by larger facility

Food or fuel? Can both of these "addictions" be satisfied by the U.S. and world agricultural producers? The pressing question -"Can agricultural production and processing create a sustainable solution on both the energy and food fronts?"-is one of the drivers that led to the development of the forward-thinking Soya Summit program held Sept. 18-20 in St. Louis.
 
 Biodiesel Production
 Though much smaller than the booming ethanol industry, the biodiesel processing industry is growing rapidly. There are currently 65 biodiesel production facilities in the United States, with an aggregate production capacity of about 385 MMgy. As of today, an additional 58 biodiesel plants are under construction-a number that includes eight expansions of existing facilities-that will bring another 718 MMgy on line. Between lists from the National Biodiesel Board and Biodiesel Magazine, there are 84 more planned projects (i.e., not yet under construction) that would add 1.9 billion gallons per year to installed and under-construction capacity. This brings the total of installed, under-construction and planned capacity to 3 billion gallons per year. While it is unlikely that all this planned build-out will occur, my colleagues and I at Soyatech expect that total biodiesel capacity will nevertheless reach 1.5 billion gallons by the end of 2008. 
 

 A number of factors are driving the consumption of biodiesel: instability in the Middle East, federal government policies, state-level clean air and fuel efficiency mandates and incentives, and an anticipated dramatic increase in the global use of diesel light vehicles. We expect that these factors will contribute to an increase in U.S. consumption of biodiesel to approximately 2.1 billion gallons by 2015. 
 
 Pressing Questions
 While all this may be good news for biodiesel producers, it raises questions as to the future availability of feedstocks used to produce biodiesel. In order to supply this market, a major realignment of agricultural resource distribution will clearly be needed. This raises a critical issue: How will this resource competition affect the price and availability of food? Is this a sustainable solution, or are other measures-perhaps a drastic conservation effort-also required?
 
 Soyatech projects that by 2015, up to one-third of U.S. soy oil output may go toward biodiesel production. What impact will this change in distribution have on the food industry? What alternative sources or types of feedstocks are available to biodiesel producers? How much of this will be domestically produced versus imported from the next energy superpower? Now is the time to begin to address these challenges and to develop a shared vision that meets all of the world's needs for both food and energy.
 
 At Soya Summit 2006, thought-leaders from the food and biofuels industries gathered to discuss strategies for dealing with the emerging potential for resource competition facing these two industries. Theconference, developed and coordinated by Soyatech LLC, featured expert presentations in two separate tracks-food and energy-with the objective of informing professionals in both industries about issues regarding supplies, distribution, new processing technologies, relevant government policies, new products, successful marketing strategies and other related topics. There was also a number of workshops, including "Evaluating Biodiesel Investments: It's More Than Numbers" presented by Scott McDermott of Ascendant Partners, and "Green Marketing 101: The Crash Course" presented by noted green marketing expert Jacqueline Ottman.
 
 Biofuels represent an exciting opportunity not only for companies and their investors, but also for the environment, our nation's economic future, security and the development of a new vision that recognizes that a balanced approach to bio-based living is a requirement for sustainability. 
 
 Peter Golbitz is the president of Soyatech LLC, a market research, consulting and publishing firm serving the soybean and soyfoods industries. Unless otherwise noted, the projections in this article were sourced from "Biofuels 2006: Production, Supply and Reality," a report recently released by Soyatech LLC and HighQuest Partners LLC. To receive a copy, call Soyatech at (978) 887-8800. For conference proceedings, visit <a target="_blank" href="http://www.soyasummit.com">www.soyasummit.com</a>.

Talking Point

Expected to build one of the largest biodiesel plants in the United States, Imperium Renewables has selected a site for construction of Grays Harbor Biodiesel on land owned by the Port of Grays Harbor between Aberdeen and Hoquiam in western Washington.
 
 At press time, a groundbreaking ceremony was expected to be held in September. It will take about 10 to 12 months of construction before the 100 MMgy facility starts production. "This site fits a model of what we were looking at with good logistics for the transportation of all our feedstock and finished product," said John Plaza, president of Imperium Renewables. 

 
 The company's first plant, the 5 MMgy Seattle Biodiesel, brings feedstock in by rail, and biodiesel is moved out by truck. "We have been bringing in feedstock from the Midwest and Canada, but if we can take advantage of any feedstocks in Washington, we certainly will," Plaza said. "We also will be looking at other various feedstocks from around the world, but we certainly are going to have to have use soy oil and canola."
 
 Grays Harbor Biodiesel is located in a community with both work force and resources transitioning away from involvement in the forestry industry-especially the paper and pulp sectors-into green energy endeavors. These days, there are interesting projects happening with renewables in Grays Harbor, Plaza said, involving electricity and the utilization of wood wastes to generate power. It is also a community where the development of new industry is necessary to sustain its vitality. "Our projects, of course, are ways that we can revitalize a community that has lost a lot of jobs, with the paper and pulp industry sort of leaving the United States and going to other countries," he said. 
 
 In several projects around the United States, the biodiesel industry has been assimilating the infrastructure that has been either vacated or deserted by the forestry and paper industries. "We are reinvigorating the community with the new green technologies and encouraging others to become such as an ethanol producer," Plaza said. "We feel it is such a perfect spot for this transition. This is a greenfield site in a region that has been traditionally paper/pulp."

Imperium Renewables starts construction in Washington

Mid-Atlantic Biodiesel doesn't lay claim to the "Biodiesel Capital" of the United States, but it very well could. The Clayton, Del., facility is in the midst of starting up near two state capitals and Washington, D.C.
 
 The 5 MMgy plant, which at press time was expected to start up in late August, is the state's first commercial-scale biodiesel facility. Mid-Atlantic Biodiesel is just 15 miles north of Dover, Del., and 60 miles northeast of Annapolis, Md. Another 33 miles farther west of Annapolis is the nation's capital.
 
 De Smet Ballestra did the process design for the project while Fagen Inc. oversaw construction. The plant is Fagen's first biodiesel project to reach start-up. The Granite Falls, Minn., company is one of the nation's leading fuel ethanol facility builders.
 
 Wes Berry of Process Technology Associates was a consultant on the process design. In early August, he said the plant was going through "the usual start-up routines and calibrations." Berry said the plant will start up using soy oil as a feedstock, but is designed to handle virgin and used vegetable oils.
 
 The plant has been touted by the Delaware Soybean Board as a way to boost the area's soy prices. "The biodiesel demand continues to grow," Delaware Soybean Board Chairman Jeff Allen said. "The demand is there. We just need to get the supply." 
 
 Massachusetts-based World Energy will market the plant's biodiesel. New Hampshire's New Energy Capital invested in the project. "We think it's an excellent project," New Energy's Dan Reicher said. "It's a project with a lot of strengths-technology, location, feedstock availability and many other factors." 
 

 Reicher said there was plenty of political support for the project at the state and local level. That was apparent even before a shovel went in the ground. Delaware Gov. Ruth Ann Miller attended the ceremonial groundbreaking of the facility, which was held in June 2005. "As a renewable energy source, biodiesel will decrease our reliance on fossil fuels and increase our energy security," Miller said at the event. "With volatile fuel prices and instability in the Middle East, supporting a homegrown alternative fuel like biodiesel is the right thing to do."
 
 Those sentiments were heard clearly just 90 miles away in Washington, D.C., when shortly after the plant's groundbreaking, the Energy Policy Act of 2005 was signed into law.
 Biodiesel is catching on quickly in the area. With the aid of the Delaware Soybean Board, the state fair used 18,000 gallons of B5 in its equipment in July. More than 200,000 people attended the event. "It was a great promotion for biodiesel," Allen said. 
 
 Indian River Marina at Delaware's Seashore State Park began using B20 in early 2005. It was the first mid-Atlantic marina to begin using biodiesel and offering it to government and public entities.
 
 De Smet and Fagen continue to ease Mid-Atlantic Biodiesel through its start-up. "While we have had our typical construction and start-up issues, both [companies] have been outstanding to work with, and I look forward to a long working relationship with them," Mid-Atlantic President Marty Ross told Biodiesel Magazine.

Mid-Atlantic Biodiesel gears up for production

Biodiesel production is a natural match for two brothers who own a construction company and whose father worked in alcohol production. Thanks to production incentives in the Energy Policy Act of 2005, Jeff and Joel Dwire were able to fund American Agri-Diesel, which started production Aug. 1 in Burlington, Colo. 
 
 Jeff Dwire told Biodiesel Magazine that Burlington was the only place in Colorado where ideal factors fell into place, including rail access, room to expand, the ability to zone correctly and sufficient agricultural land for feedstock production. Rail access was a particular challenge. "When we could find a site, the rail didn't want to service it, or they would service an area that wasn't good enough," Dwire said. Getting local farmers on board also took some time. The plant is using locally grown soy, and is also capable of using sunflower and canola oil.
 
 The construction process went smoothly once the site was selected, Dwire said. "A lot of the stuff was ready to go, so it didn't take long," he said, adding the tanks and other equipment were preordered before the location was finalized.
 
 The brothers' construction company, Dwire Earth Moving and Excavation, will use at least 2 MMgy of the plant's biodiesel. The rest will be marketed through an undeclared biodiesel broker. The glycerin will also be marketed through a broker, which had not been determined at press time.
 
 American Agri-Diesel has plans to expand this facility and also build at other locations. "This is a small test facility," Dwire said. "If this goes well, we expect to increase the capacity by 10 times." He stressed that markets will determine how much and how soon they will expand. To influence markets and "kick-start the industry," Dwire would like to see renewable fuel legislation, such as a B2 requirement, passed in Colorado and nationwide.

American Agri-Diesel starts production

A large-scale biodiesel plant is under development in the Volunteer State: Memphis Biofuels LLC. The refinery is being built on a brownfield location that houses existing, applicable equipment for the manufacturing of biodiesel. 
 

 "It's a former Proctor and Gamble oil processing facility," said Brandon Sheley, manager of sales, marketing and feedstock procurement for Memphis Biofuels. Soap-stock acidulation was also done there at one time. One million gallons of usable, on-hand storage capacity will be available for Memphis Biofuels to utilize. 
 "We're adding about another half-million gallons of storage capacity," said Sheley, who added that distillation columns need to be built, too. "Other than that, there's not a lot of equipment being added."
 
 Memphis Biofuels is permitted up to 36 MMgy of biodiesel production, and that's how much capacity the plant will produce once construction and initial start-up tests are complete. The pumps and equipment have been sized to refine up to 50 MMgy, according to Sheley. 
 
