Posted July 13, 2010
 
 Propel Fuels is working to increase the availability of biodiesel- and ethanol-blended fuels along the West Coast. This month the company announced the addition of four new senior executive employees. These new team members have been selected by Propel for their expertise, experience and innovation in the areas of finance, construction, retail operations and technology, and will be an integral component of the company's vast expansion plans.
 
 "Our view is that in this country, we need to massively remake the infrastructure to be able to deliver next-generation fuels," said Propel CEO Matt Horton. "Given the size of this undertaking, we felt that it was very important to recruit senior executives to the company who have [experience in large scale-up projects]." The new team members include Chief Financial Officer Andy Wynne, who previously served as CFO and executive vice president of Tulley's Coffee Corp.; Vice President of Operations Jim Iacoponi, who was previously employed as vice president of strategy and planning for Arco and BP ampm convenience stores; Vice President of Construction and Development Jim Cannon, who previously served as vice president of design, construction, and facilities at Jack-In-The-Box; and Director of Technology Development Michael Sarwari, who has 15 years of experience in information technology operations. 
 
 Propel currently operates 11 Clean Fuel Points in California and Washington. The company's Clean Fuel Points are essentially free-standing retail fueling locations that offer biofuels. While these fueling stations are most often co-located with existing fuel retail stations, Horton noted that some are independently sited. "We typically partner with existing fuel station owners," Horton said. "[Propel] builds, owns and operates [each Clean Fuel Point]…Most fuel station owners would love to have an alternative fuels offering, but really don't have the risk tolerance or the capital available to make the big investment that it requires." Propel's unique business plan allows existing fuel retailers to provide their customers with access to biodiesel- and ethanol-blended fuels without incurring the costs and risks associated with adding additional infrastructure to their sites.
 
 Propel's immediate expansion plans include the development of 15 additional Clean Fuel Points in California; four in Sacramento, 10 in the San Francisco Bay area, and one in Southern California. "We'll be opening our first San Francisco Bay area site within the next 30 days," Horton said. "We are also currently working on a program that is going to deploy 75 new stations across the state of California as part of a 200 station roll-out that we are looking to complete within the next two years." According to Horton, the California build-out will serve as a model to showcase Propel's ability to effectively partner with industry and government to increase retail access to biofuels. "We will be looking to replicate our successes here in California across the country very soon," he continued. 

 
 According to Horton, existing fuel marketers have shown a great deal of interest in hosting Clean Fuel Points at their retail locations. "What we've found is that a lot of station owners do recognize that alternative fuels are an important part of their offering and a great way to drive more traffic to their site, and get more customers into the convenience stores, but they are really hesitant to make a massive investment," Horton said. "Partnering with Propel is a perfect option for many of the station owners that we meet with because we provide all of the benefits to the site owner without the risks or the costs."
 
 Horton also notes that consumer demand for Propel's biodiesel- and ethanol-blended products has been strong, and that the company is continuing to build demand for its products through an aggressive marketing campaign and education and outreach initiatives. "We've found that most customers with diesel vehicles don't understand that they can use biodiesel," Horton said. "But, once we are able to reach those customers and explain the benefits of biodiesel, they become very enthusiastic." 
 
 Propel also offers its customers access to its CleanDrive platform, which is a personalized carbon emissions tracking system. When a registered customer purchases fuel at any of Propel's Clean Fuel Points, they are provided with a personalized report that tracks the carbon reductions associated with the quantity of ethanol or biodiesel that was purchased. In addition, the report also shows customers the quantity of imported oil they have offset. Although many individual customers take part in the program, Horton notes it is especially useful for fleet managers who want report on the benefits of using biodiesel. "The CleanDrive platform offers them a very visual way to be recognized for their decision to buy cleaner American-made fuels," he said.

New team members fuel Propel's growth

Posted July 14, 2010
 
 While many are disappointed with Massachusetts' June 30 <a target="_blank" href="http://www.biodieselmagazine.com/article.jsp?article_id=4266" rel="external">decision to suspend its B2 biodiesel mandate</a>, National Oilheat Research Alliance President John Huber said the action will not affect the commitment made by the oilheat industry last year to move towards biodiesel-blended products. At a September 2009 meeting in Baltimore, oilheat leaders and representatives set a goal calling for 2 percent of the nation's heating oil supply to be comprised of biodiesel by July 2010. (See: "Reinventing Oilheat" <a target="_blank" href="http://www.biodieselmagazine.com/article.jsp?article_id=3937" rel="external">http://www.biodieselmagazine.com/article.jsp?article_id=3937</a>)
 
 
 Although the suspension of Massachusetts' B2 mandate is disheartening, Huber said the lapse of the biodiesel tax credit is a far more significant impediment to the increased use of biodiesel-blended heating oil. "As a result, the price differential between heating oil and bio has grown a bit," Huber continued. "The fact that Massachusetts put those fiscal concerns on the table…adds another barrier to other states adopting [similar mandates]. All of the states are having a hard time fiscally, and we've heard in some states where they've talked about [a mandate and noted] that it would raise the price to heat [state] buildings, which has created some issues." Reinstating the $1 per gallon biodiesel tax credit will go a long way towards alleviating those financial concerns, and allowing more heating oil distributors to offer biodiesel-blended products, he said. 

 
 Matt Cota, the Vermont Fuel Dealers Association's executive director, agrees that the extension of the biodiesel tax credit will be an integral part of increasing the supply of biodiesel-blended heating oil, not only because it allows those selling biodiesel-blended products to remain completive with those offering traditional heating oil, but also because a lower price point helps drive consumer demand. "If the cost differential between the cleaner, greener fuel and standard heating oil is negligible, then customers will go with cleaner, greener fuel-and so with the dealers," he said. 
 
 According to Michael Ferrante, president of the Massachusetts Oilheat Council, the decision to suspend Massachusetts' biodiesel mandate for heating oil suppliers came as no surprise. In addition to financial concerns attributed to the expiration of the biodiesel tax credit, Ferrante also noted that the state was facing compliance issues related to the B2 mandate for heating oil. "Those compliance issues are really around how the products flow into our state, and this is not a new problem," he said. "We knew this would be something that we'd have to tackle…That to me is the main reason why our state suspended the mandate. They haven't been able to fully grasp how to regulate the flow of fuel, and truly put the mandate in place for fuel that comes from [out of state]."According to Ferrante, his organization intends to work closely with the state to resolve those compliance issues. "We believe in the product, and this is just another bump in the road," he said. 
 
 According to Cota, much of the difficultly in regulating Massachusetts B2 mandate for heating oil stems from the fact that many retailers sell products into their neighboring states. "The difficultly when you have a state by state system is that you might have dealers with a home base in Vermont, that pick up product in New York and sell it into Massachusetts," he said. "We recognize there are significant challenges [in regulating mandates under those conditions], and perhaps the best way to get it done is a regional mandate so these cross-border issues aren't a concern." 
 
 While each state in the Northeast is working towards its own mandate, Cota said that they are employing a regional approach. Connecticut has already passed a mandate similar to Massachusetts, and Vermont has proposed one that is nearly identical. These new state mandates contain language that triggers the mandate on a set effective date, or when neighboring states enact their own mandates-whichever is sooner. While this may not seem to be an effective solution at first glance, Cota said it is a process that has been proven to work in the past and offers the establishment of the Regional Greenhouse Gas Initiative as one recent example. "Massachusetts decided to go it alone and really push forward," Cota said. "We commend Massachusetts for being on the forefront, and Vermont is right behind them…but I think the difficulties that they are having with compliance reflect that." 
 
 Even without a mandate in effect, a significant proportion of Massachusetts-based oilheat suppliers are already offering biodiesel-blended products. The Massachusetts Oilheat Council represents approximately 350 retail heating oil dealers, and Ferrante estimates that about one-third of them currently offer various blends of biodiesel ranging from B2 to B20. While he noted the suspension of the B2 mandate is disappointing, Ferrante said that he doubts it will impact the commitment of those already offering biodiesel-blended products. "They are going to continue to do so because they believe in the fuel quality…and the evaluation of our fuel to a bio-blended product," he said. "I don't think they will be deterred by the delay, and I think they see the value in continuing [to offer those products]. They are the kind of pioneering companies that will keep it in place as we work though the hurdles of the state."

Suppliers undeterred by mandate suspension

Posted July 14, 2010
 
 The U.S. EPA has issued the proposed production volumes for the 2011 RFS2, calculating biomass-based diesel for 2011 at 800 million gallons. To formulate the production number, EPA examined both industry capacity and recent production rates. "As of April 2010, the aggregate production capacity of biodiesel plants in the U.S. was estimated at 2.2 billion gallons per year across approximately 137 facilities," EPA said. 
 

 "The biodiesel industry stands ready, willing and able to produce the wet gallons required to comply with the program," said Joe Jobe, National Biodiesel Board CEO. "By 2011, much of the uncertainty that has accompanied the start up and transition of the program in 2009 and 2010 will have been eliminated." 
 
 Advanced biofuels will total 1.35 billion gallons and cellulosic biofuels, according to the EPA, will total between 5 million and 17.1 million gallons in 2011. "Based on analysis of market availability, EPA is proposing a 2011 cellulosic volume that is lower than the EISA target," EPA said.
 
 The EPA believes, however, that it may be appropriate to allow excess advanced biofuels to make up for the shortfall in cellulosic biofuel, including excess biomass-based diesel. "If we were to maintain the advanced biofuel and total renewable fuel volume requirements at the levels specified in the statue, we estimate that 125 million to 144 million ethanol-equivalent gallons of additional advanced biofuels would be needed, depending on the standard we set for cellulosic biofuel." 
 
 "Biodiesel is well-positioned to meet volumes in this category relative to other advanced biofuels, and will likely play a significant role in meeting them," Jobe said. The markets, he added, will ultimately decide how much biodiesel is used to fulfill the generic category of advanced biofuels. 
 
 Under current market conditions, the EPA first considered whether the 800 million gallon volume can be met in 2011 if biomass-based diesel production may also qualify for the cellulosic biofuel volumes. "We believe that the 0.8 billion gallon standard can indeed be met," EPA said. "Since biodiesel has an Equivalence Value of 1.5, 0.8 billion physical gallons of biodiesel would provide 1.20 billion ethanol-equivalent gallons that can be counted towards the advanced biofuel standard of 1.35 billion gallons," adding, "Of the remaining 0.15 billion gallons, up to 0.026 billion gallons would be met with the proposed volume of cellulosic biofuel."
 
 "We believe that Congress wanted to encourage the development of advanced renewable fuels and allow in appropriate circumstances for the use of additional volumes of those fuels in the event that the projected volume of cellulosic biofuel falls below the statutory mandate," EPA said.
 
 Also included in the EPA's proposal report was information on domestic cellulosic diesel producers. The EPA sited two companies capable of producing cellulosic diesel in 2011, Cello Energy and Bell Bio-Energy. Producers using canola oil, grain sorghum, pulpwood or palm oil as a feedstock may soon qualify for RFS2 compliance. The EPA is proposing changes for those feedstocks if it is determined that certain greenhouse gas reductions are met. 
 
 Because the 2011 production values set by the EPA are only in the proposal stage at this point, Jobe said the recent rulemaking is only a formality put in place to allow public feedback. "NBB's comments on this rulemaking will be supportive of the EPA's decision, with the possible addition of some administrative and technical comments," Jobe said. 
 
 To offer changes on the proposed rule, the EPA will accept comments for 30 days after the proposal is posted on the Federal Register. To send comments via email: 

 <a target="_blank" href="A-and-R-Docket@epa.gov" rel="external">A-and-R-Docket@epa.gov</a>. To view the full rulemaking document, click <a target="_blank" href="http://www.epa.gov/otaq/fuels/renewablefuels/rfs2011-standards-rule.pdf" rel="external">here</a>.

Biodiesel an option for 2011 RFS2 shortage

Posted July 28, 2010
 
 University of Illinois researchers are exploring the use of electrochemical sensors on diesel vehicles to detect specific contaminants in the fuel, such as sulfur or sulfur-based compounds, contaminants that existing sensors may not detect. 
 
 The research team is contributing to the development of a sensor that, when placed in the fuel line prior to where the fuel enters the engine, the electrochemical sensor can detect any contaminants in, or other problems with, the fuel, according to Alan Hansen, professor of agricultural and biological engineering at the UI and lead researcher on the project. 
 
 "If one adds biodiesel as a blended fuel to the diesel, we're trying to make it determine the quality and quantity of biodiesel entering the engine," he said. "Other contaminants in the biodiesel are of interest to us such as methanol, glycerol and so forth. Water, if mixed with biodiesel, could be an issue as well."
 
 Sulfur contamination is critical to monitor in diesel fuel as it can contribute to the release of harmful exhaust emissions. Sulfur damages the catalysts in filters that are part of the engine's aftertreatment system. Such filters are needed to comply with the U.S. EPA's strict diesel emissions regulations. 

 
 Though there is isn't concrete preliminary results to report, Hansen said the research team is working in partnership with an undisclosed engine manufacturer where it reports its data. The goal of refining the electrochemical pathway for its application as an even more reliable sensor monitoring system than what's currently in today's commercially available diesel vehicles is the team's ultimate goal, according to Hansen. 
 
 "We've found that the commercial sensors out there have provided good results too," Hansen said. "Electrochemical sensing is just one possibility we're experimenting with. One can see the potential benefits of doing this of course, but we have a ways to go before it becomes a robust and reliable process."

Researchers investigate improved fuel sensors

A reader asked the following question regarding one of my F.A.M.E. Forum blog posts in late June, about small- and community-scale producers: 
 
 "It seems to me that many of these smaller plants are represented by a very diverse mix of local business models, many with nearly-proven production processes and wishful-thinking business, marketing and distribution plans. The results are mixed. Is there anyone out there who has developed a proven turnkey package for these small plants-one that includes a robust business and marketing plan?" 

 
 My August feature article, "The Resilient Community Producers," on page 24, was still in development when I posted the entry to which the commenter referred. I had a lot of great conversations with many small-scale producers before writing the article. One element shared by local community producers is that they take advantage of local opportunities in their specific regions, which would make it tough to develop a cookie-cutter plan for individual locales. Another commonality is that many of them use waste cooking oils collected from local establishments. 
 
 Here's a stream of pointers I learned from this inventive crowd. When starting a local project, get investments from local people who have a vested interest in the project's success, rather than from a stranger who is simply looking for a financial return. Know the feedstock and end markets-don't be in the position in which many mega-plants now find themselves: building a large plant for which you have to import feedstock from vast distances, and then export fuel far away. Many of the community plants are sized around the realistic volume of feedstock they can get from their own region. The more directly one can sell to consumers, the better the profit margins will be. And the same goes for feedstock-the more plant personnel can collect themselves without involving a broker or middleman, the better the profit margin will be. 
 
 Being successful isn't always about having the best technology, although that is an important component. But vertical integration seems to be one major key element to the survival of the small producer. The more diversified the operations are-not just producing biodiesel but consulting, offering different types of services, being creative about selling and marketing your main and coproducts-the more success will be had at riding through the down markets. 
 
 Subsidy-proof operations, don't rely on the tax credit but rather find ways to center the business plan around a noncredit environment so if/when the credit does come back, it's all profit and not relied upon to stay in business. 
 
 Befriend the community and get the green message out there through education, workshops, demonstrations and tours. Let them know you exist and how you benefit the community. Practice what you preach-people admire and respect the fact that trucks delivering B99 are also running on B99, or some blend of biodiesel if the season won't allow it. 
 
 One of the most important things I have learned, and one that is less quantifiable, involves the relationships that exist with small producers and their customers, their communities. One source said those relationships allow for a flexibility and loyalty that would be harder to find in many of the larger operations. 
 
 I learned that one cannot assume a small, local plant is sustainable just as one cannot assume a large, centralized plant is not sustainable. The best solution is that both models must be sustainable. 
 
 The commenter on my blog referred to some of these plans as "wishful thinking business," but I disagree. I see these small producers as being realistic and down to earth. After all, they are not the ones who position a massive plant in a location where they are forced to import feedstocks and export fuel long distances. These small producers would say that is more of a wishful-thinking business model.

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Small-Scale Success Stories

Biodiesel production facilities are intended to operate at or near capacity. However, when circumstances leave a plant with excess staff or production capacity, availability of excess capacity or plant space offers opportunities to collaborate with others in developing technology that may give a producer an edge when the capacity or space can be rededicated to commercial production. 
 

 It is critical that legal arrangements appropriately secure the collaborators' interests, and grant to each party a defined share of the anticipated fruits of the collaboration. A written collaboration agreement secures those interests and forces the parties to clearly specify their interests. Several issues should be addressed in substantially all collaboration agreements. 
 
 Confidentiality Confidential information can be a valuable component of the assets of a biodiesel producer. Parties seeking to collaborate with producers often have confidential information about the subject matter under development. Nondisclosure of a collaborator's confidential information is usually a basic assumption in a collaborative setting, however, the boundaries of confidentiality obligations are often not intuitively clear.
 
 A collaboration agreement should set clear boundaries and responsibilities for protection of the parties' confidential information, including identifying the types of confidential information that each party has or expects to generate; indicating the time period during which confidentiality must be maintained; and specifying limitations on use by either party of the other's confidential information. 
 
 Disclosure of confidential information in violation of a collaboration agreement may not satisfy a state court's requirements for an injunction until after lengthy discovery and trial periods. To avoid such delay, a collaboration agreement should include a term authorizing a court to issue an injunction to mitigate or prevent disclosure of confidential information in violation of the agreement.
 
 Intellectual property ownership The goal of collaborative efforts is often to develop new information or technology. Intellectual property rights (e.g., patent rights) in such developments can sometimes be obtained, depending on the laws applicable to the collaborative efforts. Those rights can have significant value, particularly where such IP rights include the right to exclude others from practicing the developments. There are costs associated with obtaining IP rights. Furthermore, most IP rights can be lost or devalued by acts or omissions of collaborators.
 
 Collaboration agreements should address IP rights that can foreseeably be expected to be created during the collaboration. The agreement should specify which of the collaborators will own the IP rights and any conditions on ownership. The agreement should specify which party will have responsibility for securing the IP rights, including who will decide whether to secure the rights. Significantly, the agreement should specify responsibilities that each party shall have for supporting creation of IP (e.g., reporting, not disclosing, and cooperating in securing of IP), especially when that party will not own it.
 
 Funding and ownership of tangible property A collaboration agreement should clearly indicate all foreseeable payments to be made and all tangible materials to be supplied by each party. The agreement should clearly indicate which party will retain ownership of tangible properties and the timing of any change of ownership.

 
 Liability Legal liability (e.g., products liability or patent infringement liability) can be a significant risk in some projects. Collaboration agreements should clearly identify which party will be responsible for such liabilities and the requirements that each party shall have to avoid, report, defend, and cooperate with the other party to resolve liability claims.
 
