As a supplier of biodiesel plants and equipment, you charge your customers for various services that you provide. You charge them for the plants and equipment that you sell to them. You might charge a license fee for the right to use your technology to operate their biodiesel plant or equipment. You might even provide a loan to purchase a biodiesel plant or equipment. And you fully expect to get paid by your American biodiesel customers with little government involvement and few legal entanglements.
 
 Not so, however, with regard to your foreign biodiesel customers. Receiving fees from them, and repatriating those fees to the United States, can present some rather thorny legal and financial issues. This article will highlight the problems that you might face in attempting to bring in and repatriate those funds. By its very nature, it cannot provide solutions to all of the problems that you might encounter in various countries around the world. The issues apply to different foreign jurisdictions differently.
 
 Foreign Government Approvals and Licenses
 In some countries, customers may not send currency out of the country without the approval of the appropriate agency or institution in their national government. In others, customers may send local currency out of the country without governmental approval, but may not send foreign currency (such as U.S. dollars) out of the country without approval. Such approval often must come from the main financial and/or banking institution in the customer's country. 
 

 Obtaining that approval can be a frustrating experience. Usually, your customer will be required to file a copy of the contract that you have entered into and application forms that require information about your company and your customer. More often than not, these documents must be translated, sometimes by an official government translator, into the language spoken in your customer's country before they may be submitted to the foreign institution for approval. In some cases, some or all of these documents must be submitted for approval each time your customer desires to send funds to the U.S. In other cases, a one-time "blanket" approval may be sought, which would allow your customer to remit payments to the U.S. as often as it wished for a certain period of time.
 
 In many countries, the application process for remitting funds overseas can take weeks. Sometimes, government officials meet only once or twice a month to approve or deny such types of applications. Therefore, your customer must take an active role in preparing, translating, and submitting to the appropriate governmental institution the application to remit fees to you in connection with your customer's business operations. The customer must be responsible for monitoring the application process at the appropriate institution and providing the government with any additional information that it may require to reach a favorable decision regarding the application to remit funds to you.
 
 Foreign Government Taxes
 After your customer receives approval from the main financial and/or banking institution in their country, they may send payments to you for fees owed to you in connection with their business operations. However, simply because the customer is permitted to send these payments overseas does not mean that the payments can be sent tax-free. Many foreign governments impose a withholding tax on the payment of funds overseas, if such payments take the form of fees or royalties paid in connection with license grants. Since payments from your customer might be remuneration for license grants by you to your customer for the use of your biodiesel technology, these fees are usually categorized by the taxing authorities in the customer's country as license fees subject to withholding tax.
 
 The amount of tax that must be withheld from the funds remitted overseas is often quite substantial, ranging from 10 percent to 25 percent of the amount of the payment itself; and it is you, not the customer, who is ultimately responsible for the payment of the tax. The customer simply acts as the agent of their government in deducting the amount of tax withheld from the payment remitted overseas, and sends the proper amount of withholding tax to the taxing authority in their country on your behalf. In practice, the customer is often prohibited from making any payment overseas until they can demonstrate they have deducted the appropriate amount of withholding tax from the payment, and have remitted such amount to their government.
 
 Let's say, for example, that you have a customer in the Philippines that has the right to use your technology in the Philippines in connection with the operation of their biodiesel plant. Let's also say that the fee that you charged your customer was $100 per month. Since, under the current tax regulations in the Philippines, the payment is subject to a withholding tax of 25 percent, your customer would send you a payment of $75 per month and would remit $25 per month to the Philippine tax authorities on your behalf.
 
 In an effort to reduce the foreign tax burden on American companies that find themselves paying foreign withholding taxes on the repatriation of funds to the U.S., the government has entered into bilateral tax treaties with many of our trading partners, which lowers the amount of tax withheld from such payments from 10 percent to 25 percent, to zero percent to 20 percent, depending upon the foreign country and type of payment involved. In Poland, for example, payment of typical license fees is subject to a maximum withholding tax of 10 percent. Absent a bilateral tax treaty between the U.S. and Poland on this matter, the payment of license fees destined for the U.S. would be subject to a withholding tax of 25 percent. 
 
 One way to eliminate the effect of a foreign country's withholding tax on the amount of funds you receive from your foreign customers is to "gross up" the payments that they make to you. In essence, "grossing up" means increasing the amount of your usual fees that are subject to withholding tax in a foreign country so that you receive the amount of fees to which you are accustomed after the withholding tax is deducted from the payments made by your foreign customers. Let's say, for example, that your usual license fee is $100 per month. Let's also say that your customer in India has informed you that any license fee they pay to you is subject to a withholding tax of 20 percent in India. If you simply increase your usual license fee from $100 per month to $125 per month, you will receive from your Indian customer your usual monthly payment of $100, after your customer deducts 20 percent of the $125 license fee, or $25, and remits that amount monthly to the Indian tax authorities on your behalf.
 
 If, despite your best efforts, your foreign customers will not agree to "gross up" your usual license fee, your foreign tax may be credited against the amount of income tax which your company owes in the U.S. In order for American companies to obtain a certain degree of tax relief from the payment of taxes to foreign governments, the U.S. government has entered into bilateral tax treaties with many countries, permitting American companies to take a credit on their U.S. corporate income tax for a portion of the amount of tax that they pay to a foreign government. However, this tax credit does not apply to every situation or to the payment of tax to every foreign government; nor is the credit for 100 percent of the amount of the tax paid to a foreign government. Each tax credit situation must be analyzed on a case-by-case basis. 

 
 Currency Risks
 In any analysis of the payment of fees from foreign customers, you must determine in which currency you will be paid: U.S. dollars or the currency used in your customer's country. 
 
 Your decision should be based upon your predictions concerning the future fluctuation of the exchange and inflation rates between the U.S. dollar and the currency of that country. 
 
 If you believe that during the term of your foreign customer's business operations, his country's currency will increase in value or experience less inflation than will the U.S. dollar during the same period, you might consider receiving your fees in the currency of your customer's country. If, for example, your customer is located in Switzerland, according to the above criteria, you might fare better financially to be paid in Swiss francs than in U.S. dollars. If, on the other hand, you believe that during the term of your customer's business operations, the currency of his country will decrease in value compared to the dollar and/or will, during the same period, experience greater inflation than will the dollar, you should probably be paid in dollars. Therefore, if your foreign customer were doing business in Mexico, according to these criteria, you would probably prefer to receive U.S. dollars, rather than Mexican pesos.
 
 Getting Your Fees to the U.S.
 There are, of course, several ways in which you can receive fees from your foreign customer. The two safest methods are by wire transfer and by irrevocable letter of credit. A wire transfer of funds is the most efficient and expedient manner in which you can be paid. You simply designate to your foreign customer an account in a U.S. bank a bank into which the fees must be deposited.
 
 Receiving payment of your fees by means of an irrevocable letter of credit is more complicated and time-consuming. However, when payment by wire transfer is not available or desirable, payment by irrevocable letter of credit should be seriously considered. The letter is a payment mechanism by which your foreign customer establishes and funds an account at a bank in their home country, for the specific and exclusive purpose of paying your fees. At the same time, you designate a bank account at a bank in the U.S. into which those fees may be deposited. When those fees are due to you, you are simply required to present to your American bank certain, pre-determined documentation which your bank passes on to your customer's bank in their country, demanding that payment be made to your bank from their bank. If the documentation that you submitted to your bank was the type required under the irrevocable letter of credit and the transaction goes smoothly, the funds will be transferred from the foreign bank to your bank in the U.S.
 
 There are, however, two disadvantages to receiving your payments by irrevocable letter of credit. First, the process can take several days or even weeks, depending upon the banks and the countries involved. You should carefully explore the procedure and length of time required for payment by a foreign bank before agreeing to payment of your fees by means of an irrevocable letter of credit.
 

 The second disadvantage is that each bank involved in the transaction will charge you a fee for its services, regardless of how small or insignificant these services might be. These bank fees can be quite substantial however, you may be able to reduce the amount if both you and your customer use different branches of the same international bank to service your irrevocable letter of credit. For example, your British customer could establish a bank account at a London branch of Citibank, and you could open an account at one of Citibank's New York offices. Your British customer could then establish an irrevocable letter of credit in your favor at Citibank's London office, and could indicate that all payments under the letter of credit be made to your Citibank account in New York. Thus, when you are paid under the letter of credit from Citibank's London branch, Citibank presumably would not charge you two service fees for the transaction.
 
 Repatriating funds from your foreign biodiesel customer can be fraught with danger. However, giving serious consideration to the issues discussed in this article, and finding a way to resolve them before any fees become due, will go a long way toward reducing most of the danger inherent in bringing your fees home. Advanced planning by you and your foreign customer could be the difference between a successful and an unsuccessful foreign business transaction. 
 
 Richard Weiner is an international biodiesel lawyer in the energy law department of Fredrikson & Byron P.A. Reach him at <a href="mailto:rweiner@fredlaw.com">rweiner@fredlaw.com</a> or (612) 492-7009.

India: Your customer in India has informed you that any license fee they pay to you is subject to a withholding tax of 20 percent in India. If you simply increase your usual license fee from $100 per month to $125 per month, you will receive from you

1657-1294331861.jpg

Philippines: Say that the fee you charged your customer in the Philippines for the right to use your technology was $100 per month. Since under the current tax regulations in the Philippines, the payment is subject to a withholding tax of 25 percent,

1658-1294331861.jpg

Poland: In Poland, payment of typical license fees is subject to a maximum withholding tax of 10 percent. Absent a bilateral tax treaty between the U.S. and Poland on this matter, the payment of license fees destined for the U.S. would be subject to 

1659-1294331861.jpg

Getting Paid: Repatriating Funds from Your Foreign Biodiesel Customer

In early March, the European Commission announced that it would impose tariffs on European Union imports of biodiesel from U.S. producers. The new tariffs, which include both anti-subsidy and anti-dumping components and can reach as high as 69.9 percent of the value of the biodiesel, are imposed provisionally for six months but may be implemented for as long as five years. To understand these tariffs and their impact on a U.S. export business that reached $1.5 billion in 2008, it is helpful to review the law and processes that brought them into being. 
 
 The World Trade Organization generally discourages protective tariffs but allows an exception when the exporting company or its government inappropriately reduces the price of the import. When a government subsidy enables a producer to under-price the producers in an importer's market, the importing country can apply "countervailing duties" as protection from the unfair competition. Similarly, when a producer's high prices in its home market (the "normal value") allow it to use a lower export price that undercuts native competitors in a foreign market (a process called "dumping"), the importing country may apply anti-dumping duties. Exporters usually argue that the duties are too high, but the arguments have ended in Europe, and the figures are fixed.
 
 The problem for U.S. producers began in April 2008, when the European Biodiesel Board asked the EC to examine the pricing of U.S. biodiesel. Following standard procedure, the EC asked for information from all relevant exporters, selected a sample of six from the responding 54 (the "cooperating" producers), examined the sample group's pricing for a selected period, developed weighted averages by producer for both normal and export prices, and declared the difference between the averages to be each producer's "dumping margin." These margins varied widely, from 3.4 percent for Archer Daniels Midland Co., to 73.4 percent for Green Earth Fuels of Houston LLC.
 
 The EC also considered subsidies to U.S. producers, quantified the subsidies, and added countervailing duties to the import burden to offset them. These countervailing duties also varied from producer to producer in a narrower range, from 29.1 percent for Imperium Renewables Inc. to 41 percent for Peter Cremer North America LP. 

 
 Despite the combination of duties, there is one slightly mitigating factor. Calculations for each of the sample group also included an "injury margin," which represents the injury allegedly done to local producers by the U.S. exporter. This margin acts not as an additional basis for duty but as an upper limit to the duties actually applied. Thus Cargill, with a dumping margin of 10.4 percent and a countervailing duty rate of 34.5 percent, is charged duties of "only" 44.9 percent, despite a calculated injury of 58.9 percent, and Peter Cremer North America LP, with a dumping margin of 57.3 percent and a countervailing duty rate of 41.0 percent, is limited to duties of "only" the injury margin of 69.9 percent, rather than 98.3 percent. 
 
 For those producers outside the sample group, the EC made some weighted assumptions, which no doubt seem harsh to companies whose pricing was not examined at all. The dumping margin for cooperating companies outside the sample is assumed to be 33.7 percent and the injury margin 51.4 percent; for those with subsidies, the assumed subsidy rate is 36 percent, with anti-dumping duties lowered to 15.4 percent to meet the limit of 51.4 percent. For the non-cooperating companies, the assumption is that the highest levels found in the study apply – a dumping margin of 73.4 percent, a subsidy level of 41.1 percent , and a cap of 69.9 percent. Although challenges and reevaluation may be possible in time, biodiesel exporters currently have a significant hurdle to clear for profitable exporting to the EU.
 
 Daniel Schwartz is an attorney in Lindquist & Vennum's Agribusiness and Energy practice group. He can be reached at (612) 371-3502 or <a href="mailto:dschwartz@lindquist.com">dschwartz@lindquist.com</a>. Mark McNeil leads Lindquist & Vennum's International practice and can be reached at (612) 371-2473 or <a href="mailto:mmcneil@lindquist.com">mmcneil@lindquist.com</a>.

1660-1294331862.jpg

1661-1294331862.jpg

European Union Imposes High Duties on Biodiesel

Last month, Evonik began the production of our biodiesel catalyst NM 30 at a new, state-of-the-art 60,000 metric ton facility in Mobile, Ala. After less than one year of construction, the plant is now ready to support the North American biodiesel industry by providing a high quality, locally produced, extremely versatile and ready-to-use catalyst.
 
 Evonik is the leading supplier of sodium methylate worldwide, and in the U.S. We have been producing it for more than 40 years and now supply some 60 countries around the world. Our new plant in Mobile was built for the U.S. biodiesel market, where we expect growth to increase in the future. It is also a test platform for additional facilities currently under review.
 
 You're probably thinking that this not the best time to start-up a multi-million dollar biodiesel catalyst plant, particularly with the industry – and the global economy – in flux, but we believe it is still a good investment. Biodiesel is part of the solution of some critical problems the world faces today. Despite the current market challenges, the industry will not go away. It is expected to grow – maybe not significantly over the next two or three months, but definitely over the coming years.

 
 Things have definitely changed since we started building this project. And they will transform again in the next half a year. Change is constant. We must learn to adapt. When we decided to invest in our first U.S. sodium methylate plant – the first outside of Germany – the growth prospects of the American biodiesel industry where bright. Now, the industry is facing its worst crisis in its still very young history. The financial upheaval was much deeper than anybody could predict: oil prices have fallen more sharply; the European Union (EU) has imposed a duty on biodiesel from the U.S.; and the mandatory blending of biodiesel into mineral diesel has still not been enforced in the U.S.
 
 But rather than sit back and complain about the situation, we need to look ahead. The economic crises will eventually ease, although no one can honestly predict when that will happen. Oil prices will move up again in the long run, since supply remains limited and the energy requirements of the global population will grow. And the final EU ruling on the countervailing duty will have an important impact on North American biodiesel as will the enforcement of the mandatory blending. As the global economy adjusts, there will be increased calls for sustainable fuels. Does anyone really believe the price of oil will remain, relatively speaking, in the $40 a barrel range forever? Once these factors change, the U.S. biofuels industry will once again regain its footing. 
 
 We expect double digit growth for biodiesel worldwide. Right now the demand for biodiesel in the U.S. is less than what we had hoped, but the outlook of the industry is still strong. 
 
 We see a bright – and profitable – future ahead. We strongly believe in sustainability, so having a robust U.S. biodiesel market is important. We must work towards strengthening the sector. In the past, many U.S. biodiesel producers concentrated on exports, sending nearly 75 percent of their product to Europe. But the U.S. biodiesel market should not be based on exports-it should be based on local demand. Thus, we believe that building up the biodiesel industry in the U.S. should be a top priority.
 
 Biodiesel has proven to be a viable fuel that helps in the fight against climate change, reduces the dependency on foreign oil (approximately 70 percent of the U.S. oil consumption is imported) and provides jobs. Thus, the Renewable Fuel Standard (RFS2) is essential to breaking our over-dependence on imported oil. With the RFS2, we put ourselves on a clear path of producing and using steadily increasing levels of a variety of biofuels over the next 15 years. We believe, because of sustainability and the future of the planet, that the biodiesel market should be larger. One billion gallons of biodiesel in the U.S. represents only 2.5 percent blending. Europe has 5.25 percent and will increase to 10 percent in two years. Brazil has 3 percent blending now, which will rise to 4 percent in July and 5 percent by 2010. Brazil is looking to further increase that portion. Other countries already have or are implementing an initial 5 percent blending. So there is still potential in the U.S. market by increasing blending rates.
 
 Evonik believes in sustainability – it is a major issue for us – and reducing the impact humans have on Mother Nature. We also believe in sound science. We do not support any practices which cannot comply with sustainability criteria. Biodiesel has proven to be a sustainable fuel whenever sound science has been applied.
 
 The world needs biodiesel. Despite the difficult times, we still believe we made the right choice to invest in a state-of-the-art plant in the U.S. to support the growth of an industry that we are convinced with ultimately succeed. We must bring our case not only to the political leaders, but also to the citizens of the world. Merely hoping that the EU will revoke its decision on countervailing duties for imports of US-produced biodiesel would mean ignoring the real source of the current problem – generating more local demand for biodiesel.
 
 Jose Berges is Evonik's head of electrolysis products and alkoxides business line.

1662-1294331863.jpg

The Future is Today

Posted May 27
 
 Finland's Neste Oil held the official groundbreaking ceremony on Tuesday for a $940 million renewable diesel plant in Rotterdam, The Netherlands. This facility, with a production capacity of approximately 240 MMgy, will be dedicated to producing the company's proprietary NExBTL fuel. It is slated to be the largest renewable fuels plant in Europe. 
 
 "We expect mechanical completion to take place sometime in early 2011," said Hanna Maula, director of corporate communications for Neste. "It will take additional time after this to ramp up production to full capacity."
 
 A facility of this size is certain to increase the strain on the already sketchy feedstock supply situation in Europe, which is importing palm oil and soya oil for biodiesel refining. Some non-governmental associations like Greenpeace and the World Wildlife Fund have protested the use of palm oil for biodiesel refining, saying that it is responsible for the deforestation of tropical areas in Indonesia and Malaysia. "Some NGOs do not support the use of palm oil in any capacity," Maula told Biodiesel Magazine. "But we do everything we can to ensure the sustainability of the palm oil we use to make renewable diesel."
 
 Neste said it does understand that there are good players and bad players in the palm farming and production sector. "We can't be responsible for the actions of the bad players," Maula said. "But we try to trace our palm oil from the refinery back to the farm to make sure that it is produced in a sustainable way." 
 
 Neste Oil has also committed itself to only using palm oil certified by the Roundtable on Sustainable Palm Oil (RSPO) as it becomes available in sufficient volumes. In addition, most of Neste Oil's research spending, with an annual budget of nearly $37 million, is used in developing new renewable raw materials.

 
 The Port of Rotterdam is an excellent location for a fuel refinery, located in central Europe, and where most shipments of virgin oils exported to Europe are destined. "Rotterdam is a very good location for us," Maula said. "It allows us to access raw material shipments and markets across Europe."
 
 Neste Oil's refineries are located in Porvoo and Naantali, Finland, and have a combined crude oil refining capacity of approx. 260,000 barrels a day. The company had net sales of €15 billion in 2008 and employs around 5,200 people.

Neste Oil starts construction on Europe's largest renewable fuels plant

It may seem odd to have two feature articles in a June issue covering the topic of cold flow or biodiesel low-temperature operability. Really it is not. We all here realize it is springtime – even in North Dakota – but one of the most repeated concerns I hear from lay people, especially from those in the North Country, is that "biodiesel would be great if it worked when it's cold." Well, as you all know, No. 2 petro-diesel doesn't work so great in cold weather either, which is why in places like Minnesota and North Dakota, No. 1 diesel fuel is blended 50/50 with No. 2. 
 
 Diesel fuels, and of course biodiesel, all have cloud point temperatures at which the fuel becomes, well, cloudy from crystallization. No diesel or biodiesel fuel is expected to perform below the cloud point, but with biodiesel a technical issue that is baffling the industry is the potential with biodiesel for operability problems at temperatures above the cloud point. As NREL principal engineer Robert McCormick says in a Q&A I conducted with him (page 42), "The problem with biodiesel from a low-temperature perspective is when you get fuel filter plugging in temperatures above the cloud point – no one expects that." The Cold Soak Filtration Test was incorporated into ASTM D 6751 to curb this phenomenon. 