 "The plant sits on 17 acres," he told Biodiesel Magazine. Memphis Biofuels' biodiesel production is only going to require a five-acre footprint, leaving 12 acres open for further development. "We'll have the ability to expand capacity up to 100 million gallons a year," Sheley said.
 
 Five pre-existing rail spurs are on-site, and the plant will be capable of handling 70 railcars at a time. The plant's primary feedstock for producing mono alkyl esters will be soy oil, but additional vegetable oils and animal fats are planned for use, too. Tennessee doesn't have any major soybean crushers, according to Sheley, so the future producer will be railing its primary feedstock in from out-of-state. Nearing press time, biodiesel and glycerin marketers were not yet finalized.
 
 Memphis Biofuels' facility will house a laboratory, where most of its BQ-9000 testing will take place. A consultant has been hired to help management and staff members get through the accreditation process, which is already underway. 
 
 The local community is excited about reinvigorating this site for biodiesel production, Sheley said. The plant is located in an industrial part of town that's lost its vitality in recent years.

Memphis Biofuels is retrofitting a brownfield site, formerly a Proctor and Gamble oil processing facility.

317-1294329453.jpg

Memphis Biofuels begins site work

The "dog days of summer" have arrived in Washington, D.C., bringing sweltering heat and Congress' annual August recess period. Very little legislative activity occurs during this time, so it gives us a good opportunity to reflect on what has happened to date and what we might expect for the balance of this Congress.
 
 With the return of Congress in early September, there will be less than 20 "legislative days" on the calendar prior to Congress' anticipated adjournment for the year. With the short number of those days remaining and the fact that this is an election year, we do not anticipate much movement in the way of substantial, far-reaching energy- or tax-related bills. 
 
 However, the National Biodiesel Board (NBB) and the biodiesel industry have aggressively pursued an extension of the volumetric blenders tax credit this year-our top legislative priority. Several bills have been introduced in this regard, including:
 -S. 2401: Introduced by Sen. Chuck Grassley, R-Iowa, and Sen. Max Baucus, D-Mont., chairman and ranking member of the Senate Finance Committee (in charge of tax writing), this bill extends the credit an additional two years through 2010.

 -H.R. 5650: Introduced by Rep. Kenny Hulshof, R-Mo., and Rep. Earl Pomeroy, D-N.D., members of the House Ways & Means Committee (in charge of tax writing), this bill provides for a permanent extension of the tax credit.
 
 Even though the likelihood of an energy/tax package moving this year is small, we will continue to work with stakeholders to build support for these measures. We remain vigilant in our efforts to exhaust every opportunity to realize an extension yet this year.
 
 Completion of the annual appropriation bills will be a priority for Congress. They must complete work on these before leaving for the year. Considerable work remains to be done, including completion of two bills containing biodiesel-related priorities. H.R. 5384, which addresses agriculture appropriations, provides funding for the USDA National Biodiesel Education Program, which has been instrumental in helping raise public awareness of biodiesel from 27 percent in the summer of 2004 to 41 percent in December 2005. Additionally, the NBB, in working with our Senate industry champions, has been able to have $1.5 million inserted as part of the Senate Appropriation Committee's version of H.R. 5427, addressing energy and water appropriations. This funding for critical testing with advanced engine technologies was authorized as part of the Energy Policy Act of 2005.
 
 As our industry grows, so does the list of regulatory and legislative issues impacting our industry. These are but a couple of critical areas for the industry that we will be focusing on for the remainder of this Congress.

NBB Insight

In a rising tide of support for increased fuel quality, Huish Detergents has become the eighth accredited producer under the BQ-9000 voluntary quality control program. BQ-9000 is a cooperative and voluntary fuel quality program adopted by both the National Biodiesel Board (NBB) and the Canadian Renewable Fuels Association that helps achieve the highest level of quality assurance in the biodiesel industry. "We are pleased to now be an accredited producer of biodiesel under the BQ-9000 program," said Evan Frampton, senior vice president of Salt Lake City-based Huish Detergents. "The reason we sought out this distinction is because Huish Detergents has a reputation as a quality producer of household cleaning products, and we want to have the same reputation with our production of biodiesel. In markets where purchasers have a choice, they will go with the product that leaves no room for error." Seven other producers are accredited under the industry's voluntary quality control program, and many others are in the accreditation process. Peter Cremer North America in Cincinnati, Ohio; West Central/Renewable Energy Group in Ralston, Iowa; Johann Haltermann Ltd. in Houston, Texas; Arkansas Operations Eastman Chemical Company in Batesville, Ark.; Imperial Western Products in Indio, Calif.; Ag Processing Inc. in Omaha, Neb.; and SoyMor of Albert Lea, Minn., have also achieved this designation. Currently, Peter Cremer North America is the only certified marketer. The BQ-9000 program includes an audit of the companies that apply. The audits ensure the companies follow proper procedures for fuel storage, handling and management. 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. Even if fuel is produced in accordance with BQ-9000 and meets spec when it leaves the plant, poor handling of the fuel can lead to trouble. That is why it is equally as critical for distributors to become certified marketers as it is for producers to be accredited.
 
 The BQ-9000 program is open to all companies that distribute, market or produce biodiesel, either in its pure form or for use in blending with petroleum diesel fuel in North America. More information on the BQ-9000 program is available at www.BQ-9000.org. More information on Huish Detergents can be found at www.huish.com.

Huish becomes part of growing industry standard for quality

One of the industry's pioneer biodiesel producers has announced a company makeover and the largest planned biodiesel expansion in the history of the industry. In August, Renewable Energy Group Inc. (REG) announced the completion of a $100 million private equity financing and two new strategic partnerships. The company has said its overall biodiesel production will reach approximately 640 million gallons by 2009, including third-party plants. 
 
 Recently, Iowa-based West Central combined all of its biodiesel-related products and services under REG. Although West Central still operates as a farmer-owned cooperative in Ralston, Iowa, as of Aug. 1 all biodiesel-related activities at the company moved under the umbrella of REG. REG is comprised of a network of wholly owned and third-party managed biodiesel plants. It will use the new capital and strategic partnerships to expand this network. Its strategic partners, Bunge and ED&F Man Holdings Ltd., will aid REG and its third-party partners in securing an efficient and consistent supply of raw materials, as well as offer advantages in site locations, risk management and logistics expertise.

Iowa biodiesel company announces historic expansion

The National Biodiesel Board (NBB) has assisted various bands who have been rolling-and rocking-on biodiesel over the years. Here are some of the current "bands on the bean:" 
 
 Vans Warped Tour-The Vans Warped Tour, www.warpedtour.com, is a traveling rock music festival visiting 50 cities in 60 days, with eight or nine stages, 70 to 80 bands and an extensive village, all operated by 700 crew members and artists. Despite the enormity of energy needs to operate this, the tour is lessening its impact on the environment through the use of biodiesel, and through other measures. At the end of the first month of this summer's tour, direct carbon dioxide was reduced by 134,706 pounds through the use of 41,780 gallons of B2O. 
 

 The Black Crowes-The NBB helped the Black Crowes, www.blackcrowes.com, find biodiesel blends on the first leg of its 2006 tour. Bus driver Bob Bottiglieri took an instrumental role in procuring biodiesel for the band's two buses. Guster-The band Guster, www.guster.com, continues to be a tireless advocate for biodiesel. The Wisconsin Clean Cities-Southeast Area recently held an event featuring Guster and the University of Wisconsin's Challenge X competition vehicle. The "Moovada," a Chevy Equinox re-engineered as a hybrid biodiesel-electric prototype, took runner-up honors at the 2006 Challenge X competition. This Milwaukee event, supported in part by the NBB, preceded the Summerfest concert series, where Guster headlined that evening. 
 
 Crosby, Stills, Nash & Young-The NBB is one sponsor of Crosby, Stills, Nash & Young's (CSNY) use of biodiesel on the band's current tour. Look out for a biodiesel booth at concert stops, turning CSNY fans into biodiesel fans. For tour dates, visit www.csny.com.

318-1294329454.jpg

Banded together for biodiesel

Texas is known as the leading state for biodiesel capacity. The state's plants report they could produce 96 million gallons of biodiesel should demand rise. Texas' biodiesel industry has garnered headlines for its growth, such as when Austin Biofuels and Triple S Petroleum opened 19 new B20 pumps in one day. In the wake of this activity, the state will host its first Texas Biodiesel Conference and Expo. 
 
 The Biodiesel Coalition of Texas (BCOT) will hold the event Sept. 27-29 in Austin. The conference will cover the latest regulatory, agricultural and technical developments in the Texas biodiesel industry. Joe Jobe, CEO of the National Biodiesel Board (NBB), as well as other industry experts, will speak at the conference. A trade show is included. Besides educational activity, networking opportunities will come by way of the Austin Renewable Energy Tour, receptions and even a Biodiesel Bash to enjoy Austin's nightlife. 
 
 "As the biodiesel industry continues to grow at breakneck speeds, it is critical that every state has a clear, articulate voice representing biodiesel interests," said Jake Stewart, board member of BCOT and vice president of Organic Fuels, an NBB member. "It behooves the industry to congeal around common state issues and work together to solve them on behalf of the greater biodiesel industry and market. There's strength in numbers battling issues in a new industry. I guess Willie Nelson put it best when he said quite simply, 'Don't mess with Texas biodiesel.'" 
 
 Space at the conference is limited, but there are still openings available for attendees, exhibitors and sponsors. Check out www.biodieselevents.com to download a registration form and get more information on the conference.

319-1294329455.jpg

Conference shows biodiesel's big presence in Texas

Health leaders received a comprehensive update on biodiesel and other renewable fuels through a renewable transportation fuel and air quality event held Sept. 8. The National Biodiesel Board (NBB) and the American Lung Associations of Washington, D.C., the Upper Midwest and the Southwest hosted the inaugural Air Quality Forum in Washington, D.C. 
 
 The unique, invitation-only event allowed health/environment leaders-including representatives of lung associations, faith-based groups and school health organizations-to have a scientific examination of air quality and the impact of alternative transportation fuels, like biodiesel. Because the top officials who attended were from across the nation, the knowledge gained from this conference was far-reaching. 
 
 The workshop's programs, case studies and panel discussions addressed: - The current knowledge of health effects of transportation pollution -The Clean Air Act as it relates to renewable transportation fuels - The contributions of renewable fuels to benefit air quality - A discussion of renewable fuels' production and distribution capacity - The business case for producers and consumers of renewable fuels - The latest in engine technology as it relates to renewable fuels - Policy across the nation 
 
 The event drew top-level professionals, such as Jonathan Samet of Johns Hopkins Bloomberg School of Public Health; USDA Senior Economist Jim Duffield; U.S. DOE Clean Cities Program Acting Director Dennis Smith; NREL's Principal Engineer Robert McCormick; and Bill Wehrum, the U.S. EPA's top clean air administrator.