 Termination It is critical that each party have the ability to either predict or control the date on which its participation will end, so that the party will not be subject to unanticipated responsibilities and obligations. Every collaboration agreement should specify when the collaboration will end. Contingent or renewable termination dates can be appropriate, but parties should avoid terms that link termination with events or conditions that may turn out to be unattainable. Furthermore, each party should normally insist that the collaboration agreement be terminable upon the occurrence of events of significance to the party. Termination provisions should clearly specify which provisions of the agreement will survive termination of the agreement. By way of example, confidentiality and (intellectual and tangible) property ownership provisions commonly survive termination of such agreements.
 
 It can be tempting to begin collaborative work with another party without the perceived trouble and expenses of drawing up an agreement to govern the collaboration-or to insist on a short agreement that does not address the issues discussed above. Collaborating without a relatively comprehensive agreement ignores the risks inherent in such work. By investing time and effort before commencing a collaborative effort, collaborators can ensure that their plans and expectations match, and minimize or avoid disputes that might otherwise spoil the effort. 
 
 Simply put, resolving potentially disputable issues in a collaboration agreement before beginning the effort will be simpler and less costly than fighting through disputes that arise from the absence of an agreement.
 
 Gary D. Colby is a former biofuels researcher who now works as a patent attorney in the Philadelphia office of the Flaster Greenberg law firm. Reach him at (215) 279-9384 or <a href="mailto:gary.colby@flastergreenberg.com">gary.colby@flastergreenberg.com</a>.

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Collaboration Agreements-Agree Now or Fight Later

Midlands Biofuels is a locally owned and operated biodiesel company located in Winnsboro, S.C., the only ASTM certified plant in operation in the state. We are the owners, and we built this company from the ground up. As a multifeedstock, batch processor with a 300,000 gallon per year capacity, MBF mainly produces biodiesel using waste vegetable oils (WVO) generated from the food service industry. With a tight budget and lots of innovation, our team at MBF had to develop a low-cost and efficient heating system for the plant, thus, we trademarked Boilerless Technology. It uses significantly less energy than the traditional boilers used by large-scale producers and is one-tenth the cost. We also worked with the University of South Carolina, NASA Engineers and South Carolina Research Authority to develop a sustainable business model that is based on smaller, more efficient plant sizes with the ability to utilize multiple feedstock sources. Future plans include developing biodiesel training curriculum for engineers and plant technicians, developing solar applications, and a biomass filtration system within the biodiesel process. 

 
 Major changes to the biodiesel industry are still being played out and one thing is for sure-the days of large multi-million gallon per year plants are drawing to a close. That doesn't mean they will all close down, but there definitely won't be room for all of them to exist. With the decline in world markets, we are starting to see plant consolidation within the industry and many large producers are either sitting idle or have closed down altogether. This has not been the case with Midlands Biofuels-in fact, growth of our company has been so rapid that equipment has been purchased, and locations in South Carolina for our second and third plants are already being identified. Feedstock availability and transportation costs are two major issues facing large producers, but there may be a solution: smaller, more efficient plants. 
 
 In the past, individuals and corporations poured millions of dollars into plants that were built to run on tax credits, not positioned for long-term growth. With high oil prices, they were able to compete with the petroleum companies, but many still sent their biodiesel overseas to turn a decent profit. Large rendering companies would argue that WVO is not a viable option for biodiesel production due to its inconsistency and availability. Our biodiesel exceeds ASTM standards and outperforms animal fat-based biodiesel in cold weather and cetane value. Many of the large rendering companies have to compete with small biodiesel producers who offer more personalized service, thus reducing their stranglehold of the WVO market. The good news is that there is room for the rendering companies and small biodiesel producers to exist. Producing biodiesel is not something that will make you rich overnight, but if a company can control their feedstock prices, they can be competitive. The guys at MBF believe there are three things to consider for the future success of small biodiesel plants: taking the proper steps to determine the size and scale of the plant, learning to operate three businesses as one, and developing good business partners, relationships and employees.
 
 No biodiesel can be produced without feedstock. When considering the size and scale of a plant one must examine the type and availability of feedstocks. That being said, smaller plants should always utilize WVO first. It is abundant throughout the U.S., even more so in the Southeast. Small plants should also be able to operate as multifeedstock plants. WVO quality is inconsistent and probably the most difficult feedstock to process, therefore, when other types of feedstocks become available on an irregular basis, they should be ready to take advantage of the opportunity. 
 
 Smaller plants must have three business functions: collecting feedstocks, processing and producing biodiesel, and distributing the biodiesel. It's important to note that marketing must be implemented in the collection and distribution functions of the business. Bottom line, small plants must collect their own feedstock in order to compete and be profitable. This means they must manage customer accounts that include marketing their services, managing containers, collection schedules, equipment and transportation. This is where smaller plants must work hard to develop good solid relationships. Finding good employees and developing those employees is also extremely important for the growth of any company. 
 
 Finally, tax credits and subsidies are a good thing for the biodiesel industry, and federal tax credits must be passed to get the industry growing again. In the long run, however, the industry must be able to operate without subsidies. The availability of financing is also critical for the industry and the credit crunch has not helped plant start-up efforts. Banks and investors are still hesitant to offer financing no matter how strong the business plan is. At the end of the day, entrepreneurs with strong leadership and technical abilities-not the government or multinational companies-are going to grow this industry.
 
 "Bio" Joe Renwick and Brandon Spence are owners of Midlands Biofuels, a community-scale biodiesel plant in Winnsboro, S.C. Reach them at (803) 718-9741.

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We're Small-Scale and Growing

In late June, just prior to the July 1 effective date for the revised renewable fuels standard (RFS2), U.S. agriculture secretary Tom Vilsack released a report outlining both the current state of renewable transportation fuels efforts in America and a plan to develop regional strategies to increase the production, marketing and distribution of biofuels. The report provides information on current production and consumption capacities as well as projections to meet the RFS2 mandate to use 36 billion gallons of biofuel per year in the U.S. fuel supply by 2022. 
 
 Some biodiesel-specific items in the report include USDA's regional analysis assumption summary, which states that by 2022, up to 450 million gallons of new productive capacity will come online in the U.S. More than half that volume of new biodiesel productive capacity, 260 million gallons per year, is expected to come from the Central–Eastern region of the country. This region includes eastern states such as Virginia and Delaware reaching as far north and west as North Dakota. 
 
 "The Central-East region of the United States is one of the two regions with the most potential for near and long term development of biofuels," the report states. "Based on feedstock and land, infrastructure, and demand, this region is key in implementing a successful biofuels market. 
 
 By 2022, the Northeast and Southeast regions are each expected to contribute another 10 million gallons of biodiesel production capacity, but an additional 180 million gallons of biodiesel is anticipated to come online from the Northwest. 
 
 USDA also included in its report U.S. EPA's estimates that 1.34 billion gallons of annual biodiesel production is anticipated to come from soybean oil and corn oil (post-ferm extraction from the backend process at ethanol refineries). 

 
 "The Obama administration has made domestic production of renewable energy a national priority because it will create jobs, combat global warming, reduce fossil fuel dependence and lay a strong foundation for a strong 21st century rural economy, and I am confident that we can meet the threshold of producing 36 billion gallons of biofuel annually by 2022," Vilsack said. "The current ethanol industry provides a solid foundation to build upon and reach the 36 billion gallon goal. As we prepare to celebrate Independence Day, we must reaffirm our commitment to bring our country closer to complete energy independence and this report provides a roadmap to achieve that goal." 
 
 USDA's report identifies numerous biomass feedstocks to be utilized in developing biofuels and calls for the funding of further investments in research and development of: 
 
 Feedstock; 
 
 Sustainable production and management systems; 
 
 Efficient conversion technologies and high-value bioproducts, and 
 
 Decision support and policy analysis tools. 
 
 Some interesting conclusions of the report include acknowledgments that the "scope of the monetary investment for biorefineries is substantial;" infrastructure deficiencies, such as the need for more blender pumps, rail and trucking infrastructure, and addressing barriers to building out the infrastructure for renewables; and drawing attention to the need to identify bottlenecks and barriers to locating facilities that involve a host of regulatory, legislative and private entities, to facilitate development of more biorefinery projects that are national in scope.

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USDA report provides roadmap to achieve RFS2 goals

At the Advanced Biofuels Workshop June 14 in St. Louis, a panel discussion took place pertinent to the many biodiesel facilities in the U.S. that are idled or distressed due to the long-lapsed biodiesel tax credit. The panel, titled, Second Life: Upgrading Existing Industrial Facilities for Advanced Biofuels Production, discussed opportunities where misfortunes otherwise abound. 
 
 Richard Aves, CEO of Cetane Energy LLC, presented on retrofitting biodiesel plants to produce between 200 to 2,000 barrels (8,400 to 84,000 gallons) per day of renewable diesel by way of hydroprocessing. He said Cetane Energy got U.S. EPA certification of its fuel in April 2009, and the company is currently looking at first-gen feedstocks for its second-gen process. 
 

 Its first demo plant was built at the company headquarters in Carlsbad, N.M., and can produce 200 barrels of hydroprocessed renewable diesel a day. Cetane Energy dubs the plant the first U.S. facility to produce hydroprocessed renewable diesel in a stand-alone facility. 
 
 Thus far, the company has five refineries planned, Aves said, and they are being engineered to produce between 500 and 2,000 barrels a day. Cetane Energy's first preference is to use idled/shutdown refineries. The locations of these projects are St. Gabriel, La.; Winnie, Texas; Lexington, Ky.; Las Vegas, Nev.; and Mobile, Ala. The Louisiana plant is in the engineering phase now, and construction is expected to begin later this year, Aves said. It is being designed to process 1,600 barrels per day. Cetane Energy also has license agreements with Rational Energies and Rio Grande Valley Biofuels. 
 
 "We're not waiting for commercialization," Aves said. "It's here." 
 
 Add-ons and retrofits to process and upgrade high-acidity feedstocks was the topic of Roman Wolff's discussion. Wolff is president of Houston-based Enhanced Biofuels LLC. He said his company's trademarked HS Reactor System is designed to process feedstocks with up to 100 percent free fatty acids (FFA) and/or carboxylic acids. 
 
 "Carboxylic acids found in pyrolysis oil are very corrosive and can leach into water," Wolff said. 
 
 Wolff discussed drawbacks of existing technologies to treat undesirable feedstocks, saying that ion exchange requires higher capital costs when dealing with feedstocks that have FFA content higher than 10 percent; acid esterification involves expensive metallurgy, large equipment, and high capital expenses, and is usually designed for batch processing; and with hydrogenation, Wolff said the corrosive, high-FFA feedstocks can degrade the catalyst and-contrary to Aves' talk-can only work on a grand scale. "I'll have to talk with Richard afterwards," Wolff said, looking over to Aves with a smile. 
 
 Unlike other advanced biofuel technologies, Enhanced Biofuels' HS Reactor System produces methyl esters. Wolff said next-generation technology providers rarely look at improving current processes, which his company does. The system employs a combination of reactor geometry, catalysts, temperature and pressure to allow utilization of undesirable and corrosive feedstocks. Enhanced Biofuels has two pilot units in operation today, one scaled at 3,000 gallons per year and the other much larger unit capable of producing 250,000 gallons per year. 
 
 "Advanced biofuel technology is here today," Wolff concluded. 
 
 When asked what aspects can make or break a retrofit project at a biodiesel refinery, Aves pointed out the situation with Healey Biodiesel, a small biodiesel plant in Sedgwick, Kan., which planned to trade in transesterification for Cetane Energy's hydroprocessing technology. The lack of available hydrogen, obviously necessary for hydroprocessing, killed that particular plant retrofit project, Aves said. Even so, he said his company and Healey Biodiesel have plans for future work together at locations where hydrogen supply is accessible, perhaps in the Gulf Coast region where the oil refineries are concentrated.

A second life for idled industrial facilities

Some of the same innovators who produce biodiesel are hoping their product could soon be used in the Gulf of Mexico, cleaning up the beaches and marshes ravaged by the BP oil spill. 

 
 Methyl esters, the chemical yielded in biodiesel production, can be formulated into a biobased solvent that is federally listed as a shoreline washing agent for oil spill clean-up. 
 
 The process starts with crews spraying the biosolvent from shallow draft boats onto oil-covered marsh vegetation or small beaches normally unreachable by land, said Randall von Wedel, founder and principal biochemist of CytoCulture International, a company that pioneered the method in the 1990s. 
 
 After the biosolvent is applied, it is followed with a gentle "rain" of seawater to rinse the dissolved petroleum mixture off the plants and shoreline for recovery on the water, using small mechanical skimmers.
 
 "Unlike other clean-up techniques, the beauty of this is that it is a green process that is nonaggressive and won't do any more damage to the oil-covered marshes and other sensitive habitats," von Wedel said. "We're growing concerned that the approach will be to slash and burn, which is incredibly damaging to the environment and will kill wildlife. They don't need to do that."
 
 The mixture of dissolved petroleum oil and CytoSol recovered by mechanical skimmers can be recycled at local refineries. With traditional clean-up methods, the oil material is gathered and dumped in landfills.
 
 Earlier this summer, von Wedel visited the Gulf of Mexico. He made arrangements to tap into 70,000 gallons of methyl esters from soybean oil to produce the product, which he brands "CytoSol Biosolvent." 
 
 Although at press time his team had submitted documentation to BP and the U.S. Coast Guard, von Wedel said there is a backlog in the "alternative response technology" screening process. Von Wedel has teamed up with other companies in Louisiana to offer an integrated shoreline remediation strategy. It combines mechanical, chemical and biological methods into one toolbox, and the team hopes the Coast Guard will buy into this approach of using prequalified technologies on the Gulf.
 
 "This method has been used several times to clean stream beds in California, so we are familiar with the results," von Wedel said. He noted that the product was licensed by the State of California in 1997 and used to clean oiled ships and response vessels during the San Francisco Bay oil spill of 2007. 
 

 "Typically we can 'lift and float' more than 60 percent of the crude oil off the shorelines and then rely on native bacteria to degrade the remaining residuals," he said.
 
 In the meantime, von Wedel said another oil company recently purchased the product for an unrelated spill. Chevron Corp. purchased CytoSol for testing on oiled river banks in Utah after a pipeline spill in early June. The spill resulted in 500 barrels of crude oil contaminating a pristine river near the Great Salt Lake.
 
 The CytoSol biosolvent includes a nutrient additive, which helps speed up the biodegradation of residual petroleum. But any biodiesel producer could make the base product. 
 
 "This is another example of what our innovative biodiesel producers can contribute to society," said Steve Howell, technical director of the National Biodiesel Board. "Not only are they producing the first commercially available advanced biofuel in the U.S. to displace crude oil, but they can also produce a green product that can clean up that same oil."
 
 Von Wedel says he and his team will continue attempting to get the biosolvent into the Gulf. 
 
 "I'm doing this first and foremost because I am concerned about the ecology and fisheries of the Gulf Coast," he said. "Our aim is to use our combination of technologies to recover the oil from these areas and allow the ecosystems to heal quickly. That's critical if we expect seafood industry and wildlife to bounce back."

Randall von Wedel has been working tirelessly to get his biodiesel-based solvent, CytoSol, approved for use in cleaning up the oil-soaked marshes and beaches in the Gulf Coast. PHOTO: CYTOCULTURE INTERNATIONAL

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Biodiesel producers stand ready to help clean up oil spill

As a lifelong fan of country music, I've always found truth and solace in the lyrics of good country songs. Our theme song for 2010 has been the classic, "If You're Going Through Hell, Keep on Going," a clever lyric that Rodney Atkins borrowed from Winston Churchill. This month, more specifically, it's Toby Keith's call to action, "A little less talk and a lot more action," that really hits home. 
 
 With the catastrophe in the Gulf continuing to get worse, politicians are again talking about clean energy such as wind, solar, and advanced biofuels. But while they continue to talk and talk, their inaction on the biodiesel tax credit is allowing America's only advanced biofuel to languish. 
 
 Critics of biofuels are quick to preface their criticism by pointing out that they are supportive of advanced biofuels, but they are not supportive of conventional biofuels such as those from corn and soy. This constant disclaimer reveals a common misperception about biodiesel, that it is a conventional biofuel. In fact, biodiesel is the only domestic fuel to reach commercial scale, which meets the definition of advanced biofuel under U.S. EPA criteria and federal law, using all of our diverse domestic feedstocks. Biodiesel has been shown to have the best greenhouse gas reduction and energy balance of any domestic, liquid transportation fuel that is available today. And it is produced from an abundant and diverse variety of locally available fats and oils that are either recycled materials or byproducts of protein production. It is not a conventional biofuel-it is advanced. 
 
 While there are a number of advanced biofuel technologies that make claims about what they could do, biodiesel is the only one that has actually done it. Despite the fact that all the other so-called advanced biofuels and next-generation fuels have similar incentives available to them, biodiesel remains the first and only advanced biofuel produced on a wide scale in the U.S. 

 
 The contrast is simple. Biodiesel is a proven, successful, sustainable fuel. Others, so far, remain romantic ideas that might or might not ever happen. There are those who think that energy policy should read like romance novels. There are others who believe energy discussions should have something to do with reality, and should at some point follow the Missouri state motto-'Show Me.' 
 
 The key is securing biodiesel's image as next generation and claiming our identity as an advanced biofuel. The challenge is that others threaten to define biodiesel.
 
 Biofuels are too often painted with one broad brush. The reality is that, like siblings, they can be as different as night and day, each having unique strengths and weaknesses. Where one lacks, another may excel. This has been lost on the public in the well-meaning but deceptively broad word, "biofuel." 
 
 Take for instance these recent headlines:
 
 Biofuels International (April 23, 2010) "Biofuels Worse than Fossil Fuels?"
 
 Investors' Business Daily (June 18, 2010) "For Gulf, Biofuels Are Worse Than Oil Spill"
 
 Trucking Magazine (April 22, 2010) "Study Questions Carbon Footprint of Biodiesel"
 
 Reuters (April 2010) "Scientists say growing grain for food, not fuel, more energy efficient"
 

 These are proof positive that we need to do a better job of telling our story. Instead of being defined by others, we must define our own self. It is critical we brand ourselves as America's first and currently only advanced biofuel.
 
 With renewable fuel standard volumes kicking in and signs of economy rehabilitation on the horizon, it is likely that we will again face increasingly fierce and misplaced criticism over food versus fuel and indirect land use. While these are not unfamiliar foes, we know that support for biodiesel is easily shaken by targeted misinformation. 
 
 From a national view, this effort is well underway. We are working with members and stakeholders to provide tools and materials to help them enact this message in their own communications and strengthen biodiesel's position as an advanced biofuel. This spring we ran a two-week ad push in D.C.-based publications that also captured that message. 
 
 Biodiesel is an advanced biofuel; it is next generation fuel; it is the fuel of the future that is here now. All of us need to repeat this message everywhere we go, 40 times per day. Like any great county song, we have a great story to tell. Now we just need to tell it until everyone knows all the words by heart. 
 
 
 Joe Jobe, CEO, National Biodiesel Board

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A Little Less Talk and a Lot More Action

Posted July 13, 2010
 
 A resolution was signed in Argentina this month to lift the required mix of biodiesel in all diesel fuel to B7 from B5. The increased mandate to a B7 blend will officially begin in September, according to Carlos St. James, president of the Argentine Renewable Energies Chamber, or Camara Argentina de Energias Renovables (CADER).
 