 
 Assistant editor Sue Retka Schill wrote an interesting feature article, on Page 36, "B100 to the Arctic Circle," which is about Purdue University's Permaflo process that uses urea to facilitate fractionation of the saturated and unsaturated methyl esters. The unsaturated fraction, Permaflo biodiesel as it's called, powered a contingent of Hoosiers and Alaskans north to the Arctic Circle and, while bottled water and canned foods were frozen solid, the Permaflo biodiesel kept performing. 
 
 So, while springtime does not make the cold flow issue go away, the warm weather is highly welcomed. Enjoy the weather!
 
 Ron Kotrba
 Editor
 <a href="mailto:rkotrba@bbiinternational.com">rkotrba@bbiinternational.com</a>

1650-1294331851.jpg

Springtime Doesn't Make the Cold Flow Issue Go Away

USDA Agricultural Research Service animal nutritionist Brian Kerr, Auburn University animal scientist William Dozier and Iowa State University animal scientist Kristjan Bregendahl have announced the results of an experiment to determine whether crude glycerin could be used to supplement livestock feed. In a series of experiments, the scientists fed pigs, laying hens and broilers different levels of crude glycerin-in pigs, between 5 to 10 percent of their diet-and in all cases found the animals were able to digest the crude glycerin efficiently with no negative effects.  Dozier said the group will have a total of six peer-reviewed papers from the research, and has been invited to present the results at national and international nutrition conferences.

Glycerin feeding trials show swine and poultry can utilize crude glycerin. /PHOTO: USDA ARS

1663-1294331852.jpg

ARS moves glycerin feeding ahead

U.S. Senators Tom Harkin (D-IA), John Thune (R-SD) and Tim Johnson (D-SD) recently introduced legislation authorizing loan guarantees for the construction of renewable fuel pipeline projects. The majority of biofuels are produced in the Midwest and the U.S. currently lacks the infrastructure to efficiently transport liquid fuels to population centers on either coast. In addition to being safer than trucks or trains, pipelines have the lowest energy input requirements and produce fewer carbon emissions than other forms of biofuels transportation.

Biofuels pipeline legislation introduced

Posted May 12
 
 Renewable Energy Group Inc. today announced it has entered into agreements to consolidate with three commercial-scale biodiesel plants. Western Iowa Energy, which operates a 30 MGY facility in Wall Lake, Iowa; Central Iowa Energy, LLC, which operates a 30 MGY facility Newton, Iowa; and Blackhawk Biofuels, LLC, which operates a 45 MGY facility in Danville, Ill., are involved in the transaction. 
 
 The facilities represent an additional 105 million gallons per year (MGY) of wholly-owned production capacity which would allow the combined entity to better position itself to meet anticipated demand from the petroleum industry's distillate fuel market.
 
 Ownership of the operations of all four companies will be consolidated in a new holding company to be named Renewable Energy Group, Inc. The consolidated company will be owned by the current members of the three acquired companies and current Renewable Energy Group (REG) investors, including Bunge North America, ED&F Man, Natural Gas Partners, NGP Energy Technology Partners, US Renewables Group (USRG) and West Central Cooperative. The transaction is subject to approvals by the shareholders of all four companies and to other conditions, including customary regulatory approvals.
 

 REG's chairman and chief executive officer Jeff Stroburg cited demand by major petroleum distributors and oil refiners as a key factor in the decision to move forward with plant consolidation. "As the Renewable Fuels Standard (RFS) takes effect and our nation moves toward energy reform, the distillate market is demanding technical expertise, dependable supply, more efficient distribution and creative pricing options from major biodiesel partners," Stroburg said. Under the 2007 Energy Independence and Security Act, the RFS calls for 500 million gallons of domestic biodiesel consumption ramping up to 1 billion biodiesel gallons in 2012.
 
 "We believe this proposed consolidation brings greater economies of scale, streamlined central management of complex logistics and decision-making processes, and enhanced risk-management opportunities," said Daniel J. Oh, REG's president and chief operating officer. "By more efficiently managing our business and strengthening distribution channels, REG will continue to partner with obligated parties of the RFS in order to reduce our nation's reliance on foreign oil."
 
 "Consolidating these three multiple-feedstock facilities under the ownership of Renewable Energy Group will offer technology advantages as these sites utilize a variety of raw materials like soybean oil, fats, corn oil, canola oil and recycled restaurant grease to produce large volumes of high quality biodiesel which are then marketed through our national infrastructure system," Oh explained. 
 
 Bill Horan, chairman of Western Iowa Energy's board of directors stated, "Although our facility is currently well-positioned compared to other biodiesel manufacturers in the U.S. due to its ability to process multiple feedstocks, this proposed consolidation offers our members the opportunity to diversify their biodiesel investments while continuing and expanding our current relationship with REG." Horan added, 
 
 "Western Iowa Energy's board has carefully considered the future of our facility and believes the REG consolidation proposal is the best direction for returning value to our members." 
 
 Central Iowa Energy's board chairman, Jim Johnston, said, "Given current industry consolidation and production economics, it is difficult for stand-alone facilities like our plant to succeed on their own in the 67 billion-gallon distillate market."
 
 In March, Blackhawk Biofuels announced upgrades and enhanced production capabilities to utilize a wider variety of feedstocks. "The Blackhawk Biofuels board believes that a merger with REG is the best option for Blackhawk in the current challenging environment," said Ron Mapes, chairman of Blackhawk Biofuels.
 ###
 
 For more information, please contact Alicia Clancy at (o) 515-239-8118; (m) 515-450-9692 or alicia.clancy@regfuel.com
 

 About Renewable Energy Group
 Renewable Energy Group (REG) leads the biodiesel industry by offering a complete biodiesel solution. Committed to redefining quality, Renewable Energy Group markets REG-9000 biodiesel, which exceeds ASTM quality specifications, through existing nationwide diesel infrastructure, including more than 20 terminal locations. 
 
 REG-9000 biodiesel is marketed through large petroleum companies and fuel distributors, and is utilized by on-highway fleets, municipalities, and power generator, mining, military, home heating and agriculture applications.
 
 REG-9000 biodiesel is produced by REG network production facilities consisting of state-of-the-art, proprietary multiple-feedstock technology. Renewable Energy Group offers procurement and risk management, production operations, and technology services in addition to alternative feedstock research and commercialization.
 
 To learn more about Renewable Energy Group, Inc. please visit www.regfuel.com
 
 About Western Iowa Energy, LLC
 Western Iowa Energy, LLC owns a commercial scale, state-of-the-art biodiesel production facility just south of Wall Lake, Iowa. The multiple-feedstock production facility can utilize soybean oil, other vegetable oils and animal fats to manufacture approximately 30 million gallons of high quality biodiesel each year. The facility employs 28 full-time, highly skilled employees. The WIE plant is located on a 38.3-acre site that is one mile south of the city of Wall Lake with access to the Iowa Interstate railroad and the Canadian National railroad. 
 
 To learn more about Western Iowa Energy, LLC, please visit www.westerniowaenergy.com. In addition, you can also find information about Western Iowa Energy in the documents filed with, or furnished to, the SEC by Western Iowa Energy at the SEC's website at http://www.sec.gov.
 
 About Central Iowa Energy, LLC
 Central Iowa Energy, LLC owns a commercial scale, state-of-the-art biodiesel production facility just north of Newton, Iowa. The multiple-feedstock production facility can utilize soybean oil, other vegetable oils and animal fats to manufacture approximately 30 million gallons of high quality biodiesel each year. The facility employs 22 full-time, highly skilled employees. The Central Iowa Energy facility, currently about 32 acres with additional acreage available for expansion, is located in Jasper County, Iowa. This site sits on the Iowa Interstate Railroad (IAIS) and is located approximately five miles from US Interstate 80. Biodiesel production began April 2007.
 

 To learn more about Central Iowa Energy, LLC, please visit www.centraliowaenergy.com. In addition, you can also find information about Central Iowa Energy in the documents filed with, or furnished to, the SEC by Central Iowa Energy at the SEC's website at http://www.sec.gov.
 
 About Blackhawk Biofuels, LLC
 Blackhawk Biofuels, LLC owns a commercial scale, state-of-the-art biodiesel production facility in Danville, Illinois. The multiple-feedstock production facility can utilize vegetable oils, such as soybean oil, and fats to manufacture approximately 45 million gallons of high quality biodiesel each year. Twenty-four full time, highly skilled positions were created with the construction completion at this facility. Blackhawk Biofuels, LLC facility is adjacent to a soybean oil processing facility operated by Bunge North America. Biodiesel production began November 2008. 
 
 Cautionary Statement of Forward-Looking Information
 This press release contains forward-looking statements that reflect management's current expectations regarding future events and the new holding company's future performance, including, but not limited to, the statements made by Jeff Stroburg, Daniel J. Oh, Bill Horan, Jim Johnston and Ron Mapes and all statements containing the words "will," "believes" or words of similar import. Many factors could cause actual results to differ materially from those projected in these forward-looking statements, including, but not limited to: whether the conditions to the business combination transaction will be satisfied, the possibility that the transaction will not close, whether Renewable Energy Group, Blackhawk Biofuels, Western Iowa Energy and Central Iowa Energy will be able to integrate their businesses successfully and achieve anticipated synergies, the market demand for biodiesel changes in legislation and regulations that provide incentives for the use of biodiesel, including RFS, and the costs for the feedstocks used to make biodiesel and the relationship of those costs to prices for finished biodiesel.. Some of these factors and other important factors are detailed in various Securities and Exchange Commission filings made periodically by Blackhawk Biofuels, Western Iowa Energy and Central Iowa Energy , particularly in each company's latest Annual Report on Form 10-K and its subsequent Quarterly Reports on Form 10-Q, copies of which are available from each company without charge. Please review these filings and do not place undue reliance on these forward-looking statements. Each company disclaims any intention or obligation to update or revise any forward-looking statements.
 
 Additional Information and Where to Find It 
 The new holding company intends to file with the Securities and Exchange Commission a registration statement and other relevant documents in connection with the proposed business combination transactions involving Renewable Energy Group, Blackhawk Biofuels, Western Iowa Energy and Central Iowa Energy. Security holders of Blackhawk Biofuels, Western Iowa Energy and Central Iowa Energy are urged to read the joint proxy statement/prospectus that will be contained in the registration statement filed by the new holding company and the other relevant documents when they become available because they will contain important information about the new holding company, Renewable Energy Group, Blackhawk Biofuels, Western Iowa Energy and Central Iowa Energy and the proposed business combination transaction. Investors and security holders of Renewable Energy Group, Blackhawk Biofuels, Western Iowa Energy and Central Iowa Energy may obtain free copies of the joint proxy statement/prospectus and the other relevant documents filed with the Securities and Exchange Commission (when they become available) at the Securities and Exchange Commission's website at http://www.sec.gov and may also obtain free copies of the joint proxy statement/prospectus (when it becomes available) by writing to, in the case of Renewable Energy Group, 416 S. Bell Ave., Ames, Iowa 50014, Attention: Secretary, in the case of Blackhawk Biofuels, 210 W. Spring Street, Freeport, Illinois 61032, Attention: Secretary, in the case of Western Iowa Energy, 1220 S. Center Street, P.O. Box 399, Wall Lake, Iowa, 51466, Attention: Secretary, and, in the case of Central Iowa Energy, 3426 East 28th Street N., Newton, Iowa, 50208, Attention: Secretary. Information regarding the identity of persons who may, under the Securities and Exchange Commission's rules, be deemed to be participants in the solicitation of shareholders of Renewable Energy Group, Blackhawk Biofuels, Western Iowa Energy and Central Iowa Energy in connection with the proposed business combination transaction, and their interests in the solicitation, will be set forth in the joint proxy statement/prospectus that will be with the Securities and Exchange Commission and contained in the registration statement that will be filed by the new company with the Securities and Exchange Commission.

Renewable Energy Group to acquire 105 MGY of additional capacity in Iowa and Illinois to meet diesel market demand

REG signs agreement with three biodiesel plants to consolidate

The U.S. Environmental Protection Agency submitted a proposal to the International Maritime Organization on March 27 to establish a 230-mile buffer zone where large ships such as oil tankers and cargo ships will face stricter emissions standards. The proposed standards will cut sulfur in fuel by 98 percent, particulate matter emissions by 85 percent and nitrogen oxide emissions by 80 percent from the current global requirements. To achieve these reductions, ships must use fuel with no more than 1,000 parts per million sulfur beginning in 2015 and new ships must use advanced emission control technologies beginning in 2016.
 
 Ocean-going vessels, which are primarily foreign-owned and operated, dock at more than 100 U.S. ports, where more than 40 are in metropolitan areas that fail to meet federal air quality standards. EPA led the U.S. effort to develop the proposal in coordination with federal partners such as the Coast Guard, State Department and the National Oceanic and Atmospheric Administration. Canada joined the U.S. as a co-proposer on the emissions control area proposal. For more information on the proposal visit <a href="http://www.epa.gov/otaq/oceanvessels.htm">http://www.epa.gov/otaq/oceanvessels.htm</a>
 
 While ocean going vessels plan for stricter emissions standards, the nation's biggest ferry system operated by Washington State ferry is concerned about the impact on consumers when the new B20 state fleet mandate for all diesel vehicles and vessels takes effect in June. Ferry managers estimate the biodiesel mandate will add $8 million to their fuel cost over the next two years.

1664-1294331852.jpg

EPA asks ocean vessels to reduce emissions

Buffalo, N.Y.-based Blue Sky Optimum Energy Inc. and Golden BioEnergy LLC completed the first phase of a multi-phase contract with the New York State Energy Research and Development Authority to develop cost-effective methods for producing biodiesel made from brown and trap greases. According to Blue Sky Optimum Energy, the newly-developed chemical process allows conversion of feedstock with up to 100 percent free fatty acid into biodiesel and is 75 percent faster than current technologies using sulfuric acid.

Blue Sky Optimum Energy, Golden BioEnergy convert trap grease

Biodiesel research received federal funding to help boost the Canadian economy. The Canadian government announced $1 million was awarded to the Sustainable Cropping System Platforms for Biodiesel Feedstock Quantity research network. The funds will help the research network determine effective ways to increase canola production through a series of five experiments on Western Canada's major soil zones and ecoregions. According to SBQQ, greater canola production will increase canola demand and profitability for canola farmers. It will help create jobs, reduce greenhouse gases and have a number of other beneficial spin-offs for the entire industry. The Agriculture and Agri-Food Canada's Agricultural Bioproducts Innovation Program is providing the funding. ABIP is intended to benefit farmers by generating new agricultural knowledge and technology, and to promote research, development, and the commercialization of agricultural bioproducts in Canada.

Funding awarded to canola research

On May 1, Minnesota reaffirmed its leadership role for biodiesel use as it became the first state requiring all diesel fuel sold to contain 5 percent biodiesel. Previously, the state enacted the country's first statewide B2 mandate in 2005. A subsequent increase to B10 by 2012 will soon follow. Increasing biodiesel production and consumption is part of Gov. Tim Pawlenty's plan to boost biodiesel blends from B2 to B20 by 2015, a measure he signed into law in May 2008. According to the Minnesota Department of Agriculture, the move to B5 would prevent approximately 139 tons of particulate pollution and 330,000 tons of lifecycle greenhouse gases, the equivalent of removing approximately 55,000 vehicles off the road. Increasing Minnesota's diesel fuel blend would require approximately 40 MMgy of biodiesel. With a current installed capacity to produce approximately 60 MMgy, Minnesota's biodiesel industry will be able to meet this demand. In addition to Minnesota, states such as Oregon, Washington, Louisiana, Pennsylvania, New Mexico and Massachusetts have also passed or enacted biodiesel mandates.

Minnesota increases biodiesel blend to B5

Bioenergy, when produced on a small-scale in local communities, can play a significant role in rural development in poor countries, according to a new report jointly published by Food and Agriculture Organization of the United Nations and the United Kingdom Department for International Development. The study, "Small Scale Bioenergy Initiatives: Brief Description and Preliminary Lessons on Livelihood Impacts from Case Studies in Latin America, Asia and Africa," covers 15 different start-up bioenergy projects from 12 countries involving a diverse array of technologies. Concern over the impact of liquid fuels has obscured the positive impacts for poor rural people, said Oliver Dubois, a bioenergy expert in FAO's Natural Resources Department. In all cases studied, the local community benefited and none appeared to jeopardize food security.

FAO: bioenergy benefits rural poor

Giovanni Bisignani, director general and CEO of the International Air Transport Assoc. noted in his remarks at the annual Aviation and Environment Summit in Geneva this spring that recent test flights by Continental, JAL, Air New Zealand and Virgin are promising. Results from algae, camelina and jatropha tests even indicated a possibility for improved fuel efficiency. Certification of biofuels for aviation is possible by 2010 or 2011, with potential benefits of 80 percent reductions in emissions.

A test flight by Continental was conducted in January using a biofuel mix of algae and jatropha./PHOTO: Continental Airlines

1665-1294331853.jpg

IATA reports biofuels for aviation possible by 2010

Recent rumblings within the biodiesel industry have called for the existing $1 per gallon tax credit for blenders to be converted to instead directly benefit producers. This means the Internal Revenue Service would pay plants for each gallon of biodiesel they produce and end incentives for oil companies and blenders to buy the fuel. Sound logic, however, differs with that line of reasoning, said David Swenson, professor of economics at Iowa State University. "The problem with changing policy in this way is that it could over-stimulate the capacity of the industry," he told Biodiesel Magazine. "This can lead to a market glut coupled with no incentives for consumer absorption-that could kill the price of biodiesel."	
 Tellurian Biodiesel, with offices in Los Angeles and San Francisco, represents a cross-section of biodiesel companies that have terminals and blend operations already in place. "Many producers are already receiving the subsidy because they are blending the fuel themselves," said Joe Gershen, vice president of sales and marketing for Tellurian. "Distributors want to have B99 delivered to them, so the market has already turned the subsidy into one for production, which lowers the price of the fuel." This in itself is a sales stimulant, he added. 
 

 Incentives only work if there is clear and viable consumer demand, Swenson said, and without the development of market acceptance a production credit could actually hurt the industry more than help it. Gershen claimed however, that if a producer can get a feedstock for $1.10 per gallon-recycled cooking oil is currently the cheapest- and manufacturing costs add another $1 per gallon, then the fuel is being made for slightly more than $2 per gallon at the very least. "Even if I collect the subsidy, I'm still losing money, because it doesn't make sense to make fuel, pay to store it and not be able to sell it," Gershen said. "So I don't see how changing the recipients of the credit would over-stimulate production."
 
 It is further observed that switching the subsidy to benefit producers would increase the support for those who have risked the capital and built the infrastructure that enabled the industry to get off the ground, but right now there's more capacity than feedstock availability in the biodiesel industry. "It is a concern that if the credit was switched entirely to one for production there'd be a new wave of people running out to build plants and that's not what we need," said Jeff Plowman, executive director of the Sustainable Biodiesel Alliance in Austin, Texas. "It would be nice to see more direct support for producers, but we also need to develop a domestic market because most of our capacity is going overseas."
 
 There does seem to be a consensus that ending all incentives for consumption could essentially hurt the development of the U.S. sales. "We don't know if shifting the entire dollar to benefit the producer would be an entirely good thing," said Jeff Kleinschmit, director of the rural communities program at the Institute for Agriculture and Trade Policy in Minneapolis. "There might need to be a mix of incentives, some of which we would like to see tied to sustainable, local production and those companies that perform with the least environmental footprint."
 
 Almost everyone agrees that the credit, despite to whom it goes, should be put in place for more than one year at a time.

Aggressive policy changes need to be considered carefully

The use of enzymes continues to advance in the biodiesel industry. A one-year grant was awarded in early April to the Chatham County Economic Development Corporation in North Carolina to conduct research on biodiesel production using enzymes. A new partnership between Massachusetts-based Verenium Corp. and Alfa Laval, a global provider of specialized products, could also benefit biodiesel by marketing an enzymatic degummer for crude feedstocks. 
 
 The $197,000 grant will be administered by CEDC with project work being done at North Carolina-based biodiesel producer Piedmont Biofuels Industrial. Piedmont Biofuels is partnering with Novozymes to conduct the work. 
 
 According to Piedmont Biofuels Research Coordinator Greg Austic, enzymatic biodiesel production is just getting its start, making this research critical. While there's been a variety of work done on the lab scale, a plant in China is essentially the only one that uses Novozymes enzymes on a consistent basis, Austic said. He says the reason for this is primarily due to the high price of the enzymes. 
 