NBB, lung associations help to educate health leaders through Air Quality Forum

An opportunity to focus on accelerating President George W. Bush's Advanced Energy Initiative-via biomass, wind, and solar energy developments-will be available in the heartland next month. "Advancing Renewable Energy: An American Rural Renaissance," cohosted by the USDA and the U.S. DOE, will be held Oct. 10-12 in St. Louis, Mo.

 Featured speakers include Energy Secretary Samuel Bodman; Agriculture Secretary Mike Johanns; and Red Cavaney, president and CEO of the American Petroleum Institute. Conference cohosts say the event will identify major impediments, review challenges and make recommendations to help accelerate renewable energy technology development. It will also examine key incentives that would help reduce risk for investors and developers in the marketplace, and review development challenges with new distribution systems. 
 
 A broad array of interested parties and stakeholders in government, as well as the private sector, are welcome to register. For more information about the conference, visit www.AdvancingRenewableEnergy.com.

Federal departments work together to advance renewable energy

The United States Green Building Council awarded Honda R&D Americas Inc. in Raymond, Ohio, with the trademarked Leadership in Energy and Environmental Design (LEED) gold certification. According to a press release from American Honda Motor Co., the facility achieved the certification because it uses water and energy conservation systems, as well as emissions-reducing tactics. One such tactic is the emergency generator, which is operated on biodiesel, reducing emissions up to 75 percent.

324-1294329457.jpg

Honda R&D Americas Inc. achieves LEED gold certification

Opening up new markets for glycerin, a by-product of biodiesel production, will help make the biodiesel industry more profitable. Now, through the leadership of U.S. Sen. Kit Bond, R-Mo., funds will become available for glycerin utilization research. Funding comes from the Highway Bill's Department of Transportation Bio-Based Transportation Research Program. 
 
 "Thanks to the leadership of Senator Bond for the biodiesel industry, the potential can be opened up to find new ways to use large quantities of glycerin in a relatively short period of time," said Tom Verry, National Biodiesel Board (NBB) director of outreach and development. Over the next four years, the $200,000 funded research will center on using glycerin as a livestock feed input, Verry said. 
 
 The Missouri Soybean Association (MSA), in partnership with the NBB, will direct the Glycerin Utilization Project research. Research will be conducted at the University of Missouri-Columbia with a team including Monty Kerley, a nationally known ruminant nutritionist who is working with the nutritional value of glycerin for its use as animal feed. 
 
 "With the proper investment in research, this country's fast-growing biodiesel business holds great promise in having a useful by-product," said Dale Ludwig, MSA executive director and CEO. "By capturing the value-added opportunity that exists with glycerin, soybean farmers can make a worthwhile venture out of something that otherwise may have been a burden." 
 
 Kerley added, "The use of glycerin as a feed ingredient creates a new market with potential to use substantial quantities of glycerin. Missouri alone produces enough beef calves to use more than 350 million pounds of glycerin, or more than 8 million acres of soybeans. This market would expand nationally just as the market for soybean meal and soyhulls has done, and glycerin can be used in diets of several animals." 
 
 The MSA has previously worked closely with the University of Missouri to develop promising new uses for glycerin, such as propylene glycol, which can be used for antifreeze. This new research should begin in early 2007.

Sen. Bond brings DOT funding to glycerin utilization program

Stinker Stores convenience stations will soon bring the sweet smell of cleaner fuel to Boise, Idaho. 
 
 The company is opening biodiesel pumps at 11 of its Treasure Valley area convenience stores this month. Stinker Stores will exclusively offer the blend as its only diesel fuel option. Organic Fuels in Houston, Texas, a member of the National Biodiesel Board, currently provides biodiesel to the company. 
 

 "Stinker will initially offer a blend of B10 with a goal of moving to a B20 blend depending upon customer acceptance," said Charley Jones, Stinker Stores president and CEO. "Stinker has sold 10 percent ethanol-blended gasoline at its stores for over 25 years, began selling E85 gasoline in 2004 and sees biodiesel as a natural companion to its fuel offering." 
 
 The U.S. DOE and Idaho Department of Water Resources awarded grants to Stinker Stores to prompt this move. The company's September announcement was slated to be made in conjunction with Idaho Alternative Fuels Month. 
 
 Other regions throughout the country are introducing several biodiesel pumps at once, as well. This Summer, 33 B20 pumps were opened in Austin, Texas, and South Carolina also has a big B20 station presence with Spinx Oil opening 30 pumps in the state. The grants that Stinker Stores received also assisted in the construction of a biodiesel storage and blending facility adjacent to the fuel distribution terminal in Boise. 
 
 According to Jones, when complete, the facility will have 80,000 gallons of heated biodiesel storage and the capability of providing biodiesel blends from B100 down to B1. Bulk sales of biodiesel will also be available to truck fleets and other retailers wishing to offer biodiesel to their customers.

More retail pump openings sweep major cities

As truckers increasingly demand homegrown biodiesel, a new toll-free number will help them find retail availability anywhere in the United States. The Biodiesel Hotline, (866)-BIODIESEL or (866) 246-3437, is staffed 24 hours a day, 7 days a week and is available to all drivers of diesel vehicles, including cars and pick-up trucks.
 
 The Biodiesel Hotline staff has access to mapping software linked to a database kept up-to-date with retail outlets carrying biodiesel. Information, including truck accessibility and blend percentage of biodiesel to petro-diesel, is available from the database. 
 
 Truck-accessible biodiesel locations are currently searchable on <a target="_blank" href="http://www.BioTrucker.com">www.BioTrucker.com</a>, but often truckers do not have access to the Internet. The Biodiesel Hotline, announced at the Great American Trucking Show on Aug. 25, reveals locations by the means most convenient for truck drivers: cell phones. The National Biodiesel Board manages both BioTrucker.com and the hotline.
 
 "Truckers are committed to using biodiesel, and we get a lot of calls from truckers looking for biodiesel on the road," said Bill Mack, "The Satellite Cowboy" on XM Radio. "We have been referring them to BioTrucker.com, but now we can give them a more convenient way to find biodiesel." Mack was on hand at the hotline launch.

Michael Frybarger, center, answers the first call to the Biodiesel Hotline during a press conference as Bill Mack, left, the XM Satellite Cowboy, and Rick Stern, a farmer from New Jersey, listen.

320-1294329455.jpg

National Biodiesel Board rolls out Biodiesel Hotline at Great American Trucking Show

Nearing press time, Eastman SE, the Arkansas-based subsidiary of Eastman Chemical Co., was in start-up mode with its newly expanded biodiesel facility built from excess chemical processing capacity at its Batesville, Ark., plant, confirmed Gary McDonald, Eastman SE's manager of administration. The facility's production output of biodiesel increased from 6 MMgy to 18 MMgy. 
 In late July, Eastman Chemical announced that it agreed to sell the Arkansas-based subsidiary to Viceroy Acquisition Corp. McDonald said Viceroy will continue biodiesel production operations at the Batesville site. Furthermore, McDonald told Biodiesel Magazine that Viceroy expressed interest in aggressively adding more biodiesel production capacity.

Eastman sells Arkansas-based subsidiary, biodiesel facility

GS CleanTech Corp., a subsidiary of GreenShift Corp., finalized an agreement in July with an Arkansas poultry processing facility to obtain animal fat for use as a biodiesel production feedstock. According to David Winsness, CEO of the process engineering division of GS CleanTech, his company will provide the technology for extracting 1 million pounds of animal fat from the poultry producer's waste sludge. The animal fat will be sold to GS CleanTech's sister company GS AgriFuels Corp., which is proposing a biodiesel production plant in the south-central United States.Winsness said the poultry company couldn't be named, as part of the agreement.

321-1294329456.jpg

GreenShift Corporation lines up source for biodiesel feedstock

A San Francisco petroleum distributor is providing a new home for a Bay-area biodiesel plant. Golden Gate Petroleum is affiliating itself with Bay BioDiesel LLC, a plant formerly under construction in Martinez, Calif., just northeast of San Francisco. The plant is being moved to a larger location in San Jose, Calif., according to Golden Gate Petroleum spokesman Kris Miller. 

 
 The plant's new location offers railroad access on a rail spur, and increased storage for feedstocks and finished product. Start-up for the plant is expected by October. The additional warehouse space will allow the plant to double in capacity from its initial 2.5 MMgy, Miller said.

322-1294329456.jpg

323-1294329456.jpg

Bay BioDiesel, Golden Gate partner

Solix Biofuels Inc., a Boulder, Colo.-based business, is developing technology for the massive cultivation of algae to produce biodiesel and also working toward the goal of implementing the technology, according to COO and CFO Doug Henston. Originally explored by the National Renewable Energy Laboratory, newer technology now makes it practical, CEO Jim Sears said. The company, formerly known as SunSource Industries, was one of seven finalists in Colorado's BioWest Venture Showcase competition. Finalists were set to make presentations during the Aug. 23 event.

Colorado company develops algae technology

Oilfield service provider PetroSun Drilling Inc. (PSUD) recently formed a wholly owned subsidiary called Algae Biofuels Inc. According to PetroSun, its new spin-off company will focus on the research and development of high-oil-yielding algae cultivation for processing into biodiesel. Sites in Arizona and Australia will house Algae Biofuels' R&D and production facilities. As a service provider to the oil industry, PetroSun's president L. Rayfield Wright said his company's formation of Algae Biofuels is a "forward-looking strategy," ultimately benefiting "future generations."

Oilfield service provider starts algae spin-off

Greg Keenan has joined Madison, Wis.-based Virent Energy Systems Inc. as vice president of business development. Keenan will be responsible for maximizing opportunities for Virent's aqueous phase reforming process through the development of market channels and alliances.
 
 Keenan was formerly business development manager with Air Products and Chemicals of Allentown, Pa., where he focused on developing and implementing new technologies in the hydrogen and alternative energy markets. Keenan has a management of technology degree from the University of Pennsylvania.

Virent Energy hires Keenan

Dustin Blumenthal has joined GeoGreen Fuels LLC as plant manager for the company's Gonzales, Texas, biodiesel facility, which at press time was expected to start up in September. He will coordinate and oversee plant construction and operations, including feedstock supply, quality control, personnel, and product specifications and storage.
 
 Blumenthal has more than 10 years of experience in the plumbing and heating industry as territory manager of Moen Inc., district manager of Viega North America and branch manager of consumers Pipe & Supply Co. in Las Vegas. He graduated from the University of Utah in 1997.