 "Argentina decided to quickly expand to a B7 [blend] for a combination of reasons," St. James told Biodiesel Magazine. "On the one hand, until last year, Argentina imported about 5 percent of its diesel needs, typically from Venezuela, which has a particularly high sulfur content. The B5 [mandate] eliminates the need to import this diesel." 
 
 In May, CADER published a report entitled, "State of the Argentine Biofuels Industry: Launching of the Domestic Biodiesel and Ethanol Market," which indicated Argentina having an installed capacity of approximately 2.4 million tons (720.5 million gallons) annually originating from 19 producing facilities. In 2009, Argentina exported 1.2 million tons per year of production, almost all of it to Europe. 
 
 "Beginning in 2010 the B5 mandate began along with the startup of considerable small and medium-sized plants to supply the domestic market," St. James said. "Given the abundant installed capacity, meeting the B7 [mandated blend] is easy."
 

 With a B7 mandate now in place, St. James said he's optimistic that Argentina will subsequently increase to a B10 in-country blend by the end of the year, "but a lot of negotiating needs to happen with the automotive industry first," he said. 
 
 In related news, Brazil, which has required an in-country B5 biodiesel blend since the beginning of this year, is mulling over whether or not to raise the blend requirement to B10 or possibly to B15. The increase to B5 was originally planned for 2013. Biodiesel blends in Brazil became mandatory in early 2008, followed by a raise in blend levels from B2 to B3 in July of the same year and from B3 to B4 in 2009. 
 
 According to a USDA Foreign Agricultural Service report released in April, Brazil currently has 64 biodiesel plants in operation with an estimated 4.6 billion liters (1.22 billion gallons) of production capacity annually. Production will reach approximately 2.35 billion liters in 2010 under the B5 blending mandate based on estimated consumption levels. 
 
 Additionally, the report indicated that Brazil's soy oil exports from January through May were down by approximately one-third from last year due mostly to growing demand from biodiesel producers.

Argentina increases biodiesel mandate

Sustainability is more important than ever, but what's often missing is a clear definition of what it means exactly. U.S. soybean producers are working to change that through a new Web platform, <a href="http://www.usbthinkingahead.com">www.usbthinkingahead.com</a>, which defines the concept and points to agriculture as the original sustainability success story. "Many people define and measure sustainability differently, and the discussion about what it really means can generate more heat than light," said David Wilson, United Soybean Board director and soybean farmer from Lincoln, Ala. "Agriculture has been working well for 10,000 years, so it has always been sustainable historically. But soybean producers have been doing some innovative work to improve on that success and make sure soybean production continually decreases environmental impact and remains sustainable going forward." 
 
 For USB, defining soybean sustainability accurately is far more than a marketing goal. Wilson says there's a lot more at stake than most people realize. 

 
 "In just 20 years, the amount of grain-producing land per person is projected to drop to one-third of what it was in 1950," Wilson said. "At most there is 12 percent more arable land available that is not presently forested or environmentally marginal. Meanwhile the World Water Council projects that in just 10 years, the need for fresh water will be 17 percent higher than water availability. These are significant problems that threaten the food supply, yet these issues get little media attention amidst all the green chatter that's going on." 
 
 USB's efforts to address those challenges are being blogged about on the new Web site.

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United Soybean Board tackles sustainability

Panel speakers discussed back-end coproduct optimization for ethanol plants at the 2010 International Fuel Ethanol Workshop & Expo in St. Louis in June. In recent times, more biodiesel producers have incorporated use of post-fermentation corn oil, extracted from ethanol plant stillage, as a biodiesel feedstock. 
 
 The chief technology officer for Greenshift Corp., David Winsness, said only about 4 MMgy of post-ferm corn oil was being extracted from whole stillage at U.S. ethanol plants in May 2007. Two years later, however, that number grew to 33 MMgy. By May 2010 as much as 44 MMgy of post-ferm corn oil was removed and sold as biodiesel feedstock or for other uses. Winsness said by 2022, it is expected that up to 680 MMgy of post-ferm corn oil will be siphoned from the back-end of U.S. ethanol plants.

Encouraging numbers for corn oil feedstock

In a white paper titled "Producing and Using Biodiesel in Afghanistan," authors Wayne Arden and John Fox (formerly head of Innovation Fuels) argue that the production and use of biodiesel in Afghanistan will increase the probability that U.S. efforts will succeed, and that Afghanistan will become a productive and stable nation. 
 
 Inspiration for the paper came from the commitment to deploy an additional 30,000 troops made by President Barack Obama at West Point Dec. 1, 2009, and a desire to help advance the eventual withdrawal of U.S. forces. 
 
 The paper explains that the cost of importing oil into Afghanistan is high yet the cost of proven biodiesel production technology is relatively low. By using biodiesel the military could lessen its dependence on petroleum and save money. At the same time, Afghan farmers could be paid the same amount of money to grow a biodiesel crop as they are currently paid to grow poppy. Until now, these two problems-securing the military's fuel supply and combating the opium trade-have been considered independently of one another. There are five key benefits associated with producing and using biodiesel in Afghanistan: reducing casualties; freeing up troops for other assignments; saving money; challenging the opium trade; and creating a new industry for Afghanistan.
 
 A full copy of the paper can be downloaded by visiting <a href="http://biodieselinafghanistan.org">http://biodieselinafghanistan.org</a>.

Significant role for biodiesel in Afghanistan

At a ceremony in July, Piedmont Biofuels LLC was scheduled to unveil its newest technology for renewable fuel production, an enzymatic biodiesel plant. 
 
 The new process technology was developed in partnership with the Biofuels Center of North Carolina, major enzyme-maker Novozymes, and the Chatham County Economic Development Corp. This is the first pilot plant of its kind in the U.S. and uses cutting-edge technology developed by Piedmont Biofuels and Novozymes to create high-quality biodiesel from low-quality waste grease. 

 
 Lyle Estill, president of Piedmont Biofuels, told Biodiesel Magazine to think of the new process as "Biodiesel 3.0." Conventional transesterification methods form soaps or salts in both the biodiesel and glycerin phases, producing low-grade coproducts. 
 
 "This new process of using enzymes to produce biodiesel will increase yields, decrease waste and allow producers to use lower cost feedstocks," says Greg Austic of Piedmont Biofuels. "This groundbreaking technology will create more valuable coproducts, and will allow existing producers to double their biodiesel output." Glycerin, a coproduct resulting from the enzymatic process, can be used to make a wide variety of products, including bioplastics and solvents.

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Enzymatic biodiesel pilot plant to open soon

On June 22, the Australian Customs and Border Protection Service issued dumping notice No. 2010/21, regarding initiation of investigation into alleged U.S. biodiesel dumping and subsidization. 
 
 The CEO of the Australian Customs and Border Protection Service has initiated investigations following an application lodged by Biodiesel Producers Ltd. The application requests the publication of a dumping duty notice and countervailing duty notice in respect of biodiesel exported to Australia from the U.S. 
 
 The application alleges that the goods have been exported to Australia from the U.S. at prices less than their normal value, that countervailable subsidies have been received in respect of the goods exported from the U.S. to Australia, and that the dumping and subsidization has caused material injury to the Australian industry through lost sales volumes, loss of market share, price undercutting, and reduced profits and profitability.

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Australia investigates US biodiesel dumping

Steve Howell, technical director for the National Biodiesel Board and president of the Marc-IV consulting firm, said he was at the Advanced Biofuels Workshop's Drop-In Biofuels panel to present what "infrastructure-ready" biofuels means to him and the biodiesel community. He also gave an industry update and spoke to the sustainable nature of biodiesel. 
 
 Biodiesel is a great example of a sustainable fuel based on waste or excess materials, Howell said. Since soybeans are grown for the meal, soy oil is a byproduct of the soy crushing industry. In more recent times, many plants have been built or retrofitted to utilize waste greases, used cooking oils and animal fats, or any combination thereof. "No one fries more food or grows more livestock for the waste," Howell said. 
 
 He mentioned the disadvantage from this model, however, is that the fuel properties of biodiesel made from these products are based on the properties of the feedstocks used-some of those properties are desirable, and others not so much. 
 Without disrupting markets or causing any real shift in current practices, about 1.75 billion gallons of biodiesel can be produced today from the available fats, oils and greases in the U.S., Howell said. 
 
 Econometrically speaking, biodiesel still represents the best low-cost option of advanced biofuel production today. Biodiesel is "fully known, there are no mysteries," he said, as there are with many advanced biofuels under investigation. 
 
 Howell made some important points to consider in the discussion of infrastructure-compatible fuels. "There is a lot more to being infrastructure-ready than delivery," he said, such as having a fine-tuned fuel specification as the result of years of hard work and finesse-something Howell and the biodiesel industry know all too well. "It took eight years to get the first biodiesel specification," he said. 

 
 Also, several automakers have approved B20 for use in their vehicles, and virtually all have approved B5-one has to remember that vehicles are infrastructure too, and a tremendous amount of work has been done over the years to get biodiesel blends accepted by diesel engine and systems makers. 
 
 Oilheat burners are also infrastructure, and the oilheat industry has committed itself to dramatically increasing biodiesel use to clean up its fuel and bring it into the new era of clean energy. 
 
 The unknowns with many emerging advanced biofuels should be a real concern, and Howell asked the audience to consider such things as minor components in these new fuels, an area of seemingly little study but an important one nonetheless. The biodiesel spec has been adjusted over the years to address minor components in biodiesel, sterol glucosides, mono and diglycerides, sodium, potassium, magnesium and calcium, to name a few. Thus, "infrastructure" is more than just pipelines, terminals and service stations, Howell emphasized. 
 
 Howell also mentioned progress in advancing biodiesel as a pipelined fuel-and just because the biodiesel industry is relatively small compared to the petroleum or even the ethanol industries, pipelining biodiesel can save a significant amount of money for those obligated parties, the oil refiners, under the RFS2. Shipping biodiesel via the pipe can save between five and 25 cents a gallon in transportation costs, which in total can save obligated parties up to $50 million annually. 
 
 There is a tremendous amount of work being done on behalf of the pipeline steering committee, of which Howell is a big part. Much of that effort right now is focused on upping the fatty acid methyl ester (FAME) contamination spec in jet fuel from 5 parts per million to 100 parts per million. The airplane engine manufacturers are worried that FAME contamination in jet fuel can cause engine problems, something no one wants to risk. "I fly a lot so I don't want any airplanes to fall out of the sky," Howell said. There is ongoing work, 5,000 15-minute test cycles for instance, testing jet fuel with 400 ppm FAME contamination in jet engines. If four times the concentration of 100 ppm proves to be safe, then this will help push through a 100-ppm spec. Data from these tests is expected this fall. 
 
 As biodiesel production volume grows in the U.S., Howell said it would behoove the industry to begin tailoring select oil and fat feedstocks with more desirable properties than the available feedstocks that are currently being used. "If we're going to grow 7 billion gallons, then let's do it right," he said. 
 
 Unlike blends of ethanol or perhaps even methyl ester biodiesel, the issue with many advanced biofuels under development isn't blend volumes or regulatory blend caps, said Seth Synder, head of the chemical and biotechnology section of Argonne National Laboratory's energy systems division. "Instead, we have to worry about sustainability," he told attendees. 
 
 He said work on Argonne's multifaceted project to develop drop-in biofuels is in its nascent stages, with monthly conference calls starting in June. Immediate focus is determining the tools for the lab's giant research project-the integrated biofuel/engine design study-such as atomic layer deposition to help develop effective catalysts and bring them to scale. 
 

 "We're doing it all at once rather than saying, 'I have a bug, where do we go from here?'" Snyder said, adding that the lab just filed for a patent related to this project last week. Part of the work involves over-expressing production of molecule chains with five carbon atoms. "We're not waiting for biology to scale up," Snyder said. Argonne researchers are looking at where the sweet spot is for natural production of these desirable molecules, versus what makes a good fuel. "So we're bringing that together," he said. 
 
 The project covers a wide area of research, including fuel combustion in engines, life-cycle analyses, processes, organism and catalyst developments, and more, spanning eight or nine programs. 
 
 Another panelist, Jeff McDaniel, director of business development for Velocys Inc.-part of the Oxford Catalyst Group-presented on microchannel technology for production of cellulosic diesel. "The Fischer Tropsch process needs to change to enable biomass-to-liquids," McDaniel said, adding that microchannel technology enables the successful FT conversion of biomass to fuels. 
 
 The technology utilizes a multitude of small-diameter reactor tubes that improve the heat/mass transfer to better control the reaction, and increase the process speed. 
 
 The gasification process yields 72 percent conversion to carbon monoxide, and minimizes selectivity to methane. Velocys has three demonstration commitments, one in Austria, another in Brazil and a third project at the Wright-Patterson Air Force Base in Ohio.

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Hard work has made biodiesel a 'drop-in' fuel

U.S. Sen. Patty Murray (D-Wash.) and National Biodiesel Board member Propel Biofuels hosted a press conference in Seattle to discuss support for the biodiesel blender tax credit. The speakers discussed its positive impacts on job growth, carbon emissions reduction and national security. 
 
 "For far too long, government policy has subsidized and supported the status quo in the energy sector," Murray said. "Big oil companies have been allowed to dominate the industry without regard for their environmental, economic, or national security impact. And we see the results of those policies each time prices at the pump spike, and every time we turn on our televisions and see more images of oil gushing into the Gulf of Mexico." Murray called the situation "unacceptable" and "unsustainable."
 "That's why I have been such a strong supporter of policies that support companies working on new, innovative, and renewable energy sources," she said. "And it's why I'm fighting so hard to extend the tax credits for biodiesel production right here in Washington State."
 
 The event was held at Propel Fuels Clean Fuel Point, the first renewable fuels station in downtown Seattle. 
 

 Other NBB members, General Biodiesel and Imperium Renewables, also participated in the event. The industry's message was clear: renew the tax credit and our industry will immediately increase production and create jobs.
 Leaders across the industries of bioscience, refining, production and retail consumer access joined the senator in discussing the importance of the extension of the tax credit.
 
 "I am proud to stand here today with such great representatives of the industry in Washington State," she said. "And I am committed to going back to Washington, D.C., and making sure we pass this critical extension of clean-energy tax incentives."

U.S. Sen. Patty Murray speaks to a gathering at the Propel Fuels Clean Fuel Point, the first renewable fuels station in downtown Seattle, about the importance of reissuing the lapsed $1 per gallon federal biodiesel tax credit. 

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Sen. Patty Murray pumps up Seattle on federal tax credit

A new poll released by Stanford University found 84 percent of respondents favored federal tax breaks to encourage alternative energy, including water, wind and solar. 
 
 "The research clearly demonstrates Americans are crying out for home grown solutions to develop clean energy sources and end our addiction to oil," said Joe Jobe, CEO of the National Biodiesel Board. "The biodiesel tax inventive is a perfect example of the type of investments the federal government should be supporting to cut carbon pollution, lessen our reliance on petroleum and create green jobs."
 
 Jobe pointed out that the biodiesel tax credit, in just five years since its enactment, has resulted in the construction of more than 150 renewable refineries in 44 states, 23,000 jobs, and billions of dollars of net tax revenue to the U.S. Treasury. All the while, it has been displacing billions of gallons of petroleum. 
 
 Researchers at Stanford University's Woods Institute for the Environment interviewed 1,000 randomly selected adults nationwide June 1-7 for the survey.

Stanford poll finds overwhelming support for clean energy tax breaks

Each year the National Biodiesel Board recognizes individuals and organizations that have made an outstanding difference in furthering biodiesel with the Eye on Biodiesel Awards. The awards honor industry leaders in six "I" categories: 
 
 Innovation: Goes to an individual, organization or company with the best idea, new product, research results, invention or marketing strategy to further biodiesel. 
 
 Inspiration: Presented to an individual who has gone above and beyond to create awareness. 
 
 Industry Partnership: Presented to an organization that has worked cooperatively and proactively with NBB to further success of biodiesel.
 

 Influence: Goes to an organization or individual who has influenced public acceptance of biodiesel.
 
 Impact: Awarded for success in legislation, new markets, OEM outreach and other areas of impact on the industry. 
 
 Initiative: Awarded for success in legislation, new markets, OEM outreach and other areas of impact on the industry.
 
 NBB will begin accepting nominations for the 2011 awards, which are due by Sept. 1.
 
 To submit a nomination, email Kaleb Little at klittle@biodiesel.org. Please include in your email the person/company or organization you are nominating, which award you are nominating them for, the nominee's phone number, nominee's address, nominee's email, the reason for nomination, your name, and your phone/email.
 
 The eighth annual Eye on Biodiesel Awards Ceremony will take place during the February 6-9 Biodiesel Conference & Expo in Phoenix. In general, chosen nominees must be present to win. Staff and contractors are not eligible for the awards, nor are previous winners.
 
 The 2010 winners of the Eye on Biodiesel Awards included: Impact-Terry Taylor of Sysco Corp.; Inspiration-Wayne Hettler, St. Johns Public Schools, St. Johns, Mich.; Industry Partnership-The American Oil Chemists' Society and Gina Clapper; Initiative-The Iowa Soybean Association, Minnesota Soybean Growers Association, and Nebraska Soybean Association; Influence-Ramiro Lopez, City of Irving, Texas.

The National Biodiesel Board is accepting nominations for the annual Eye on Biodiesel Awards. The deadline is Sept. 1. 

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Seeking nominations for annual Eye on Biodiesel Awards

City-owned land outside the Salt Lake International Airport models the potential for Freeways to Fuel. Previously a weeded, open space, this plot of safflower is expected to produce 1,000 gallons of biodiesel feedstock. The National Biodiesel Board's feedstock development program is one of the Freeways to Fuel program supporters.

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Freeways to Fuel shows promise in Salt Lake City

Weeds to wet gallons

The federal renewable fuel standard (RFS2) is about to move the "M" to a "B"-annual biodiesel production has measured in the millions for the past 10 years, but starting in 2012, those numbers are expected to swap "million" for "billion."
 
 RFS2 requires obligated parties to use 1.15 billion gallons of biodiesel domestically by the end of 2010 to account for 2009 and 2010 use. In 2012, requirements hit the 1 billion gallon mark. While RFS2 was carefully designed to create a predictable and easily attainable safety net for biofuel use, there are market considerations and long-term targets to consider that will help ensure a smooth transition to higher volumes. 
 
 The National Biodiesel Board appointed an RFS2 Volume Working Group to guide the industry through the RFS2 implementation process and accompanying potentially higher volume demands. The task force will draw on economic indicators, feedstock availability forecasts, and historic trends and data. Task force members include:
 
 Gene Gebolys, World Energy Alternatives LLC , Charlestown,
 Mass.
 
 Kris Kappenman, Archer Daniels Midland Co., Decatur, Ill. 
 
 Greg Anderson, Nebraska Soybean Board, Lincoln, Neb.

 
 Martin Beirne III, Green Earth Fuels LLC, Houston
 
 Beth Calabotta, Monsanto, St. Louis
 
 Leif Forer, Piedmont Biofuels Industrial LLC, Pittsboro, N.C.
 