 Novozymes is currently working on improving the quality of its enzymes so it can bring the price down to a more commercially feasible level. "Our goal is to have the process figured out so that when they bring their price down, we know how to do it right before anyone else," Austic said. The project work will include optimizing a commercially viable process in the lab, designing an upscale system, and then building a small pilot, which Austic says will produce an estimated 10 to 30 gallons an hour. 
 
 In March, enzyme-developer Verenium signed an agreement with Alfa Laval combining their Purifine PLC enzyme with Alfa Laval's engineering services and equipment. "We needed somebody who was able to integrate our enzyme into existing processes effectively, so we partnered with Alfa Laval for that," said Tim Hitchman, Purifine project manager at Verenium. "They are a non-exclusive provider of engineering solutions to the industry, and they're able to bring our process to reality," which he said is good for companies looking for that kind of "one-stop engineering shop."
 
 The enzymatic degumming process improves operating efficiency by yielding less phosphorus, making the downstream processing more reliable, Hitchman said. The Purifine enzyme works by reacting with the phospholipids releasing both the oil in the gum and the oil-component of the phospholipids, allowing a higher percentage of oil to be converted into biodiesel.

 
 "That yield gain is directly proportional to the amount of phospholipids you have in the oil to start with," Hitchman said. "It's a significant improvement in processing economics." 
 
 The Purifine enzyme is a phospholipase C, an advantage for biodiesel processors because it doesn't increase free fatty acids as do other enzyme degummers, thereby minimizing the refining process. Benefits of enzymatic biodiesel production include a simplified purification process with no wash water use, higher quality glycerin with minimal amounts of processing, and a potential energy savings.

Enzymatic degumming using Purifine PLC yields a fluid 'gum.' The gum mass is greatly reduced compared with the conventional process./PHOTO: Bunge Inc.

1666-1294331853.jpg

Water degumming of oil yields typical gums that are viscous and difficult to handle due to the high phospholipid content./PHOTO: Bunge Inc.

1667-1294331854.jpg

Biodiesel enzyme work gains ground

Since the European Commission moved forward with its proposal to impose provisional tariffs on biodiesel imported from the U.S., it has been widely speculated that some U.S. producers and marketers will be in serious trouble.
 
 The European Biodiesel Board has long-argued that the $1-per-gallon federal blending credit has given an unfair advantage to the "splash-and-dashers," or U.S producers that were importing B100 from outside the country and then blending it with a miniscule amount of petroleum diesel in order to make the fuel eligible for the blender's credit before it's shipped elsewhere – where the fuel may be eligible for additional subsidies. The EBB said this has put the European biodiesel industry at a considerable disadvantage for more than two years since U.S. biodiesel has been sold in the European market at a substantial discount, hence creating a price-setting competition to progressively disrupt the margins of European biodiesel producers, leading a number of them to stop or significantly slow production, or even to go bankrupt.
 
 The tariffs, effective March 13, require U.S. biodiesel producers to pay between €211.20 and €237 (approximately $270 to $300) per metric ton for the anti-subsidy duties. The anti-dumping measures pile on an additional charge of between €23.60 and €208.20 (approximately $30 to $265) per metric ton.
 
 The tariffs have become the blame for layoffs and lowered production at some U.S. biodiesel plants, but from another perspective, they could have a positive aftershock on other countries as producers look to focus on alternative markets. 
 
 When Innovation Fuels Inc. shipped its first 15,000 barrels (630,000 gallons) of biodiesel from New York Harbor to Rotterdam, The Netherlands, in August 2008, CEO John Fox was optimistic about extending the company's global reach. "This (the shipment) shows our ability to reach customers internationally, not just domestically, and is done so with positive margins," he told Biodiesel Magazine. 
 
 In Fox's view, the EU customers are the biggest victims of the tariffs, not U.S. biodiesel producers. "And actually, since the tariffs [were enacted], the local market and the other international markets have heated up, so unfortunately, the tariffs-as they usually do-only harm the European customer," he said. 
 
 Fox said EU customers are seeing higher pricing now that the tariffs are in place. "With us, we have a [40 MMgy production facility] in New York Harbor that allows us to serve different markets and from an international standpoint, what we're seeing is a really strong demand for biodiesel in other nations-in Southeast Asia, even into the Middle East." 
 

 Although unable to disclose how much biodiesel Innovation Fuels exports, Fox said that a majority of the company's fuel is still going overseas, even though it has an increasingly large customer base in the U.S. The company recently became the first biodiesel manufacturer in the Northeast to receive BQ-9000 accreditation in both areas of biodiesel production and marketing.
 
 The European Commission has indicated that there is a definite possibility the tariffs will be extended for five years, a decision which is expected to be made in July. If extended, Fox said he believes Innovation Fuels will probably see even less of its product going to the EU. "EU prices are going higher and higher because it's a very captive market, and there's not enough supply there to support their mandates," Fox said. "The issue here is that when you break supply chains, it's difficult to get those back working again without significant cost issues. As we redirect our product into the U.S., which is good for us-to serve more of a local market-other international sources will also be less likely to serve our European counterparts." 
 
 As Innovation Fuels and other producers shift focus to domestic and alternative markets, Fox's sentiment regarding U.S. mandates echoes that of many others. "I think that one of the things we need here in the U.S. is increasing mandates on biodiesel, and we are actually starting to see a very strong demand due to mandates that have taken effect in states such as Pennsylvania and Massachusetts," Fox said. Massachusetts requires all home heating fuel and diesel to be a B2 blend in 2010 and B5 by 2013, and in January, Pennsylvania signed onto a mandate, which will require a B2 blend at their pumps in 2010.
 
 "It has created a burgeoning market here, and we are still able to sell biodiesel that's competitive to diesel fuel," said Fox. "We'd like to see more mandates here, because ultimately we'd like to keep our product here. It makes a lot more sense to produce it here and use it in the local environment, and it's much more cost-competitive from a life-cycle standpoint than to ship it overseas. Unfortunately, the U.S. government has been very slow to act."

The fuel tanker shown above is transporting Innovation Fuels Inc.'s biodiesel from New York to Rotterdam, The Netherlands./PHOTO: INNOVATION FUELS INC.

1668-1294331854.jpg

Tariffs cause shift to domestic, other markets

The Internal Revenue Service made an unexpected move that surprised the industry in early April, pushing back six months the deadline requiring biodiesel to meet the latest version of ASTM D 6751 to legitimately claim the dollar-per-gallon tax credit. The latest version of D 6751 includes a Cold Soak Filtration Test. As a result of IRS's extension, biodiesel meeting the previous version of D 6751 – the version without a CSFT – is still eligible until IRS's new enforcement date, Oct. 1. The news came just days after April 1, the original enforcement date. Immediately afterwards, several sources closely involved in the ASTM process told Biodiesel Magazine they were shocked by IRS's move, and they were not sure exactly how or why this happened. 
 
 The deadline extension could cause some interesting discussion in the industry. For producers having trouble passing the test, it is good news as they can continue to collect the credit while modifying their process. However, buyers are interested in purchasing B100 that meets the latest version of D 6751, which means purchasing biodiesel that passes the CSFT. BQ-9000 certified producers and marketers, however, are expected to meet the latest version of D 6751 to remain eligible for their BQ-9000 status. Also, the invisible allowance of B5 in the diesel fuel specification, ASTM D 975, is predicated upon B100 meeting the latest version of D 6751. 
 
 The version of the existing cold soak method which many people in the industry say is flawed (see the feature article "'Cold Soak' or Wet Blanket?" in May 2009 Biodiesel Magazine), will be replaced later this year by a new, more feedstock-equal test method. The latest CSFT method recently got out of a committee of standards review process at ASTM, and it received an official number – ASTM D 7501. 
 
 The CFST was originally developed after the Minnesota B2 mandate went into effect in 2005, when diesel fuel filters across the state began clogging. As a result, the intention of a precautionary test was to help minimize the introduction of fuel into the marketplace that has a propensity to precipitate out of solution at temperatures above the cloud point, and contribute to faster fuel filter pluggings in diesel vehicles. 
 
 To view the IRS document, visit <a href="http://www.irs.gov/pub/irs-drop/n-09-34.pdf">http://www.irs.gov/pub/irs-drop/n-09-34.pdf</a>.

The CSFT involves time-filtering B100 under vacuum after the fuel has been cooled down and then warmed back up./PHOTO: Teresa Alleman, NREL

1669-1294331854.jpg

IRS delays biodiesel 'cold soak' deadline for tax credit eligibility

Despite the economic crisis, some producers are still managing to maintain a healthy business-and a fraction of them, in recent months, have continued to forge ahead with acquisitions, expansions and new projects.

 
 Aspiring biodiesel/ethanol producer Four Rivers BioEnergy Inc. announced it has acquired V-Fuels Biodiesel Ltd.'s biodiesel plant and accompanying assets located on a 140-acre site at Blyth, southeast Northumberland, England. 
 
 It is the company's second acquisition within the past few months. In mid-March, Four Rivers acquired California-based Kreido Biofuels Inc. assets, which include Kreido's spinning tube-in-tube (STT) reactors and STT technology, as well as its modular biodiesel production plant equipment. 
 
 On Four Rivers' most recent acquisition, CEO Gary Hudson said the decision was simple. "The plant was available, and we were able to negotiate an acceptable deal," he told Biodiesel Magazine. Hudson said that although the plant is currently dormant, he believes it will soon become fully operational, offering plenty of scope for expansion. The technology accompanying the acquisition is multi-feedstock capable, allowing the utilization of a variety of feedstocks including used cooking oil.
 
 In addition to these acquisitions, Four Rivers is also developing a project on a 437-acre site near Calvert City, Ky.,-a 130 MMgy corn-based ethanol plant co-located with a 35 MMgy soy oil-based biodiesel plant, slated to start operations in 2010. 
 
 "In Calvert City, we are arranging top-up financing, and are presently on schedule to start production in about nine months," Hudson said.
 
 In other development news, Blackhawk Biofuels LLC recently completed upgrades to its 45 MMgy facility in Danville, Ill. The $12 million project included the installation of multiple feedstock pretreatment and production upgrades, enhanced laboratory and testing facilities and improvements for storage and logistics capabilities.
 
 The Blackhawk plant upgrades, which were completed according to schedule, began in September 2008. The company said now the facility has the ability to process a wider array of animal fats, virgin oils and waste vegetable oils. Iowa-based Renewable Energy Group oversaw the upgrade project, and is responsible for managing plant operations and will market all biodiesel from the upgraded facility.
 
 North of the U.S., Canadian Bioenergy LLC and Archer Daniels Midland Co. entered into negotiations to form a joint venture to construct and operate a 265 million liter per year (70 MMgy) canola-based biodiesel production facility at the site of ADM's canola crushing plant in Lloydminster, Alberta. The companies are in the process of undertaking a full feasibility analysis of the project.
 

 Upon completion, the plant will consume an annual supply of 240,000 tons of canola oil crushed from 600,000 tons of seed. Construction of the facility is slated for fourth quarter 2009, and completion is expected within the first quarter of 2011.
 
 Canadian Bioenergy has also engineered and received the required permits to construct a 60 MMgy biodiesel facility near Edmonton next to Bunge Canada's oilseed-crushing plant, but it plans to re-evaluate the project once a feasibility study is completed with ADM.

The Blackhawk Biofuels LLC biodiesel plant in Danville, Ill., recently completed a $12 million upgrade./PHOTO: Blackhawk Biofuels LLC

1670-1294331855.jpg

Biodiesel industry sees activity despite recession

In June 2008, the rains started to fall in the Corn Belt and the commodity markets began to take off – a combination of the weather market influence, record oil prices and free-flowing money moving into the markets. Analysts were saying the corn/soybean relationship had been permanently altered by the new market influence of biofuel demand.
 
 But what a difference a year made. High grain prices have settled back down, crude oil prices backed off, the booming biofuels business is struggling with poor or negative margins, and the free-flowing money that added market volatility has dried up. As a result, daily market moves have been in a more normal range in recent months, even as this season's market dynamics have played out.
 
 The softening of both soybean and corn markets, plus increased fertilizer costs for the nutrient hungry corn crop, put the two crops back into balance. "The pendulum doesn't favor one crop over the other right now when you look at costs and what the market is offering," said Darrel Good, extension economist at the University of Illinois. 
 
 USDA's Prospective Plantings report issued March 31 indicated U.S. producers were planning to plant less acreage in 2009 compared to 2008, presumably because there will be less double cropping. "Producers cut soft red winter wheat acres quite a bit, which limits double cropping opportunities," Good said. However, while intentions for overall acres planted to all crops dropped from the previous year, producers were planning 206,000 more acres of soybeans for 2009 than 2008. The largest increase of 200,000 acres was planned in Kansas, with increases of 100,000 acres planned in Iowa, Mississippi, Nebraska, North Carolina, North Dakota and Ohio. Offsetting those increases were reductions in planned soybean acres of 150,000 in Missouri and South Dakota, 100,000 acres in Illinois and 50,000 acres in Indiana, Louisiana and Minnesota. 
 
 USDA factored those changes into the April 9 World Agriculture Supply and Demand report to project U.S. soybean ending stocks could be at their lowest at the end of the current marketing year since 2003-'04, due to strong exports and a reduced South American crop offsetting weaker domestic demand. Export demand was remaining strong, partly due to the Chinese buying soybeans to replenish depleted inventories along with less competition from the Argentine crop, which was significantly reduced due to drought. The news added strength to the soybean markets. Cash soybeans at Decatur, Ill., climbed nearly $2 from $8.35 on March 1 to $10.25 on April 24. "While soybean prices are still high from a historic standpoint, they're still not at the levels we saw last year, which motivated a lot of double cropping," Good commented. The third week of April, 2008, saw $13 soybeans, but new crop beans for harvest delivery were trading at only $8 a bushel. 
 
 In the soybean oil market, USDA projected 2.2 billion pounds of soy oil will be used for biodiesel in the current year, out of a total market of 18.4 billion pounds. That puts biodiesel use at 12 percent of the oil market, although Good pointed out that soybean oil is only 20 percent, while meal is 80 percent of the total soy market. Soy oil for biodiesel, Good said, "is really only 2 or 3 percent of the whole complex." Thus the impact of soy biodiesel is far less than that of corn ethanol which is now consuming nearly one-quarter to one-third of the nation's corn production.
 
 Nonetheless, biodiesel is becoming a substantial market for soybean oil, Bob Wisner, biofuels economist at Iowa State University, wrote in an analysis of the biodiesel market, which was published in the May newsletter of ISU's Ag Marketing Resource Center. "In the past few years, its use has exceeded total U.S. soybean oil exports." The estimated use of soybean oil for biodiesel last year was equivalent to about 15 percent of domestic food and non-biodiesel soybean oil use. "This new surge in demand for soybean oil versus markets in 2001 is equivalent to a jump of 117 percent in the 2006-'07 U.S. soybean oil exports," he said. With the downturn in the biodiesel market, USDA is now projecting soybean oil use in biodiesel will decline by 26 percent for the 2008-'09 marketing year compared to the previous year.
 
 Wisner also took a look at the potential impact from mandated blending of biodiesel in diesel fuel, which is scheduled to increase in the Renewable Fuels Standard to 1 billion gallons by 2012. "Blending at that level, if 80 percent of the feedstock is soybean oil, would be equivalent to about 37 percent of recent non-biodiesel domestic use of soybean oil," Wisner said. "Viewed from an international perspective, it would be equivalent to approximately 3.7 times the size of current U.S. soybean oil exports."

 
 Wisner suggested that, given the inelastic demand in the vegetable oil market, the biodiesel industry and policy makers need to ask what impact that volume of added demand is likely to have on feedstock costs. In the May newsletter he said, "A highly inelastic demand means that a large price increase is needed to cause consumers to make small reductions in consumption when supplies are short. Conversely, if supplies become more plentiful, large decreases in price are needed in order to encourage consumers to increase use. The inelastic demand sets the stage for very volatile feedstock prices for the biodiesel industry. It also indicates that the biodiesel industry can expect pressure on biodiesel margins as production levels increase and a larger portion of the feedstock supply is used for biodiesel."

Soybean markets settle down, analysts watch exports, SA crop

If you have ever had the pleasure of tackling a puzzle with a child's "help," you know the agony of watching a four-year-old take a random puzzle piece and attempt to fit it with another random piece. As adults, we are more likely to look at the picture and work to construct the puzzle using the finished model as a guide. Working with NBB's feedstock effort has been, in some ways, like working on a puzzle with my daughter. There are dozens of puzzle pieces to work with, but we don't necessarily have the benefit of knowing what the final picture will look like. This makes for a slightly frustrating endeavor intermingled with euphoric achievements.
 
 Some of the puzzle pieces are known. We know that feedstock supplies have been one of several obstacles to potential growth. We know that in 2007, soybean oil was used to generate approximately 80 percent of production while in 2008 soybean oil represented less than 60 percent of production. Now don't get confused by this statistic. As an industry, we used roughly the same amount of soybean oil both years, however, the use of animal fats, yellow grease and other oils were largely responsible for the increase. We know that in the near term, we will continue to rely on existing feedstock sources and must find ways to create "virtual acres." Finally, we know we must invest in additional puzzle pieces to ensure future growth.
 
 One potential piece is algal biomass. Microalgae have the capacity to be 10 times to 30 times more productive per acre than current feedstocks, can potentially be harvested every day and some strains contain more than 50 percent oil. Although algae are potentially one of the largest pieces of the feedstock puzzle, many research issues remain to be tackled before commercial scale production. NBB was among those representing the biodiesel industry at the U.S. Department of Energy's algal biomass roadmapping meeting last fall. The meeting proved valuable as hype gave way to realistic assessments of the research challenges that must be addressed. Dewatering and oil extraction challenges are considered to be two of the most significant economic barriers to the proliferation of algae as a viable feedstock. 
 
 This year NBB will fund an effort with Richard Sayre, director of the Enterprise Rent-A-Car Institute for Renewable Fuels at the Danforth Plant Science Center, to further develop a non-destructive oil extraction process, sometimes referred to as "milking the algae," which is capable of continuously removing oil from living algal cultures. Our program will consider which strains perform best and how the process may benefit production efficiency by removal of contaminants in the growth media.
 
 If algae is a large piece of the puzzle, then existing feedstocks represent the borders-the place where I tell my daughter to start building our puzzle. After years of research investments by life science companies, new yield technologies have reached commercialization and are set to have a meaningful impact on soybean yields next year. Adopting this technology will enable increased production without crowding acreage in the U.S., however, realization of this benefit will be dependent upon an expansion of oilseed processing capacity. In other words, protein demand will need to increase to create an economic incentive in order to expand processing capacity needed for additional bushels.
 
 The same benefit can be achieved by increasing oil content. Previous efforts focused on increasing the flow of carbon into the oil biosynthesis pathway. Downstream bottlenecks, however, appear to reduce the value of this approach. NBB has partnered with DPCS to identify novel approaches to enhance oil production in camelina and soybeans. This work centers on the hypothesis that these crops' inability to efficiently utilize available carbon limits oil production. Therefore, the second year DPCS' work will focus on engineering carbon sinks that will pull metabolites through the oil production process in plants.
 
 Understanding that private firms are best positioned to deliver technology to the marketplace, NBB's focus on near-term feedstock sources is centered on risk management issues for new oilseeds as well as those being grown in new regions. Every biodiesel producer knows the value of mitigating risk for their operation. In meetings with current camelina growers in Montana, access to crop insurance was one of two primary concerns voiced. NBB has offered to assist camelina leaders in developing insurance options. In the same manner, producer surveys indicate a perception that expansion of winter canola acreage involves more risks compared to growing wheat. NBB is working with the U.S. Canola 
 Association to educate growers on how winter canola can be included in crop rotations and to start the process of data collection for expanded county coverage for crop insurance.
 
 In addition, NBB continues to be a strong advocate in Washington, D.C., for increased investment in feedstock research. In the end, all puzzle pieces will be important to the overall feedstock picture. 

 
 Alan Weber is a Partner at MARC-IV Consulting and advisor to the National Biodiesel Board.

1671-1294331855.jpg

The Feedstock Puzzle

Earlier this year, ExxonMobil Corp. finalized details outlining its expectations for biodiesel, and is now analyzing methyl ester specifications and preparing to accept the biofuel into its sales system. 
 
 "ExxonMobil recently notified the biodiesel industry that it will begin accepting biodiesel shipments via its supply and distribution system," said Kevin M. Allexon, ExxonMobil spokesman. "Suppliers' product will need to meet a stringent set of specifications that will ensure product stability during distribution and storage, as well as to provide consistent performance across a range of ambient temperatures and other conditions that consumers typically encounter when using the product."
 