Blumenthal joins GeoGreen Fuels

Ralston, Iowa-based Renewable Energy Group (REG) recently hired Paul Predaris as biofuels sales manager. He will oversee biodiesel sales, development, product distribution and customer service in the northeastern United States.
 
 Predaris joins REG with 12 years of industry experience, most recently as account manager for Portsmouth, N.H.-based Sprague Energy Corp. He also served on the company's board of directors and is a member in several state oil heat councils and associations. Predaris has worked closely with home heating oil distributors, petroleum distributors and terminal owners to expand the market for biodiesel and bioheat.

REG hires biofuels sales manager

Rob Black, managing partner at Blue Sky Biodiesel, the New Plymouth, Idaho, facility that caught fire in July, said storage tanks were back in place and plans were in full swing to salvage the facility to meet a new scheduled start-up date in mid- to late August. In addition, Bill Miller has been hired as the new safety manager at Blue Sky. "He comes from the mining industry and has a lot of experience with on-the-job safety … a lot of practical experience," Black said.

Blue Sky Biodiesel hires safety manager, plans to rebuild

Nova Energy Holding Inc. named John Reiland to its board of directors in early August. He currently works for Sanders Morris Harris Group as a senior financial analyst, bringing management experience in finance and operations to Nova Energy. 
 

 Nova also added three former oilmen to its board back in July. Robert Black was the senior vice president in the Office of the Chairman of Texaco, and Robert White was the former president of Mobil Exploration and Producing U.S. Jody Powers was the former president of Halliburton Energy Services, having worked there for nearly 35 years before retiring in 2002. The knowledge base of the free men in the oil industry will enhance the power of the company's leadership, according to Nova Energy.

Nova Energy adds to board of directors

FUMPA Biofuels, a 3 MMgy biodiesel plant in Redwood Falls, Minn., received the 2006 Ag Innovator of the Year award from the Agricultural Utilization Research Institute, a nonprofit group in Minnesota. FUMPA Biofuels, a division of Farmers Union Industries, was the first facility to produce biodiesel in Minnesota, according to Charles Neece, director of research and development for FUMPA Biofuels. The company has utilized canola oil and corn oil, but its primary feedstocks are soy oil and animal fat.

325-1294329457.jpg

FUMPA receives Ag Innovator of the Year award

Saying the domestic crude glycerin market is reaching its saturation point would place one in the running for understatement of the year. The neutral substance, which is a by-product of the burgeoning biodiesel industry, has been anything but neutral to those directly affected by its price and availability.
 
 As biodiesel production soars, so does crude natural glycerin. With up to 400 million additional gallons of biodiesel production being built or on the drawing board, it's clearly evident glycerin is becoming a significant issue.
 
 As with most industries, the U.S. glycerin market is representative of the world markets. Europe has been facing excess glycerin production issues for years since its biodiesel production began booming. "Biodiesel has taken off around the world," says the National Biodiesel Board's (NBB) Steve Howell. "Glycerin is very much a global market."
 
 In addition, the growing oleochemical industry in Asia is producing glycerin by the barge-load. Much of it had been exported to the United States, but with rising freight costs, a majority of it is now shipped to China.
 
 European companies are striving to stay ahead of the glycerin explosion. In early 2006, international chemical company Solvay announced plans to build a 10,000 metric-ton-per-year epicholorohydrin plant in France. The plant will manufacture glycerin products to make epoxy resins, paper-reinforcing agents and other products. Other companies are proposing similar projects.
 Meanwhile, the U.S. synthetic glycerin market has taken quite a beating. Synthetic glycerin is petroleum-based, where natural glycerin-such as that produced during biodiesel production-is created from fats and oils. Dow Chemical was once the nation's only producer of synthetic glycerin. It closed its Freeport, Texas, plant in January, citing-in part-the flood of glycerin from biodiesel production. Dow Chemical still operates a glycerin plant in Germany.
 
 "There is quite a synthetic market that's been upset," says Jim Conway, vice president of sales for Kentucky biodiesel producer Griffin Industries. "We are beginning to produce more than the market can bear under the current scheme of things."
 
 Annual consumption of glycerin in the United States has ranged between 400 million and 450 million pounds for the past three years. Domestic production figures show that approximately 400 million pounds per year was produced heading into the turn of the century. 
 
 The U.S. biodiesel industry is expected to produce an estimated 1.4 billion pounds of glycerin valued at $289 million between 2006 and 2015, according to an economic study by John Urbanchuk, director of LECG Inc. According to projections gleaned from NBB estimates, the industry could produce as much as 200 million pounds this year alone. Crude glycerin that once fetched between 20 and 25 cents per pound is now edging closer to 5 cents and lower.
 

 Some companies are trying to hedge against crude glycerin by refining their own. Purada Processing already operates a glycerin refinery at its biodiesel plant in Lakeland, Fla. Cargill built its own refinery collocated with its 37.5 MMgy biodiesel plant in Iowa Falls, Iowa, making it the first company in North America to combine soybean crushing, biodiesel production and United States Pharmaceutical-grade glycerin production at one plant. In early August, Cargill announced a second similar facility for Kansas City, Mo.
 
 While constructing glycerin refineries is a viable option for companies like Cargill and Archer Daniels Midland Co. (ADM), most biodiesel producers have to play with the market presented to them. And with glycerin prices at historical lows, it hasn't been easy.
 "Not every biodiesel plant is big enough to justify the capability to upgrade the crude glycerin," says Bill Downey, vice president and head of Kline Co.'s petroleum and energy consulting practice. "The right-sized biodiesel suppliers will win with more feasible project economics based on the sale of a by-product that would otherwise be discarded."
 
 As much as glycerin prices have taken a downturn, anyone involved in the biodiesel industry knows that the issues surrounding glycerin haven't slowed down progress whatsoever. "Low prices for glycerin aren't having a negative impact on putting up biodiesel plants," Howell says. "They are going up fairly quickly. If we would have higher-value uses for glycerin, it would make biodiesel economics that much better."
 
 Beyond the Economics
 After digesting the current market specifics, what potential is there for biodiesel-derived crude glycerin? For one, some experts believe the glycerin markets will stabilize and even rebound once demand for new applications hit the market.
 
 This fall, market research firm Kline & Co. is launching a study, "Global Business Opportunities in Biodiesel Fuels, 2006-2010," to determine the potential market swings. The study is expected to provide a comprehensive analysis of the global market for biodiesel, including manufacturing cost economics for glycerin.
 
 Beyond the actual production and marketing of glycerin are end-users. Everyone Biodiesel Magazine spoke with for this article agreed that there is no catch-all answer in respect to a new market for biodiesel-production-derived glycerin. "I don't know of any silver bullets," Howell says. "If there were, companies like Procter & Gamble and Cognis would already be doing it."
 

 While some community-based biodiesel producers tout soap-making or aerobic composting as potential solutions, they won't make a dent at large-scale commercial operations. The most likely uses will be in replacing petroleum-based chemicals and in a variety of newfound applications. While studies on new uses are relatively few and far between, they are certainly picking up steam.
 Until the past few years, not even the NBB focused much attention on glycerin. Understandably, that was at a time when crude glycerin prices weren't nearing rock bottom. "Recently, finding new uses for glycerin has worked its way up the priority list," Howell says. In fact, the NBB is supporting a Glycerin Innovation Award to encourage researchers and academia to utilize budgets to focus on uses for crude glycerin (see page 44).
 
 Now even Decatur, Ill.-based ADM is throwing its significant weight behind exploring new uses. In mid-July, ADM scientist Paul Bloom told a crowd at a two-day biomass conference in Grand Forks, N.D., that his company plans to develop and produce industrial products like propylene glycol and other "large-volume" chemicals from glycerin (see "The 'Peak' Role of Biofuels," August 2006). In November 2005, ADM announced plans to build a polyols facility that would use glycerin-based feedstocks to produce propylene glycol and ethylene glycol.
 
 An Energy Source
 Renewable Energy Group's Myron Danzer says despite the glycerin market's fallout, it does have a floor. With any material, the floor is its value as an energy source, and with the crude glycerin market reaching basement levels, feed and fuel trials are becoming a real possibility.
 
 While companies are beginning to commercialize technologies and processes that use biodiesel-derived glycerin for products such as polyols, dust suppressants and pharmaceutical products, another more basic potential is beginning to get recognition.
 
 In June's "Proposed Biodiesel Plant List," many proposed projects were considering the possibility of using their crude glycerin in various forms as a boiler fuel source in replacement of a No. 4 or No. 6 fuel oil. Rose Patzer, a chemist with the Agricultural Utilization Research Institute (AURI) in Marshall, Minn., tells Biodiesel Magazine that several companies have received permits to burn crude glycerin. Although unable to divulge those companies, she did say they weren't based in Minnesota.
 
 Working with biodiesel since 1996, Patzer has studied the possibility of using glycerin as a fuel or fuel supplement. One study tested glycerin in wood pellets fueling a wood-burning stove. Analysis didn't show a significant improvement with the glycerin mixture. AURI has also worked with Minnesota biodiesel producer FUMPA Biofuels in combining feather meal and glycerin for use in beef and dairy diets.
 
 A more recent animal feed trial using glycerin has received national attention. Researchers at the University of Arkansas' Center of Excellence for Poultry Science recently studied glycerin as a dietary supplement in growing broiler chickens. Poultry nutritionist Park Waldroup initiated the study, which evaluated glycerin in diets fed to broilers of typical market age in litter floor pens.
 

 The study, which Waldroup cautions is strictly preliminary, showed that as much as 10 percent glycerin could be fed to chicks in battery brooders up to 16 days of age. Battery brooders are brooding boxes with wire floors stacked on top of each other to conserve space. 
 
 Five percent glycerin inclusion in pelleted feed showed no adverse effect on bodyweight, feed intake, feed conversion or mortality. However, 10 percent glycerin inclusion reduced body weight due to reduced feed flow rate. More information on the study can be found at www.biodieselmagazine.com.
 
 Waldroup and his researchers concluded that glycerin can be used as an energy source for broiler diets. While the results of this study are intriguing, Waldroup cautions they are preliminary and were based on a consistent, clean supply of glycerin. 
 
 Butler, Ky.'s Griffin Industries provided the glycerin for the study. Griffin produces 2 MMgy of biodiesel in addition to recycling agricultural wastes. "We have looked for different types of markets (for glycerin)," Conway says. "We are very closely related to the animal feeding industry, so we looked at this some time ago."
 