 Ryan Pederson, U.S. Canola Association, Washington
 
 Mike Noble, Lake Erie Biofuels, doing business as HERO BX, Erie, Pa.
 
 Jim Conway, Griffin Industries, Cold Spring, Ky. 
 
 Bobby Heiser, Nittany BioDiesel LLC, Boalsburg, Pa.
 
 The Task Force will also develop recommendations for the U.S. EPA as it considers volumes for 2013 and beyond.

NBB Members convene in Washington to discuss RFS2, the biodiesel tax incentive and new opportunities for biodiesel at their annual June membership meeting. 

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National Biodiesel Board plans for billion gallon market

Alaska Green Waste Solutions began production in its new Anchorage biodiesel plant in June and celebrated with a grand opening. The plant has a capacity of 1,000 gallons per day and provides a solution for disposing of waste cooking oil and producing clean biodiesel. Constructed in Salem, Ore., by Pacific Biodiesel Technologies and JVNW, the plant was disassembled for shipment and reassembled in Anchorage. Built in six shipping containers, the facility includes storage for feedstock, biodiesel and glycerin, utilities and the biodiesel production system. Pacific Biodiesel Technologies was contracted to design and build the plant for Alaska Green Waste Solutions, which plans to use most of the biodiesel for its fleet of refuse collection trucks operated by its sister company, Alaska Waste. With the largest refuse fleet in the state, using biodiesel is an important part of Alaska Waste's commitment to recycling and sustainability. 
 

 BlackGold Biofuels and the San Francisco Public Utilities Commission are commissioning the 100,000 gallon per year biodiesel demo plant bought by the city from BlackGold Biofuels to alleviate problems associated with too much sewer grease in the city's water treatment systems. The SFPUC estimates that grease blockages in San Francisco sewers account for 50 percent of all sewer emergencies and annually costs the city $3.5 million in cleanings. In 2008, the city received a $1 million grant from the California Energy Commission for the project. The SFPUC also announced it received a $175,000 grant from the U.S. EPA to produce a how-to manual for other cities to follow San Francisco's lead. The facility will make two grades of fuel, ASTM D6751-grade biodiesel and a biobased bunker fuel, equivalent to a No.6 fuel oil.
 
 The Hawaii Public Utilities Commission approved a contract for Sime Darby, Malaysia's leading multinational conglomerate, to provide approximately 1 million gallons of palm oil-derived biodiesel for use in Maui Electric Company's Biodiesel Demonstration Project at its Ma'alaea Power Plant. The demonstration will assess the use of biodiesel in place of petroleum-diesel in Maui Electric's diesel generating units and other diesel units around the state. Converting to biodiesel will be an important part of meeting Hawaii's renewable energy goal of 40 percent of electricity from renewable resources by 2030. Maui Electric has long used clean-burning biodiesel for start up and shut down of its diesel generators but the demonstration will test biodiesel for four months to determine its long-term effect on air emissions, heat rate, operations and maintenance costs and other factors. 
 
 The Austrian company BDI-BioDiesel International AG announced it has changed its name, dropping biodiesel for bioenergy, "in order to reflect the broader strategic focus of the company on the 'waste-to biofuels' field," BDI-BioEnergy International stated in a July 1 release. Starting as specialists in biodiesel plant manufacturing and process technology in 1996, the company has continued to update its biodiesel product portfolio with such technologies as the RetroFit program, an optimization package; RepCat, a biodiesel process for converting very high free fatty acid feedstock; and others. This year BDI started to supply biogas technology, so-called ENBAFERM Multi-Feedstock BioGas, to industrial users. Also this year BDI came out with BioCrack technology to enable refineries to include up to 20 percent biomass content in fuel during the refining process itself, by making use of crude oil refining byproducts. 
 
 
 SG Biofuels, an agricultural biotechnology company specializing in jatropha development, recently announced the appointments of Eric Mathur as vice president of molecular agronomics and scientific affairs. Mathur, a 30-year industry veteran, will direct an expansion of SG Biofuels' research operations in San Diego and globally, and will drive commercialization of jatropha. The company also appointed Jeff "J.D." Davids as CFO. Davids, who has more than 20 years of leadership roles in accounting, finance, operations, strategic planning and business development, will be responsible for all elements of accounting and financing for the company.
 
 
 American Biodiesel Inc., doing business as Community Fuels, stated it received notice of a proposed grant award through the Alternative and Renewable Fuel and Vehicle Technology Program of the California Energy Commission. The project, "Expanding Access to Renewable Fuels - Port of Stockton Terminal," encompasses the design and construction of a biodiesel fuel terminal on a parcel of land adjacent to the existing Community Fuels biodiesel production facility at the Port of Stockton, Calif. The terminal will include equipment for fuel storage, final product purification, tanker truck loading, rail car loading and unloading, red dye injection and an automated fuel delivery system. 
 
 White Mountain Biodiesel LLC, in Haverhill, N.H., is starting production after being under construction for more than a year and a half. The plant is sized at 5.5 MMgy, and is using waste greases as feedstock. The process technology was designed in-house by plant engineer and plant manager Bruce Lamarre. It features feedstock pretreatment for dewatering and solids removal, and an acid esterification unit to convert the free fatty acids to biodiesel. White Mountain Biodiesel also implements methanol recovery and a dry wash system. The plant's fuel passed all ASTM tests required, and the company is finalizing registration with the IRS and U.S. EPA. 
 
 Repsol has signed a framework agreement with Neuron BPh for the development of projects of joint interest in the area of industrial biotechnology. Neuron, developer of registered technology platform MicroBioTools, works on the development of bioprocesses for the food, chemical, pharmaceutical and energy industries. The development of bioprocesses by Neuron Bioindustrial include the isolation and selection of microorganisms, optimization and scaling studies in bioreactors, and technical and economic feasibility studies in industrial plants. Among the developments achieved by Neuron's technology platform stresses MicroBiOil, a novel technology for the production of second-generation biodiesel from crude glycerin; and TriBioPlast, a technology for the production of bioplastics. Repsol is an integrated international oil and gas company, operating in more than 25 countries and is a leader in Spain and Argentina. It is one of the 10 largest private oil companies in the world and the largest private energy company in Latin America in terms of assets.
 
 Elevance Renewable Sciences Inc. announced that it has entered into an agreement to form a joint venture with Wilmar International Ltd., one of the largest global agribusiness groups, to construct a world-scale biorefinery. The joint venture will use Elevance's proprietary biorefinery technology to produce high-value performance chemicals, advanced biofuels and oleochemicals. Large existing and rapidly emerging new demand exists for these products in surfactants, antimicrobials, lubricants, renewable biodiesel and green jet fuels. This commercial-scale manufacturing facility will begin with a capacity of 180,000 metric tons (approximately 400 million pounds) with the ability to expand up to 360,000 metric tons of products. The facility will be located within Wilmar's new integrated manufacturing complex under construction in Surabaya, Indonesia. It is expected to come online in 2011, and will be capable of using multiple renewable oil feedstocks. The biorefinery will produce green olefins, including a unique distribution of alpha and internal olefins for chemicals and advanced fuels; novel multifunctional esters and acids, including 9-decenoic acid, as well as a premium mixture of oleochemicals and advanced biofuels. 

 
 In June, Virent Energy Systems Inc. closed a $46.4 million third round of funding in which Royal Dutch Shell plc and Cargill Inc. deepened their commitment to Virent's technology platform, the BioForming process, which converts plant sugars into sustainable advanced fuels for car, truck, train, and air transportation. This new round of funding will advance Virent's efforts to scale its patented catalytic biorefinery platform to commercial production volumes. The investment agreement also expands an existing research and development collaboration with Shell for the production of biogasoline to include diesel fuel. With its new equity stake, Shell will also have a seat on Virent's board. Shell says it is the world's largest distributor of biofuels.

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Business Briefs

The biodiesel industry's diversity isn't recognized enough, says Emily Bockian Landsburg, CEO of BlackGold Biofuels and chair of the National Biodiesel Board's sustainability taskforce. "I think it's one of our greatest assets," she says. "We're a huge plant, we're a small plant. We're an urban model, we're a rural model. We use all different types of feedstocks. We are all different types of organizations and business models. You don't find that diversity elsewhere&mdash;it's a real positive character trait of the biodiesel industry." If biodiesel producers could be put into three broad categories based on scale and operational limits, they would consist of the more centralized, large-scale producers; decentralized small- or community-scale producers; and the wildcard home brewers who enjoy the challenge of their hobby, and don't mind trading time for the reward of energy independence. Kumar Plocher, president of the 500,000 gallon per year (gpy) Yokayo Biofuels Inc. located in the northern California town of Ukiah, tells Biodiesel Magazine about his home brewing days. He started home brewing biodiesel in 2001, after he and his wife moved from Berkley, Calif., to the northern part of the state where he needed transportation. Plocher bought a 1980s diesel Mercedes station wagon to run on biodiesel. "We were using a washing machine belt-driven motor with very few safeguards, duct tape in various places, a 55-gallon drum, using a drill with a paint-mixing attachment on it for mixing," Plocher reminisces. "And the second I learned more about safety I thought, 'Oh my God, we could have killed ourselves,'" he laughs. "It seems like the information on how to make biodiesel got out there before all the safety information did." Many small commercial producers began with home brewing, which Plocher says is great for the do-it-yourself type, but he quickly realized back then that there was a growing market in the local community for already made, quality biodiesel. Yokayo was well-established as a biodiesel distribution company by 2005, when it opened the doors of its small-scale commercial production facility. In the beginning, it was all about producing biodiesel, he says. "We weren't terribly concerned about energy efficiency, or getting value from waste streams like glycerin or methanol recovery-all of the things that are critically important over time," Plocher says. Another aspect of production that was important for Yokayo, and its customers, was increasing the sustainability of its fuel and operations. "One thing that's changed over time is my definition of what it means to be a sustainable fuel provider," he says. "What I realized is that it's all based on local resources. Once we can effectively source all our resources locally, and deal with our wastes by getting value from them locally as well, it's at that point we become insulated from the petroleum market and the pressure all of that exerts on us." Uncontrollable forces drive commodity prices up and down, so one of the only ways small producers can exact any semblance of control over their margins is to become vertically integrated at the local level. Vertical Integration "If we didn't control our own feedstock, then we wouldn't have a business," says Nat Harris, production manager for Newport Biodiesel LLC in Newport, R.I. The plant is producing about 500,000 gpy, but Harris says by the end of the year production should be around 750,000 gpy. The model Newport Biodiesel follows is production targets are never outpaced by the volume of used cooking oil feedstock secured locally. "We did not want to build a plant scaled significantly greater than the amount of feedstock we can collect ourselves," Harris tells Biodiesel Magazine. "That's been our growth model since inception, and it's what's allowed us to stay in business." Rhode Island is the most densely populated state in the U.S., Harris says, so a 40-mile radius of the plant offers a plethora of waste feedstock collection opportunities; Newport Biodiesel has nearly 1,000 restaurants in its collection chain. "It helps in getting the message out to the local community&mdash;we're collecting a local waste product for local biodiesel production for local consumption," Harris says. "Local restaurants really get that, the local message, and it helps us retain them when our competition is offering them money for their grease." Newport Biodiesel obtains most of its feedstock for free. Harris says one of his company's main distributors, T.H. Malloy &amp; Sons, had been distributing biodiesel for years before Newport Biodiesel came online. "They were looking for sustainably sourced fuel," says Harris, adding that they were buying biodiesel from the Midwest. "When we came online here in Rhode Island, they were thrilled." Ever since, local biodiesel demand has never been an issue. Landsburg can relate to this idea of not producing more than your local feedstock resources allow. BlackGold based its business model on just that, looking at local waste streams that are burdensome to their owners and, not only minimizing that burden, but creating value from it. And the waste streams she is focused on are the nastiest out there, the sewer greases. BlackGold's pilot plant is in Philadelphia, but its first commercial plant, bought by the San Francisco public utilities commission, is being commissioned right now. Another small-scale biodiesel producer, Bently Biofuels in Minden, Nev., says vertical integration has been critical to their success. Bently Biofuels is one of a number of companies owned by Don Bently. A third of the biodiesel plant's supply goes to its sister company's ranching operations. "That gives us a baseline demand," says Carlo Luri, general manager for Bently Biofuels. "Owner Don Bently believes in minimizing petroleum use and reducing our carbon footprint, so he's not going to stop using biodiesel because the tax credit goes away." This strong, passionate belief in biodiesel, alongside savvy localized business models, has sustained the small-scale producer during this dark period without the federal tax credit; and while a number of large, "corporate" biodiesel plants sit idle in this uncertain policy environment, many community-scale biodiesel plants are operating at full capacity-even if their production capacities are small by comparison. "Vertical integration becomes pretty important in the economic model," Luri says. "If you're buying from and selling to the commodities markets, then your fate is out of your hands. The spread might be good or it might be bad, but you have no control over what the spread is." He says one fatal flaw seen over and over in the biodiesel industry is well-intentioned investors fund the building of a massive plant, yet there isn't enough available feedstock within a reasonable distance from the plant to operate anywhere near capacity. "So now your model includes transporting feedstock long distances, which, as energy costs go up&mdash;and they will&mdash;the cost of transportation goes way up," he says. Conversely, if the local demand is significantly outpaced by a large plant's capacity, then the fuel itself must be shipped long distances to reach end markets. Vertical integration meets company diversification at Bently Biofuels' own retail station and convenience store, where it sells B99 directly to consumers. The station also sells B5, B20 and ethanol blends of 10 and 85 percent.	 Diversification Like many small-scale biodiesel producers, Piedmont Biofuels, a worker- and member-owned cooperative in Pittsboro, N.C., knows the importance of diversification. "We do make biodiesel, but fortunately that's not all we do or we'd be boarded up right now," says Lyle Estill, president. Piedmont operates a 1 MMgy production facility. It also has a design-build group that makes skid-mounted reactors, the latest project of which is with enzyme-maker Novozymes to develop an enzymatic biodiesel production process. The enzymatic pilot plant will open in July. "We also make a cavitational reactor that we ship," Estill says. "And in the pump and tank shop we've got a degumming skid, a local farmer hired us to build a little skid unit to knock the gums out of his soybean oil. We also manufacture small-scale methanol recovery units, that sort of stuff." The co-op also has a research and analytics group. "They do some outside testing for others in the industry," Estill says. "And we also do contract research," for professors, for instance, who have theories they want tested at the practical level. In addition, Piedmont supports local and regional educational workshops. "We have a mobile rig, so we'll pull into town and hold biodiesel workshops," he says. The rig has an oilseed press and biodiesel production unit, so the co-op starts its workshops by dumping whole oilseed in, and by the end of the session, they get ASTM quality biodiesel. Finally, Piedmont does consulting. "Any given day you might find someone visiting us from afar, talking to our lab guys about analytics or asking about regulations or how to get a license or permit for their plant," Estill tells Biodiesel Magazine. "Or they might be sitting on the couch or in the kitchen rapping about pumps with our staff. So we're a fairly diversified operation where making biodiesel is only one of the things that we do." Estill says ideally feedstock is gained, and the biodiesel is produced and consumed, locally. "We would like to see the next 100 million gallons of biodiesel production come not from one behemoth plant in the harbor, but from a hundred community-scaled plants like ours," he says. "We're trying to get free from a top-down oppressive energy infrastructure like the one we know from petroleum." Relationships "When you know your clients&mdash;your feedstock providers, your customers&mdash;it's a personal transaction, not purely a commodity-based transaction," Landsburg says. "This allows for a level of flexibility and loyalty. These types of relationships exist for small-scale producers that would be harder to find in larger-scale operations. I think that offers a lot of resilience against down markets." Two common misconceptions out there about small producers are that they're not as safe as their larger counterparts, and they cannot ensure fuel quality. But the average community-based producer is selling fuel to family, friends and neighbors&mdash;on top of using the fuel themselves&mdash;so fuel quality and community safety are paramount for maintaining the integrity of these vital relationships. "I say I won't sell you bad fuel because that same fuel is going in my vehicle," Luri says, adding that Bently Biofuels' tanker trucks delivering biodiesel are powered by B99. "Our customers appreciate that the fuel we deliver is brought in a tanker truck running on B99, not some truck running on petroleum diesel." Harris says, "If there's a problem with our fuel, it's going to affect our friends, our families, us. It's different than shipping fuel off to some end user who we'll never hear from again. I'm the production manager, and that personally drives me to ensure fuel quality." Ron Kotrba is editor of Biodiesel Magazine. Reach him at (701) 738-4942 or <a href="mailto:rkotrba@bbiinternational.com">rkotrba@bbiinternational.com</a>.

Yokayo Biofuels was established as a local distributor of biodiesel by the time its 500,000 gallon per year plant opened in 2005. photo: YOKAYO BIOFUELS

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Bently Biofuels of Minden, Nev., owns a retail fuel outlet and convenience store to which the company can sell its B99 and other biodiesel blends, in addition to ethanol-blended gas, directly to customers. photo: BENTLY BIOFUELS

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The Piedmont Biofuels crew runs a diverse operation in Pittsboro, N.C., which has helped it stay in business during these tough economic times. photo: PIEDMONT BIOFUELS

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Piedmont Biofuels also runs a laboratory where the company conducts third-party analyses for regional biodiesel producers. photo: PIEDMONT BIOFUELS 

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The myth is that small producers are are less able to provide quality fuel and safety protocols compared to the big producers, but small producers make solid arguments to the contrary. photo: YOKAYO BIOFUELS

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Vertical integration, diversified operations, education and valued relationships are vital components to the success of community-based biodiesel producers. This is their story.

The Resilient Community Producers

During these tough economic times in the biodiesel industry, success-even survival-often comes down to finding M&A partners. The following are important aspects for biodiesel companies to consider throughout the scope of the M&A process.

Mergers and Acquisitions in the Biodiesel Industry

Posted July 19, 2010
 
 Honda Motor Co., Japan's second-leading automaker, announced last week that it plans to delay production of its clean diesel engines and shift focus on its growing hybrid line.
 
 The decision comes in light of Honda's plans to delay construction of its Yorii factory, north of Tokyo, and a plant at its subsidiary Yachiyo Industry Co. to produce so-called mini-vehicles, light cars with engine sizes up to 660 cubic centimeters, both of which were originally scheduled to start production this year. The Yorii facility is projected to begin production in 2013, which falls in line with Honda's latest plan to start in or after 2012.
 
 "This isn't a new announcement," Honda spokesman Chris Martin told Biodiesel Magazine. "About three years ago, we were aiming to bring clean diesels to our Acura brand. That was during a time when gas prices were getting high and diesel prices were relatively low at that time and we saw an opportunity to bring a cleaner diesel vehicle in Europe and to California due to their respective strict emission regulations. Once diesel prices started creeping higher with gas prices we started looking in a different direction in the hybrid line."

 
 After the global financial meltdown in 2008, Honda initially planned to build clean diesel and other fuel-saving vehicles at its Yorii manufacturing facility, but has since delayed the development of clean diesel engines, planning instead to roll out with a new hybrid system to boost fuel economy in its larger vehicles, according to Martin.
 
 "We're certainly not out of the diesel business," Martin said. "We continue to look for developments there."
 