 ExxonMobil specifications go beyond ASTM D 6751 standards and include strict monoglyceride limits, as well as cloud point and additive considerations. It also included BQ-9000 certification in the specifications, further highlighting the focus on quality. 
 
 While ExxonMobil is opening new doors for biodiesel, Kinder Morgan had announced plans to move B5 through pipelines, a sure sign that biodiesel is getting set for a future with the big, traditional energy players.

Biodiesel goes big time

When it comes to domestic energy solutions, National Biodiesel Board CEO Joe Jobe has often said there is "no silver bullet," but apparently there is a "golden bullet." Honored with the Alternative Fuel Vehicle Institute's Golden Bullet Award, Jobe thanked members of the biodiesel community and pointed out that the fuel is among the renewable energy solutions that will help lead America toward energy independence.
 
 "Biodiesel is just one key part of the solution to reduce our nation's dependence on foreign oil, preserve our natural resources, reduce harmful greenhouse gas emissions and provide sustainable energy," Jobe said. "I am honored to be recognized, but thank the members of the biodiesel community, who are dedicated and persevering when it comes to ensuring America can produce its own fuel." 
 
 The AFVI recognizes outstanding leadership in the alternative fuels and vehicles industry. The Golden Bullet was among awards presented at the 15th Alternative Fuels & Vehicles Conference and Expo 2009 in Orlando, to honor leaders and organizations that further advanced technologies resulting in clean alternatives to petroleum. 
 
 "A rising tide lifts all boats, and biodiesel's successful growth has a ripple effect in demonstrating that alternative fuels can power the nation," said Kimberly Taylor, AFVI director of education and business program. Estimated domestic biodiesel production in 1999 was 500,000 MMgy. By 2008, that number had grown nearly 700 MMgy.

Alternative fuels industry honors National Biodiesel Board CEO

As more customers demand green transportation alternatives along with environmentally friendly products and services, truck fleets using biodiesel can now provide more concrete data about how the fuel is helping them be eco-friendly. 
 

 Compared to petroleum diesel, biodiesel reduces direct carbon dioxide emissions by 78 percent, over its entire lifecycle. At this year's Mid-America Trucking Show, NBB and the Nebraska Soybean Board revealed the results of a trucking demonstration that modeled exactly the carbon dioxide reductions for truck fleets that use biodiesel.
 
 Over the course of six months, California-based fleet States Logistics ran four trucks on B5 and three on B99. The demonstration showed using biodiesel instead of petroleum diesel reduced States Logistics' carbon output by 72.9 tons. "We were really pleased to see the quantified reduction of CO2 and other pollutants," said Ryan Donovan, vice president of operations and business development at States Logistics. "This is something that we can take to our customers, like Clif Bar and Co., who can show their customers. 
 We all benefit from having this information available to show the efforts being made to reduce the carbon footprint throughout the supply chain."
 
 Chicago-based Indigenous Energy, LLC, developed the program used to calculate the carbon reduction. It compares the entire lifecycle carbon output based on gallons of fuel consumed and allows fleets to measure carbon savings related to biodiesel. 
 
 Biodiesel significantly reduces most regulated emissions. While tailpipe carbon dioxide emissions for biodiesel and petroleum diesel are comparable, biodiesel's environmental benefits start long before the fuel hits the tank and the tailpipe. Therefore, carbon reduction was measured over the fuel's comprehensive lifetime compared to petroleum diesel. 
 
 In addition, NBB and Kentucky Soybean Promotion Board ran an online survey of Owner Operators, independent, and company drivers. Of 276 responses, eight percent were not familiar with biodiesel; 75.8 percent did have a positive impression of biodiesel; 57 percent have at least tried biodiesel and 94 percent would use biodiesel in the future. 
 
 Supporting American farmers was the main concern regarding the use of biodiesel by 59 percent of those surveyed, which was followed by concerns for energy independence representing 40 percent.

Truck demonstration makes the environmental case for biodiesel

Biodiesel has the highest energy balance of any domestically produced transportation fuel, and new research shows the ratio of energy output to lifecycle inputs has increased to an impressive 4.56:1. This energy balance measures energy output for biodiesel compared to the fossil fuel used to produce the renewable fuel.
 
 The latest report from the University of Idaho shows energy used to produce biodiesel from soy (including cultivating, harvesting, transporting, crushing, processing, and fuel transport) compared to the final energy gained from the renewable fuel is constantly moving toward greater energy efficiency. In 1998, the energy balance was 3.2:1. Noted improvements have resulted from farming techniques requiring less fuel than other inputs, more efficient soybean crushing and more efficient conversion to biodiesel. By 2015, the balance is projected to reach 5.44:1.
 
 Petroleum diesel has a negative energy balance and yields only 0.83 units of usable energy per unit of fossil energy consumed.
 

 Biodiesel supporters have long been aware of the fuel's many benefits. With the highest energy content of any alternative fuel produced in the U.S., it has higher average cetane than diesel and similar fuel economy, horsepower and torque. Work continues to improve yields of traditional crops on existing acres and new feedstocks are being developed to bolster what is already the most diversified fuel on the planet. 
 
 Dev Shrestha, professor of biological and agricultural engineering at UI, completed the new lifecycle analysis with support from the U.S. Department of Agriculture and co-authors A. Pradhan, A. McAloon, M. Haas, W. Yee, J. A. Duffield and H. Shapouri. At press time, the report was under final review by the USDA Economic Research Service.

New research shows biodiesel energy balance at 4.56:1 and climbing

The most reputable biodiesel quality program in the world has increased in power as a tool for biodiesel marketers, producers and now laboratories. 
 
 The National Biodiesel Accreditation Commission continues to refine BQ-9000 protocols. The commission most recently approved revisions to both the BQ-9000 marketer program and the BQ-9000 producer program requirements. 
 
 Marketer program changes include clarifying tank testing requirements, further guidance on co-mingling shipments of B100 and modifying fuel blending verification requirements. 
 
 Meanwhile, changes to the BQ-9000 producer requirements involved including the cold soak filterability test in the critical testing parameters, refining production lot tank homogeneity requirements and additional guidelines on co-mingling production lots of B100.
 
 The NBAC also released a new certification for commercial laboratories. The BQ-9000 lab program covers the establishment and maintenance of a quality management system in commercial laboratories that analyze biodiesel and biodiesel blends. Laboratories operated by BQ-9000 producers and marketers are also eligible to seek this certification. The lab certification program focuses on several analytical related areas such as test result reporting, equipment calibration and maintenance, quality control and proficiency testing.
 
 These revisions and constant vigilance to monitor and improve the BQ-9000 programs assures the voluntary programs remain a value-added feature to product marketability. It also assures products can be followed from production to end user to easily and quickly manage potential quality concerns with a legal chain of custody. 
 
 For a complete list of BQ-9000 certified marketers and producers visit: <a href="http://www.BQ-9000.org">www.BQ-9000.org</a>.

1672-1294331856.jpg

Biodiesel quality assurance program, BQ-9000, continues growth

When Missouri's Central Electric Power Cooperative held a ribbon cutting for their algae demonstration project, NBB staff members were more than happy to participate. 

 
 Located on the banks of the rolling Missouri river, the Chamois Power Plant is the perfect location to experiment with algae to reduce carbon dioxide. Power Cooperative staff provided a personal tour to give the NBB team an inside look at the pilot project.
 
 The project brings together the collective expertise of Missouri-based Associated Electric Cooperative and Central Electric Power Cooperative with Lincoln University and Missouri University of Science and Technology to study the feasibility of using carbon dioxide in flue gas from the Chamois Power Plant to feed algae.
 
 The demonstration project features algae growing in four large pools. The algae use energy from sunlight to feed on the flue gas carbon dioxide as it bubbles up through the water. The experiment will determine whether this process can, in fact, capture carbon dioxide and possibly reduce emissions often associated with climate change.
 
 In addition to mitigating climate change concerns, the group envisions algae as a resource for biodiesel, ethanol and livestock feed.

Experimental algae pools hold the potential to change the landscape of power plants. /photo: Central Electric Power Cooperative

1673-1294331856.jpg

Algae interest for biodiesel, carbon reduction grows

›The Iowa Renewable Fuels Association is sponsoring a grass-roots program to promote biodiesel. IFRA's Biodiesel Backer program is offering two $2,500 grants meant to increase biofuels awareness among the state's youth while promoting their health and well-being. Schools interested in sharing the biodiesel story can use the biodiesel toolkit available on the IRFA Web site, <a href="http://www.ifra.com">www.ifra.com</a>, to educate their communities about the benefits of the renewable fuel. 
 
 ›The National Biodiesel Accreditation Commission has added laboratories to its BQ-9000 quality assurance program. "Reliable lab results are a major factor in guaranteeing fuel quality," said Rod Lawrence, manager of quality control for Magellan Midstream Partners LP. The BQ-9000 Lab Program calls for quality management systems in commercial laboratories that analyze biodiesel and biodiesel blends. The certification program focuses on equipment calibration and maintenance, quality control, proficiency testing and test result reporting. 
 
 ›California biodiesel equipment manufacturer SRS Engineering Corp. hosted representatives of the Indonesian government in late March. The delegation visited a handful of Southern California businesses to discuss potential trade agreements, including the feasibility of a biodiesel plant being erected in Indonesia and the potential for expanded palm oil exports to the United States. "I was very impressed with the Indonesian delegates and their desire to create strong trade agreements between the two countries," said Clayton Hawranik, CEO of SRS Engineering. "Our brief meeting uncovered a wealth of opportunities between our countries." More talks will follow, he said.
 
 ›Global Clean Energy Inc. has created a biodiesel division targeting algae as a feedstock in addition to its core work in clean coal technology. With this expansion of its business model, GCE has moved its U.S. headquarters from Denver to Houston. Tom Kaufmann, head of investor relations for GCE said that its proprietary vortex pump-equipped to extract oil from algae slurry with a solid content near 80 percent-is one reason they're very excited by the prospects of this new division. "It can extract oil with greater speed and better cost performance than other equipment we've seen," Kaufmann said. 

 
 ›The Argentine Renewable Energies Chamber has updated its report of the current state of the Argentinean biodiesel industry, covering the past six months. Although Argentina is among the top five biodiesel producing countries in the world, it is only operating at about half of its total installed capacity, the report found. Total industry production reached 1.07 million tons (319 million gallons) in 2008, with sales in excess of $1.3 billion. A free copy of the report, which also discusses the EU's moves to limit the entry of soy-based biodiesel and domestic market data, can be viewed at <a href="http://www.argentinarenovables.org/archivos/ArgentineBiodieselMarket09.pdf">www.argentinarenovables.org/archivos/ArgentineBiodieselMarket09.pdf</a>
 
 ›Acciona Energy commissioned its second biodiesel plant, a 60 MMgy facility at the Port of Bilbao in Zierbana, Spain, on land owned by Bunge Ltd. Bunge has a 20 percent stake in the plant and will provide feedstocks from its European crushing operations. Spain has mandated that 3.4 percent of transport fuels come from renewables this year, and 5.83 percent in 2010. With less international competition because of countervailing measures against U.S. imports and new biofuels mandates, conditions are more favorable for new biodiesel plants in Europe. 
 
 ›United Kingdom biodiesel producer Argent Energy was named "Sustainable Biodiesel Producer 2009" at the Sustainable Biofuels Awards during the World Biofuels Markets Expo and Conference held in Brussels, in mid-March. Award nominees were judged on sustainability benefits, as measured by greenhouse gas savings, environmental impact and further societal benefits of the operations or technology. Argent Energy's 50 million liter (13 MMgy) multi-feedstock plant, built by BioDiesel International AG, uses used cooking oil and animal fats. It is located near Motherwell, Scotland.
 
 ›Renewable Energy Group CEO Daniel Oh is adding the role of company president to his duties, replacing three-year REG veteran Nile Ramsbottom. Oh's duties at REG will include the oversight of biodiesel manufacturing, sales and marketing, procurement and risk management, production operations and technology services, alternative feedstock research and commercialization, and corporate development programs for REG's domestic biodiesel business. Ramsbottom will forgo full retirement to become vice president of global operations, helping REG pursue relationships and business with national and international biodiesel customers and large feedstock producers. Natalie Lischer was appointed treasurer. In the newly created position, Lischer will oversee credit, invoicing, cash management, tax and inventory, accounts payable and debt banking relationships.
 
 ›Hawaii-based Pacific Biodiesel Inc. is supplying the first Hawaiian military marine fleet with locally produced biodiesel. The John W. Finn, launched in April, is the first of five new U.S Navy-operated tour boats that will run on the fuel. These ferry boats will replace the existing tour boats that transport 1.5 million visitors to and from the Arizona Memorial Visitors Center each year. Pacific Biodiesel's fuel is made from locally collected used cooking oil and meets the current U.S. ASTM specifications. 
 
 ›Designed specifically for biodiesel transfer demands, Wilden, a division of the Grand Terrace, Calif.-based Dover Corp.'s pump solutions group, said their new line of advanced series pumps with the Pro Flo X air distribution system allows plant operators to use an integrated control dial to select the efficiency point and flow rate best suited to the individual needs of each application. "The results, in addition to lower energy costs, are higher performance, lower operational costs and performance flexibility that goes beyond what is considered the industry standard," Wilden stated. 
 
 ›Evonik Degussa Corp. dedicated its new sodium methylate plant in Mobile, Ala., on April 28. The 60,000 metric ton per year (16.5 MMgy) facility will serve North American biodiesel producers. Previously, Evonik Degussa supplied U.S. biodiesel producers with catalyst made at its German facility. The new plant in Alabama, however, employs a different process to produce sodium methylate than its German counterpart. Instead of using an electrolysis process to make sodium methylate from sodium hydroxide and methanol, the new facility employs reactive distillation to make the same ready-to-use catalyst. The Evonik Degussa chemical park in Mobile, Ala., where the new catalyst manufacturing facility is located, contains 17 chemical plants. The company began chemical production there in 1976. 
 

 ›The Brazil-U.S. Higher Education Council has formed a new network of biofuels-related researchers and institutions to promote information exchange and facilitate research between the world's two leading biofuels-producing nations. The network was developed under the auspices of the U.S. State Department through the Fulbright Commission in Brazil. Objectives of the network include providing information and access to funding opportunities; promoting awareness of research projects in Brazil and the U.S.; developing and advancing scientific exchange on research projects, technologies and scientific results; and improving communication, interchange and interaction among researchers in a variety of U.S. and Brazilian institutions.

1674-1294331856.jpg

CEHMM is growing saltwater algae in raceways at its research center in Carlsbad, N.M./PHOTO: CEHMM

1675-1294331857.jpg

1676-1294331857.jpg

1677-1294331858.jpg

1678-1294331858.jpg

Business Briefs: Companies, Organizations & People in the News

Since its inception in the 1970s, the criteria used for "building green" – the practice of using energy efficient, environmentally friendly designs and materials in construction – has been transformed. Earth Day, a nationwide, grassroots demonstration that debuted in 1970, may have served as the unofficial beginning of the green building movement. Since then, energy-saving infrastructure such as solar panels, water reclamation systems and modular construction units have become commonplace.
 
 In the past, the greening process mainly referred to a building's structural enhancements, but today, it begins with the first shovel of earth, which may be powered by any number of fuels – including biodiesel. The use of biodiesel in on-site construction equipment fleets, or as a heat and power source for facilities, is becoming more common. The incentives and benefits associated with biodiesel use as part of a green-building strategy are becoming increasingly obvious. 
 
 The Pyramid Companies, a Syracuse, N.Y.-based construction firm, only uses B100 to fuel its equipment fleets for its Destiny USA construction project. Since 2007, the company has reduced its greenhouse gas output by 67 percent, according to a U.S. EPA technical report. The company is also committed to pursuing Leadership in Energy Environmental Design Platinum Level certification. The LEED program was developed by the U.S. Green Building Council and is the nationally recognized benchmark for design, construction and operation of high-performance green buildings. 
 
 The Pyramid Companies isn't alone in aspiring to take the LEED lead. Through its Destiny USA development, project developer and owner Aldeia LLC is currently constructing Independence Station, a $15 million building complex at Independence, Ore., which will house condominiums, multiple office spaces and retail stores. The complex will feature a multitude of green characteristics including seven biodiesel-powered generators and a biodiesel production facility. 
 
 From groundbreaking to completion, these companies are poised to set a new standard for green economic development.
 
 Scoring the LEED
 The LEED system awards points to projects satisfying specific green building criteria. Within each of the six LEED credit categories, projects must satisfy particular prerequisites in order to earn points. The categories include sustainable sites, water efficiency, energy and atmosphere, materials and resources, indoor environmental quality, and innovation in design. The number of points a project earns determines the level of LEED certification it receives-certified, silver, gold or platinum. The LEED points system tops out at 69. 
 
 Since 2000, when the first LEED new construction rating system was released, there have been more than 19,500 registered LEED projects in all 50 U.S. states and 91 countries. 
 

 Although that number seems high, energy consumption from commercial and residential buildings represents almost 39 percent of primary energy use in the U.S., according to the Energy Information Administration. And, since buildings are among the heaviest consumers of natural resources, accounting for 38 percent of all carbon dioxide emissions according to EIA, there is astronomical room for improvement. 
 
 World's Greenest Building
 Aldeia has dubbed its Independence Station project the "World's Greenest Building." The 57,000 square-foot building is expected to win the highest LEED rating recorded: 64 points, with two additional points pending. Not only will Independence Station complex house residential and business space, it will also host facilities for biofuel production, education and research. Steven Riberio, Aldeia principal developer, says he plans to be personally involved in the production of biodiesel, which will be made from yellow grease collected from local restaurants. 
 
 "I've made arrangements with them to collect their waste oil year-round, in exchange for an endorsement from Aldeia and table tents explaining that the restaurants are helping to support the world's greenest building with their waste oil," Riberio says. The waste oil will be transported via a retired, 3,000-gallon heating oil delivery truck purchased by Aldeia. B99 will also be purchased from nearby SeQuential-Pacific Biofuels, which owns a biodiesel refinery in Salem, Ore. 
 
 The anticipated annual utility savings for Independence Station, construction of which is now 50 percent complete, will come in at about 92 percent, compared to a typical code-compliant building of the same size and type. "Our goal is for our residents in this amazing building to live much better than the average American, but do so on just 17 percent of the energy that the average American consumes – and I'm referring to their complete lifestyle," Riberio says. 
 
 While biodiesel will be the main energy source for Aldeia's facility, across the nation, another construction company has also embraced biodiesel but in a slightly different role.
 
 Destined for Green 
 Robert Congel, founder of The Pyramid Companies and its Destiny USA project, is a successful shopping mall developer in the northeast with more than 1,000 centers, whose annual retail sales total about $5 billion, according to Melissa Perry, Destiny USA director of sustainability. Originally from Syracuse, Congel became displeased with slow economic growth in the area while he was developing the infamous Carousel shopping center. "Just under 70 oil tanks existed at a brownfield site near Syracuse," Perry explains. "Driving in from the airport into the city, it was what you would see. Knowing that this was an issue – and how unattractive it was to anybody who might come to the city to open a business, live or work here – Congel decided to do something about it."
 
 After an extended battle, Congel eventually got the oil tanks condemned and moved to another area, and chose the site as the location for Carousel Center. Destiny USA, a pre-certified gold LEED project, is an expansion of this center, which attracts 17 million people each year. "He knew he had to go further to develop economic growth in the area, and decided to do something unique and different," Perry says. "Now that he is in his 70s, he was looking for a legacy project that people will reflect on, and realize something really great was accomplished."

 
 Congel's master plan, as Perry tells it, includes molding the new facility into a green consumer retail and research laboratory. "In this economic environment, it was important for Congel to come up with something other than a just a place where companies that were struggling could go," Perry says. "[He envisioned] a place where they could learn more about their customer base, and maximize their square footage through testing and research of different projects."
 
 Within that project, Congel wished to challenge everybody locally, regionally and nationally to make Destiny USA the greenest facility in the country. "He wanted to make it a large-scale demonstration project for renewable energy, and also a whole-green building," Perry says. "That's why we came to look at this project totally differently than any other retail facility or construction project in the country. The challenge we were given was to complete this project – construction and operations – without the use of fossil fuels. Obviously, that was a huge undertaking, so we started with the construction piece and thought of different ways we could meet that challenge, and decided biodiesel would be a great way to start."
 