 Waldroup is continuing to study glycerin in broiler diets, this time using glycerin provided by Stuttgart, Ark.-based Patriot Biofuels, which began producing 3 MMgy of biodiesel this spring. The second study is determining the effects of 2 percent to 2.5 percent glycerin inclusion in order to more accurately represent real world market conditions. "No one is going to be feeding 10 percent glycerin," Waldroup says. "If you looked at the typical poultry operation, it's going to be mixing 4,000 tons of feed per week. It would take a pretty big biodiesel plant to even have enough glycerin to have 1 percent in the diet."
 
 Waldroup again stresses the consistent quality of the glycerin needed to make it a realistic addition to animal diets. "Everybody wants to give me their glycerin," he says. "But what are some quality parameters?"
 
 Quality a Cause for Concern
 Like biodiesel itself, glycerin quality is an obvious concern for refiners. The quality of crude glycerin is as varied as the process technology available to produce biodiesel, which at times can seem limitless. "The crude glycerin quality from biodiesel operations is all over the map," Howell says. "While the West Centrals' are looking at newer uses, smaller companies are primarily focused on just trying to get biodiesel produced."
 
 Patzer says AURI's studies varied based on the quality of glycerin. In studies that used glycerin as a fuel supplement, the less pure the glycerin the less energy value. Patzer also warns that incomplete combustion of glycerin can release toxins. "Biodiesel plants generally don't have purification processes (for glycerin)," Patzer says. "If you're trying to purify it, you're adding cost. That doesn't mean we can't find uses for it."

 
 Typically, larger, professionally engineered plants have a more consistent glycerin because they give more attention to cleaning up the by-product. Smaller, self-designed facilities oftentimes don't pay as much attention to glycerin quality, causing it to suffer, according to Howell. "Companies that refine glycerin aren't willing to take some of the lower quality glycerin," Howell says. 
 
 He adds he's heard reports of smaller plants essentially giving away glycerin because of small quantities and varying levels of methanol residue and salts within. Biodiesel Magazine has talked with other small plants that have had to pay to dispose of the glycerin.
 
 As with anything in a capitalist system, it all boils down to economics-dollars make sense. As crude oil prices have skyrocketed, so has the interest in biodiesel production and use. The likewise is true with glycerin, although on a significantly less turbulent timeline. Sure, glycerin prices have fallen, but companies aren't about to invest until that trend is sustained. Once it does, glycerin stands to become an even more commonly used chemical than it already is.
 
 Glycerin will likely become a substitute for common petrochemicals on the market. "Glycerin may become the next biodiesel," Howell says. "In three to five years, it will be seen as an environmentally friendly way to replace other competing petroleum products. You'll see a variety of smaller chemical uses where glycerin can come in and replace other petrochemicals. It will be one of the next chemical platforms, to use U.S. DOE speak, that will become widely available, and people will spend time focusing on it." 
 
 Dave Nilles is a Biodiesel Magazine staff writer. Reach him at dnilles@bbibiofuels.com or (701) 373-0636.

Glycerin storage at West Central's biodiesel plant in Ralston, Iowa

326-1294329457.jpg

The biodiesel industry continues to make an impact on the liquid fuels industry-but its by-product is having just as much of an effect. Producers and consumers alike are struggling with business plans influenced by an expanding flood of crude glycerin.

Combating the Glycerin Glut

A majority of current and future U.S. biodiesel producers report that soybean oil is, or will be, their primary feedstock for refining mono alkyl esters. With the way the biodiesel industry is expanding, it's astonishing to consider how many markets-shifting possibilities can come-probable or not-from that solitary, isolated statement. 
 
 For instance, other feedstocks may take on a bigger presence in the United States when soy oil demand hits record-breaking levels in the coming years. Experts say another possibility is transitioning non-critical Conservation Reserve Program (CRP) lands to soybean production. Specialists also indicate that acres of market-devalued crops may go to the bean. On the other hand, soybean yields may increase over time due to better genetic engineering, which could help alleviate pressures for more soy oil and needed acreage. Then there are the potential shifts in global trade. The United States could decrease its exportations of whole soybeans, retaining them here for more domestic crushing and freeing up more oil to help satisfy demand. Alternatively, soy oil exports might narrow. Soy oils in human foods may trend downward, which is another way to get more oil for methyl ester refining onto the market. Maybe increasing imports of soybeans or soy oil is another possibility-likely a controversial one. 

 
 Despite all of the unknowns, some of the more probable routes to expansion in this industry lead experts to wonder about what might come of all that additional meal. 
 
 Putting the Pieces into Place
 Rather than placing the cart before the horse, though, consideration should first be given to addressing where new additional feedstock might come from. According to Marty Ross, director of the United Soybean Board (USB), concerns over biodiesel's demand on soy oil have been mounting for some time. "People seem to think we've already used up all our excess soybean oil, but we haven't yet," Ross says. "Eventually we may, and after that point-after we are using 100 percent of our oil and it's driving the soybean market-what's next?" That's the million dollar question. 
 
 Alejandro Reca, executive director of Rabobank International's Food and Agribusiness Research team for North and South Americas, hit home this message of changing commodities markets in a presentation at a conference called, "Biodiesel: Powered by Canola," which took place in Calgary, Alberta, in mid-July. His presentation, which was a culmination of intense research, concluded that global demand for vegetable oils is likely to push major crushers of particular oilseeds into changing their current business models. "The main implications, or threats, are for those oilseeds with relatively higher meal content-meaning soybeans," Reca tells Biodiesel Magazine. Often, soybeans are called oilseeds, but, in fact, many say the soybean is really a protein bean. 
 
 David Feider, Oilseeds division spokesman for Cargill, tactfully relays his inability to divulge information about Cargill's future crushing plans in this business on the verge of change. "Typically, Cargill does not offer market outlook or commentary, especially when we have financial positions in those markets," he says. Other crushers choose not to comment, as well. North American crushers and producers holding certain biases against oilseeds with higher oil content will be driven toward crushing more canola and eventually sunflower, Reca says. "The larger crushing of these will require higher production at the farm level as well," he adds. 
 
 Rick Ostlie, president of the American Soybean Association (ASA)-an organization working closely with many oilseed processors-says the major crushers are watching this situation develop. Nevertheless, American biodiesel producers simply like soy oil; it has been a high quality, abundant and reasonably priced feedstock. 
 
 There are options for limited growth in a soy-oriented industry, without crushing more soybeans. According to Reca, the U.S. food manufacturing industry has seen a decline in soy oil use for the first time ever in 2006. "That's mostly because of the move away from trans fatty acids in food," he says. This trend could continue, which bodes good news for U.S. biodiesel producers fixed on soy oil. Straight oil exports are another tapping source from which the processing of more beans isn't necessarily needed. 
 
 Historically, the demand for soybeans' protein-rich meal has driven its production and crush output. If a swelling demand for the oil surpasses the tipping point to drive the soybean market, then there will be untold meal tonnage along for the ride.
 

 Meal Possibilities
 In this industry, soy biodiesel producers use approximately one-fifth of the content in soybeans, unless of course the producer extracts its own oil. In that case, those biodiesel producers and oilseed processors sell the meal and retain the proceeds. Corn's fermentable starches, used to make ethanol, constitute 70 percent of the yellow dent feedstock that an ethanol plant takes in. Once ethanol producers make their alcohol, the remaining unfermentables-the protein, fiber and fat-produce a commodity coproduct marketed to feedlots as mid-protein distillers grains. Due to the nature of distillers grains origination, ethanol producers have direct and vested interests in market prices for distillers grains. Conversely, the various commercial biodiesel makers who buy soy oil through contracts may not be affected directly by soy meal markets, but the people who run those businesses and their investor-growers often are. 
 
 At a recent conference hosted by the Grand Forks, N.D.-based Energy and Environmental Research Center (EERC), mega-crusher Archer Daniel Midland Co.'s Paul Bloom talked about meal quantities and opportunities. "One billion gallons of soybean-oil-based biodiesel would create about 33 billion pounds of meal," he said. "So it's really an opportunity-not for only feed and these expanded feed applications, but for industrial applications." 
 
 That's the general consensus in the midst of all these uncertainties: opportunities in the unknown. Experts say the markets will work it all out. "The market is always the driver," Ross tells Biodiesel Magazine. "It will decide." 
 
 The Soybean Meal Information Center (SMIC) is an initiative sponsored by the USB, state soybean associations and soybean growers. The organization focuses on animal nutrition and factual information pertaining to protein meal for the livestock industries, according to Program Administrator Grant Kimberley. The organization has been deeply involved in the business of information for oilseed processors and meal exporters for 10 years, he says, in part by analyzing the latest supply and demand issues, and studying competing protein sources. 
 
 "For the last 60 years, there have been efficiencies made in feed grains and soybean meal regarding amino acid profiles and energy requirements for poultry, swine and some ruminants," says Keith Smith, SMIC technical advisor. "There are plenty of advantages to soymeal over distillers dried grains (DDG)." Distillers grains production is growing in step with the ethanol industry. To varying degrees, DDG competes with soymeal as protein feed for livestock. "But soymeal is a more stable product-it's less variable-and it has higher energy, protein and critical amino acids, and improved digestibility," Smith explains.
 
 According to international markets specialist John Baize, who presented "The Outlook and Impact of Biodiesel on the Oilseeds Sector" to a recent USDA Outlook Conference, for every ton of DDGS used in swine or poultry rations instead of corn, two-fifths of a ton of soymeal "on a protein equivalent basis" is displaced. Should that make soymeal advocates and crushers concerned? "We have to be," Smith tells Biodiesel Magazine. But greater competition for livestock market presence, mixed with higher volumes of soymeal on the market, doesn't necessitate a tragedy. Ostlie says if oil drives soybean production and increased supplies of meal amidst greater competition drives its prices down, livestock production would have lower costs. "U.S. livestock could become more competitive worldwide," he says. Essentially, what's lost in trading prices is more than recuperated in volume sales and the value-added nature of soy-protein-fed livestock. Baize also suggests that the United States could become a major soymeal exporter, pinching out the large South American processors. 
 
 In the United Soybean Export Council's July 2006 "Global Update on U.S. Soy Export Market" newsletter, it was written that "Mexico and Latin America … accounted for 54 percent of U.S. soybean meal exports last year. U.S. meal exports to Mexico more than quadrupled in the past five years, and it appears that there is still room for growth. … A recent new market is Cuba." 

 
 The SMIC's Kimberley agrees that new markets can be developed and current markets can be reinforced, domestically and internationally. "We still have plenty of good outlets for meal," he says. According to Kimberley and Smith, one of the markets in which soymeal is expected have some of the biggest growth is the aquaculture industry, or fish farming. "The aquaculture industry has seen tremendous growth of soymeal consumption," Smith remarks. "It only accounts for 3 [percent] to 4 percent consumption of meal supplies now, but it provides the most opportunity for growth."
 