 Honda CEO Takanobu Ito, who took the helm about a year ago, has said he wanted to accelerate the roll-out of hybrid cars as environmental regulations become more stringent worldwide.

Honda delays plans to build clean diesels

Posted July 14, 2010
 
 After several months of failed funding requests, Claypool, Ind.-based LD Biodiesel and Soybean Processing Plant has filed suit against the USDA. Louis Dreyfus Agricultural Industries LLC (LDAI), owner of the Claypool plant, filed in the District Court of Columbia, and claims that the USDA is unconstitutionally denying the Claypool facility funding due to the plant's percentage of foreign ownership. LDAI, located in Maryland, but owned by Geneva-based parent company Louis Dreyfus, states in their case that the USDA did not follow normal protocol before implementing a rule that requires biofuel companies to be a minimum of 51 percent American owned to be eligible for funding. The rule appears in a May 6, 2010, Notice of Contract Proposal for payments to eligible advanced biofuel producers form. 
 
 Located in Kosciusko County, the 80 MMgy plant created roughly 105 jobs in a town whose population is only 250. Robert Conley, Kosciusko County Commissioner said the plant's employees would be in jeopardy if the facility was unable to produce at capacity. "The consensus from the farmers that use the plant have been nothing but positive," Conley said regarding the use of biodiesel in the region. "They save time and money, and repairs to their trucks have been cut." 
 
 The requested funds, from the Bioenergy Program for Advanced Biofuels established in the 2008 Farm Bill, do not "impose any requirement that an 'eligible producer' must be a United States citizen or at least 51 percent owned by a United States citizen," LDAI's complaint said. "LDAI is a 'producer of advanced biofuels' within the meaning of the Advanced Biofuels Statute." Also in the complaint, LDAI goes on to say, "USDA has acknowledged that 'this citizenship requirement is not required by the statute' but nonetheless chosen to impose it because 'it is consistent with the Agency's other programs.'"
 
 Conley said Kosciusko County has already set aside a half-mile space on either side of the plant to allow for further growth. "The school in Claypool has been reopened and there has been more staff and support hired. People are looking to build homes near the school where their children will be going," Conley said. "I have telephoned Under Secretary of Agriculture Mr. Dallas Tonsager and invited him to Claypool to meet with me and take a tour of the facility and also meet with some of the farmers of the area." For now, Conley said they are still waiting to hear back, and will wait for the case to be resolved.

Indiana biodiesel plant files suit against USDA

Posted July 14, 2010

 
 The <a target="_blank" href="http://ne.biomassconference.com" rel="external">Northeast Biomass Conference & Expo</a> Aug. 4-6 at Westin Copely Place in Boston will feature a biorefining panel titled, "Cutting-Edge Conversion Approaches: Breakthroughs in Biorefining." 
 
 Stephen Fitzpatrick with Waltham, Mass.-based Biofine Technology LLC will present on the Biofine Process for thermocatalytic biomass refining. The process employs high temperatures and dilute-acid catalysis for rapid hydrolysis of lignocellulosic biomass to produce levulinic and formic acids, and biochar. Fitzpatrick said the process is carried out in a novel continuous reactor system that enhances yield for commercial applications. 
 
 "The process is flexible enough to utilize a wide range of lignocelluloses such as forest residues, waste paper or straw," he said. "Derivative green products of interest include heating and transportation fuels, monomers and general chemicals." Fitzpatrick said that a semi-commercial-scale plant is now operational in Gorham, Maine, adding that, "the process could allow biomass to displace crude oil as the primary source of fuels and chemicals. … It was recently assessed to have a greenhouse gas life-cycle assessment that is more than 90 percent better than gasoline or diesel fuel and 40 percent better that soy-based biodiesel by independent assessors using the DOE-developed GREET methodology." 
 
 He said of particular commercial interest is the production of ethyl levulinate, a versatile fuel product that can be blended with heating oil, diesel or gasoline. "It is manufactured by combination of levulinic acid with ethanol," he said. "The development of a renewable heating oil blending component that can be economically produced and used in the Northeast should be of great commercial interest." He projected that the process can allow profitable production of heating oil blendstock from wood or agricultural residues for less than two dollars per gallon at large scale. "Ethyl levulinate can be blended directly or co-blended with biodiesel," Fitzpatrick said. 
 
 Waste plastic streams in MSW can be a real concern, much of which gets landfilled where it serves no good to anyone. Polyflow Corp. chairman Joseph Hensel said his company has developed a process to convert mixed and dirty polymer solid wastes into chemical intermediates and fuels. 
 
 "A unique value that this technology offers is the utilization of the mixed polymer stream without sorting by polymer type," Hensel said. "Today only 7 percent of all polymers are recycled because of the difficulty and expense of sorting, leaving 93 percent that are currently being landfilled. Unlike classic plastics recycling processes, this technology uses mixed, unseparable polymer waste. There is no requirement for sorting any of the polymers by color, type or grade. The process is robust, minimizing the need to manage the composition of the feedstock to maintain the process specifications and maximize output volume and quality." He said mixed polymer feedstock means hard packaging, flexible packaging, multilayer films, thermosets as well as thermoplastics, tires, carpet, agricultural film, e-waste plastic, expanded polystyrene and other polymers.
 

 He said the process can make chemical intermediates that can be sold to the petrochemical industry, in addition to gas and diesel fuel, through a simple cracking process similar to how crude oil is refined. "These polymers were already refined once, so they're pretty easy to handle," Hensel told Biodiesel Magazine. "Thirty-seven percent of the energy used in this country comes from crude oil. Ten percent of that is used to manufacture plastics and rubber. We can take that 10 percent and bring it back into the energy stream. That can have a major impact." 
 
 Also presenting at the NEBCE in Boston is Bernhard Quirbach, who will discuss hydrothermal carbonization and pyrolysis, two systems to get a high-energy output without a very high-energy input, he said. Quirbach's presentation will show the options of how to use HTC and pyrolysis for a "new biofuel and bioenergy generation," he said. 
 
 Kevin Gray, chief technology officer for Qteros, is scheduled to speak about the biomass-to-ethanol process based around the trademarked Q microbe, Clostridium phytofermentans, which he said has the natural ability to hydrolyze all types of polysaccharides in biomass and ferment those sugars into ethanol. "The genome sequence of the Q microbe shows the presence of over 105 different glycosyl hydrolases, and microarray analysis indicated that the glycosyl hydrolases were induced when the organism was grown in the presence of complex carbohydrates and down-regulated when grown on simple sugars," he said. "Enzyme titration data has shown that the Q microbe achieves maximal productivity with one-fourth to one-fifth the amount of exogenous enzyme required by Saccharomyces cerevisae." 
 
 Gray said a genetic system has been developed such that specific genes can be deleted or over-expressed in order to improve performance, adding, "this presentation will describe recent progress in strain and process development to meet commercial metrics." 
 
 Maxwell Morton with Grayhead Associates is scheduled to moderate this panel. 

 
 To register for the Northeast Biomass Conference & Expo, visit <a target="_blank" href="http://ne.biomassconference.com" rel="external">http://ne.biomassconference.com</a>.

Breakthroughs in biorefining: a panel preview for Northeast BIOMASS Conference & Expo

Posted July 20, 2010
 
 An advanced biodiesel project developed by researchers at Idaho National Laboratory has been selected by R&D Magazine to receive a 2010 R&D 100 award. The annual competition, which recognizes outstanding technology developments with promising commercial potential, has been held by R&D Magazine since 1962.

 
 INL was recognized for its Supercritical Solid Catalyst (SSC) process, which converts waste feedstocks with up to 100 percent free fatty acid content into ASTM-quality biodiesel. According to Chemical Engineer Daniel Ginosar and Chemist Robert Fox, INL researchers leading the project, the SSC process has been specifically designed to take advantage of low-value waste feedstock, such as brown and black grease, waste fats, oil and greases (FOG), municipal waste water, and similar waste streams. "We can use up to 100 percent free fatty acid feedstock without any additional pretreatment," Ginosar said. 
 
 SSC is a continuous process during which the oil or fat feedstock is mixed with alcohol and nontoxic supercritical fluid solvents, Ginosar said. In a single fluid phase, the resulting mixture is then passed over a solid catalyst to transform the free fatty acids into methyl esters. The process produces significantly less waste water than traditional biodiesel processes, and results in a glycerol byproduct that is not contaminated with any acids or bases, Ginosar said. 
 
 Fox and Ginosar began research on the SSC process in 1995. Although there were several starts and stops along the way, Fox said the eventual result has been a complete technology portfolio for which INL holds five patents. When the team first began to approach other researchers and those in the biodiesel industry with the process several years ago, Ginosar said most did not believe the technology would work. "But, we knew our chemistry…and science was solid, and continued to press on," he continued. 
 
 The SSC process was later licensed by BioFuelBox Inc., which launched a 3,000 gallon per day demonstration-scale facility featuring INL's SSC process in 2009. According to Ginosar and Fox, that facility was highly successful in proving the commercial viability of the technology. In addition to receiving the 2010 R&D 100 award, INL's SSC process was also recognized by the World Economic Forum when BioFuelBox was recognized as a Technology Pioneer by the WEF in late 2009. 
 
 BioFuelBox's license for the SSC process has since expired, said Ginosar, and INL is actively seeking other potential licensees for the technology. While it may be possible to retrofit some existing biodiesel plants to use the SSC process, Ginosar said it's more likely that the technology will be deployed in new projects. Although the initial capital costs of a new facility employing the SSC process will be higher than those of a traditional biodiesel facility, Fox said the additional costs can be recouped over several years, primarily through the use of lower-cost waste feedstocks. 
 
 A <a target="_blank" href="https://inlportal.inl.gov/portal/server.pt?open=514&objID=1269&mode=2&featurestory=DA_551474 " rel="external">video</a> documenting the team's SSC research is available on INL's website.

INL recognized for waste-to-biodiesel process

Posted July 20, 2010

 
 Rothsay Biodiesel, the Guleph, Ontario-based producer, has a message for other biodiesel users. In 2009, Rothsay, a division of Maple Leaf Foods Inc., fueled its truck fleets with biodiesel, resulting in a carbon reduction of approximately 700 tons and the removal equivalent of roughly 130 cars from the road. Combined with its cleaner, proven fueling solution, the company said the fleet's biodiesel usage shows successful performance in real-life operating conditions. "Our biodiesel blends, which are produced from inedible animal byproducts and recycled restaurant grease, have proven they perform well in our Canadian climate," said Todd Moser, vice president of Alternative Fuels at Rothsay. 
 
 "This is the message we want other potential biodiesel users to see," said Mike Paszti, director of technical services and innovation for Rothsay. One hundred and thirty seven trucks are fueled with Rothsay-produced biodiesel, and in 2009 the fleets traveled a combined 3.3 million miles, using more than 600,000 gallons blended at an average of 9.2 percent biodiesel. During that time there were no mechanical issues or mileage decreases, according to Rothsay. "As biodiesel use has spread across Rothsay, vehicle maintenance programs, reliability and performance have not changed in any measurable way," Paszti said.
 
 In 2001, Rothsay began to run B5 and higher blends at its Montreal biodiesel production facility. Today, roughly five B100 trucks operate out of the Montreal facility, Paszti told Biodiesel Magazine. In 2009, Rothsay expanded its overall biodiesel usage by incorporating biodiesel blends from B5 to B20 at its Dundas and Moorefield, Ontario, rendering plants. 
 
 After announcing its fleet accomplishments, Rothsay was also commended by the Canadian Renewable Fuels Association. "Rothsay's on-road fleet experience is proof of the positive benefits of blending biodiesel in Canada. In everyday use and all weather conditions, Rothsay's biodiesel delivered top performance and, importantly, reduced the harmful greenhouse gas emissions, air pollution and smog that is associated with fossil diesel use," said CRFA chair Doug Hooper. 
 
 Based on the success of the current biodiesel fleets, Paszti said Rothsay is expanding its biodiesel use at other Maple Leaf Foods plants in Ontario. "The transportation of perishable food products means that our biodiesel must perform flawlessly," Paszti said. "As such, every facility that has adopted the use of our biodiesel has scrutinized our product's performance before making an informed decision to move forward just as any external fleet would have."

Rothsay Biodiesel announces fleet results

Posted July 20, 2010
 
 Only 18 months after the EU took action to mitigate the influx of U.S. products into the European biodiesel market, a Spanish renewable energy organization is claiming that European biodiesel markets are once again being overtaken by unfair imports. APPA Biofuels, a division of Spain's Association of Renewable Energy Producers, recently released a report stating that 60 percent of the biodiesel utilized in Spain during the first quarter of 2010 was imported into the country, with the vast majority of those imports coming from Argentina. 
 

 According to APPA Biofuels, the influx of Argentinean biodiesel into the European market primarily stems from an export tax in Argentina that encourages the export of finished biodiesel over the export of soybean oil. In fact, APPA Biofuels states that while a 32 percent export tax has been levied against soybean oil in Argentina, the export tax on biodiesel is only 18 percent. This imbalance is exacerbated, said APPA Biofuels in its report, by the EU's exemption of Argentine biodiesel from paying the 6.5 percent import tariff normally levied against biodiesel imports. 
 
 While Argentinean biodiesel flows into the Spanish market, APPA Biofuels reported that 75 percent of the capacity of Spain's 46 biodiesel plans is currently idle. The most recent statistics available through the European Biodiesel Board show that while Spain has the capacity to produce approximately 3.7 million metric tons (about 1.1 billion gallons) of biodiesel per year, only 207,000 metric tons (62 million gallons) was produced in 2008.
 
 According to APPA Biofuels President Roderic Miralles, several countries, including France and Portugal, have already taken internal measures to protect their local biofuels industries from unfair competition posed by imported biodiesel. "Spain cannot remain [a] paradise for exporters when we have invested in [dozens of biodiesel plants] in [this] country," Miralles said in a press release. 
 
 While some countries have taken measures to protect their biodiesel producers, Dieter Bockey, spokesman for German-based Arbeitsgemeinschaft Qualitätsmanagement Biodiesel e.V. (AGQM), said the problem with Argentinean biodiesel is affecting a significant portion of the European market. He estimated that German biodiesel producers are operating at less than 50 percent capacity. Although biodiesel producers in the U.S. are struggling primarily due to the failure to extend the biodiesel tax credit, Bockey said the European industry's challenges can primarily be attributed to internal completion and the import of biodiesel from other countries. "Nowadays, I think it's also [due to] additional biodiesel from Argentina due to the exporting subsidy system they have," Bockey said. 
 
 APPA Biofuels also states that the market damage being caused by Argentinean biodiesel exports has been further aggravated by the Ministry of Industry, Tourisms and Trade's delay in approving a Royal Decree for new fuel specifications that would allow biodiesel to comprise up to 7 percent of a diesel fuel mixture. According to APPA Biofuels, approving the use of B7 would increase market demand for biodiesel, allowing local producers to increase production.

Spanish biodiesel industry crippled by imports

Posted July 20, 2010
 
 The U.S. EPA has released a Notice of Data Availability (NODA) for its recent modeling of the canola oil biodiesel pathway. As of March 26, when the EPA officially announced the final rule for the revised renewable fuel standard (RFS2), the canola pathway had not been analyzed as a biofuel feedstock capable of meeting the required greenhouse gas reduction standards set by the Energy Independence and Security Act of 2007. Using the same RFS2 lifecycle analysis modeling approach for other biofuels already approved, the EPA stated that the canola oil biodiesel pathway creates a 50 percent reduction in GHG emissions compared to the diesel fuel baseline. 
 
 "These results, if finalized, would justify authorizing the generation of biomass-based diesel RINs for fuel produced by the canola oil biodiesel pathway modeled, assuming that the fuel meets the other definitional criteria for renewable fuel (e.g., produced from renewable biomass, and used to reduce or replace transportation fuel) specified in EISA," EPA said in the NODA memo. 
 
 EPA analyzed canola oil as a feedstock "assuming the same biodiesel production facility designs and conversion efficiencies as modeled for biodiesel produced from soybean oil." To assess the impact of producing biodiesel from canola oil, the EPA also created a control case projection estimating 200 million gallons of canola-based biodiesel per year by 2022. "While we recognize that some canola oil has historically been used to make biodiesel for domestic use," EPA said, "this range of production (zero to 200 million gallons) covers the range of production likely by 2022." To create the projection, the EPA used a number of factors including historical volumes, potential feedstock availability and competitive uses, potential increases in crop acreage and potential increases in crop and conversion yields. 

 
 "As with other EPA analyses of fuel pathways with a significant land use impact, the proposed analysis for canola oil biodiesel includes a best estimate as well as a range of possible lifecycle greenhouse gas emission results based on formal uncertainty analysis conducted by the agency," EPA also noted. 
 
 Higher yield improvements, which could show a greater reduction of land use impacts and improve projected GHG performance of canola-based biodiesel, were given by industry members to the EPA, but not used for the analysis. "As was the case for analyses of other crop-based biofuels," the agency noted, "EPA projected increases in canola crop yield based on long-term trends. Yield improvement rates recommended by industry were higher and were based on recent shorter term trends." 
 
 EPA's analysis included the Forestry and Agricultural Sector Optimization Model (FASOM) and the Food and Agricultural Policy and Research Institute international models maintained by the Center for Agricultural and Rural Development (FAPRI-CARD). For key model inputs and assumptions (e.g., crop yields, biofuel conversion yields, and agricultural engery use), EPA has also provided a docket of information accompanying the NODA. The information included in the docket was generated by peer-reviewed literature and reflects expert recommendations from the canola and biodiesel industries considered by EPA. For 30 days, effective from the publication date in the federal register, the EPA will accept comments on the proposed lifecycle assessment of canola oil biodiesel. 
 
 Click <a target="_blank" href="http://www.epa.gov/otaq/fuels/renewablefuels/regulations.htm" rel="external">here</a> to view the NODA.

EPA releases data on canola biodiesel pathway

Posted July 21, 2010
 
 The Congressional Budget Office recently completed a study of biofuel tax credits that aimed to determine if existing tax credits favor one type of biofuel over another and estimate the costs of those credits on U.S taxpayers. The study, titled "Using Biofuel Tax Credits to Achieve Energy and Environmental Policy Goals," was prepared by the CBO at the request of the Chairman of the Senate Subcommittee on Energy, Natural Resources and Infrastructure. 
 
 Although the $1 per gallon biodiesel tax credit expired in December 2009, the CBO included it in the analysis. According to the report, this was done to provide policymakers with information on the value of the credit, should they choose to reinstate it in the future. In addition to the biodiesel tax credit, the report includes data related to tax credits for corn and cellulosic ethanol. 

 
 The CBO's main findings included the following: 
 
 	-The incentives provided by the tax credits differ between the three fuels. When adjusted to reflect the different energy contents of the biofuels, as well as the petroleum fuel used to produce them, the CBO found that corn ethanol producers receive 73 cents for each quantity of ethanol that contains the energy equivalent of one gallon of gasoline. On the same basis, the incentives for cellulosic ethanol and biodiesel were a respective $1.62 and $1.08 per volume of energy equivalent fuel. 
 