 Fueling Fleets with Biodiesel
 Perry points out that many construction equipment and manufacturing companies do not warranty their engines. "So we had to gather our excavation contractor, construction manager, and the equipment leasing companies, along with a lot of different players, to collaborate and discover how we could overcome this and get everyone onboard to allow this kind of testing to go on during our construction," she says.
 
 After an extended effort involving many people from places such as Yellowstone National Park, which has been using biodiesel in all of its equipment for the past eight years, and Washington-based excavation company Earthwise Excavation, everybody involved in the construction of the Destiny USA facility finally agreed to press forward with incorporation of biodiesel blends in its construction equipment. "The final decision to make it a go was in March 2007," Perry says. "We built the program, and started with a B10 blend to give everybody some confidence. After a month, we moved to B20, and then almost skipped B50 altogether. By mid-May, we were using full-blown B100 in all the construction equipment on-site." More than 100 pieces of different fleet equipment, from the lighting to excavators, bulldozers, cranes, pile driving equipment and all generators at the Destiny USA project site run on B100. 
 
 Feedback from the equipment operators regarding the performance of biodiesel has all been positive, despite some initially negative assumptions. "There was a lot of pre-chatter about loss of horsepower and other things, but everybody who used the equipment said it was truly minimal, if any," Perry says. 
 
 To date, Destiny USA has used more than 249,000 gallons of biodiesel in its equipment fleets. To evaluate what kind of emissions resulted from the switch to biodiesel, an emissions report by a third party was conducted. In collaboration with the New York State Energy Research and Development Authority and Southern Research Institute, an emissions report was prepared to evaluate the effects of switching from ultra-low sulfur diesel to biodiesel. 
 
 "The biggest success story was that at B100, we were at about 68 percent cleaner than ultra-low sulfur diesel, for removing particulate matter from the air," Perry says. "We're about 59 percent more efficient in removing carbon monoxide from the air, and we've dropped about 2,000 tons of carbon dioxide out of the air compared to a normal construction project." 
 

 Using B100 hasn't come without challenges though. "It actually significantly increased [nitrogen oxides] at a B100 level versus ultra-low sulfur diesel," Perry admits. "We are very transparent with our results though. We published that, along with all of our results, and the day that came out in the paper we received multiple calls from people trying to help us with a solution. There's a lot of technology out there that we haven't tested yet, but we're purposely transparent because we know this isn't a perfect solution-and we're trying to develop a way to make biodiesel usage viable, and as clean as possible."
 
 As far as the future role of biodiesel in construction activity is concerned, Perry says serving as a living example has helped encourage smaller, but similar, initiatives. "Whether people use it at the B100 level or not is yet to be seen, but we like to bring things to the extreme with the demonstration, hoping we can get people to come in at any level," she says. "One of our contractors, who's used 60,000 of the 260,000 gallons we've gone through, has already got another bid project in Syracuse and uses B20 on-site, and has also contacted multiple distributors to use it all over New York state for projects. It's a single success story, but we believe people will eventually become comfortable with it." 
 
 Paperless Fuel Tracking 
 Throughout its biodiesel-fueled construction activities, The Pyramid Companies has been able to test a unique, paperless fuel-tracking technology in collaboration with Ascent Aviation LLC. "We were looking for a partner to provide us with quite a bit of biodiesel, as well as trucking equipment and storage," Perry says. "The great thing that completes the story, which is all about economic development, is that they invested in the infrastructure and storage facilities, put in a blending facility and hired more people for the purpose of what we're doing here."
 
 The unique technology used at the Destiny USA site, called Fleet Connect, allows for computerized fuel tracking using small devices called iButtons. "Due to the high number of contractors on the site at any give time, which can be up upwards of 40, tracking the fuel billing was challenging," Perry explains. "This technology basically registers each piece of equipment with small iButtons, which go on each equipment piece's fuel tank." The device accurately measures the amount of fuel put into the tank by gallon, notes to whom the fuel belongs, and which contractor is using it. "This allowed us a very unique, paperless environment to track fuel usage," she says. "It's a new technology they were testing at airports and we thought it would be a great introduction into the construction industry." 
 
 Now that the core and shell of the 1.3 million square feet Destiny USA building is nearly complete, work on the interior will begin. Working through three phases, the facility is slated for completion in 2012. Throughout the rest of the construction process, the company plans to continue its green initiatives, including the use of biodiesel, while embracing an applicable motto: "Green is a journey, not a destination." 
 
 Anna Austin is an associate editor of Biodiesel Magazine. Reach her at (701) 738-4968 or <a href="mailto:aaustin@bbiinternational.com">aaustin@bbiinternational.com</a>.

Since mid-May 2007, all Destiny USA construction equipment has been fueled with B100./PHOTO: DESTINY USA

1651-1294331858.jpg

Green building is a major, developing trend. Biodiesel Magazine investigates the current and potential role of biodiesel in this growing movement.

Bleeding Green

It's almost unbelievable, but the promoters of the Indiana-based Permaflo biodiesel process had an independent lab test their biodiesel's cloud point at minus 45 degrees Fahrenheit before they shipped 250 gallons of it to Alaska. It was the ultimate road test – driving diesel vehicles on B100 in Alaska's late winter conditions. 
 

 The seven Indianans flew to Fairbanks where they were met by three researchers from the University of Alaska–Fairbanks, who drove the group in a diesel-powered UAF minibus from Anchorage to Fairbanks amid a late-winter March storm. Two diesel pickups carried part of the crew 250 miles north to the Arctic Circle, where they camped overnight at minus 24 degrees F temperatures. 
 
 "We're extremely happy with the results of the test," says John Whittington, vice president of Integrity Biofuels Inc., the 5 MMgy plant at Morristown, Ind., where the fuel was processed. "We knew it was good – we knew from tests. But it really [had] a different feeling when you're out there in a vehicle in those extreme temperatures and actually see it perform." 
 
 Doug Morrow, a soybean farmer and president of the Indiana Soybean Alliance, was equally pleased. "It's quite amazing. When we were in Alaska, we weren't even concerned about the fuel – but we were concerned about ourselves staying warm." 
 
 Simple, Solid Science
 Purdue University researcher Bernard Tao laughs when asked whether people react to his biodiesel refining process by saying it sounds too good to be true. "Yes, we hear that, but we proved we can make it," he says. Tao's goal has been to accomplish for biodiesel what the petroleum industry has done with oil refining – take any crude oil regardless of its source or quality and produce a fuel with consistent properties.
 
 In petroleum refining, the differing boiling points of the molecules allow the fractions of crude oil to be separated as the mixture's temperatures rise in the distillation process. In biodiesel, all the molecules have about the same molecular weight, Tao points out, so distillation is not an efficient means of separating its fractions. However, biodiesel molecules do have chemical differences, commonly known as saturated and unsaturated fats, caused by the absence or presence of double carbon bonds. Saturated fats with no double carbon-carbon bonds are straight, linear molecules, whereas the double-carbon bond in unsaturated fats puts a kink in the molecule. 
 
 Tao adds urea – the common, granular agricultural fertilizer – to finished biodiesel in order to set up the physical separation known as cathration or host-guest complex. Not soluble in biodiesel, the urea molecules associate with each other to create a lattice of hexagonal tubes at the molecular level. The linear saturated fat molecules can slip into those tubes where they are held in a weak composite, becoming a semi-solid that precipitates to the bottom. "You can think of it as putting your arm down a pipe," Tao says. "As long as you have your arm straight you can fit it in, but if you bend at the elbow you can't fit it in." The kinked, unsaturated molecules rise to the top, effectively separating the biodiesel into a cold-flow fraction on the top and a warm-flow fraction on the bottom. The separation occurs at room temperature.
 
 The difference in properties between the separated B100s is remarkable. The saturated fats in the warm-flow fraction have high melting points of 35 to 40 degrees Celsius, or approximately 155 to 120 degrees F, says Tao. Introducing one double bond for a saturated fat drops the melting point to minus 15 degrees C, and when another double bond is introduced to make it polyunsaturated it drops another 15 degrees C. His experiments have shown that biodiesel's cloud point can be adjusted to a desired level regardless of the feedstock used, by varying the concentration of urea. "On this process, everything works out," Tao says. "The urea is recyclable – there are no energy inputs and no waste products." One downside of the cold flow fraction is with the saturated molecules that contribute to oxidative stability having been removed, the remaining biodiesel requires additives to retard oxidation.
 
 Urea is the only ingredient for the cathration process, Tao says, and recovering the urea is as simple as the process. Although urea is not soluble in biodiesel, it is soluble in water and can be separated from the gelled warm-flow fraction through water washing. The biodiesel floats to the top, and the water and urea drop to the bottom. In waterless processes, Tao adds, the urea and warm flow biodiesel mixture can be heated up to 110 degrees C. "Urea nicely melts and is much denser than biodiesel," he says. "The biodiesel floats to the top. Let the urea settle to the bottom, solidify and then recycle to the front of the process again."

 
 "Spreadable" Biodiesel
 The applications for the cold-flow fraction are obvious, and were well demonstrated on the promoters' Alaskan trip (see sidebar). Being the consistency of spreadable margarine at room temperature, the warm fraction presents some different issues. There are some intriguing possibilities beyond using it in summer biodiesel blends, Tao says. One possible use may be as a paint remover, since the gelled biodiesel would cling to vertical surfaces and works well for stripping paint. Tao's civil engineering colleagues at Purdue have worked out another application – using the warm-flow biodiesel as the base for a concrete sealer. The material seals concrete to a high depth, protecting it from salt and water damage from freeze-thaw cycles; plus, it automatically seals cracks that appear from physical stresses. "It makes concrete much more durable over the long term in winter conditions," Tao explains. "It could be a tremendous opportunity for biodiesel; but its uses can go far beyond transportation, with the potential for a larger volumetric usage than the fuel business." Increasing the life span of bridges and highways would have a tremendous impact, he adds, but the initial reaction from concrete manufacturers and highway departments was skeptical. "It's like cold-flow biodiesel – they say if you can really do this, it is great," Tao says chuckling. "We've done the testing here," he adds, pointing out that Purdue has a national concrete testing laboratory. "The [concrete] industry is starting to get interested."
 
 Commercialization Ahead
 With the science established and the favorable results from the Alaska demonstration, the Permaflo project is ready for the next step. Indiana's Soybean Alliance has supported the research and development with grants over five years totaling nearly $1 million, says Ryan West, ISA director of technology commercialization. Engineering studies are needed next to establish production costs and necessary adaptations for various configurations. The process can be done with minimal modifications, as was done at Integrity Biofuels where minor changes to piping were made in the batch process. Integrity has manufactured approximately 4,000 gallons to date, however, Tao says that more modifications may be necessary for efficient production in either batch or continuous flow processes. Tao anticipates the capital requirements will be reasonable.
 
 ISA is in the process of evaluating how to proceed, according to West. "We're a little slow to turn it over to anybody," he says. "Not because we're afraid it gets out there, but exactly the opposite. We're afraid it may become very restricted, and we're not interested in that." 
 
 Susanne Retka Schill is assistant editor of Biodiesel Magazine. Reach her at <a href="mailto:sretkaschill@bbiinternational.com">sretkaschill@bbiinternational.com</a> or (701) 738-4922.

Purdue researcher Bernard Tao fields questions at the ISA booth during the National Biodiesel Conference./PHOTO: ISA

1652-1294331859.jpg

A contingent of Hoosiers and their Alaskan friends drove on pure Permaflo biodiesel to the Arctic Circle to demonstrate its cold flow performance.

B100 to the Arctic Circle

Bob McCormick, principal engineer with the National Renewable Energy Laboratory, presented at the National Biodiesel Conference in San Francisco, on a study the Coordinating Research Council conducted. The study, titled, "Biodiesel Blend Low-temperature Performance Validation," is CRC Report No. 650 and can be found at <a href="http://www.crcao.org">http://www.crcao.org</a>. 

 
 Biodiesel Magazine talks with McCormick about the investigation and results.
 
 Q: The objective of the low-temperature performance validation on biodiesel blends, which was conducted by the Coordinating Research Council in conjunction with NREL, was to validate a cold flow performance test for B100 to eliminate biodiesel that shows precipitation with B20 and lower blends above the blend cloud point, and to evaluate the correlation of bench test results to actual heavy-duty vehicle performance at low temperatures. Was the objective of this study met, and what was learned? 
 
 A: Yes, overall the study objective was met. What we did was test four B100s with a range of cloud points of zero degrees Celsius up to 12 C – zero, 5 C, 9 C, and one at 12 C. We tried to cover the full range of biodiesel cloud points, except for palm oil biodiesel. Out of the four B100s, we had one B100 that failed the cold soak filtration test; and the other three were all less than 200 seconds. So, for the B100s that had a cold soak filter time of less than 200 seconds – at both B5 and B20 blends – we had good operability for the vehicles down to the cloud point. We tested three different trucks and there was good operability down to the cloud point. Even though some people use other tests, such as the cold filter plugging point (CFPP) or the low temperature flow test (LTFT), the cloud point is really the most widely used diesel fuel measurement for low temperature operability limits. 
 
 ASTM D 975 has these charts that are based on historical weather data, which give the 10th percentile minimum temperature for every part of the country for the winter months. 
 
 What this means is that 90 percent of the time the temperature is going to be warmer than the 10th percentile minimum. So people tend to want to buy fuel in the winter with a cloud point that is below the 10th percentile minimum temperature – you don't want a fuel clouding up in a temperature that you can see more than 10 percent of the time. Some fleet users are [cautious enough] and feel if it is really critical that their vehicles operate when it is cold, they will buy fuel with an even lower cloud point. 
 
 Here in Denver, 6 degrees Fahrenheit is the minimum design temperature in December. One day this past December the temperature was minus 11 F, and a lot of diesel vehicles that have never even seen biodiesel did not run. That sort of thing happens with diesel vehicles. We were trying to see if the CFST was effective in ensuring that cloud point is a good predictor of the low-temperature operability limit for biodiesel blends, and we were able to operate down to cloud point with biodiesel that has less than 200 second cold soak filtration time. And, in some cases, we were able to even operate maybe a degree or two below the cloud points – including with the B20 blends. Of course, the B20 cloud points weren't anywhere near B5 cloud points. With very low cold soak filtration time B100, we didn't see any problem. On occasion, biodiesel blends can cause filter plugging at temperatures above the cloud point – no one expects that to happen. For low cold soak filter time biodiesel, that didn't happen. For the one high cold soak filter time material, the most severe vehicle design failed to operate at a temperature significantly above the cloud point – maybe four degrees above the cloud point. We didn't have the time or the budget to continue testing that vehicle to see how bad it was by going to even higher temperatures, but with that vehicle design, which can represent about a third of end use trucks in North America, we would predict there could be some significant problems operating at cool temperatures above the cloud point of the fuel, for biodiesel blends using B100 that failed the CSFT.
 
 Q: You mention the severity of that particular truck design. What about that particular design makes it severe?

 
 A: For the other fuels – the control petroleum fuel and the low filter time B20s – this design worked fine. It was only for the high cold soak filtration time material that it didn't work. Actually, for the B5 blend it worked okay, but it was clear to us that something was trying to plug the filter, but it didn't succeed. With the high cold soak filtration time B100 in a B20 blend, it definitely plugged and would stall out. I don't know why it's important for the OEMs to use this design. It's based on a lower fuel recirculation rate. And the fuel doesn't warm up as fast. But if the design caused problems with petroleum diesel, I am sure the OEMs would have changed designs by now. The design, even though it is a heavy-duty truck design, is more similar to the type of fuel systems used in light-duty diesels. 
 
 Q: So it sounds like the study was a success. Is that right? 
 
 A: Yes it was, but admittedly, the failure we saw was one fuel in one truck. And this type of study, where we have heavy-duty trucks tested in indoor laboratories where there are controlled cold temperatures, that is not cheap to do, so there was a limit to how much we could do. But, yes, the objectives were met. The study may be criticized for not being big enough. In a perfect world we would have had more vehicles and more fuels.
 
 Q: I understand the tests were conducted at an indoor laboratory in Sarnia, Ontario, is that correct?
 

 A: Yes, at a lab owned by Imperial Oil in Sarnia, Ontario. Imperial Oil is a division of ExxonMobil Corporation. The laboratory was very heavily utilized by oil industry and the fuel additive industry, and in a totally unrelated business decision ExxonMobil closed the lab down at the end of 2008, so we cannot go back there for additional testing. 
 
 We are, however, looking for another facility to do further testing. To satisfy the needs of the biodiesel industry, we are going to need to do some additional testing to determine things like whether the time requirement for cold soak filtration should be 360 seconds all the time; or is 200 seconds or less needed during the wintertime. The question is, do we need the 200-second limit or is a 360-second limit adequate? We want additional testing to try and answer that question. I don't think our study answers that. 
 
 Q: To be clear, the truck designs other than the truck with the most severe design, did not fail using high cold soak filtration time B20? 
 
 A: There were three truck designs. The design of each of the three trucks represent in some sense about a third of the market. The most severe design failed. 
 
 The intermediate design showed signs of potential issues for the high cold soak filtration material. As we measured pressure drop through fuel filter, we saw pressure build up, but it was never enough to stall the vehicle. What that means is it was right on the edge. In the real world, instead of in a controlled lab environment, it may have been worse. The third heavy-duty truck design incorporated an electric fuel filter heater, and it had no problem. We could have plugged the filter on that one with diesel or biodiesel with cold enough temperatures, but at cloud point of the fuel there was no problem. 
 
 Q: In the slides you presented at the National Biodiesel Conference in San Francisco, a phase two of this study was mentioned. 

 
 A: We are in the middle of that. We got some vehicle test data from the Sarnia Lab before it closed. We are aiming to get some additional test vehicle data to figure this all out. We may not have gotten enough data originally. So, we are looking at the data now, and we are doing additional analysis on the fuels. We are still looking for another test lab to do additional tests, but it's difficult to say when that will happen. We hoped to have results by now so that we could try to bring new proposals to the ASTM committee in the next six months but, in spite of the best laid plans, we just didn't get there. 
 
 Ron Kotrba is editor of Biodiesel Magazine. Reach him at (701) 738-4942, or <a href="mailto:rkotrba@bbiinternational.com">rkotrba@bbiinternational.com</a>.

Here at the Imperial Oil laboratory in Sarnia, Ontario, the CRC and NREL tested low-temperature operability for biodiesel blends. The lab was subsequently closed./PHOTO: EXXONMOBIL CORP.

1653-1294331859.jpg

The low-temperature operabilty study used three heavy-duty diesel vehicle designs, each of which represent roughly 30 percent market share of HD diesel trucks on the road today./PHOTO: EXXONMOBIL CORP

1654-1294331859.jpg

No fuel is expected to perform below its cloud point, but a plugged filter above the cloud point is never quite expected. Bob McCormick discusses results from a recent study that investigated this phenomenon.

Q&A with Bob McCormick on Low-temperature Operability

Posted May 12, 2009, at 8:19 a.m. CDT
 
 The soybean market may be settling down, if the USDA's first projections for the 2009-'10 marketing year prove accurate. The USDA made its initial assessments for the next marketing season in its May 12 World Agricultural Supply and Demand Estimate report with the caveat that "because spring planting is still underway in the Northern Hemisphere and remains several months away in the Southern Hemisphere, these projections are highly tentative." The projections reflect economic analysis, normal weather, trends and judgment.
 
 In the USDA forecast, the U.S. season average soybean oil prices were projected at 32.5 to 36.5 cents per pound compared with 32.5 cents for 2008-'09. The season-average soybean price for 2009-'10 was projected at $8.45 to $10.45 per bushel compared with $9.85 in 2008-'09. Soybean meal prices were forecast at $260 to $320, compared with $305 per ton for 2008-'09. 
 
 Soybean crush for 2009-'10 was projected to increase 2 percent to 1.67 billion bushels reflecting a small increase in domestic meal use and higher exports. Domestic soybean oil consumption was projected to increase 1 percent as biodiesel expansion is partly offset by a small decline in food use. Soybean oil used for biodiesel production was projected at 2.2 billion pounds, up 300 million from the revised 2008-'09 estimate of 1.9 billion.
 

 U.S. oilseed production for 2009-'10 was projected at 94.5 million tons, up 6 percent from 2008-'09 with soybean production accounting for most of the increase. Soybean production was projected at 3.2 billion bushels, up 236 million from 2008-'09 reflecting a small increase in harvested area and a trend yield of 42.6 bushels per acre. Soybean supplies were projected at 3.3 billion bushels, up 5 percent from 2008-'09 as smaller beginning stocks partly offset increased production. Cottonseed production was also projected higher, while peanuts, sunflower seed and canola production were projected down.
 