 In March, the USB initiated a meal taskforce to critically analyze the growth potential of various meal markets, says the USB's Ross. This follows last year's soy oil taskforce. Together, he says, both of the taskforce's reports will assist in outlining the USB's 2020 vision, the board's long-term soybean market outlook. "The meal side of this issue is much more complex than that of the oil," Ross tells Biodiesel Magazine. "With competing DDGS, compositional traits and world markets, all of these things complicate the issue."
 
 Ostlie agrees. "This is a very complicated matter, and there are a lot of scenarios that could come out of this-what demand will be, how many acres will be planted, how South America is going to respond…," he says. "It's hard to peer into the looking glass to see what'll come of it. There are just so many possibilities." 
 
 Ron Kotrba is a Biodiesel Magazine staff writer. Reach him at rkotrba@bbibiofuels.com or (701) 746-8385.

Biodiesel Magazine explores some broader implications of the increasing demand for soy oil coming from the burgeoning U.S. biodiesel industry.

Pressing the Possibilities

What would be the state's third commercial-scale biodiesel plant has begun construction in Arkansas. Arkansas Soy Energy Group LLC commenced initial work on a 7 MMgy plant near DeWitt, according to Jon Hornbeck, chief financial officer of <a target="_blank" href="http://www.hbkseed.com">Hornbeck Seed Company</a>.

 
 The project will include a grain-handling facility, soy crush plant and soy meal mill, Hornbeck said. He said he expects construction on the facility's main buildings to be complete by spring 2007. Start-up is expected by fall.
 
 The biodiesel plant will use soy oil as feedstock. Hornbeck said most of the biodiesel plant's feedstock will be sourced locally. "The main purpose is for area farmers to have a better market," Hornbeck said. "They have been very supportive of the project."
 
 Hornbeck said the plant site is near his family's seed company outside of DeWitt's city limits. Hornbeck Seed is a family-owned dealer of "proprietary soybean products," according to the company's Web site. 
 
 DeWitt is located in southeast Arkansas, approximately 100 miles southeast of Little Rock. DeWitt is also less than 30 miles south of Stuttgart, Ark., which is home to <a target="_blank" href="http://www.patriotbio.com/">Patriot Biofuels</a>. The 3 MMgy biodiesel plant began production in March and is already undergoing expansion plans. 
 
 The state's largest biodiesel producer is Eastman Chemical Company, which initially produced biodiesel in October 2005 in Batesville. The plant now produces 18 MMgy of biodiesel and was purchased in July by Viceroy Acquisition Corp.
 
 
 Dave Nilles is Online Editor for Biodiesel Magazine. Reach him at dnilles@bbibiofuels.com or (701) 373-0636.

 
 Posted: 10:12 a.m. CDT Monday, September 25, 2006

Arkansas looks to add another biodiesel plant

While the celebration is over, the work continues in getting a North Carolina biodiesel plant on line. A ceremonial grand opening was held Monday for <a target="_blank" href="http://www.biofuels.coop">Piedmont Biofuels Industrial's </a>1 MMgy biodiesel plant near Pittsboro, N.C.
 
 Initial biodiesel production is expected within a week, according to Piedmont's Rachel Burton. Test samples will then be sent to an off-site lab to verify ASTM 6751 biodiesel standards.
 
 "Last night's grand opening event was a true culmination of seeing how involved and supportive the community has been," Burton said.
 
 Piedmont Biofuels Industrial is a project of Piedmont Biofuels, a 350-member co-op founded in 2002. The co-op grew out of the support for a biofuels program at Central Carolina Community College in Pittsboro.
 
 Burton said approximately 500 people attended Monday's celebration, including U.S. Reps. Bob Etheridge and David Price, and state Rep. Joe Hackney, who has supported a variety of biofuels legislation in the state.
 
 The biodiesel project was partially funded by the North Carolina Department of Administration's State Energy Office and built in an abandoned Cold War-era metal alloys plant, according to Piedmont.
 
 Feedstock, which will consist primarily of waste vegetable oil and animal fats, will be sourced within a 100-mile radius of the plant, Burton said. The facility is equipped with a fuel terminal that can accommodate top-loading and bottom-loading fuel tankers.
 

 The plant also features an in-house fuel quality lab, which Burton said can do six of the required tests for ASTM 6751.
 
 Piedmont Biofuels Industrial joins <a target="_blank" href="http://www.blueridgebiofuels.com">Blue Ridge Biofuels </a>in Asheville, N.C., as in-state biodiesel producers. The multi-feedstock Blue Ridge plant has 2 MMgy of production capacity. A Blue Ridge spokesman said the plant is entertaining plans to expand production capacity and on-site storage. 
 	
 Piedmont Biofuels Industrial
 Location: Pittsboro, North Carolina
 Design/builder: Piedmont Biofuels
 Capacity: 1 MMgy
 Feedstock: multi-feedstock
 Biodiesel marketer: Piedmont Biofuels
 Start of construction: September 2005
 Start-up date: September 2006
 
 Dave Nilles is Online Editor for Biodiesel Magazine. Reach him at dnilles@bbibiofuels.com or (701) 373-0636.

 
 Posted: 11:16 a.m. CDT Wednesday, September 27, 2006

North Carolina plant nears production start

Chula Vista, Calif.-based <a target="_blank" href="http://www.greenstarusa.com">Green Star Products Inc.</a> is nearing completion on a fabrication facility designed to build biodiesel plants in Glenns Ferry, Idaho. Green Star President Joe LaStella said the 90,000-square foot plant is less than two weeks from going online.
 
 Once operational, the manufacturing facility will take approximately four months to build a biodiesel plant, according to LaStella. Green Star announced in early August it had funding commitments to build three biodiesel plants. The first plant will be shipped to North Carolina, Washington state or produce biodiesel at the Idaho site. Glenns Ferry is located in southwest Idaho along Interstate 84.
 
 LaStella said the Idaho manufacturing facility is built on 7.8 acres equipped with 1,000 feet of rail spur, eight 16,500-bushel grain silos and bulk grain elevators.
 
 Each Green Star-designed plant will have 10 MMgy to 20 MMgy of biodiesel production capacity. The plants will be shipped via rail or truck in 40-foot shipping containers, two of which are already on site, LaStella said.
 
 Green Star announced in May it developed an "enclosed, waterless continuous flow biodiesel production" system. LaStella said the plants are "fully sustainable," meaning they only require on-site electricity and storage tanks to operate.
 
 Green Star was previously an owner of American Biofuels LLC, a biodiesel plant in Bakersfield, Calif. The facility was expected to expand from 10 MMgy to 40 MMgy prior to a Feb. 17 fire. The fire was initiated by a methanol spill, which destroyed the entire plant. 
 

 After initial plans to rebuild an expanded facility at the Bakersfield site, Green Star announced plans in March to begin building biodiesel plants. LaStella said there is still a chance the company would consider rebuilding in Bakersfield. He said proper permits are already in hand.
 
 Dave Nilles is Online Editor for Biodiesel Magazine. Reach him at dnilles@bbibiofuels.com or (701) 373-0636.
 
 Posted: 4:08 p.m. CDT Wednesday, September 27, 2006

Green Star's Idaho manufacturing plant nearing completion

Within 15 years U.S. biodiesel industry consolidation will begin, Brazil will become a production leader and algae will become a viable biodiesel feedstock, according to a research report now available from Emerging Markets Online. The Houston-based energy intelligence and management consulting firm has published its 380-page <a target="_blank" href="http://www.emerging-markets.com/pdf/biodiesel2020study.pdf">"Biodiesel 2020: A Global Market Survey</a>."
 
 The report identifies trends in worldwide biodiesel production, according to Will Thurmond, the report's author and director of management consulting for Emerging Markets Online. The survey is designed to provide financiers, producers, developers, distributors, consultants and analysts with a market guide detailing medium and long-term trends and developments in the global biodiesel sector.
 
 The report identifies several interesting trends in the biodiesel industry. Thurmond said he expects U.S. biodiesel distribution to expand as companies like Marathon Oil Co. and Chevron become invested in the industry. Marathon is ramping up its biodiesel blending capabilities at its fuel terminals. Chevron recently announced investment in a biodiesel plant under construction in Galveston, Texas.
 
 The infrastructure expansion means biodiesel will become distributed in costal areas, making it more available nationally, Thurmond said. Currently the fuel is distributed on a local or regional basis.
 

 The U.S. retail market is already growing from 300 refueling sites in 2005 to more than 950 sites this year. However, public consumption still lags behind Europe, where biodiesel represents 2 percent of total on-road fuel consumption and is expected to reach 6 percent by 2010, according to the report. "Our consumer market needs to grow significantly," Thurmond said.
 
 While the entrance of companies like Marathon and Chevron may boost national distribution, it may also signal the maturation of an industry in its infancy. Thurmond said he expects industry consolidation to begin within three years.
 
 "Eventually the market will settle down," Thurmond said. "Only so many biodiesel producers will compete versus Marathon or Chevron and the other facilities doing over 120 million gallons of production per year. The participation by the larger corporations in larger, lower-cost biodiesel enterprises will lead to a consolidation among smaller players, which could include a series of mergers and acquisitions with small to mid-size players."
 
 Thurmond said he expects more biodiesel production to come online as long as gasoline prices remain near $2.50 per gallon and if the federal biodiesel tax credit is extended past 2008. "I don't see any reason why we shouldn't have continued growth as we've seen over the past two to three years," Thurmond said.
 
 Biodiesel production is expected to expand overseas. Thurmond said Brazil will play an important role as an international biodiesel supplier. Due to its agricultural capacity, Brazil is expected to be one of the world's biggest biodiesel suppliers by 2020.
 
 The report also details the biodiesel industry in China. Thurmond said trends show China and India will become large-scale producers and users of biodiesel over the next decade, possibly even overtaking Europe. Thurmond said while Europe is currently a leading biodiesel producer, it will be difficult to expand production due to agriculture capacity limitations.
 
 Finally, biodiesel feedstock sources may be changing. Thurmond said within five years soy oil may be start being replaced by biodiesel created from algae or imported palm oil. Some palm oil is already being imported to Europe, he said. Thurmond said he expects market introduction of algae-based biodiesel three years. "It's hard to say what the volumes will be," Thurmond said.
 
 Dave Nilles is Online Editor for Biodiesel Magazine. Reach him at dnilles@bbibiofuels.com or (701) 373-0636.

 
 Posted: 11:24 a.m. CDT Friday, September 29, 2006

Global biodiesel report identifies industry trends

The second biodiesel plant in as many weeks is getting close to start-up in North Carolina. An official from a 5 MMgy plant near Lenoir, N.C., said his facility produced a test batch of fuel last week.
 