 	-The cost to taxpayers to use corn ethanol to reduce gasoline consumption by one gallon is $1.78. The same cost for cellulosic ethanol is $3 and the cost for biodiesel was found to be $2.55. According to the CBO, these cost estimates depend on the size of the tax credit for each fuel, changes in federal revenue streams that result from the difference in excise taxes collected on the sales of gasoline and biofuels, and the amount of each biofuel that would have been produced if the credits had not been available. 
 
 	-The costs to taxpayers of reducing greenhouse gas (GHG) emissions through the tax credits was $750 per metric ton of carbon dioxide equivalent (CO2e) for corn ethanol, $275 per metric ton of CO2e for cellulosic ethanol, and $300 percent metric ton of CO2e for biodiesel. 
 
 Imperium Renewables Inc. called the CBO's report "fatally flawed" in a statement issued July 20. According to Imperium, the study is misleading because it accounts for only taxpayer costs, and does not address the many benefits these tax credits create for taxpayers. Furthermore, Imperium states that the report is flawed in that it does not apply the same types of analysis to conventional petroleum fuels. The report underestimates the benefits of biofuels, said Imperium, while hiding the significant existing costs to taxpayers of our reliance on petroleum fuels. 
 
 "This report is like a cost-benefit analysis, without the benefit analysis," said Imperium Founder and CEO John Plaza. "First, the CBO completely ignores the cost to taxpayers of the current petroleum industry…Second, the CBO report ignores the reality that these incentives are really investments in the long-term development of a domestic and renewable energy supply, something the federal government has a deep history of providing…The CBO also ignored data showing that every dollar of subsidy invested in biofuels returns more than two dollars in increased Gross Domestic Product and state and federal tax revenue."
 
 "We call on the CBO to revise this report to include the known benefits to taxpayers resulting from the biofuels industry, and more importantly, to conduct a similar investigation of the cost to taxpayers of petroleum fuel," Plaza said. "Until then, policymakers cannot reasonably rely on this report when evaluating the continued federal investments in clean, domestic and renewable fuels."

Biodiesel producer finds CBO report flawed

Posted July 28, 2010
 
 The latest chance for a biodiesel tax credit extension, H.R. 4213 or the Unemployment Extension Act of 2010, passed without the biodiesel tax credit extension included. For months, the $1 per gallon biodiesel tax credit, which expired on Dec. 31, was included in H.R. 4213, but now the extension, led again by the support of Sen. Chuck Grassley, R-Iowa, must seek a new avenue to give the industry much needed relief. Grassley, who first introduced the extension legislation nearly a year ago with Sen. Maria Cantwell, D-Wash., and has since tried multiple times to pass it, has now introduced an amendment to the Small Business Bill currently under debate in the senate. 
 
 On July 26, the House ways and means committee, which has solo jurisdiction over matters relating to taxation, released a draft of The Domestic, Manufacturing and Energy Jobs Act of 2010. This package contains an extension of the biodiesel tax credit for 2011. The summary states, "The proposal would reinstate for 2011 the per gallon tax credits and outlay payments for biodiesel and renewable diesel. The extension of these tax credits and outlay payments for 2010 has previously passed both the House of Representatives and the Senate at different times but has not become law. The extension for 2010 would be incorporated into this legislation if that extension has not been enacted by the time this legislation is considered. This proposal is estimated to cost $1.108 billion over 10 years."
 
 Neither the ways and means committee nor the full House are expected to consider this legislation prior to the August recess, which, for the House, is scheduled to begin the week of Aug. 2. 
 
 "This noncontroversial, nonpartisan provision for clean, green energy is being held hostage," Grassley said in a statement on the stripping of the biodiesel tax credit extension from H.R. 4213. "I'm trying, once again, to put Americans back to work in this clean, renewable fuel industry." Grassley has also described the failure to extend the tax credit as devastating, noting that an estimated 29,000 biodiesel-related jobs were lost due to uncertainty. His Washington D.C. office told Biodiesel Magazine however, that he will continue to fight for biodiesel. 
 

 The National Biodiesel Board continues the fight as well. Manning Feraci, vice president of federal affairs for the NBB, wrote a letter to Sen. Harry Reid, D-Nevada, to address the energy package Reid outlined on July 22. "The U.S. biodiesel industry notes your interest in displacing petroleum use in heavy duty highway applications. The most reliable, immediate way to achieve this worthwhile objective is to include a retroactive, multiple year extension of the biodiesel tax incentive in the upcoming energy bill," the NBB letter said. The letter went on to say that the continued lapse and uncertainty regarding the federal government's commitment to advanced biofuels like biodiesel, directly undermines the nation's ability to displace petroleum diesel fuel. 
 
 "Accordingly," the letter ended, "the NBB respectfully asks that this common sense proposal ultimately be included in forthcoming energy legislation." While the tax extension may pass in accordance to either the Small Business Bill or the paired down energy legislation from Reid, Grassley's office also said tax legislation expected towards the end of the year may offer another opportunity for the biodiesel tax credit.

New bills offer hope for biodiesel tax credit

Posted July 21, 2010

 
 The used cooking oil supply for Ames, Iowa-based Renewable Energy Group Inc. just got bigger. REG has agreed to purchase yellow grease from Restaurant Technologies Inc. With over 16,000 used cooking oil collection systems spread throughout the U.S., along with 36 collection depots, REG now has access to RTI's national distribution chain of used cooking oil. "We have a system that we've put into restaurants that allows us to help them automate cooking oil use. We deliver cooking oil and we also remove it," said Jeff Kiesel, CEO for the Minnesota-based RTI. 
 
 With new access to the cooking oil collection depots, REG vice president of supply chain management Dave Elsenbast said the company now has the potential "to replace more than a half million barrels of imported crude oil" with biodiesel. 
 
 Along with the RTI cooking oil contract, REG has also acquired Tellurian Biodiesel Inc., a California biodiesel company and marketer, and American BDF LLC, a joint-venture owned by Golden State Service Industries, a wholly-owned subsidiary of Golden State Foods. 
 
 Kiesel noted that working with REG gives RTI "a good contract with a good customer." And, Kiesel said, "It does help our customers to be part of the green revolution and have a green story." REG, which currently has a production capacity of more than 200 MMgy, said the finished biodiesel produced in part from the yellow grease will be marketed and distributed under the company's REG-9000 brand. The amount of the contract was not made available, but Kiesel said REG will purchase the oil for market price.

REG secures new supply of used cooking oil

Posted July 21, 2010
 
 For Earl Fisher Biofuels co-owner Brett Earl, farming isn't a new undertaking. He, a fourth generation farmer, and business partner Logan Fisher are veterans when it comes to harvesting the hundreds of oilseed crops that go into their 275,000 gallon per year biodiesel production facility in Chester, Mont. However, having engines owned by Burlington Northern Santa Fe Railway Co. to run on their biodiesel is a new enterprise they hope will flourish with positive results over the next year.
 
 On July 1, Earl Fisher Biofuels delivered its first shipment of biodiesel to BNSF at the Havre Depot. The study calls for Montana State University-Northern Bio-Energy Center to conduct laboratory testing of the biodiesel performance in one switch train running on regular diesel, which will act as a control, and the other will run on a B20 blend, mostly made from canola and camelina oil in order to test performance in extreme cold weather conditions come winter time.
 
 Over the next year, Earl Fisher Biofuels will supply BNSF with 24,000 gallons of biodiesel-roughly 2,000 gallons per month-for the duration of the study, according to Earl.
 "I'm not sure if we can supply their entire fleet with our product," Earl said. 

 
 Earl Fisher Biofuels and MSU-Northern have a history of partnering on related biodiesel experiements and studies as the school has a diesel mechanics curriculum. For the study with BNSF, the college wasn't capable of producing the quantity of biodiesel needed for the test, so it turned to nearby Earl Fisher Biofuels to fill the supply gap.
 
 Earl Fisher Biofuels began production in the spring of 2008. The company is looking to eventually ramp up production to 1MMgy later this year, according to Earl.
 
 "We've sized our utilities for 1MMgy plus," he said. "Our reactor is just a 500-gallon reactor and so that limits our capacity. We would just modulate our reactors to increase our capacity."
 
 The company also has an oilseed crushing plant in the production facility, which crushes approximately 600 to 700 gallons per week of oil depending on what oilseed it crushes. Although the majority of Earl Fisher Biofuels' feedstock is predominantly camelina, the company also processes canola, safflower, sunflower and occasionally mustard seeds.
 
 Since approximately 70 percent of the weight of camelina pressed for biodiesel production is meal, it leaves no room for profit. Until the U.S. Food and Drug Administration clarifies rules for implementing a camelina meal market for producers, Earl said the company will continue to stockpile the product at its silos. 
 
 "That's one of the down sides of camelina," Earl said. "If we had soy-type markets for camelina meal then the industry would be going gangbusters. We just don't have that here."

Earl Fisher Biofuels supplies biodiesel to BNSF

Posted July 26, 2010
 
 Navistar International Corp. said from a workshop last week that the U.S. EPA and the California Air Resources Board presented preliminary proposals aimed at the compliance loopholes found in current 2010 liquid-based selective catalytic reduction (SCR) systems for diesel NOx emissions control.
 

 "Navistar first identified these loopholes to the agencies and also presented our concerns at [this] workshop," said Jack Allen, president of Navistar's North American truck group. "We will be working with the EPA and CARB to ensure full environmental compliance." 
 
 At the joint CARB and EPA workshop, Navistar's concerns about environmental compliance were backed up by independent test findings that show new commercial vehicles that must contain liquid urea to meet federal NOx emissions standards continue to operate effectively when urea is not present. At such times, Navistar said, the vehicles throw off levels of NOx as much as 10 times higher or more than when urea is present. 
 
 The research was conducted by EnSIGHT, an independent environmental consulting firm, using two long-haul vehicles and one heavy-duty pickup, all of which use SCR technology that relies on liquid urea to clean up NOx emissions after they leave the engine.
 
 EnSIGHT's research showed that when liquid urea was not present, there was little or no effect on the vehicles' operations. This included long periods of time when the vehicles' urea tanks were empty or were refilled with water instead of urea. One truck tested appears to operate indefinitely with water and as a result without any functioning SCR NOx control. That truck has accumulated more than 13,000 miles with its SCR NOx emission control turned off.
 
 European research also has shown that even with a full tank of liquid urea, the SCR NOx emission control system does not turn on when exhaust temperatures are not hot enough. This occurs during stop-and-go traffic. That means that there is frequently no SCR NOx control when these trucks are operating in urban areas as well as in any other congested traffic situation.
 
 Navistar, which commissioned EnSIGHT's work, joined two prominent environmental groups, the Coalition for Clean Air and Environment Now, in calling on the EPA and CARB to eliminate the loopholes and the resulting excessive NOx emissions. 
 
 "Truck owners are paying a substantial price to comply with 2010 NOx requirements," Allen said. "They, and the public, deserve to know that the new equipment they are purchasing actually works as promised to curb pollution. It's obvious, however, that these trucks can operate effectively without liquid urea, and that under these and other conditions, SCR NOx emission control is turned off. We're calling on the EPA and CARB to assure that all vehicles, not just ours, work when they are supposed to be working."
 
 SOURCE: NAVISTAR INTERNATIONAL CORP.

Navistar exposes troubling data on urea SCR

Posted July 26, 2010

 
 New statistics published by the European Biodiesel Board on July 22 show that while the growth rate in the European biodiesel market has slowed, the region still reigns as the world's largest biodiesel producer. According to the EBB, 9 million metric tons (2.7 billion gallons) of biodiesel was produced in the EU during 2009. This means nearly two-thirds of the region's 22 million ton (6.6 billion gallon) production capacity sat idle. 
 
 Overall, the EU's 2009 production increased 16.6 percent over the previous year. This is in line with the 16 percent production increase recorded in 2007, but well below the respective 35 percent, 54 percent and 65 percent increases experienced in 2008, 2006 and 2005. However, production did not increase in all EU member countries. Biodiesel production actually decreased last year in Germany, Greece, and the UK. However, those decreases were more than set off by production increases in Austria, Belgium, Finland, Italy, Netherlands, Poland and Spain. Currently, the EU's top three biodiesel producing countries include Germany, France and Spain. 
 
 Biodiesel still comprises the majority of Europe's biofuel production, accounting for 75 percent of the biofuels produced in 2009. As of July 2010, 245 biodiesel production facilities exist in the EU. According to the EBB, this is a slight decrease from last year's count, and can primarily be attributed to reorganization in the sector. 
 
 The EBB's July 22 release also addressed unfair trade practices currently plaguing the EU's biodiesel industry. According to the EBB, biodiesel exports from Argentina are currently causing economic hardship to producers, similar to the impact of U.S. biodiesel in 2007. The influx of Argentinean biodiesel into the European market is primarily attributed to an export tax scheme that levies a disproportionately higher tax on soybean oil exports when compared to the tax levied against biodiesel. The EBB said this issue is intensified by an EU policy that allow Argentinean, Malaysian and Indonesian biodiesel to enter the European marketplace duty free. Approximately 850,000 metric tons (255 million gallons) of Argentinean biodiesel entered the EU in 2009, with an additional 260,000 metric tons (78 million gallons) entering the European market during the first quarter of 2010.
 
 Click <a target="_blank" href="http://www.ebb-eu.org/EBBpressreleases/EBB%20press%20release%202009%20prod%202010_capacity%20FINAL.pdf" rel="external">here</a> to read the full copy of the EBB's report.

EBB publishes annual biodiesel statistics

Posted July 26, 2010
 
 An employee of Innovation Fuels Inc.'s Newark, N.J., biodiesel plant was injured this month from an explosion of toxic chemicals when 100 to 200 gallons of sulfuric acid leaked from a 400-gallon drum inside the plant's containment area. The employee survived with third-degree burns to 18 percent of his body. 

 
 He was connecting hoses to a tanker truck filled with methanol when the sulfuric acid container behind him leaked and subsequently burst. Local firefighters evacuated a six-block radius upon responding to the incident, which occurred July 15. 
 
 The extent of the damage to the plant was being assessed a few days after the accident, said Malek Jalal, president of Innovation Fuels.
 
 "We're definitely looking to implement stricter measures to prevent an incident like this from happening again," he said. "We're going to enhance our hazardous materials operations as well."
 
 While the exact cause of the explosion is still being investigated, Jalal said he hoped to restart operations as soon as possible. The 40 MMgy multi-feedstock biodiesel plant started production in January 2004, initially having an installed capacity of 5 MMgy. 
 
 Formerly Eastern Biofuels LLC, Innovations Fuels uses multiple feedstocks to include animal fats, beef tallow, yellow grease and virgin oils such as soy and canola. The company has also developed pennycress and camelina crops in New York and Wisconsin. 
 
 Focused on its mid-stream assets, Innovation Fuels acquired a 310,000-barrel terminal at the Port of Milwaukee in December 2009. The terminal was originally built as Shell Oil's Milwaukee headquarters in the 1950s.

NJ biodiesel plant explosion injures employee

Posted July 27, 2010
 
 In the past year, more than 750 diesel technicians and students have been trained on the benefits and use of biodiesel through an educational program established by the Iowa Biodiesel Board. The program, which is specifically targeted at Iowa's diesel mechanic community and community college instructors, aims to increase professional knowledge on biodiesel and its performance in diesel engines. The program is fully funded by a grant from the Iowa Power Fund. 
 

 During the first year of the program, continuing education courses aimed at diesel mechanics in the workforce were held at all 15 of Iowa's community colleges. A two-day "train the trainer" course was also offered for college faculty in September 2009, where instructors were provided with biodiesel curriculum and had the opportunity to interact with industry experts. A follow-up meeting held in March allowed faculty to share instructional experiences and received curriculum updates. 
 
 According to Jerry Burns, an associate professor at Des Moines Area Community College, the curriculum through the training program is one of the best he ever received. "In my classes, I am now able to embed that curriculum into my courses, and teach it as some of my regular curriculum, so my students are now able to get the latest and greatest biodiesel training," Burns said. "And, I know that pretty much holds true for many of the other instructors across the state that participated in the program."
 
 Burns said the program has given him the opportunity to train not only students, but also fleet managers and diesel technicians, on the benefits of biodiesel. "The range of knowledge of people who have attended the classes was very wide," he said. "The majority of them had heard of biodiesel, but maybe didn't know a whole lot about it, so this curriculum was really able to bring them [up to speed] on what biodiesel is, what feedstocks biodiesel is made out of, and what percentages of the fuel engine manufacturers support the use of." The training also provided students with information on how to identify high quality biodiesel at the pump. 
 
 According to Burns, the feedback he has received from students has been overwhelmingly positive. "They now know to look for the BQ-9000 seal of approval at the pump to know that [the biodiesel] meets ASTM fuel testing specs," he said. In addition, prior to the training many students didn't understand the benefits of biodiesel. "The ultra-low sulfur diesel fuel that we're required to use on the road now basically took a lot of lubrication out of the fuel," Burns continued. "One of the characteristics of biodiesel is enhanced lubrication value…so by running even a blend as low as 2 percent biodiesel, it helps to offset some of the sulfur content that we used to have for lubrication in diesel fuel. A lot of people were very unaware of that. They were also unaware that some of the exhaust emissions…are lowered."
 
 Randy Olson, IBB executive director, said, "The biodiesel industry has always taken a very proactive approach in its outreach to the petroleum community and users of the fuel. This education program is one more example of that forwarding thinking approach. In fact, we've tried to learn lessons from our cousins in the ethanol industry. There are many antidotes in the early development of the ethanol industry that highlighted mechanics and other influencers not being fully educated on the performance of ethanol in engines. So, as a result, the biodiesel industry is trying to stay ahead of the curve and make sure that diesel mechanics have accurate, up-to-date information about biodiesel and its performance in heavy duty engines."
 
 When people take their vehicles to a technician or mechanic, they put their trust in them, said Burns. If they say a certain fuel is bad, then people probably won't use it. Alternatively, if those technicians and mechanics could explain the benefits of using a biodiesel-blended fuel, drivers would be more willing to give it a try. "These students who are taking this [knowledge] out into the workforce are going to be better able to educate people on biodiesel," Burns said. "I feel very strongly that this is a good program. It has helped train a lot of people and made them very knowledgeable on what biodiesel truly is."

Training mechanics on biodiesel

Posted July 27, 2010
 
 This month, New Mexico joined a handful of states mandating the use of biodiesel. All state agencies, political subdivisions and public schools operating on-road motor vehicles are now required to use at least B5. 
 
 After July 1, 2012, the B5 mandate will extend to consumers, and unless the state agriculture and energy departments find that the state has an insufficient supply of biodiesel, or the price of biodiesel significantly exceeds the price of diesel fuel for at least two months, the mandates will stay in effect. Rio Valley Biofuels, a biodiesel producer in Anthony, N.M., hopes the mandate will cause the government fleets to use more biodiesel, plant operations manager Jed Smith told Biodiesel Magazine. 