 Reduced South American supplies, due to drought in Argentina, Paraguay, and southern Brazil, were projected to push U.S. soybean exports to a record 1.26 billion bushels. Ending stocks were projected at 230 million bushels, resulting in a relatively low stocks-to-use ratio at 7 percent.
 
 Global oilseed production for 2009-'10 was projected at a record 422.1 million tons, up 25.9 million from 2008-'09. Foreign oilseed production was projected at 327.6 million tons, up 20.4 million. Global soybean production was projected to increase 14 percent to 241.7 million tons. The Argentina crop was projected at 51 million tons, up 17 million from the revised estimate for the 2008-'09 crop based on increased harvested area and a return to trend yields. The Brazil crop was projected at 60 million tons, up 3 million from 2008-'09 based on a 3 percent increase in harvested area. China soybean production was projected at 15.6 million tons, down 0.4 million from 2008-'09 due to reduced area. Global production of high-oil content seeds was projected to decline 2 percent from 2008-'09 as lower projected yields more than offset higher area for sunflower seed and rapeseed. Lower rape seed production for Canada and Ukraine more than offsets increases for China, EU-27, India, and Australia. Lower sunflower seed production for Russia, Ukraine, and EU-27 more than offsets an increase for Argentina. Despite higher global oilseed production, 2009-'10 supplies are up just 4 percent reflecting lower beginning stocks.
 
 Global protein meal consumption was projected to increase 3 percent in 2009-'10. Protein meal consumption was projected to increase 4 percent in China, accounting for 32 percent of global protein consumption gains. Global soybean trade was projected at 75.3 million tons, up 2.1 million from 2008-'09. China imports were projected to account for just over half of world trade at 38.1 million tons.
 
 Global vegetable oil consumption was projected to increase 3.8 percent in 2009-'10 led by increases for China, India, and EU-27. Global vegetable oil stocks are projected to decline 6 percent from 2008-'09.

WASDE: small increases in new crop supply, demand

Posted May 12, 2009, at 10:53 p.m.

 
 Bio Blend Fuels Inc. began operating its 2.6 MMgy biodiesel plant at a new location in Manitowoc, Wis., using animal fats as its feedstock. The plant was designed by Dan Kaderabek, company founder along with his wife Traci Kaderabek. The couple had been producing biodiesel on a smaller scale since 2005, improving their process and learning how to meet ASTM specifications, Dan Kaderabek said. Bio Blend Fuels recently moved to a new location in Manitowoc and began operating May 1. The pair have started another company, American Fuel Blending Systems to market a freestanding biodiesel station incorporating heated tanks and a blender pump to facilitate blending of the animal fat-based biodiesel at optimal temperatures.

Bio Blend Fuels begins Wisconsin operations

Posted May 12, 2009, at 3:42 p.m. CDT
 
 California's Water Resources Control Board has expanded its approval for storing biodiesel blends in underground tanks from the existing B5 limitation to up to B20, in a resolution adopted May 5. A 25-year-old California law requires the storage of any chemical in underground tanks to be tested and independently certified as being compatible with the tank materials, explained water board spokesman Bill Rukeyser. The law also requires an approved leak detection method. 
 
 With only B5 blends having been tested, the water board approved a three year emergency variance to allow higher blends up to B20 in double-walled tanks and piping that currently meet requirements for petroleum-based fuels. "What we have been told by biodiesel industry spokesmen, is that they are in discussions with Underwriters Laboratory on testing protocols, and within three years should have tests done," Rukeyser said. "These issues have contributed to the delay of more widespread use of biodiesel in California," the water board resolution stated. The three-year variance will assist the state in meeting greenhouse gas emission reduction targets and requirements under the federal energy policy act. 
 
 California has strict laws on underground tanks used for storage as a result of earlier experience, he added. "We've had terrible experiences with tanks of earlier designs and substances that are no longer allowed, MTBE being one of them, contaminating our water." Rukeyser pointed out that both the petroleum industry and ethanol industry have had to comply with the regulations. The water board only has jurisdiction over underground storage, with other agencies handling above-ground storage and other regulatory issues.
 	
 Some confusion was caused by an erroneous report that the Water Resources Control Board's action was a move to enact stricter biodiesel storage guidelines than what had been in place. "I was not happy to see it wasn't B100," said Joe Gershen, vice president of sales and marketing for Tellurian Biodiesel Inc. "But B anything is better than nothing." Gershen added that B20 is probably the most commonly used blend in California, "going from nothing to B5 to B20 is going in the right direction." He added that the California Biodiesel Alliance which Tellurian CEO Eric Bowen chairs has been meeting with the water board which has increased the member's comfort level with biodiesel. "We're forging a new relationship with regulators in California," Gershen said.

California expands underground storage rule

A life cycle analysis conducted by Michigan Technological University shows that jet fuel made from camelina could lead to drastic cuts in carbon emissions from traditional fuel. Great Plains Oil & Exploration, the largest camelina company in the world, welcomes the results of the study.
 
 "This confirms what we have learned about camelina and why we established camelina as a biofuel source," said Great Plains CEO Sam Huttenbauer, III. "We studied and improved camelina production for a decade before we launched the crop commercially, knowing that this crop will be a leader in next generation biofuels."
 
 "The fuel industry could be revolutionized by this amazing plant," added Huttenbauer.
 

 The study, conducted by Michigan Tech professor David Shonnard, also points out that camelina can be converted into drop-in jet fuel. That means that engines can use 100 percent fuel made from camelina instead of traditional jet fuel with no performance or maintenance changes. The difference is the effect camelina has on the environment. 
 
 Throughout camelina's life cycle, the study showed the drop in carbon emissions is about 84 percent when compared to the emissions throughout the life cycle of traditional jet fuel. In a story on Michigan Tech's Web site, Professor Shonnard stated, "Camelina jet fuel exhibits one of the largest greenhouse gas emission reductions of any agricultural feedstock-derived biofuel I've ever seen".
 
 Results Will Improve 
 Great Plains is the world's largest supplier of camelina seed to farmers and camelina oil to biofuel producers. The company has exclusive access to the majority of the world's camelina germplasm. Further, Great Plains has contracted the vast majority of acres commercially growing camelina in North America. The company is working to improve camelina yields to prepare for the explosive demand for camelina oil in the coming years. Through agronomic practices, varieties suited for specific geographic and climate conditions, traditional breeding, and biotech solutions, Great Plains is leading the charge to bring camelina into aviation and other biofuel production.
 
 "This will be a record year for camelina," said Huttenbauer. "We are experiencing tremendous growth in contracted acreage and our intellectual property is driving rapid increases in yield. This study illustrates what we have known. Camelina is at the forefront of the changing fuel landscape in North America."
 
 About Great Plains Oil & Exploration
 Great Plains Oil & Exploration (Great Plains – The Camelina Company) is a renewable fuels company founded with the purpose of manufacturing and marketing fuel and chemicals produced from camelina. Great Plains is establishing a grower base and production facilities from which it will produce and supply biofuel as well as highprotein, omega-3 rich animal feed.. More information can be found at CamelinaCompany.com.
 
 SOURCE: Great Plains Oil & Exploration 

 
 Media Contact: Yancy Deering
 Pinger PR at Powers Agency
 (513) 721-5353
 ydeering@powersagency.com

Camelina cuts jet emissions 84 percent

Recently I contacted a biodiesel service provider wanting to buy their test kits and get more technical details on their other products. However after several tries-and your introduction-there was no reply. This is not unusual, in fact, the silence or cold shoulder treatment from 'foreign equipment and technology suppliers' is something I expected and have become use to. It is a fact that Chinese buyers have been burned by many American and European suppliers. I know of several horror stories myself. From simple things like a water separator, to living things like jatropha saplings, or extremely complex things like a biomass thermal power plant, Chinese partners have consistently ripped off their 'foreign' suppliers so much so that it is almost expected of them. It has happened so many times across all industries it became an industry of it own, and I am sure a GDP can be calculated.
 
 One common mistake, however, that all 'foreign' suppliers make is that they believe they need a powerful state-owned Chinese partner to sell their technology or products here. 
 
 The reality is, these powerful entities are responsible for more 'ripping off' than private Chinese businesses. Often it would start with the 'foreign' technology suppliers being contacted by an influential Chinese individual controlling several large businesses and well-connected to the Chinese leadership. These are often some officials' family member or childhood friend. They have plenty of 'Guanxi' (influential connections or relationships) as everyone in the world has come to know the term. Everyone knows, however, it is good to have lots of it, but no one seems to understand what it is or how to use it. 
 
 Really it is no different to the rest of the world, but when it has a Chinese name it is "oriental exotic" with a mystic aura, and people go all bananas over it. When the suppliers are invited to visit China, they go wild when they're shown large factories, army of employees, number of real estate projects and number of 'unrelated' businesses this person 'owns'. 
 
 He would then host dinners with armies of government officials-with names they cannot pronounce and titles that need a degree to understand-and our suppliers are more than impressed. The knock out punch would be a trip to the Great Wall or the Forbidden City, after which the suppliers leave with their heads in the clouds thinking they have sure access to the massive Chinese market.
 
 An influential individual, however, is not bound by any contracts, and for tax or other reasons, his name is not on any of the businesses he 'owns'. These influential people will only invest their 'Guanxi' into this partnership, not cash. If the arrangement proves to be unprofitable, the Chinese partner withdraws all support, along with 'Guanxi,' converted shares and the 'foreigner' is left with nothing. On the other hand, if it is profitable, the Chinese partner will always make more profit selling copies on his own, and the 'foreigner' is still left with bananas. Since the Chinese courts confuse even the most scientific minds, the 'foreigner' should be happy that he has anything and just move on.
 
 What does this have to do with me? Well, for those working hard to develop a new industry in a 'developing' world like China, we are left without access to the outside world. 

 
 Although it's cheaper and easier to do things here, working in developing countries means access to only very limited resources. Since we need to develop the whole industry vertically, our resources are spread even thinner. For my biodiesel business, I am forced to build my own collection system as well as develop sorting and pre-treatment mechanisms for a large variety of feedstock because local suppliers either don't know how or don't care to sort feedstocks. 
 
 I have to develop and experiment with every detail of production technology because I cannot buy ready-made products from the U.S. Conversely, I have to find alternative equipment and adapt it to biodiesel applications, build a sales network and promote renewable energy. In addition we have to build a completely vertically-integrated business because there is no specialization and lack of economy of scale. Often we turn to western technology suppliers to solve a specific problem when we have exhausted all local options. 
 
 In this case, I contacted a U.S. company to inquire about their post-treatment filter. Buying a ready-made solution to solve a problem is something that any other biodiesel producer can do by picking up the phone or sending out some e-mails. Living in China, however, means I cannot even find out specifications to know whether it will work or not. 
 
 Often they ask me to work with their licensed sellers. 
 
 However, these middlemen are interested in sales and often have no idea about technology or the basic concept of the design. For example, I recently purchased a coalescer. 
 
 Having faith in the technical expertise of this company I gave them my specifications. They consulted their U.S. offices, and returned with a design and demanded 100 percent payment upon order. Due to regional sales issues, I placed my order through a trading company in Shanghai. I waited three months for delivery on very expensive, high-tech equipment, which to my surprise came with a two-page instruction booklet. Furthermore, it did not work. I had to apply and wait two more months for on-site technical support, which never solved the problem and the company offered nothing else to get the equipment up and running. So now I am left with two steel tubes, a bunch of membranes and 350,000 RMB cash gone. I would have been better off with bananas.
 
 Working in China has its benefits. Tougher operating conditions means things that systems built in developing nations will work everywhere else in the world because they are designed to tolerate greater variables. Low-tech solutions coupled with high-tech parts in a development market generate the greatest benefits. Renewable energies in developing countries are viable options, whereas in developed countries they are costly replacements or alternatives. So those of us working in developing countries need all the help we can get.

Letter to the Editor: The Perils of Chinese Biodiesel Producers

Posted May 13, 2009
 

 Despite the highest inventories of crude oil since before the Great Depression, around 375 million barrels, prices are rising to the puzzlement of the U.S. Energy Information Administration. "Prices are at $50 or $60 per barrel, when they should be at around $35 per barrel according to the fundamentals of supply and demand," an EIA source told Biodiesel Magazine. 
 
 Diesel market trends are following crude oil's suit. "The trucking industry, which buys more diesel than any other sector, has lost 30 percent of its business in a single year, and the major areas of diesel demand are also performing poorly," the EIA said. "We're done with the home heating oil season. Rail freight's biggest customer is the auto manufacturers, so their volume is down. Next is construction…and none of the people I know in construction are working…so all of the major customers of diesel are not buying nearly as much fuel – yet the price is going up."
 
 The crude spot price from May 5 to May 12 jumped from $53.81 to $58.81, at Cushing, Okla., a major pipeline distribution spot. 
 
 OPEC has cut back on the amount of oil they are supplying to the market in addition to curtailing production, said Phil Weiss, an analyst for Argus Research Group in New York City. "If they didn't cut production, inventories would be growing even more." 
 
 A production cut in crude obviously has an effect on prices, even if surpluses remain high. There are other market conditions, however, which are also firming up price performance. "One reason for the rising price of crude and diesel is that the market is making bets on how quickly the economic recovery will take place," Weiss said. 'We've seen some early positive signs."
 
 According to EIA's weekly regional price report, the national average price of diesel fuel rose, gaining 3 cents to $2.22 per gallon for the first time in four weeks. The price, while higher than a month ago, was an astounding $2.12 below last year's average price, and $2.55 less than the all-time high price recorded on July 14, 2008. Prices in all regions of the country increased with the East Coast, moving three cents higher to $2.26 per gallon. The Midwest price also went up three cents, to $2.16 per gallon. 
 
 "The average price for the Gulf Coast increased the most of any region, growing four and a half cents to $2.20 per gallon," EIA reported. "The increase in the Rocky Mountains was the smallest of any region, creeping up nearly a penny to $2.27 per gallon. The West Coast moved up more than two cents to $2.33, while the price in California rose two cents to $2.34 per gallon." 
 

 "This is ridiculous and we don't know why it's happening," said Biodiesel Magazine's source at the EIA. "The market is not following the fundamentals." 
 
 As reported by World Energy Alternatives, the good news for the biodiesel industry was that rack prices for the renewable fuel were also up 5 cents per gallon for the week of May 11.

EIA: Spring diesel prices not following fundamentals

Posted May 14
 
 World Energy Alternatives LLC announced today that it successfully completed the sale of its Lakeland, Florida biodiesel facility to Clean Fuel Lakeland, LLC of Orlando, Florida on April 15, 2009. 
 
 "This move is an important step in World Energy's plan to reposition itself to adjust to the changing US biofuels landscape. We congratulate Clean Fuel and wish them well," stated Gene Gebolys, President and CEO of World Energy. 
 
 About World Energy: World Energy develops new energy sources and markets to expand the global energy supply. With a focus on renewable biofuels, the company delivers customer value through quality, service and reliability. Supported by a diversified global platform and network of production facilities, the company has earned a reputation for technical excellence and customer service. World Energy's operations in North America, Europe, South America and Southeast Asia ensure reliable supply of quality product worldwide. For more, please visit http://www.worldenergy.net.

World Energy completes sale of Lakeland biodiesel plant to Clean Fuel

Posted May 18, 2009, at 12:47 p.m. CDT
 
 <a href="http://www.eaba-association.eu/">The European Algae Biomass Association</a> is planning its first, organizational conference June 3 to 4 in Florence, Italy. Peter Vis, member of the Cabinet of European Commissioner for Energy Andris Piebalgs in charge of Renewable Energy Sources, will be the keynote speaker at EABA's inaugural conference. Panel sessions featuring European researchers and industry spokesmen will cover the current status and perspectives for algae development, technical and legal challenges, investment, greenhouse gas balance and sustainability implications.

 
 The panel discussion introducing the potential for the newly formed European algae association includes Mario Tredici, University of Florence; Raffaello Garofalo, Euorpean Biodisel Board; Frederic Bouvier, Roquette Freres in France; Claudio Rocchietta, Oxem in Intaly; Ben Graziano, the Carbon Trust in the United Kingdom; Patrick Sorgeloos, University of Ghent in Belgium. The new association will be formally organized on the second day of the conference, with elections for the officers, steering board members, committee members and the executive director taking place. 
 
 The general objective of the European Algae Biomass Association is to act as a catalyst for fostering synergies among scientists, industrialists and decision makers in order to promote the development of research, technology and industrial capacities in the field of algae. The group aims to defend its members' interests at the European and international level. Its main target is to act.

EU forms algae group, plans first conference

Posted May 18, 2009
 
 Every biodiesel producer and distributor must pass the ASTM cold soak filtration test after Oct.1, 2009. Because many biodiesel fuel samples have failed cold soak filtration since its introduction into the fuel quality parameters, Schroeder Industries of Leetsdale, Penn., began to research the problems and develop a solution. 
 
 What resulted from Schroeder's work was the new Cold Clear filtration system said to bring off-spec biodiesel into compliance with ASTM guidelines and improve cold-flow operability. "We spent lots of time in the lab and ran a lot of fuel samples," said Jonathan Dugan, biofuels product manager for Schroeder Industries. "We checked sterol glucoside and monoglyceride levels among others, and determined it was no single component that caused biodiesel to fail cold soak filtration, but a variety of impurities. In fact, the system brings biodiesel into compliance without changing monoglyceride levels."
 
 Schroeder tested fuel samples from producers throughout the biodiesel industry and created some of its own methyl esters in order to study the crystallization process said to precede the gelling of biodiesel. Because the company has a patent application to protect Cold Clear, Dugan couldn't tell Biodiesel Magazine what particular conclusions the company made regarding the relationship of impurities to methyl ester gelling, but could only speak in general terms. 
 
 "When you open up the chemical engineering book and start to study the crystallization phenomenon, you see that removing the 'seeds' of crystallization is how you stop the process," Dugan said. "We ran a lot of fuel and crunched a lot of numbers and found certain correlations in the data." 
 
 Cold Clear works by removing certain contaminants "that create higher than normal likelihood of surface crystallization" on filters which can cause break downs. The system is designed to be a single pass three-stage bank of filters and absorbers that sequentially remove those compounds likely to cause filter plugging, Schroeder stated. "I think it's the easiest equipment on the market to implement into the scheme of a biodiesel plant," Dugan said. "It's a simple housing with absorption cartridges that can be changed very easily, and there are no hazardous materials or chemicals involved."
 

 Each three-stage housing compartment and cartridges can treat an estimated 15,000 gallons of B100 per complete change. The filtration housing is sized for five gallons per minute of flow, but is easily scaled for higher requirements that can accommodate the specific needs of individual plants. 
 
 Schroeder currently has a three day course scheduled for August in Pittsburgh, Penn., which will feature training for producers on fuel cleanliness and meeting the new ASTM cold soak requirements.

Schroeder launches Cold Clear Filtration system

Posted May 29, 2009
 
 An ongoing effort asking scientists from around the world to pledge their support for biodiesel is getting quick results. Roger Beachy, Ph.D., president of the Donald Danforth Plant Science Center in St. Louis, and Rob Myers, Ph.D., founder of the Thomas Jefferson Agricultural Institute in Columbia, Mo., serve as co-chairs of the campaign, which invites all members of the scientific community to visit <a href="http://www.biodieselsustainability.com/scientists.html ">www.biodieselsustainability.com/scientists.html </a>and add their names to the list of biodiesel supporters.
 
 "The soybean checkoff has a long-term investment in researching sustainable, renewable biodiesel," said Vanessa Kummer, United Soybean Board (USB) communications chair and a soybean farmer from Colfax, N.D. "So it's good to see the scientific community coming out in support of biodiesel. It's important to increase awareness of the science behind using soy biodiesel as an answer to decreasing our dependence on petroleum while still providing food, feed and fiber for the world."
 
 Scientists who sign the petition are agreeing that biodiesel can reduce dependence on petroleum, help address climate change and boost domestic economies. Additionally, by signing the declaration, the scientists pledge their support for further investment and research, which will enhance biodiesel's status as a sustainable fuel for transportation and other uses as well as its ability to meet the world's food, feed, fiber and energy needs of the future.
 
 More than 80 scientists have signed up since Myers and Beachy announced the declaration at the National Biodiesel Board Conference and Expo earlier this year.
 
 As a consistent source of funding for the research and promotion of biodiesel, the soybean checkoff has been a major force in increasing biodiesel production from 500,000 gallons in 1999 to nearly 700 million gallons in 2008. Checkoff-funded research, for example, has found that soybean oil is the superior biodiesel feedstock due to the improved lubricity, cold-flow properties and other diesel-engine benefits provided by soy biodiesel.
 