 Foothills Bio-Energies LLC is close to beginning production in a renovated adhesives factory. Randy Dellinger said the plant sent samples of its initial test batch to a third-party laboratory to conduct ASTM testing. 
 
 The plant is built in the former Southeastern Adhesives Co. facility in Lenoir, which is on the edge of the western third of the state. Dellinger said renovation began in February 2006 and was completed in September. The building offers the potential for large-scale biodiesel production due to its existing infrastructure, which includes reactors, mixers and tanks. "We stripped it down to what we needed," Dellinger said.
 
 An in-house design was used for the biodiesel plant. "We based it on existing components for the biodiesel process," Dellinger said.
 
 The plant will primarily use soy oil feedstock. Animal fats may also be used, Dellinger said. He said a distribution deal is already lined up with a company that has ties to the home heating oil market. Foothills Bio-Energies also has its own blender's license, Dellinger said. It allows the group to blend down B100 for distribution.
 
 Dellinger said he expects the plant will immediately produce one 4,000- to 5,000-gallon batch of biodiesel per day before ramping up. The facility features an in-house lab to conduct many of the required ASTM tests.
 
 Dellinger also said his company is working with area universities to study value-added products based on glycerin. He said the plant can produce approximately 90 percent pure glycerin.
 
 Once operational, Foothills Bio-Energies is expected to become the largest biodiesel producer in North Carolina. Piedmont Biofuels Industrial is ready to start-up a 1 MMgy plant in Pittsboro, and Blue Ridge Biofuels in Asheville is already a 2 MMgy producer. A grain growers cooperative is planning at least a 20 MMgy plant in Mt. Olive that will be built by Renewable Energy Group. The Mt. Olive project is named Atlantic Bio-Energy.

 
 Dellinger said the Lenoir plant could also expand in the future. The two-story building has more room for process equipment, and the 8-acre property leaves room for additional storage tanks. A rail spur from a nearby Norfolk Southern main line would likely be used in any future expansion.
 	
 Dave Nilles is Online Editor for Biodiesel Magazine. Reach him at dnilles@bbibiofuels.com or (701) 373-0636.
 
 Posted: 2:08 p.m. CDT Tuesday, October 3, 2006

Another North Carolina biodiesel plant nears start-up

Automaker <a target="_blank" href="http://www.daimlerchrysler.com/">DaimlerChrysler</a> and off-road vehicle manufacturer <a target="_blank" href="http://www.arcticcat.com/">Arctic Cat</a> have recently announced plans that support the use of biodiesel blends.
 
 Earlier today DaimlerChrysler announced plans to factory-fill B5 biodiesel in two of the company's 2007 model lines. Every 2007 Dodge Ram diesel pickup truck at DaimlerChrysler's Fenton, Mo., assembly plant will be factory-filled with B5. In early 2007 the company will launch the Jeep Grand Cherokee common rail diesel with a 3.0-liter turbo-diesel engine, which will also be factory-filled with B5.

 
 The company has already delivered more than 15,000 Jeep Liberty (CRD) vehicles running on B5. The vehicles are produced at DaimlerChrysler's Toledo, Ohio, factory.
 
 The company has also approved the use of B20 in vehicles for commercial, government and military fleets. For this program, vehicles will require a supplemental fuel filter and must be used with fuel meeting the military's quality requirements.
 
 Earlier this year DaimlerChrysler became the first U.S. automaker to <a target="_blank" href="http://www.biodieselmagazine.com/article.jsp?article_id=790&q=daimlerchrysler&category_id=5">specifically approve B20 </a>in a warranty position statement. The company is working with the National Biodiesel Board and other groups to develop a consistent, universally applied B20 quality standard.
 
 "In order for automakers to produce, sell and warranty biodiesel vehicles, a national B20 standard is critical," said Deborah Morrissett, vice president of regulatory affairs. "We think allowing our fleet customers to use fuel made to current military specifications will accelerate the development of a national B20 specification for general use."
 
 Earlier this month Thief River Falls, Minn.-based Arctic Cat Inc. announced it had completed development of a twin-cylinder diesel all-terrain vehicle (ATV), which will be the first of its kind on the market. After conducting a testing program, Arctic Cat is encouraging the use of biodiesel blends in the ATVs. In fact, the machine comes with a fuel tag that recommends biodiesel use of up to B20. It marks the first time B20 has been commercially prompted in small diesel engines, according to the National Biodiesel Board.
 
 To verify compatibility, Arctic Cat vigorously tested three 2007 ATVs equipped with 700 cubic-centimeter, twin-cylinder Lombardini diesel engines. Research on biodiesel in the small diesel engines was sponsored by the Minnesota Soybean Research and Promotion Council, the Agricultural Utilization Research Institute's Center for Producer-Owned Energy and the Minnesota Corn Growers Association.
 
 
 Dave Nilles is Online Editor for Biodiesel Magazine. Reach him at dnilles@bbibiofuels.com or (701) 373-0636.

 
 Posted: 4:08 p.m. CDT Monday, October 9, 2006

DaimlerChrysler and Arctic Cat pushing the use of biodiesel blends

Despite hosting the <a target="_blank" href="http://www.nbb.org">National Biodiesel Board's </a>(NBB) headquarters, Missouri hasn't been much of a biodiesel producer. That is about to change soon.
 
 A large-scale biodiesel project partially owned by <a target="_blank" href="http://www.cargill.com">Cargill Inc</a>. is about to start construction as a second project nears start-up in the state. The construction process is nearly finished on Mid-America Biofuels LLC, a 30 MMgy plant in Mexico, Mo., according to J.P. Dunn of the Missouri Soybean Association. A grand opening is set for Oct. 24 with initial production slated for mid-November, he said.
 
 Mid-America Biofuels is a joint venture of Biofuels LLC, a farmer-owned biodiesel business based in Jefferson City, Mo., Ray-Carroll County Grain Growers, MFA Oil Company and <a target="_blank" href="http://www.admworld.com">Archer Daniels Midland Co.</a> (ADM). Jefferson City is also home to the NBB.
 
 The project, which began construction in October 2005, marks the first time ADM has dipped into U.S. biodiesel production. The agri-business company owns an interest in the plant, which will use soy oil as feedstock. ADM has extensive biodiesel operations in Europe and is building an 85 MMgy canola-based biodiesel plant in Velva, N.D. The project is expected to start-up by April 2007.
 

 The Mexico plant will be the state's largest, at least until Cargill's plant comes on line. Cargill's 40 MMgy facility, which is majority owned by farmers, is expected to begin construction later this month in Kansas City, according to Dunn. The project, which was announced earlier this year, includes a 30 million-pound food-grade glycerin refinery and will be built adjacent to Cargill's soy processing plant. The project will be jointly owned by Cargill and Paseo Biofuels LLC, a new entity formed by Missouri soybean farmers and the Missouri Soybean Association.
 
 Cargill owns 47 percent of the project while Paseo Biofuels owns the remaining 53 percent, Dunn said. Minneapolis-based Cargill will be the primary biodiesel marketer for the plant, which is expected to take 11 months to complete. <a target="_blank" href="http://www.lurgipsi.com">Lurgi PSI</a> is slated to build the facility.
 
 The Kansas City project will be similar to Cargill's 37.5 MMgy biodiesel plant in Iowa Falls, Iowa. That project also features a glycerin refinery.
 
 Missouri has small-scale biodiesel operations in Bunceton and Bethel that produce approximately 6 MMgy.
 
 Dave Nilles is Online Editor for Biodiesel Magazine. Reach him at dnilles@bbibiofuels.com or (701) 373-0636.
 
 Posted: 3:40 p.m. CDT Wednesday, October 11, 2006

Cargill, ADM biodiesel projects moving forward in Missouri

The U.S. soybean harvest is poised to set records while corn totals appear ready to dip slightly for the second straight year, according to the USDA's <a target="_blank" href="http://www.usda.gov/wps/portal/!ut/p/_s.7_0_A/7_0_1OB/.cmd/ad/.ar/sa.changenav/.c/6_2_1UH/.ce/7_2_5JN/.p/5_2_4TR/.d/0/_th/J_2_9D/_s.7_0_A/7_0_1OB?PC_7_2_5JN_navid=AGENCY_REPORTS&PC_7_2_5JN_parentnav=NEWSROOM#7_2_5JN">latest estimates </a>released today.

 
 Soybean production is forecast at 3.19 billion bushels, which is up 4 percent from the last growing season. Yields may just miss setting a new record, as estimates put this year's average at 42.8 bushels per acre, down just 0.2 bushels per acre from last year's record high. Prices are projected at $4.90 to $5.90 per bushel.
 
 Global oilseed production is projected at 390.4 million tons, which is up 3.9 million tons from last month's figures and up 2.1 million tons from 2005. Foreign oilseed production is projected higher due to increased rapeseed, sunflowerseed and cottonseed production. Rapeseed production is projected higher in several European countries, including major biodiesel producer Germany. Increased palm oil production in Malaysia is also credited with the increase in the world oilseed market.
 
 U.S. corn production is expected to reach 10.9 billion bushels, down more than 200 million bushels from the previous month's estimates and down from 2005's 10.91 billion bushel harvest. A record 11.81 billion bushels was harvested in 2004. This year will be the fourth consecutive time more than 10 billion bushels of corn have been harvested in the United States.
 
 Demand from export markets and the rapidly growing U.S. ethanol industry is expected to drive prices higher. The projected price range is up 25 cents to $2.20 to $2.60 per bushel. Last year the U.S. ethanol industry used more than 13 percent of the corn harvest.
 
 Corn yields are expected to average 153 bushels per acre, which would be the second largest on record behind 2004. Early harvest results in the central Corn Belt revealed that hot, dry summer conditions had reduced yield potential more than anticipated.
 
 Dave Nilles is Online Editor for Biodiesel Magazine. Reach him at dnilles@bbibiofuels.com or (701) 373-0636.
 
 Posted: 12:06 p.m. CDT Thursday, October 12, 2006

Soybeans poised for record harvest

<a target="_blank" href="http://www.cargill.com">Cargill Inc.</a> announced plans Wednesday that would appear to capitalize on the abundance of unrefined glycerin created by the rapidly expanding biodiesel industry. The Minneapolis-based agri-business company plans to commercialize a process using glycerin as a feedstock for producing a platform of biobased products.

 
 The first of the platform's products will be propylene glycol, which is commonly used in a variety of resins, food ingredients, lubricants, cosmetics and antifreeze. A newly formed company is being created to produce the substance. 
 
 Few details were readily available regarding the venture. A press spokesman said Cargill is in the process of structuring the new company. No timeline or company name was available. The spokesman said further details are expected soon.
 