 
 Some government fleets however, didn't need a mandate. The South Central Solid Waste Authority, a state agency responsible for management of solid waste in Las Cruces and Dona Ana County, has already run B20 blends in the majority of its diesel vehicles for the past three years. "In 2006, Patrick Peck, the director of SCSWA, approached Rio Valley Biofuels about running a B20 blend in his fleet," Smith said. "He had been trying to find biodiesel in the area and was excited about the opportunity to use a renewable fuel." Smith added that Rio Valley was awarded a bid to supply SCSWA with B20 and that SCSWA has been one of the best customers promoting the use of biodiesel in the area. 
 
 Every month, SCSWA orders a 7,500-gallon tanker of B20 for use in 16 tractor-trailers and trash trucks, landfill equipment including heavy duty tractors and bulldozers along with four diesel trucks. The feedstock used to produce the B20 generally comes from waste vegetable oil provided by local restaurants, but Smith said the plant can use almost any feedstock. 
 
 Rio Valley Biofuels has been producing biodiesel for five years, and "has worked very hard to educate people in the area about biodiesel," Smith said. Along with SCSWA, El Paso Electric is running its fleet on a B20 blend, the University of Texas at El Paso has been purchasing B20 for its bus fleet since January of 2008 and both the city of Albuquerque and the New Mexico Department of Transportation have been using a blend of biodiesel, according to Smith.

New Mexico biodiesel mandate up and running

Posted July 27, 2010
 
 Diesel industry pioneer Herb Wittershiem passed away July 25 at the age of 89. An honorary member and first president of the Association of Diesel Specialists, Wittershiem began his career in the diesel industry as a machinist apprentice with Chicago-based Diesel Engineering and Manufacturing (DEMCO) after graduating from high school in 1939. 
 
 While under the apprenticeship, he was awarded a mechanical engineering scholarship by DEMCO to attend the Amour Institute (now the Illinois Institute of Technology). Wittershiem also served in the U.S. Army during World War II, during which time he established the High Speed & Heavy Diesel Training Schools at the Army's Transportation Training Center at Fort Eustis in Virginia. Following his discharge from the Army, Wittershiem established Diesel Injection Sales & Services Inc. in Norfolk, Va., and later expanded to company to 10 locations throughout Virginia, North Carolina and South Carolina. He later purchased the Virginia Beach-based Automotive Training Institute, serving as president and CEO. 
 
 Wittershiem collaborated with other early leaders in the diesel industry to establish the ADS, which was founded in 1956. He was one of the 21 founders who attended the inaugural meeting held in Chicago. According to the ADS, Wittershiem never missed a single ADS Annual Meeting or Board of Directors Meeting. He also attended many regional meetings throughout his career. In 1969, Wittershiem was honored by the ADS with the Henry B. Sirotek Memorial Award for his efforts to advance the association and diesel industry. 
 

 "It is with great sadness we announced today the passing of ADS Honorary Member and 1st President Herb Wittersheim," said the ADS in a statement issued July 27. "The Association of Diesel Specialists owes a sincere debt of gratitude to this diesel industry pioneer…Herb was passionate about ADS and the diesel industry and believed 'ADS should remain an active partner in the diesel industry. To do so, it must never forget its basis of foundation is service.' Herb Wittersheim will be sorely missed."

Diesel industry pioneer passes

The Northeast Biomass Conference & Expo, Aug. 4-6 in Boston at the Westin Copley Place, will feature a panel titled, "Working Out the Kinks: Addressing Feedstock Logistics in the Northeast." 
 
 The panel will feature David Dowler, extension director for the Penn State Cooperative Extension, who will talk about camelina as a new oilseed crop for permanent no-till systems in New England. After two years of growing camelina in northwest Pennsylvania-work funded by the Northeast Sun Grant program and a USDA/NRCS state Conservation Innovation Grant-Dowler said, "We have learned much about its potential as a major biodiesel feedstock for the northeast." According to Dowler, camelina yields of 1,200 pounds per acre are very achievable and yields of 2,000 pounds per acre, or more, have been obtained. The oil content of camelina is around 40 percent, twice that of soybeans. "We have accumulated field data on culture, production, harvesting, storing, processing, marketing of the seed and meal, and using the oil as a feedstock for biodiesel production," Dowler said. "Research data from PSU poultry trials have demonstrated that the Omega-3's from camelina do transfer into eggs and poultry tissue when chickens are fed camelina meal. The high level of Omega-3 fatty acids found in camelina meal makes it an ideal feed replacement for flax in poultry, and as a value-added protein feedstuff for other classes of livestock." 
 
 Dowler said he believes that successful camelina production will hinge on capitalizing on the crop's uniqueness and subsequent opportunities it will create for diversity, rotations, and significant cover cropping opportunities.
 
 Crawford County Commissioners have signed a memorandum of understanding with Penn State University, according to Dowler, to use approximately 100 acres of their county farm ground to further this work. Dowler said joining PSU in this effort were three critical partners: Hero BX, formerly known as Lake Erie Biodiesel; Ernst Conservation Seeds, a local and nationally known seed producer for renewable fuels; and Northwest Grain Processors, a co-owned local soybean crushing plant that was setting idle but now has been converted into a crushing plant for camelina and canola. 
 
 Dowler also plans on discussing the challenges that lie ahead in commoditizing camelina. 
 
 Also featured on this panel is Randy Hill, head of Advanced Trailer. Hill said three years ago, Advanced Trailer began exploring use of its drying trailer to remove moisture from woody biomass. After a series of projects since then, Hill will present project results from this research at BBI International's Northeast Biomass Conference & Expo-what he said is the first public presentation of research related to transporting, drying and storing biomass while in a transport vehicle. 

 
 Maurice Hladik, president of Biomass4Energy, will discuss possible solutions to the serious potential of a feedstock shortage in trying to fulfill the RFS2 volume requirements, specifically the 16 billion gallons of advanced biofuel required by 2022 under the federal mandate. 
 
 "The challenge to meet this biomass requirement is as large as the opportunities that this presents for rural America," Hladik said. "These opportunities and challenges will be discussed from both the point of view of the biorefinery investor and the farmer/forest owner." Hladik will speak from his experience as the lead feedstock scout for Iogen Corp. for nearly 10 years in the U.S., Canada and Europe. 
 
 Hladik said the low-hanging biomass fruit will be agriculture residues. "Forestry residue and new harvest trees are other biomass resources but again there are challenges regarding costs and the yields of cellulosic ethanol from softwoods," he said, adding that dedicated tree plantations also have their pros and cons for both biorefineries and landholders. Hladik said dedicated biomass crops remain the probable dominant source of biomass. "For most biorefiners, the preferred biomass source will be perennial grasses such as switchgrass or miscanthus," he said. "This preference is based on the security of supply which this presents because of the long-term commitment of the farmer with perennials and the lesser impact of climate on such crops." 
 
 There is understandable reluctance from farmers to make long-term commitments given the lack of knowhow to establish these grasses, the novelty of contracting a crop for years in advance and without a commitment by a biorefinery investor in the form of beginning actual construction. Hladik said the investor, on the other hand, does not want to risk the stranded asset of a cellulosic ethanol facility operating well below capacity if the local community proves to be reluctant to supply biomass and enter into long-term contracts. 
 
 Hladik said the national biomass requirement to achieve the 16 billion gallon advanced biofuel portion of the RFS2 alone will be 200 million tons annually. "Assuming that a typical biomass provider will supply an average of one thousand tons per year, this means that 200 thousand farmers and others must make long-term supply commitments," he said. "Clearly this requires a massive and early mobilization of biomass providers in the next 12 years leading up to 2022. By comparison, there are about 150 thousand wheat farmers in the U.S."
 
 Qingzheng Cheng, a research associate with the Biomaterials and Wood Utilization Research Center at West Virginia University will discuss recent work in green pretreatments of woody biomass for ethanol production. Cheng said petreatment of biomass is the most costly single step-up to 20 percent of the total cost-of cellulosic ethanol production. It encompasses reducing biomass size, removing inhibitory lignin and enhancing conversion of cellulose and hemicellulose into fermentable sugars. 
 
 "Hardwood residues and three-year-old hybrid poplar of the third-generation progeny were examined as potential feedstock," Cheng said. "After debarked, dried, and milled to particles of different sizes, the samples were pretreated using environmentally-friendly pretreatment methods, including ultrasonication, homogenization, and hydrogen peroxide and ammonia fiber expansion at different pressures and temperatures in a pressure reactor." Cheng said the particles were characterized using optical microscopy, scanning electron microscopy and water retention value. The particle size was reduced, surface area was increased, and lignin content was dramatically decreased through the pretreatment processes. Cheng said the trademarked Accellerase 1000 enzyme was used to further evaluate the pretreated samples for sugar production. "The sugars produced were evaluated with high-performance liquid chromatography," Cheng said. "The results could potentially help lower bioethanol production cost with environmentally-friendly pretreatments and improve utilization of woody biomass for bioenergy production." 
 
 BBI International Program Manager Tim Portz will moderate this panel. Click <a target="_blank" href="http://ne.biomassconference.com/ema/DisplayPage.aspx?pageId=About" rel="external">here</a> to register for the Northeast Biomass Conference & Expo.

Northeast Biomass Conference & Expo: addressing feedstock issues in the Northeast

Posted Aug. 2, 2010

 
 Construction of Dynamic Fuels Inc.'s 75 MMgy biorefinery in Geismar, La. is nearly complete; however the joint venture's technology provider has reported a second quarter loss. The facility, which is being developed by Tyson Foods Inc. and Syntroleum Corp., will produce renewable diesel, naphtha and petroleum gas. 
 
 The good news for the technology provider Syntroleum, however, is that in comparison to losses recorded in 2009, the 2010 second quarter loss is much less. Syntroleum, which has constructed the plant, reported 2009 net income losses of roughly $3.8 million, but this year, only $1.02 million, according to Syntroleum's filings with the Securities and Exchange Commission. 
 
 The reason for the second-quarter loss this year, according to statements by Syntroleum in the SEC filing, results from increased staffing needed to complete construction of the facility. In 2009, Syntroleum reported a second-quarter loss on investment for the Dynamic facility of $898,000, and for 2010, $1.1 million. The project, which achieved mechanical completion on July 9, is set to begin initial fuel production in the third-quarter of 2010, the filing said. "We currently expect that the first facility will produce approximately 77 percent diesel, 13 percent naphtha and 10 percent liquefied natural gas," the SEC filing also said. The capital and working capital budget for the Geismar facility is roughly $170 million and in June of this year, Syntroleum made a $5 million investment in the plant and according to the filing, the company will also commit an additional $10 million in the second half of 2010. 
 
 The Tulsa-based company currently has approximately $24 million in cash and cash equivalents and said in the filing, "We believe that all of the receivables currently outstanding will be collected and have not established a reserve for bad debts." The plan for the next several years, the Syntroleum filing also said, is to invest in additional plants and earn revenue, "assuming the commercial success of the plants based on the Syntroleum Process."

Dynamic Fuels co-owner reports loss

Posted Aug. 3, 2010
 
 The most recent legislative vehicle that could bring the biodiesel tax credit back to life is once again stalled at a crossroads in Congress. This time, the tax credit remains in flux as Sen. Mitch McConnell, R-Ky., and Sen. Harry Reid, D-Nev., struggle to agree on the Small Business Bill and the number of amendments the Senate will vote on in the bill. During their first meeting, Reid offered three amendments while McConnell offered eight. Both Senators however, proposed to include an amendment for the biodiesel tax credit extension, but have not yet agreed on the total number of amendments.
 
 The amendment, proposed by Sen. Blanche Lincoln, D-Ark., would retroactively extend the tax credit through December 31, 2010. Lincoln's press office confirmed that the amendment was offered by both parties, but said the amendment and the bill are still in limbo. At press time, Reid has said that the two parties, "are pretty close to an agreement," and that the bill could reach the Senate floor for a vote before the August recess. If the Senate did vote before the recess, the House would most likely vote on the bill after the recess, sometime in September. Sen. Thomas Carper, D-Del., cosponsored Lincoln's amendment. 
 
 Earlier in the month Reid also unveiled the highly anticipated energy legislation. Many of us want a comprehensive bill that creates jobs, breaks our addiction to foreign oil and curbs pollution, Reid said about the bill. "We need to lessen our dependence on foreign oil," he said. The energy bill however, did not include any provisions that would revamp the biodiesel industry, and the tax extension was absent. A bill that was formed to give up to $30 billion to small banks to help those banks lend to small businesses, the Small Business Bill, is instead the piece of legislation the majority leader has attached the tax credit extension to and now, once again, with support from both parties, the industry has to wait on Washington.

Lincoln submits biodiesel amendment 

Posted Aug. 3, 2010

 
 UK-based biodiesel chemical supplier Trinity Research launched an "Ask a Chemist" service aimed at providing visitors to its new website the opportunity to pose a question to an experienced laboratory chemist. For a nominal fee of $13USD (10 Euro), the chemists will answer any question related to the petrochemical, pharmaceutical and biodiesel industries. 
 
 "We realize that many biodiesel producers need an easy-to-access knowledge base where advice can be gained quickly and at a sensible cost," according to Mark Schofield, managing director for Trinity Group. "With the launch of our new e-commerce website, it made sense for Trinity Research to fulfill that need."
 
 The company recently launched a new e-commerce website, which gives its customers a more convenient and user-friendly platform for purchasing the company's products and services. The website is the first of several new e-commerce websites planned by the business as it implements its growth strategy. 
 
 Trinity Research supplies a wide variety of biodiesel-related products and services within the UK market, including methanol, potassium and sodium hydroxide, while providing a free glycerol disposal service. The company also supplies a range of biodiesel equipment, winter additives and BioPura filtration media. 
 
 To visit Trinity Research's new e-commerce website, visit <a target="_blank" href="http://www.trinity-research.co.uk" rel="external">www.trinity-research.co.uk</a>

Trinity Research launches new service 

Posted Aug. 9, 2010
 
 The Senate has left for August recess, but the biodiesel tax credit extension is still sweating it out in Washington. While both parties proposed a biodiesel tax amendment as part of the Small Business Bill, party leaders Sen. Harry Reid, D-Nev., and Sen. Mitch McConnell, R-Ky., failed to compromise on the total number of amendments to be put before the Senate, stalling progress on the legislation. The bill had showed bipartisan support, but now the fate of the bill – and more importantly the biodiesel tax extension – will have to wait until the Senate returns in September. 
 

 The delay of the Small Business Bill might not matter, however, as a new piece of legislation recently surfaced to extend the tax credit. Sen. John Kerry, D-Mass., has unveiled a new bill, titled "The Clean Energy Technology Leadership Act of 2010," to provide tax incentives for clean energy manufacturing, renewable energy and conservation. 
 
 Kerry's bill will extend the excise tax credit for biodiesel and renewable diesel retroactively for 2010 and through 2012, according to a statement by Kerry's office on the content of the bill. "While we continue to fight to bring comprehensive energy legislation to the floor of the United States Senate, it's essential that we take action to start moving in the right direction," said Kerry. "Providing incentives for clean energy production will drive our economy forward and take us one step closer to reducing our carbon emissions and ending our dependence on foreign oil." 
 
 Also included in the bill are provisions to include algae-based fuels in the cellulosic biofuel tax credit, provide $3.5 billion more in clean renewable energy bonds, and a number of other energy efficiency-based incentives.

Kerry unveils new biodiesel tax extension bill

Posted Aug. 3, 2010
 
 A report recently published by the World Bank's Development Prospects Group argues that biofuel production has had a much smaller impact on food price increases than originally thought, but that the use of commodities by investment funds may have been partially responsible for the 2007/08 price spike. According to the report, titled "Placing the 2006/08 Commodity Price Boon into Perspective," a stronger link between energy and non-energy commodity prices is likely the dominant influence on development in commodity markets, especially food markets. 
 
 The report states that role played by biofuels in the commodity price spike of 2007/08 has been hotly debated, with some claiming that first generation ethanol and biodiesel production accounted for as much as two-thirds of the food price increase. Others have claimed there is little direct evidence that demand for ethanol and biodiesel feedstocks played any role in the price spike. 
 
 According to the World Bank's report, only 1.5 percent of the global cropland used to grow grains and oilseeds is used to produce feedstock for biofuels. "This raises serious doubts about claims that biofuels account for a big shift in global demand," said the Development Prospects Group in its report. "Even though widespread perceptions about such a shift played a big role during the recent commodity price boom, it is striking that maize prices hardly moved during the first period of increase in U.S. ethanol production, and oilseed prices dropped with the EU increased impressively its use of biodiesel. On the other hand, prices spiked while ethanol use was slowing down in the U.S. and biodiesel use was stabilizing in the EU."
 
 According to the report, while much debate has focused on the amount of food crops that have been diverted to biofuels production, less attention has been paid the issue of how energy prices provide a floor for agricultural prices. While the average price of crude oil between 1984 and 2004 was slightly more than $20 per barrel in real 2000 terms, the authors of the report note that most analysts and researchers now believe the new equilibrium price of oil will be between three and four times higher. In the long term, the report states that prices of other energy sources will increase at the same proportion. "If such assessment is correct, then high energy prices coupled with the high energy intensity of agricultural commodities imply that developments in non-energy (especially food) markets will depend strongly on the nature and degree of the price links between energy and non-energy commodities," said Development Prospects Group in its report.

Report: Biofuel not cause of food price spike 

Posted Aug. 3, 2010

 
 On July 29, the New York City Council unanimously voted to pass air quality legislation that will ensure all heating oil used within the city contains biodiesel. The legislation, which expected to be signed into law within two weeks, will require the use of a B2 blend of heating oil starting in October 2012. 
 
 "New York City has our heartfelt congratulations on once again demonstrating that the city is a leader in renewable energy," said Shelby Neal, state regulatory director for the National Biodiesel Board. "Already the largest municipal user of biodiesel in transportation applications, the city has now taken a progressive step towards cleaner emissions from heating the homes and buildings there…This move to Bioheat will also support green jobs and domestic energy security, and we hope New York City's progressive actions will encourage other cities serious about greening efforts will follow suit."
 
 The New York Oil Heating Association played an instrumental role in drafting the language of the legislation and moving it through the New York City Council, said NYOHA CEO John Maniscalco. "The New York Oil Heating Association is 100 percent in support of the legislation," he continued. "We worked long and hard to get this legislation passed. We're very pleased."
 
 Maniscalco estimates that approximately 10 percent of New York City's oilheat distributors currently supply a biodiesel blended heating oil to customers. One of those companies has been supplying their customer base with a 20 percent biodiesel blend for several years, he continued. According to Maniscalco, the two-year delay before the mandate goes into effect should provide the remaining oil dealers with ample time to upgrade distribution infrastructure to supply biodiesel blended fuels. 
 
 "New York City consumes 1 billion gallons of heating oil annually, more than any other city in the United States," said James F. Gennaro, chair of the New York City Council's Environmental Protection Committee. "Our legislation will annually replace 20 million gallons of petroleum with an equal volume of renewable, sustainable, domestically produced biodiesel. We are already home to what will be the largest biodiesel processing facility in the country as well as a growing grease collection industry, and we expect to see more and more green collar jobs and green economic growth as a result of our legislation."