 According to Myers, biodiesel is an obvious choice as a fuel of the future.
 
 "Biodiesel is such a good fit with our goals for domestically produced, renewable energy sources," said Myers, who grew up on a corn and soybean farm in Illinois. "Soybean, as the predominant crop currently used for biodiesel, is an environmentally friendly crop from the standpoint that it produces its own nitrogen and doesn't need nitrogen fertilizer."
 
 <a href="http://unitedsoybean.org/programs/soy_biodiesel.aspx">SOURCE: UNITED SOYBEAN BOARD</a>

Scientists unite in supporting biodiesel

<a href="http://www.bioblendfuels.com">Bio Blend Fuels Inc.</a> has opened its first blending station alongside the company's newly opened 2.6 MMgy biodiesel plant in Manitowoc, Wis. The blending station, <a href="http://www.americanfuelblendingsystems.com">American Fuel Blending Systems</a>, is a portable unit with above-ground heated storage and a self-contained dispensing system complete with a credit card reader. 
 
 Available with 5,000 or 10,000 gallon tanks, the unit can be used for B20, B50 and B99 blends, as well as programmed for individual blending requirements. Don and Tracy Kaderabek, founders of both companies, designed the blending station to compliment its biodiesel processing system making biodiesel from animal fats. The heated tank of the blending station maintains the ideal temperature for optimal blending of the animal fat-based biodiesel, he explained. 
 
 The Kaderabeks suggest the American Fuel Blending System will have distinct advantages in certain situations. For example, it would be ideal for seasonal industries such as a marine or RV location where the smaller capacity reduces the concern over having leftover fuel at the end of the season or for a construction companies that could move the station as they move to new construction sites.

American Fuel Blending Systems offers a portable, complete biodiesel station that can also be used for ethanol./Source:Bio Blend Fuels

1679-1294331863.jpg

Portable blending station opens in Wisconsin

Posted May 20, 2009
 
 Legislating tougher Corporate Average Fuel Economy requirements will lead auto manufacturers to take a look at their diesel offerings as compression engines have better fuel efficiency and lower carbon dioxide emissions, said Dave Barthmuss, group manager for General Motors Environment and Energy Communications North America. 
 

 Auto manufacturers won't necessarily be running out right away, however, to bring more diesel models to the market. "It is tough to bring diesel engines to a broader range of products," Barthmuss told Biodiesel Magazine. "Because diesel engines have greater fuel efficiency and can operate with biodiesel-which is a low-carbon fuel-expanding this area will be considered, but our plan is to achieve the reductions with our current portfolio."
 
 Along with compression engines and biodiesel utilization, corporate fleets will use flex-fuel, hybrid, plug-in and other alternative fuel vehicles to cut back on their petroleum usage and comply with the more stringent CAFE program.
 
 "The new standards, covering model years 2012-2016, and ultimately requiring an average fuel economy standard of 35.5 mpg in 2016, are projected to save 1.8 billion barrels of oil over the life of the program with a fuel economy gain averaging more than five percent per year and a reduction of approximately 900 million metric tons in greenhouse gas emissions," stated the White House Press Office in an official release on May 19. "This would surpass the CAFE law passed by Congress in 2007 which required an average fuel economy of 35 mpg in 2020."
 
 Because diesel engines can offer fleet operators savings on CAFE requirements, it has been speculated in the short time since the new CAFE overview was published that the sector could see more business. This could be a boon for biodiesel. "There definitely has been more of a push from the current administration to implement programs that help the biofuels industries," said Robert Dascal of New Energy Fuels in Waller, Texas. "Increased diesel fuel utilization obviously opens up more of a market for us."
 
 The CAFE standard set by the Obama administration for model year 2011 is 27.3 mpg for the light duty fleet, which includes passenger cars and light trucks. The California Air Resources Board (CARB) reported that its standard for model year 2011 is 26.7 mpg for the light duty fleet, which includes passenger cars and light trucks. "We have a lot of customers here in the Houston area starting to be educated on the benefits and performance characteristics of biodiesel," Dascal told Biodiesel Magazine. "If there are more nationwide incentives to use biodiesel, we hope that our base will expand."
 
 GM says that previously there have been different approaches to enforcing CAFE from several different states, along with DOT and EPA standards, all of which have made life hard on auto engineers. Now, with a federal standard on the front, there will be more of a consistent platform on which to base plans for future product lines. "The ultimate winner will be the consumer because the industry now has a consistent guide-one national standard-when it comes to fuel economy and carbon dioxide emissions, which will save time, labor and money," Barthmuss said.

GM: Federal CAFE standards good for nation, industry

Posted May 20, 2009
 
 PerkinElmer Inc., a global leader focused on the health and safety of people and the environment, today announced a major expansion of its EcoAnalytix biofuels analytical solutions portfolio. The Company has expanded its biodiesel and bioethanol portfolio to include nine analyzers and systems, crossing six technologies: ICP-optical emission spectroscopy (ICP-OES), gas chromatography (GC), liquid chromatography (LC), infrared (IR), differential scanning calorimetry (DSC), and liquid scintillation counters (LSC).
 

 "PerkinElmer is committed to improving the quality of our environment. Our expanded biofuels portfolio will help to increase the development and use of alternative fuels and renewable energy, such as solar, that can have a direct and positive impact on the overall health of the environment," said Sandra Rasmussen, vice president, Applied Analytix, Perkinelmer.
 
 Rasmussen commented, "Global government mandates require the use of alternative fuels in gasoline to increase from 3 percent today to 10 percent by 2020. We are dedicated to providing laboratories with the instrumentation, consumables, software, applications and standard operating procedures they need to help meet these mandates and advance their research and development of biofuels."
 
 Biodiesel, a clean-burning fuel made from natural renewable sources, such as sunflower, soybean, rapeseed, jatropha, or used vegetable oil, must meet either ASTM or EN standards before entering the marketplace. PerkinElmer's biodiesel and bioethanol portfolio has been expanded to include the FAME (Fatty Acid Methyl Esters) system based on the Clarus GC for determining fuel composition, oxidation stability system based on the DSC 8500 for determining the oxidation status of biofuel, and the 14C LSC system for determining the fuel blend. This range represents a full suite of methods and technologies for biodiesel development and testing needs. 
 
 A full suite of systems for testing bioethanol, a sugar-based fuel made from such crops as sugar-cane, corn or wheat, is also available. This line consists of an EcoAnalytix Trace Metals Analyzer based on the Optima 7000 ICP-OES for testing Group I and Group II metals and phosphorus, Alcohol system for determining the right blend of ethanol in gasoline by GC, and Bioethanol Fermentation HPLC system for monitoring fermentation broth. The 14C Determination by LSC system available for biodiesel can also be used in qualifying bioethanol.
 
 Both the biodiesel and bioethanol platforms also include PerkinElmer's LABWORKS greenLIMS, a pre-configured software application specifically for the biodiesel industry, as well as consumables, application notes, methods, standard operating procedures (SOPS) and onsite training. 
 
 These new systems are additional solutions to the Company's biodiesel platforms which were launched as a part of the Company's EcoAnalytix initiative in 2008. These biodiesel offerings include: a EcoAnalytix Glycerin & Methanol Analyzer for the analysis of free and total glycerin and residual alcohol in biodiesel; the EcoAnalytix Trace Metals Biodiesel Analyzer based on the Optima 7000 ICP-OES for testing Group I and Group II metals and phosphorus; and the EcoAnalytix FAME Blend Biodiesel Analyzer (for ASTM only) based on the Spectrum 100 FT-IR System for analyzing the properties of biodiesel fuel that are determined by the structure of its fatty acid methyl esters. 
 
 All biofuels analyzers, instruments and configured systems are available globally for purchase. For more information visit <a href="http://www.perkinelmer.com/biofuels">www.perkinelmer.com/biofuels</a>.

 
 About EcoAnalytix 
 The EcoAnalytix initiative is a collaborative problem-solving approach that creates application-based solutions that contribute to a healthier ecosystem worldwide. EcoAnalytix is initially focusing on providing products and support to laboratories conducting environmental, biofuels and food safety analyses. Through partnerships and collaborations that support local, regional and global initiatives, this business leverages PerkinElmer's core technologies, application capabilities, global reach, and thought leadership to improve business ecosystems. 
 
 About PerkinElmer Inc.
 PerkinElmer Inc. is a global leader focused on improving the health and safety of people and the environment. The Company reported revenue of approximately $2 billion in 2008, has around 8,500 employees serving customers in more than 150 countries, and is a component of the S&P 500 Index. Additional information is available through www.perkinelmer.com or 1-877-PKI-NYSE. 
 
 Media Contacts:
 PerkinElmer:
 Lori Benedetto, 203-402-6893
 lori.benedetto@perkinelmer.com 
 
 Porter Novelli:
 Kate Weiss, 617-897-8255
 kate.weiss@porternovelli.com

Nine New Analytical Platforms Available for Biodiesel and Bioethanol Laboratories

PerkinElmer expands its biofuels solutions portfolio

Posted May 21, 2009

 
 The American Soybean Association (ASA) testified today before the U.S. House of Representatives Small Business Subcommittee on Regulations, Healthcare and Trade on the impacts of outstanding regulatory policy on small biofuels producers and family farmers. Uncertainty over federal policy, such as the extension of the biodiesel tax credit, implementation of the Renewable Fuel Standard (RFS2), and implementation of the U.S. Department of Agriculture's (USDA) Bioenergy Program is undermining investor confidence in the biodiesel industry. 
 
 At the top of ASA's list of regulatory policy concerns is the Environmental Protection Agency's (EPA) Notice of Proposed Rulemaking for implementation of the expanded RFS2. This Proposed Rule, released on May 5, includes several very obvious and immediate flaws and concerns. 
 
 "The proposed rule as released contains unprecedented, untested and far-reaching indirect land use assumptions and projections which will adversely impact markets for U.S. farmers and impede our national efforts to reduce dependence on foreign oil and thus impede efforts to improve our environmental footprint," said ASA Vice President Ray Gaesser, a soybean producer from Corning, Iowa. "We are concerned that EPA has attributed an undue degree of land use causation to U.S. biofuels production and that EPA's assumptions do not adequately consider the other market factors (population growth, food and feed demand, timber prices, etc.) that have historically driven international land use decisions." 
 
 ASA believes that an expanded RFS2 that includes a specific minimum use requirement for biomass-based diesel is a necessary and beneficial program. A workable RFS-2 is necessary to move the country toward our goals of energy independence and clean, renewable energy production. The current market demonstrates that the production and use of biofuels is not economically viable when petroleum prices are low. Combined with the extension of the biodiesel tax credit, and the implementation of the Bioenergy Program, the RFS2 could provide some much-needed market certainty for U.S. biodiesel production. 
 
 "We are also very concerned with the potential under the EPA Proposed Rule to require renewable fuel manufactures to prove that their feedstocks meet the definition of renewable biomass," Gaesser said. "The Energy Independence and Security Act included a prescriptive definition of renewable biomass and the EPA Proposed Rule would limit eligibility to biofuels produced only from feedstocks grown on existing cropland. This requirement could result in the need to provide feedstock certification. Such feedstock certification would be onerous and unworkable." 
 
 Soybean processors likely do not know precisely where their soybeans come from unless they are direct delivered by the farmers. Most processing plants buy soybeans from local elevators as well as direct from farmers. The local elevator does not know who delivered what soybeans once they go into storage. In the case of some processors, they buy all of their soybeans from local cooperatives with very little direct delivery. Under the EPA Proposed Rule, they would need to get certifications from the hundreds of thousands of producers who deliver soybeans to a cooperative, who in turn deliver soybeans to the processor. 
 
 "EPA does not provide a clear method to implement this feedstock certification, and they must recognize the challenge it would present," Gaesser said. "This is a great concern for farmers and our industry partners and will be the subject of significant attention as we develop formal comments and response to the EPA Proposed Rule." 
 
 In addition to ASA's concerns with significantly flawed indirect land use assumptions and unworkable feedstock certification proposals, ASA is seeking implementation by the USDA of the Bioenergy Program for Advanced Biofuels, which was funded in the Energy Title of the 2008 Farm Bill. The Bioenergy Program, if implemented properly, could provide much needed assistance to U.S. biodiesel producers. 
 

 "The purpose of the Bioenergy Program for Advanced Biofuels is to provide payments to eligible producers to support and ensure an expanding production of advanced biofuels," Gaesser said. "USDA has not issued proposed rules or a notice of funding availability for the program as of yet. Our primary requests are to have the program implemented in a timely manner and provide payment on all gallons of eligible biodiesel produced retroactive to October 1, 2008." 
 
 Soy biodiesel is one of the cleanest burning biofuels in commercial existence today. It is a renewable and sustainable energy source that can play a significant role in our national efforts to increase our energy security and improve our environmental footprint. Biodiesel has also provided a significant market opportunity for U.S. soybean farmers and jobs and economic development for rural communities.
 
 ASA's complete testimony is available at: <a href="http://www.SoyGrowers.com/policy/testimony052109.pdf">www.SoyGrowers.com/policy/testimony052109.pdf</a>. 
 
 ASA is the policy advocate and collective voice of its 22,000 producer-members on domestic and international issues of importance to all U.S. soybean farmers. 
 
 For more information contact: 
 Ray Gaesser, ASA Vice President, 641-344-2327, gaesserfrms@wildblue.net 
 Bob Callanan, ASA Communications Director, 314-576-1770, bcallanan@soy.org

ASA testifies federal policy undermining investor confidence in biodiesel

Posted May 22, 2009
 
 A proposed rule by the Environmental Protection Agency (EPA) could undercut already struggling small business biofuel producers, lawmakers argued today during a Congressional hearing. Rep. Kathy Dahlkemper (D-PA), the Chairwoman of the House Committee on Small Business' Subcommittee on Regulations and Healthcare, said that the EPA's proposal to include international land use changes in the calculation of the greenhouse gas emissions from biofuels could undermine the fledgling industry, just as it is beginning to take root.

 
 "When it comes to calculating biodiesel's emissions profile, EPA's actions could be devastating," said Dahlkemper. "The biofuels industry holds great promise not only to create new, good paying jobs, but to wean our nation off foreign energy sources. However, we can only benefit if we adopt policies that promote the growth of this industry, rather than hampering it before it gets off the ground."
 
 On May 5, the EPA released its Notice of Proposed Rulemaking to implement the Renewable Fuels Standard. The Renewable Fuels Standard (RFS) is a law that requires fuels in the U.S. to contain a certain percentage of biofuels. The EPA's rule could disqualify many biofuel producers from the RFS program, preventing them from selling their product and staying in business. The EPA plan would attempt to take into account how biofuel production changes the use of land and how those changes affect greenhouse gases emissions. For example, the EPA's analysis would evaluate whether clearing forests to make room for crops used to produce biofuels would result in greater carbon dioxide emissions. However, lawmakers said that the effect of land use changes are currently difficult to measure and that trying to consider them could be harmful to many smaller biofuel producers. 
 
 "Currently, measuring land use changes is complex and I am not convinced there is a scientific consensus on the topic," said Dahlkemper. "What we do know for certain is that the EPA's proposed rule, as currently drafted, would have a detrimental effect on the small firms and family farmers that are pioneering the renewable fuels industry."
 
 Until recently, renewable fuels and biofuels were seen by many as a promising solution for promoting energy independence, reducing energy costs for consumers and creating jobs in rural America. However, the combination of volatility in oil and gasoline prices, a tightening credit market and the overall weakening of the economy have badly battered the industry and put many producers in jeopardy. During today's hearing, Dahlkemper called on the EPA to take into account the needs of small firms and family farmers as it moves forward.
 
 "The EPA has the ability to be flexible in drafting emissions profiles, and it is critical that the agency use that flexibility," said Dahlkemper. "To begin, it could accomplish a great deal by drafting a clear, workable framework for small firms to follow. As part of that process, biodiesel entrepreneurs should be consulted."
 
 EPA's publication of its proposed rule starts the clock ticking on the formal comment period, which will last for 60 days. Upon completion of that comment period, EPA is expected to move forward in crafting a final rule. 
 
 Small Business Press Office (202) 226-3636
 
 CONTACT: Zac Petkanas (202) 225-5406

Small business biofuel producers endangered by proposed EPA rule

Posted May 22, 2009
 

 The Global Biorenewables Research Society was launched May 20 by scientists from eight countries, aiming to become the independent standard for science-based knowledge for sustainable biorenewables. "This effort will be of great value to policy-makers who will be facing a world transitioning from non-sustainable technologies to bio-based economies," said the chair of the new society Luuk van der Wielen from Delft University of Technology in the Netherlands. Manuel Heitor, Portugal's Secretary of State for Science, Technology and Higher Education, stressed that governments as well as the international debate, would greatly benefit from the input of sound scientific knowledge provided by the GBR Society.
 
 The founding members are international research leaders from diverse disciplines including agriculture, biology, economics and engineering. They will provide scientific assessments on environmental, social and economic challenges that increasing demand for biomass will bring. Importantly, the Society will explore opportunities for rural development, better management of agriculture, and reduction of green house gas emissions. Priorities also include enhancing interactive communication between scientists, policy-makers and the general public, as well as facilitating an educational network for international exchange of students and scientific staff. The GBR Society will be feeding into this year's United Nations Climate Change Conference in Copenhagen.
 
 "Our ecosystems are under pressure by increasing demands for food, feed, fiber and fuel," Van der Wielen said. "Implementation of a bio-based economy will significantly impact our society, as the increasing demand for biomass requires sustainable production, responsible use and equitable sharing of the resources and products. Energy security and climate change mitigation, rural development, sustainable land use will depend upon rigorous debate supported by the best available fact-based information."
 
 The GBR Society is the outgrowth of two roundtable discussions held in the United States last year. Scientists in the discussions were proposing to form a group that would function much like the Intergovernmental Panel on Climate Change whose comments on climate change are considered authoritative, partly because of the breadth and inclusiveness of the scientists involved in the process.
 
 The founding partners of the GBR Society are scientists from the following leading international biorenewable centers: B-Basic (Netherlands), Energy Biosciences Institute (USA), Kluyver Centre (Netherlands), Institute for Biotechnology and Bioengineering (Portugal), Institute of Advanced Studies of the University of São Paulo (Brazil), University of Queensland (Australia), Porter Alliance (United Kingdom), University of Cambridge (United Kingdom), Copernicus Institute of Utrecht University (Netherlands), Catholic University of Valparaíso (Chile), Indian Institute of Technology Kharagpur (India) and University of York (United Kingdom). Membership will be open to other scientists from public research institutes.

Global scientific society forms to inform policy debate

Posted May 26, 2009
 
 A fire Saturday night, May 23, damaged the soybean oil and biodiesel loading area at <a href="http://www.mnsoy.com/">Minnesota Soybean Processor's</a> facility in Brewster, Minn. At 9:55, alert employees saw smoke in the area and called the Brewster Fire Department, which, in turn, was assisted by a number of area fire departments in responding to the fire.
 

 The fire was contained the area involved with the storage and loading of finished soybean oil and soy biodiesel. No explosion occurred and no injuries resulted, according to general manager Richard Galloway. Damage was limited to load-out equipment, to the insulation on a biodiesel storage tank and to a soybean oil storage tank. Since the event occurred during a holiday weekend evening, only six employees were on site. No loading was happening at the time and no employees were in the area. 
 
 The facility was closed on Tuesday, but with no damage to the production facilities or the grain elevator portion of the facility, processing is expected to resume later this week.
 
 Minnesota Soybean Processors is a 2,300 member cooperative that owns and operates a soybean processing plant and 30 MMgy biodiesel refinery in southwestern Minnesota. It processes around 35 million bushels of soybeans annually purchased from nearby farmers in Minnesota, Iowa and South Dakota.

Fire damages Minnesota Soybean Processors plant

Posted June 1, 2009
 
 Biodiesel producers have a new tool to analyze biodiesel economics.<a href="http://www.agmrc.org/"> The Ag Marketing 
 Resource Center</a> rolled out its biodiesel profitability spreadsheets in its June newsletter. "We put together what we think is a ballpark or typical biodiesel plant in Iowa to give an overview where the industry is going," explained Don Hofstrand, co-director of the AgMRC, an online center hosted by Iowa State University Extension Service. 
 
 The biodiesel profitability spreadsheet plugs in the figures for a hypothetical 30 MMgy biodiesel plant based in Iowa including fixed and variable costs and product prices. With the launching of the spreadsheet, the Iowa-based prices for biodiesel, soybean oil, methanol and natural gas will be updated monthly. "We don't do monthly updates for glycerin because we couldn't find a good data series for glycerin in Iowa," Hofstrand said. He was a bit surprised to see how small of a factor glycerin was in the overall biodiesel profitability analysis, he added.
 