 The biodiesel industry has recently focused on discovering new avenues for biodiesel-derived glycerin. Unrefined glycerin has flooded the market, resulting in considerable drops in prices.
 
 "Cargill already sells glycerin from its biodiesel plants and has ready access through its supply chain and other sources to enough glycerin for world-scale production of (propylene glycol)," said Jim Stoppert, senior director of Industrial Bioproducts for Cargill. "We are confident that our approach to manufacturing price-competitive, renewable (propylene glycol) on a large commercial scale will be highly desired by the chemicals industry."
 
 Cargill has produced biodiesel since May at its 37.5 MMgy plant in Iowa Falls, Iowa. The facility is also home to a 30 million-pounds-per-year glycerin refinery, which produces United States Pharmacopeia grade and other grades of glycerin, according to the company.
 
 The Missouri Soybean Association and Cargill announced plans earlier this year for a 40 MMgy biodiesel plant and 30 million-pound food-grade glycerin refinery adjacent to Cargill's existing soybean processing facility in Kansas City, Mo. The project is jointly owned by Cargill and Paseo Biofuels LLC, an entity comprised of Missouri soybean farmers. A Missouri Soybean Association representative said the project is expected to begin construction later this month.
 
 Cargill is also an accredited biodiesel producer through the <a target="_blank" href="http://www.bq-9000.org">BQ-9000</a> program, the biodiesel industry's voluntary quality assurance program.

 
 "We anticipate continued, steady growth in the (propylene glycol) market," Stoppert said. "Current capacities remain tight and the fluctuation of propylene prices continues to batter the industry. These market dynamics create a ripe opportunity for a new, renewable and stable product offering."
 
 Dave Nilles is Online Editor for Biodiesel Magazine. Reach him at dnilles@bbibiofuels.com or (701) 373-0636.
 
 Posted: 2:49 p.m. CDT Thursday, October 12, 2006

Cargill planning glycerin venture

Americans must not be complacent toward their energy future, even in light of falling gas prices, according to President George W. Bush. Despite the recent drop in energy prices, the President reaffirmed his support for ethanol and biodiesel at an energy conference last week.
 
 The jointly held USDA and U.S. DOE event, <a target="_blank" href="http://www.technologyforums.com/6EN/">Advancing Renewable Energy: An American Rural Renaissance</a>, was held Oct. 10-12 in St. Louis. Bush, USDE Secretary Mike Johanns and DOE Secretary Samuel Bodman each spoke at the event. One long-time biofuels proponent and Washington-insider said he believed it was "the most powerful bureaucratic lineup at any renewable energy conference in history." The focus of the event was on building partnerships and strategies for advancing the commercialization of renewable domestic energy. "It is apparent, and should be for most Americans, we've got to change our habits if we want to remain the economic leader of the world," Bush said Thursday.
 
 Activity in the ethanol and biodiesel industries has been frantic since the President announced America was "addicted to oil" in January's State of the Union address. The ethanol industry is on pace to produce more than 5 billion gallons of the fuel this year. More than 100 plants are now operating with another 60 either under construction or expansion.
 
 Likewise, the biodiesel industry continues to feverishly expand. There are at least 75 biodiesel plants in operation and approximately 40 under construction. There is nearly 600 MMgy of biodiesel production capacity currently available. "Biodiesel is coming," Bush said. "It makes a lot of sense for us to continue to invest in biodiesel technologies to make the production process even more efficient."
 

 Bush became the first sitting president to visit a biodiesel plant when he toured Virginia Biodiesel Refinery Inc. in May 2005.
 The President told conference attendees he was committed to furthering alternative energy sources. "We're too dependent on oil," Bush said. "Low gasoline prices may mask that concern. So, first, I want to tell you that I welcome low gasoline prices. However, it's not going to dim my enthusiasm for making sure we diversify away from oil."
 
 Bush touted the potential of cellulosic ethanol. He said the lack of feedstock diversification is preventing the widespread production and use of ethanol. "It makes a lot of sense for the federal government to continue to invest taxpayers' money, because the more efficient raw materials that are practical in use, the more ethanol production facilities spread across the country," Bush said.
 
 Commercial cellulosic development was recently boosted through several announcements. Sioux Falls, S.D.-based ethanol plant developer Broin Companies and DuPont recently announced an agreement expected to lead to a corn stover-to-ethanol plant by 2009. It would be the first commercial-scale facility of its kind. The National Renewable Energy Laboratory and Chevron Corp. also announced a five-year research alliance to develop biomass production technologies.
 
 Bush also promoted the prospects of clean coal technology. He said the federal government is spending $2 billion to promote technologies to reduce emissions from coal-fired plants. "By the year 2012, we'll build the first clean-coal power plant that will remove virtually all pollutants and greenhouse gases from burning coal," Bush said. "In other words, there's a way coming that's going to enable us to use this plentiful resource."
 
 For its June 2006 issue, Ethanol Producer Magazine surveyed ethanol projects regarding plant energy sources. Results showed that nearly 30 percent of ethanol plants under construction were planning on using coal-fired boilers or a combination of coal and natural gas to power their facilities. That is a significant shift from current ethanol producers, of which more than 90 percent rely on natural gas.
 
 On Wednesday, Bodman and Johanns announced nearly $17.5 million for 17 biomass research, development and demonstration projects. The grants are intended to develop technologies to help make bio-based fuels cost-competitive with fossil fuels in the commercial market. 
 
 The DOE funds total $4.7 million and are directed toward three cellulosic ethanol projects. USDA's funding will be used to address feedstock production and product diversification. "This funding will spur new scientific innovation that will help us kick our over-reliance on oil," Bodman said. "President Bush's policies, like the <a target="_blank" href="http://www.whitehouse.gov/stateoftheunion/2006/energy/
 ">Advanced Energy Initiative</a>, have demonstrated a strong commitment to a secure energy and economic future. By investing in our nation's promising researchers we are closer to making clean, affordable alternative sources of energy a reality."

 
 Bush announced his Advanced Energy Initiative in January's State of the Union address. He set a national goal of replacing more than 75 percent of oil imports from the Middle East by 2025. The initiative provides for a 22 percent increase in clean-energy research at the DOE.
 
 "What I'm talking about is a comprehensive approach to solving the national issue, which is dependence on oil, and how best to protect this environment," Bush said. "It's time to get rid of the old, stale debates on the environment and recognize new technologies are going to enable us to achieve a lot of objectives at the same time."
 
 The following projects received funding through Wednesday's announcement from the USDA and DOE:
 
 -- Edenspace Systems Corp (Virginia) - $ 1,926,900
 Development of commercial corn hybrids engineered for enhanced, low-cost conversion of cellulosic biomass to ethanol. 
 
 --Center for Technology Transfer (Wisconsin) - $1,521,800
 Stabilizing value of biomass material before processing. 
 
 --Lucigen Corporation (Wisconsin) - $1,259,000
 Novel enzyme products for the conversion of defatted soybean meal to ethanol. 
 
 --Ceres, Inc. (California) - $1,523,530

 Enhance economic competitiveness of bio-based fuels through product diversification. 
 
 --Ceres, Inc. (California) - $1,572,460
 Double switchgrass yield by 2020 (cellulosic ethanol). 
 
 --Western Governors' Association (Colorado) - $290,246
 Strategic development of bioenergy in the western states. 
 
 --Southern Illinois University (Illinois) - $676,722
 Expansion of ethanol production in the Upper Mississippi River Basin. 
 
 --DOE's Argonne National Laboratory (Illinois) - $400,000
 Enhance animal feed values in corn dry mills with bio-based solvents. 
 
 --Iowa Corn Promotion Board (Iowa)- $1,762,157
 Add value to commercial polymers through the incorporation of biomass-derived materials. 
 

 --Louisiana State University Agriculture Center (Louisiana) - $791,865
 Natural fiber and commingled waste plastic project. 
 
 --Michigan State University (Michigan) - $376,616
 Develop environmental information on corn and soybean cropping systems and platform chemical production. 
 
 --SUNY College of Environmental Science and Forestry (New York) - $813,450
 Willow biomass crop management. 
 
 --Clarkson University (New York) - $250,001
 Waste biomass feedstocks for ethanol fuel production. 
 
 --North Carolina State University (North Carolina)- $435,997
 Strategic positioning of biofuels in the context of agriculture, crude oil and auto manufacturing. 
 
 --The Pennsylvania State University (Pennsylvania)- $579,340
 Lignin conversion to value-added materials. 

 
 --Drexel University (Pennslyvania)- $1,312,389
 Improve bio-based polymers for moisture barrier applications. 
 
 --Virent Energy Systems, Inc. (Wisconsin) - $2,000,000
 Co-production of propylene glycol with biodiesel production. 
 
 Dave Nilles is Online Editor for Biodiesel Magazine. Reach him at dnilles@bbibiofuels.com or (701) 373-0636.
 
 Posted: 11:35 a.m. CDT Monday, October 16, 2006

September 2006

Business Briefs

Honda R&D Americas Inc. achieves LEED gold certification

Eastman sells Arkansas-based subsidiary, biodiesel facility

GreenShift Corporation lines up source for biodiesel feedstock

Bay BioDiesel, Golden Gate partner

Colorado company develops algae technology

Oilfield service provider starts algae spin-off

Virent Energy hires Keenan

Blumenthal joins GeoGreen Fuels

REG hires biofuels sales manager

Blue Sky Biodiesel hires safety manager, plans to rebuild

Nova Energy adds to board of directors

FUMPA receives Ag Innovator of the Year award

Columns

Editor's Note

Legal Perspective

Talking Point

NBB Insight

Featured

Food or Fuel:Where Does Vegetable Oil Have More Value?

Defining the Balance

Getting Serious about Safety

Combating the Glycerin Glut

Pressing the Possibilities

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

Business Briefs

Honda R&D Americas Inc. achieves LEED gold certification

Eastman sells Arkansas-based subsidiary, biodiesel facility

GreenShift Corporation lines up source for biodiesel feedstock

Bay BioDiesel, Golden Gate partner

Colorado company develops algae technology

Oilfield service provider starts algae spin-off

Virent Energy hires Keenan

Blumenthal joins GeoGreen Fuels

REG hires biofuels sales manager

Blue Sky Biodiesel hires safety manager, plans to rebuild

Nova Energy adds to board of directors

FUMPA receives Ag Innovator of the Year award

Columns

Editor's Note

Legal Perspective

Talking Point

NBB Insight

Featured

Food or Fuel:Where Does Vegetable Oil Have More Value?

Defining the Balance

Getting Serious about Safety

Combating the Glycerin Glut

Pressing the Possibilities

September 2006