 <a href=" http://www.agmrc.org/renewable_energy/biodiesel/profitability.cfm ">The Biodiesel Profitability Chart </a>is available for downloading at www.agmrc.org under the renewable energy heading for biodiesel profitability.The Excel spreadsheet is designed so that a biodiesel producer can change the basic values on the "Economic Model" tab to reflect a plant's actual fixed and variable costs and efficiencies to see how those play out throughout the tables and charts. The nine charts built upon data entered in the economic model include analyses of returns per gallon of biodiesel and per pound of soybean oil, breakeven purchase cost for soybean oil and sale price of biodiesel, return on equity, return over variable cost, among others.

 
 Along with launching the biodiesel profitability spreadsheet, the June issue of the AgMRC's newsletter includes the second of two articles by Bob Wisner on biodiesel,<a href="http://www.agmrc.org/renewable_energy/biodiesel/biodiesel_economics__costs_tax_credits_and_coproduct.cfm"> "Biodiesel Economics-Costs, Tax Credits and Co-product." </a> His May article covered<a href="http://www.agmrc.org/renewable_energy/biodiesel/economic_pressures_on_the_biodiesel_industry.cfm "> "Economic Pressures on the Biodiesel Industry."</a> 
 
 With the help of Ann Johanns, the data available on the Web site also includes monthly updates of Wisner's supply and demand balance sheets for soy oil/biodiesel and soybeans/biodiesel. The spreadsheets analyzing biodiesel industry data compliment a similar set of corn ethanol spreadsheets available on the AgMRC Web site.

Ag Marketing Resource Center launches biodiesel profitability spreadsheets

Posted June 2, 2009
 
 Said to be the third biggest bankruptcy case in American history, General Motors Corp. has filed for debt protection under federal law. Pres. Barack Obama said on June 1, that the financial crisis that began last September had crippled the American economy-including the manufacturing sector. In an effort to save jobs and an institutional American business, the U.S. treasury will be making an "additional investment" 0f $30 billion to save GM.
 
 "GM is an American company with tens of thousands of employees in this country, and responsibility for its future ultimately rests with us," Obama said. "These steps have put our government in the unwelcome position of owning large stakes in private companies for the simple and compelling reason that their survival and the success of our overall economy depend on it."

 
 A monthly survey conducted by Creighton University in Omaha, Neb., asked Midwest supply managers and banks how they felt about the U.S. Government's bailout of GM. Of those surveyed by Creighton, 66 percent said they were against this maneuver. A reason for this stance is that those surveyed are business people-including biodiesel producers-who might be buying parts from GM or bidding on steel, gasoline or other raw materials, as a competitor of GM in the marketplace. "GM is going to be getting loans at zero interest, so this is going to make it harder for their competitors, especially Ford, Toyota and other U.S. auto manufacturers," said Ernie Goss, professor of Economics at Creighton.
 
 While GM is getting a lifeline from the federal government, indications are that the rest of the economy is still struggling. Supply managers in the nine-state region surveyed by Creighton continue to trim inventories. The May inventory index was 39.3 percent, up from April's record low of 36.2 percent. "We have yet to record any restocking of inventories for raw materials and supplies," said Goss in Creighton's report. "However, I expect replenishment of inventory levels later this year to have strong positive impacts on the regional economy." 
 
 In addition, most supply managers that Creighton surveyed don't think the government should be in the business of making cars. "The money that is going to be used to support GM comes from taxpayers-and supply managers certainly fall into that category-so they think that their business will face increased burdens," Goss said. 
 
 On March 31, GM reported consolidated debt of $54.4 billion, along with additional liabilities, including an estimated $20 billion obligation to the UAW Voluntary Employee Beneficiary Association. Of GM's common equity, 60.8 percent will be owned by the U.S. Treasury, 11.7 percent by the Canadian and Ontario governments and 17.5 percent by VEBA. In addition, 10 percent has been reserved "for the benefit of the unsecured bondholders and unsecured creditors of GM," the company stated.
 
 "The government-taxpayers-are going to own the majority percentage of those shares, so who is going to vote on those shares if GM wants to close a plant in Kansas?" Goss asked. "Will it be the public? Will it be Obama? Will it be Tim Geitner? Will it be Congress? No one knows."
 
 As far as reactions to this news from the biodiesel industry, Kelly King of Pacific Biodiesel says GM's problems won't affect their business significantly. "I don't think they've been very supportive anyway and I don't think they've been moving in concert with the development of renewable fuels," King told Biodiesel Magazine. "So I hope that whoever is left standing gets the message from the Obama Administration on how we will be moving forward."

GM declares bankruptcy

Posted June 2, 2009
 

 Just months ago a new network of researchers and institutions from Brazil and the U.S. was developed by the Brazil-U.S. Higher Education Council under the auspices of the U.S. State Department through the Fulbright Commission in Brazil. Now, the network is offering a free short course in Sao Paulo July 27 through Aug. 7. 
 
 Dubbed the "1st Brazil-U.S. Short Course in Biofuels: Proving Interdisciplinary Education in Biofuels Technology," the objective is to provide interdisciplinary education in bioenergy and biofuel technology, and to improve the communication among institutions of higher education, science, and other public and private organizations in Brazil and the U.S. 
 
 The application deadline is June 15. 
 
 According to the Fulbright Commission, the course is an important tool and vehicle for those wanting to learn and discuss the best ways to serve the biofuels community. It aims to help biofuels researchers and professionals advance their development by giving them a chance to network. Both Brazil and the U.S. are investing in biofuels research and development programs, and trained human resources, information, and networking opportunities to learn from new advances that are occurring are highly required. 
 
 The coursework will include: 
 
 - An overview and research priorities in biofuels research in Brazil and the U.S.
 - Feedstock production
 - Feedstock biochemistry applied to biofuels
 - Logistics: harvest, storage and transportation
 - Conversion technologies: lipid process; sugar and starch; biochemical processing of cellulosic biomass; thermochemical processing of cellulosic biomass; chemical and catalytic processing
 - Biorefinery systems
 -Markets, economics and policies

 -Sustainability, life cycle analysis and certification process 
 
 Other components of the course include visits to ethanol and biodiesel plants, sugarcane mills and science and technology centers and panel discussions.
 
 Once again, there is no registration fee. Select participants will pay for and arrange their own transportation to Sao Paulo, where double-room accommodations including breakfast will be provided to all participating graduate students-except for those living in Sao Paulo. Daily lunches will also be provided throughout the course. 
 
 For more information and to register, visit <a href="http://www.fulbright.org.br">www.fulbright.org.br</a>, or <a href="http://www.brazil-usa-henetwork.org">www.brazil-usa-henetwork.org</a>; or call +55 61 3248 8614; or fax +55 61 3248 8611

1st Brazil-U.S. short course in biofuels offered

Posted, June 3, 2009
 
 Western Biofuels Inc. released the results of an independent validation test and announced plans to build a 1.4 MMgy demonstration plant for a new biofuel process. Fuel chemist Nicholas Irving, president and founder of Western Biofuels, described the process as combining a chemical reaction using nitrogen compounds and distillation to create a unique biofuel from fats and oils that is not a methyl ester. He's calling it a High Energy BioFuel (HEBF) because it combines the energy advantage of petro-diesel with the benefits of biofuels. 
 
 "HEBF has no restriction as to feedstock, it can be tallow, palm, olive oil or 100 percent FFAs [free fatty acids]," Irving said. "We can even use crude vegetable oils, the water isn't a problem." The distillation is done at atmospheric pressure, Irving added, although the HEBF process does require the proper equipment and can't be done even on a bench scale with glassware.

 
 "The unique characteristic of our product is the consistency of output," said Western Biofuels CEO Jose Parjus. Regardless of feedstock, the process yields about 5 percent of a light, naptha-like fraction, about 10 percent of a heavy bio-bunker fuel and the rest the biomass-based diesel fraction. The HEBF process has no coproducts such as glycerin and produces a fuel with a unique chemical footprint which allows full traceability. Testing by the independent laboratory, Oil Test International, confirmed HEBF is comparable to ultra low sulfur diesel or better, Parjus said, and performs well compared to biodiesel specifications with a notable cold filter plugging point of minus 13 degrees Celsius. The sample fuel used for the independent tests was made from pure free fatty acid crude palm oil feedstock, he added. 
 
 With the independent test results in hand, Western Biofuels is now putting together equipment and in discussions to select a location for a 1.4 MMgy demonstration facility, possibly in Texas or in Central America. The company has roots in both regions with Irving being based in Guatemala City, Guatemala, and Parjus based in Miami Springs, Fla. 
 
 <center><img src="/images/upload/20090603111155.jpg" alt="Test Results" /></center>

Western Biofuels introduces new process

Posted June 3, 2009
 
 Eastman Chemical Co. has marketed a second and improved version of its line of additives for biodiesel formulations under the trade name BioExtend 30 HP. "It maintains its easy to use characteristics but ensures that it will not do damage to engine components, which petroleum companies-especially in Europe-are demanding," said Nancy Kinkade of Eastman's BioExtend scientific team. The "no harm" certification was made by the Biodiesel Quality Management Association of Germany (AGQM). 
 
 Kinkade says there will be more and more testing of various products and additives for biodiesel that meet the "no harm" certification requirements. "Before, there were only one or two additives that the companies in Europe were willing to accept in the biodiesel they purchased," Kinkade said. "So AGQM decided to expand the products they certified because they thought many were superior to the one that was approved." AGQM spent most of 2008 evaluating biodiesel stabilizers and in January 2009 released a list of 13 products it had approved.
 
 BioExtend can be added to biodiesel at virtually any point in the supply chain. Most often it's added to the fuel by the actual producer, but it can also be added by distributors or even end users. "An airport with material in its tanks for ground equipment can add BioExtend to its supplies to extend the shelf-life and oxidative stability of their biodiesel," Kinkade said. "Bioextend allows biodiesel to be retreated several times so that oxidative stability can be improved at various points in the supply chain." 
 
 Eastman BioExtend 30 HP is a result of research and development efforts to assist customers in meeting ever increasing fuel regulations, Eastman said. "We do expect the ASTM spec for oxidative stability to increase from its current limits," Kinkade said. "BioExtend allows biodiesel to perform way above the parameters that are now in place-even if those parameters are doubled in the future."

Eastman revamps BioExtend for 'no harm' certification

Posted June 4, 2009

 
 <a href="http://www.nesteoil.com/ ">Neste Oil Corp. </a>announced a commitment to exclusively use certified palm "when sufficient volumes become available." The company states it believes this will be possible by the end of 2015. In its announcement released June 4, Neste said it recently received its first cargo of 5,000 tons (600,000 gallons) of palm oil from certified sources, and it expects to use at least 50,000 tons of certified palm oil this year.
 
 "Neste Oil has developed a system for the full traceablity of the palm oil it uses, all the way from plantations to NExBTL plants. We believe that responsible companies can make a difference. As a forerunner, Neste Oil is putting a lot of effort into establishing exemplary procedures for its operations, ones that we believe could also act as a model for other companies and industries using palm oil," said Jarmo Honkamaa, executive vice president, renewable fuels and deputy CEO.
 
 Neste is a member of the Roundtable for Sustainable Palm Oil, an organization that brought palm oil producers, users and environmentalist critiques of palm oil expansion together to develop a set of sustainability criteria and certification. The World Wildlife Fund released figures in mid-May that showed only 1 percent of the sustainable palm oil available on the market had been bought. "So far, around 1.3 million tons of certified sustainable palm oil have been produced, but less than 15,000 tons have been sold," said David McLaughlin, vice president of agriculture for WWF, a founding member of the RSPO. "This sluggish demand from palm oil buyers, such as supermarkets, food and cosmetic manufacturers, could undermine the success of sustainability efforts and threatens the remaining natural tropical forests of Southeast Asia, as well as other forests where oil palm is set to expand, such as the Amazon."
 
 WWF announced its plan to monitor the world's major users of palm oil over the next six months and publish a Palm Oil Buyer's Scorecard. It asked that all companies buying palm oil to make public commitments that they will use 100 percent certified sustainable palm oil by 2015. 
 
 Neste's public commitment to purchasing certified sustainable palm also followed a May 12 Greenpeace demonstration held the same day as WWF's announcement. Greenpeace activists from Finland and Sweden locked down the Neste Oil renewable diesel refinery in Porvoo, Finland. Greenpeace urged the Finnish government to use its influence to stop Neste Oil using palm oil, and not to subsidize palm oil for fuel in the future. "The most significant way to reduce transport emissions is to make cars more energy efficient and to develop a low-energy and low-carbon transport system," the organization said. Greenpeace added that Neste's announcements to scale up its NExBTL production with new plants in Finland, Singapore and the Netherlands potentially will make Neste the world's largest single consumer of palm oil at about 1.5 million metric tons of palm oil a year. "Palm oil biodiesel is not a solution to climate change. It actually makes the problem worse if rainforests are cut down to grow the palm oil to fuel our cars. Greenpeace is also calling on the Indonesian government to implement an immediate moratorium on further deforestation, including further peatland conversion for palm oil. The solution to climate change lies in developed countries making deep emissions cuts at home and helping to finance forest protection in developing countries like Indonesia," said Joko Arif, Greenpeace Southeast Asia forest campaigner.
 
 Neste is currently doubling the capacity of its first renewable diesel refinery in Finland to 340,000 metric tons per year (120 MMgy), has a <a href="http://www.biodieselmagazine.com/article.jsp?article_id=3327 ">plant in Singapore that began construction</a> earlier this year and <a href="http://www.biodieselmagazine.com/article.jsp?article_id=3499 ">recently broke ground in Rotterdam</a>, the Netherlands. The Finnish oil company developed a feedstock-neutral refinery-scale process using hydrogenation technology to convert fats and vegetable oils into renewable diesel, calling it NExtBTL. The company said the renewable diesel offers between a 40 to 80 percent lowering of greenhouse gas emissions compared to fossil diesel fuels, depending on the feedstock used. In announcing the commitment to sustainable palm oil, it also said its research and development efforts are looking at other new industrial-scale renewable materials susch as algae, other microbes and wood residues.

Neste commits to 100 percent sustainable palm

Posted June 8, 2009

 
 While industrial size plants have gotten built without opening-signaling the struggles of the commercial biodiesel industry-there's a company known as Springboard Biodiesel in Chico, Calif., that's flourishing. Its business model, based on the sales of portable biodiesel processing units capable of producing only 36,000 gallons per year, is experiencing accelerated growth. "There is market out there for serving the small-scale biodiesel producers that aren't going to sell the fuel, but process it for their own uses," said Matt Roberts of Springboard. 
 
 Proprietary fluid separation technology marketed as the Induced Coalescent Separator (INCOSEP) can help home brewers dramatically speed up the process of local refining, therefore, increasing production capacity. "This type of equipment has no precedent- that we know of in our industry," Roberts said.
 
 The portable biodiesel processors are made of 304 stainless steel and all industrial-grade components. It allows customers to make ASTM grade biodiesel very cheaply-for less than $1 per gallon. Ninety-nine percent of its users make biodiesel from recycled vegetable oil, according to Springboard. "We've sold a large number of our machines to small businesses, universities, municipalities and co-operatives in the United States," Roberts said. 
 
 "This technology (INCOSEP-Pro) is capable of inducing secondary fluids to 'coalesce' out of the raw biodiesel," Roberts said. "It can rapidly separate glycerol and water from the fuel."
 
 The BioPro 190 biodiesel processor, Springboard's flagship product, is capable of producing a 50 gallon batch of ASTM quality biodiesel every 48 hours. "With INCOSEP-Pro installed on the equipment, however, we can reduce that time to 21 hours," Roberts said. Also, if existing users purchased a BioPro processor before the start of 2007, they can have their machines retrofitted to incorporate Springboard's new technology. 
 
 Springboard also offers a dry wash system for biodiesel processing. The dual resin tower design, the SpringPro 76, helps double the capacity of "any biodiesel processor," the company stated and can purify 480 gallons per day. "This is a dry wash column that uses resins to clean and polish the biodiesel," Roberts said. "Water is a commodity that is becoming more and m ore scarce, especially in California."

Market found for portable biodiesel processors

Posted June 8, 2009
 
 For those concerned about using a B20 blend in late-model diesels that employ post-injection for controlling emissions, Chevron Oronite Company LLC developed a unique engine oil additive to help combat serious engine wear associated with methyl ester dilution in the engine oil crankcase. 
 

 Some OEMs use post-injection in their strategies to "regenerate" or burn off soot accumulated in diesel particulate filters (DPF). Injecting fuel late in the combustion cycle does not combust the fuel but vaporizes it as the fuel is carried downstream through the exhaust to create an exothermic reaction, which burns off the collected soot in the DPF. This periodic soot burn-off is called regeneration. OEMs have a choice to utilize post-injection or fuel injection downstream of the engine, as in the exhaust system directly, but it is more cost-effective to use post-injection because there is no additional hardware needed to perform regeneration. 
 
 Fuel dilution has always been an issue with diesels, but never more so than with post-injection. Petrol diesel dilutes engine oil too, but it volatilizes off and eventually is released through the breather system. For biodiesel, however, the story is significantly different. 
 
 Biodiesel has a higher and narrower boiling range than petroleum diesel, and its physical properties lead to larger droplet sizes exiting the fuel injectors. This means that, while the petrol portion of the blend vaporizes and follows its destination to the exhaust stream as the piston is at the bottom of the cylinder, the methyl ester fraction-with its higher, narrower boiling range and larger droplet size-remains in liquid form collecting along the exposed surface area of the cylinder wall, and as the piston rises, much of the biodiesel bypasses the rings to enter the crankcase. Once in there, the biodiesel does not volatilize off like mineral diesel does. With the heat of the crankcase, there is concern about oxidation of the oil/biodiesel mix and engine wear resulting from the organic acids. 
 
 "In the case of biodiesel, once it gets in the crankcase and as it starts to degrade, it forms organic acids and starts to polymerize," said Gary Parsons, global OEM and industry liaison manager for Chevron Oronite. "The organic acids can aggressively attack certain metals, particularly lead in the lead bearings. And then as it polymerizes and oxidizes, it can lead to increased deposits in the engine-in particular, deposits on the pistons."
 
 The engine oil additive Chevron Oronite developed is designed to counter the effect of the acids, so they don't aggressively attack the metal; and also to prevent oxidation and formation of deposits. 
 
 Historically, in the context of acids, the lubricant additive business has largely been focused on formulations that help combat sulfuric acid damage. Before many of the recent sulfur limitations on diesel fuel went into effect, sulfur content in diesel fuel ranged from unlimited to 5,000 ppm to 500 ppm; but now, on road ultra low sulfur diesel only contains 15 ppm sulfur maximum. "Much of the historical effort had been in neutralizing sulfuric acids, and now much of the sulfur issues have gone away," Parsons said. "But now we're talking about putting this organic material in the oil, which forms organic acids, so part of what we've done is we've tailored our formulation to address those organic acids in order to prevent oxidation of the fatty acid methyl ester in the oil. That's why it's called for special research and development in that area-because it's different than what's been done historically. " 
 
 The product, which is commercially available and marketed under the Oronite Lubricating Oil Additive, or OLOA, trademark, has been receiving global attention since its commercial debut last year. "People are starting to see that there's going to be more biodiesel in the market, and more exposure and potential risk, so we're seeing more and more interest because of that," Parsons said. "Until now, the use of biodiesel has largely been driven by economics or people who just want to do good things for the environment-not by mandates."

June 2009

Business Briefs

Business Briefs: Companies, Organizations & People in the News

Columns

The Future is Today

Springtime Doesn't Make the Cold Flow Issue Go Away

The Feedstock Puzzle

Letter to the Editor: The Perils of Chinese Biodiesel Producers

Featured

Bleeding Green

B100 to the Arctic Circle

Q&A with Bob McCormick on Low-temperature Operability

June 2009.css-7jxktu{position:absolute;bottom:0px;left:0px;right:0px;height:3px;border-radius:3px;background-color:var(--chakra-colors-brandBlack);}

Business Briefs

Business Briefs: Companies, Organizations & People in the News

Columns

The Future is Today

Springtime Doesn't Make the Cold Flow Issue Go Away

The Feedstock Puzzle

Letter to the Editor: The Perils of Chinese Biodiesel Producers

Featured

Bleeding Green

B100 to the Arctic Circle

Q&A with Bob McCormick on Low-temperature Operability

June 2009