New York City passes B2 oilheat mandate

Posted Aug. 3, 2010
 
 The Food and Agriculture Organization of the United Nations has joined the supporters of jatropha as a possible feedstock for biodiesel production. In conjunction with the International Fund for Agricultural Development, the FAO has published a report that outlines the benefits and uses of the crop, titled, "Jatropha: A Smallholder Bioenergy Crop." The report states, "Jatropha is an underutilized, oil-bearing crop. It produces a seed that can be processed into non-polluting biodiesel that, if well exploited, can provide opportunities for good returns and rural development." 
 
 Although most jatropha currently available remains toxic, the report said that jatropha could eventually, "evolve into a high yielding crop and may well be productive on degraded and saline soils in low rainfall areas," adding, "Its by-products may possibly be valuable as fertilizer, livestock feed, or as a biogas feedstock, its oil can have other markets such as for soap, pesticides and medicines, and jatropha can help reverse land degradation." 
 
 By 2015, the report estimates that 12.8 million hectacres of jatropha will be planted. Indonesia will be the largest producing country in Asia. In Africa, Ghana and Madagascar will be the largest, and in Latin America, Brazil will produce the most jatropha. The chief weakness of the plant however, is that it has "undergone little crop improvement," according to the report. Along with seed yield and oil quality variability, the toxicity of the plant, knowledge of the agronomy of jatropha "is generally lacking," the report said. 
 

 Increased investments and policy decisions on the use of jatropha as an energy crop are happening, the report notes, but they have been based on a small amount of evidence-based information. "There are many knowledgeable gaps concerning the best production practices and the potential benefits and risks to the environment," the report said, adding, "Identifying the true potential of jatropha requires separating the evidence from the hyped claims and half-truths." Although another potential biodiesel feedstock, palm oil, is currently being analyzed by the U.S. EPA and an expected pathway modeling assessment should come in the next few months, according to Cathy Milbourn, EPA's senior press officer, "EPA has not initiated any assessment of the lifecycle impacts of producing biofuel from jatropha oil."

FAO report: jatropha a promising crop

Posted Aug. 9, 2010
 
 Decatur, Ill.-based agri-business giant Archer Daniels Midland Co. posted solid quarterly earnings on Aug. 3, as improved demand and stronger margins in oilseeds and corn processing boosted results. Overall, ADM reported a net earnings increase of $388 million to $446 million for its quarter ending June 30. 
 
 ADM's Oilseeds Processing segment increased $132 million while crushing and origination results increased $77 million to $218 million. The company noted that refining, packaging, biodiesel and other results increased $58 million to $79 million for the quarter. ADM credited the expansion of its 54MMgy plant in Rondonopolis, Brazil successful in capturing favorable margins and volumes amid strong demand. 
 
 ADM's Agricultural Services segment increased $195 million for the quarter and decreased $326 million for the 12 months. In the quarter, ADM saw a good global supply of grains and oilseeds and modestly improving demand, particularly from Asia, where results of $62 million for the quarter reflected the company's share of Wilmar International Ltd.
 
 "The ADM team finished strong, capping a very good year with very good fourth-quarter performance," said Patricia Woertz, ADM's chairman of the board and chief executive officer. "As we begin our new fiscal year, our large projects are nearly finished, and we commit to use our strong balance sheet and cash flow to deliver shareholder value."
 
 As for BIOX Corp., the Canadian biodiesel producer posted methyl ester production for its third quarter at 14.4 MMly (3.8 MMgy) compared to 12.1 MMly (3.2 MMgy) the same quarter last year, which correlated with depressed operating profits at a loss of $5.6 million and $7.2 million for the three-month and nine-month periods respectively ending June 30, compared with $1.2 million and $4.8 million for the corresponding periods in 2009. Overall, the company reported a net loss of $6 million in its third quarter this year compared to $1.5 million last year. 
 
 Biodiesel sales for BIOX was at $6.6 million and $33 million respectively for its three-month and nine-month periods ending June 30 compared to $10.8 million and $32.8 million for the corresponding periods in 2009. According to its earnings report, BIOX said that the change in sales was primarily a result of the impact of the $1-per-gallon biodiesel tax credit, which expired December 31, 2009. During the quarter, BIOX said it "sold biodiesel that included $1.6 million of contingent revenue that cannot be recognized unless/until the U.S. biodiesel tax incentive is reinstated retroactively". 
 
 As an obligated party under the registration of renewable identification numbers (RINs) for biodiesel in accordance with the RFS2 requirement implemented in July for biomass-based diesel, BIOX said that it intends "to be opportunistic in its sales approach in the near term and sell its biodiesel when prices warrant, and will otherwise store biodiesel for sale at a future date anticipating higher values as a result of the implementation of RFS2 and/or the reinstatement of the biodiesel tax incentive".

 
 Additionally, BIOX submitted two applications to Natural Resources Canada to build a 67MMly (17.7 MMgy) facility in Hamilton, Ontario and another in Montreal in the ecoENERGY for Biofuels program. The company said that the Hamilton project has "progressed to a full merit-based assessment based on its advanced state of readiness". BIOX currently operates a 60MMly (15.8 MMgy) biodiesel plant in Hamilton. 
 
 "The longer-term market dynamics for renewable fuels is becoming increasingly clear with the implementation of RFS2 in the U.S.," said BIOX President and CEO Tim Haig. "Over the coming months we expect to see the fundamentals for biodiesel demand gain traction now that traditional refiners and importers are obligated to actively participate in the biodiesel market in order to meet the requirement to blend 1.145 billion U.S. gallons in 2010 and 2011."

ADM, BIOX Corp. report quarterly earnings

Posted Aug. 3, 2010
 
 New Orleans-based nonprofit Operation Reach Inc. is seeking $25,000 in funding from the Pepsi Refresh Project Do Good for the Gulf program to support a local biodiesel education project. The initiative, titled the "Gulfsouth Youth Biodiesel Project," provides green job training to young people between the ages of 16 and 24 who reside low-income communities in the New Orleans area. Members of the public can <a target="_blank" href="http://gulf.refresheverything.com/youthbiodiesel" rel="external">vote</a> on the Pepsi website for their favorite project. Up to 10 projects that receive the most votes will be awarded funding. 
 
 The goals GYBP of the program are to:
 - Provide green job training to at least 50 youth participants, with a minimum 65 percent job or education program placement rate for graduates
 - Produce 10,000 gallons of biodiesel for use by local diesel fleets

 - Recycle 10,000 gallons of used cooking oil per month
 - Conduct outreach to educate at least 500 community members about biodiesel
 
 According to Hamilton Simons-Jones, Operation Reach's chief development officer, the GYBP is now in its second year. "We originally formed this project about a year and half go to accomplish two things," he said. "One is to be a small, biodiesel social enterprise that converts used cooking oil into biodiesel fuel as a …local/regional business run by the nonprofit. The second is to develop green job training…and [expose local] youth to biodiesel…and really use that [experience] as an introduction not only to overall environmental awareness, but also more concrete job training."
 
 Students attend the training program 4 hours a day, 5 days a week. According to Simons-Jones, the program has attracted a wide variety of participants. Some have some college-level training, he said. Others are high school drop-outs who are participating in the program while earning their GED. "We really have a pretty kind of broad spectrum of folks, but most of them haven't had success in the traditional workforce," he said. 
 
 The GYBP program graduated its first class of 15 students in April, and the next class of students will begin the program this fall. According to Simons-Jones, the first class of students actually helped assemble the teaching facility, which includes a biodiesel plant. The experience allowed the participating students to earn a construction certification through the National Center for Construction, Education and Research. "[The students] received instruction on pipe fitting, plumbing and carpentry," Simons-Jones continued. "They were a part of helping us build out this teaching facility that produces biodiesel, and then learning about how that all works as well, of course." Depending on the amount of funding that is received, approximately 30 students will be able to participate this fall. 
 
 According to Simons-Jones, the education program is divided up into four modules. One features information on the science behind biodiesel production. "They get to understand the chemistry of it, and they actually get some hands on exposure to producing biodiesel," he said. The technical component of the program also includes information on plant safety, and quality testing. 
 
 The second module of the program allow students to gain a better understanding of climate change, where fuels come from, the challenges of continued dependence on fossil fuels, and the benefits of renewable energy. The third module includes training on business planning and management, including marketing, research, advertising and sales. The final module involves community leadership training, public and persuasive speaking, and is designed to provide students with the skills necessary to educate the community on the benefits of renewable energy sources, such as biodiesel. 
 
 There are not many biodiesel jobs in New Orleans right now, said Simons-Jones. While some students have found work at Operation Reach's biodiesel plant, others have used the program as a stepping stone to pursue bachelor or technical degrees in the renewable sector. "We try to prepare them for a number of different pathways, not just biodiesel, since there are not enough [biodiesel] jobs right now in New Orleans," he continued. 
 

 Another component of the program involves more basic educational outreach to community members and students at local high schools. "We are actually working right now with Louisiana Technical College, which has been a great partner with us to be able to offer [this training] as a course open to any student in the community," Simons-Jones said. "We've also had a lot of interest from high school teachers to help them incorporate [some biodiesel training] into their chemistry and science curriculum."
 
 Operation Reach's biodiesel plant is currently producing about 100 gallons per day of biodiesel manufactured from recycled cooking oil. Simons-Jones said the organization is currently working to refine its production process, and plans to scale up to producing approximately 500,000 gallons per year. If awarded, $5,000 of the $25,000 in funding will be used to purchase safety materials and tools for the program's participants. The remaining $20,000 would be used to purchase a biodiesel processer and a vacuum truck for collecting used cooking oil.

Program trains low-income youth on biodiesel 

Posted Aug. 3, 2010
 
 Northeast Biodiesel LLC and Co-op Power held a groundbreaking event for the construction of a 3.5 MMgy biodiesel plant in Greenfield, Mass. Led by majority shareholder Co-op Power, the cooperative effort invested $2.5 million into the development of the plant. 
 
 "The two key factors enabling us to move forward now are technology changes permitting production of biodiesel at smaller scales and the patience of our investors," said Larry Union, president and chief executive officer of Northeast Biodiesel LLC. The company will initially install a single 1.75 MMgy processing unit with plans to add an additional unit by 2012.
 
 The facility, which will exclusively use recycled vegetable oil from local restaurants for the production of biodiesel and home heating oil, is expected to be in full operation by January 2011, according to Lynn Benander, chief executive officer of Co-op Power and board chairwoman for Northeast Biodiesel LLC. 
 
 "I know we're going against the grain right now given the state of the industry without the producer tax credit," Benander said, "Northeast Biodiesel is a community-owned recycled oil biodiesel plant that will bring significant benefits back to our community – environmental, economic and social." 
 
 Co-op Power is a member-owned cooperative founded in 2005 to create community-owned renewable energy across the Northeast. With 375 members, Co-op Power applied $135,000 of its $300,000 member equity coffers towards the development of the biodiesel project while leveraging $1 million from 24 investors.

Northeast Biodiesel LLC and Co-op Power broke ground on its 3.5 MMgy biodiesel plant in Greenfield, Mass. Pictured l-r: Greenfield Mayor Bill Martin, Mass. State Senator Stan Rosenberg, Northeast Biodiesel LLC CEO Larry Union, Co-op Power CEO Lynn Be

2126-1294332262.jpg

Biodiesel plant breaks ground in Mass.

Posted Aug. 10, 2010

 
 The Iowa Central Fuel Testing Laboratory is the first to reach gold. The Fort Dodge-based facility is now the first-ever BQ-9000 accredited laboratory after completing roughly ten months of certification. Overseen by the Independent National Biodiesel Accreditation Commission, BQ-9000 is a voluntary, gold standard fuel assurance program for producers and marketers. For a producer, the program means the production company is using the system to monitor the quality of their biodiesel, including: sampling, testing, storage, retain samples and shipping. 
 
 "Biodiesel producers should just think of us as any other fuel testing laboratory. Send us a couple liters of sample (more or less depending on the tests wanted) and expect results within a few days for all the ASTM D6751 tests," said Don Heck, ICTL director. The Iowa facility, located on the campus of Iowa Central Community College, is however, not the average testing laboratory. People don't necessarily associate a community college with state-of-the-art laboratories, Heck said, but the new accreditation backs that up. With the support of Iowa Senators Chuck Grassley, R-Iowa, and Tom Harkin, D-Iowa, along with Rep. Tom Latham, R-Iowa, the facility was able to secure more than $2 million in funding. 
 
 One of the main benefits from the new testing facility is the partnership with the Iowa Department of Agriculture's Weights and Measures Bureau; the department responsible for ensuring fuel standards remain high. "The partnership is unique as many in the biofuel industry and many in the quality control industry recognize the need for efficient fuel quality testing, but the resources aren't always there," Heck said. "Our partnership gives a low-cost solution that allows for an expanded testing program by the state." 
 
 While the lab is already helping special projects with standard instruments, the facility also offers "uncommon" instruments like a gas chromatograph coupled with a mass spectrometer. "We purchased that to help out with special projects like filter residue testing." Heck said ICTL has also helped a group from Iowa State University identify some compounds in their samples of green diesel which in turn helped them trouble-shoot their production process. "We not only want to provide routine testing but we also want to provide additional lab support for those in the renewable fuels industry who can benefit from it." 
 
 The facility also tests blends under the specs D7467 and diesel specs D975, and is currently working on instrumentation for ethanol testing. To finish the 10 month certification process, Heck said the ICTL brought in an outside consultant to help with the Quality Manual, a document outlining the program. The manual includes procedures on how to handle documents, receive and process samples, record and manage data, maintain and calibrate instruments and how to address problems, according to Heck. "All in all it was a fair amount of extra work, but a very do-able program for us," he said. 
 
 ICCC vice president, James Kersten said the school's relationship with several groups including the Iowa Soybean Association, Iowa Biodiesel Board, National Biodiesel Board, along with state and federal governments, is a key to the success of the facility. "Without the help of all those folks, the lab would not be a reality."

Iowa lab becomes the first-ever BQ-9000 site

Posted Aug. 10, 2010
 

 Bioenergy crop company SG Biofuels Inc. recently announced plans to establish a jatropha research and development center in San Diego. The center will include a 42,000 square-foot greenhouse, world class laboratory facilities and a team of molecular biologists. According to Brian Brokowski, SB Biofuels' vice president of marketing and communications, the facility is expected to be operational this fall. 
 
 The greenhouse will help accommodate the company's library of jatropha genetic material, which currently includes more than 6,000 unique genotypes and a vast array of jatropha genetic traits, including those for enhanced yield, soil adaptation and improved harvesting. "The foundation of any crop improve program…is having a diverse and extensive library of genetic material," Brokowski said. "We've developed the world's largest collection of jatropha material, and that collection has tremendous variety of traits and characteristics that are helping us to breed and develop stronger elite varieties of the crop."
 
 Research at the new center will focus on combining advanced breeding with biotechnology applications. "Our San Diego center will allow us to continue our breeding efforts to breed the best and strongest traits into the jatropha and it will also provide us the opportunity to incorporate biotechnology," said Brokowski. We have a partnership with a San Diego company that is currently working to sequence the jatropha genome, he continued. "With the sequence of the jatropha genome we'll be able to even much more quickly identify and develop traits that improve jatropha," he said. 
 
 The San Diego center will also serve as a hub for a global network of crop improvement centers. According to Brokowski, SG Biofuels currently operates several centers in Central America, including one in Guatemala. "We are also developing a center right now in Hawaii and we are working to develop centers in a number of other locations, initially in Latin America, but also expanding beyond Latin America into other parts of the world where jatropha currently grows," Brokowski continued.
 
 SG Biofuels released JMax 100, its first elite cultivar of jatropha, earlier this year. According to Brokowski, JMax 100 was developed though SG Biofuels' JMax platform and is optimized for growing conditions in Guatemala. "The projected yields are 100 percent greater than what we have seen with existing commercial varieties," he said. 
 
 We are focused on developing jatropha as a low-cost feedstock for biodiesel that is economically viable and profitable, said Brokowski. "Right now, with our first lead varieties of jatropha, we can produce crude jatropha oil for about $1.40 per gallon," he continued. "Though additional crop improvements, we are driving towards a production costs approaching $1 per gallon."

Jatropha R&D center planned for San Diego

Posted Aug. 11, 2010
 
 Best BioDiesel Cashton LLC, a subsidiary of Madison, Wis.-based Best Energies Inc., shut down operations at its 8 MMgy facility in Cashton, Wis., citing the lapse of the federal blender tax credit as the determining factor behind the decision. 

 
 Best BioDiesel Cashton filed for Chapter 128 receivership in late April in Monroe County Circuit Court to Milwaukee-based law firm Beck, Chaet, Bamberger & Polsky S.C. The plant had eight employees when it closed. Production began in December 2007, but the facility hadn't produced biodiesel since the end of March. The plant, which had 20 full-time employees at the time, subsequently laid off additional workers when it approached receivership, according to Laxson Boyd, principal for Wadsworth Whitestar Consultants, a turnaround consulting firm assigned to oversee operations and market the plant for sale that was retained by BCBP. 
 
 "Essentially, we had been operating since the receivership that was filed back in late April under the assumption and certainly with the hope that the biodiesel credit would come back and, had it come back, it was the intent of the receiver and of the bank that is providing financing to the receivership to restart the facility so that we would be selling an operating biodiesel plant as opposed to an idled plant," Boyd told Biodiesel Magazine. 
 
 The plant initially used soy oil as feedstock but in 2009, Best Energies installed esterfication units for transitioning to using crude corn oil collected from various ethanol producers in the region. In 2008, Best Energies formed a partnership with Golden Grain Energy LLC, an 80 MMgy ethanol plant in Mason City, Iowa, to create a new entity called Corn Oil Bio-Solutions LLC that intended to extract corn oil from ethanol plants for biodiesel production. The extraction unit utilized proprietary technology owned by Best Energies.
 
 Boyd said there are prospective suitors interested in taking over operations of the Cashton biodiesel facility, but a decision from a potential buyer to purchase the plant would ultimately rest on if/when the biodiesel tax credit will be reenacted. 
 
 "Frankly, I think that a lot of them are also sitting on the sidelines waiting to see what's going to happen with the tax credit," Boy said. "It's very difficult for us to move prospective buyers to being actual buyers when they're in the same position we were in, and that's waiting to see what Congress is going to do with the tax credit. We're hopeful that we'll be able to bring the plant to sale relatively quickly in the absence of the tax credit.

Best BioDiesel Cashton plant shuts down

Posted Aug. 11, 2010
 
 Renewable Energy Group Inc. will celebrate the grand reopening of its Seneca, Ill-based biodiesel plant on Aug. 12. The 60 MMgy facility was acquired by REG in April after its original owner, Nova Biosource Fuels Inc., filed for bankruptcy. 
 
 According to REG President and COO Daniel Oh, the facility had been idle for more than a year. "Since we acquired the property in April, we've been through a really detailed inspection, renovation, retrofit and repair/upgrade program," he said. "The facility is, by design, generally as you'd expect, but we've made a lot of operational and other improvements as we've moved along."

 
 The facility includes three side-by-side 20 MMgy biodiesel processing units, a technical grade glycerin refining facility, raw material and finished product storage, and railcar and truck unloading and loading. There is also potential for barge transportation. "One of the excellent things about this facility is that it produces a technical grade glycerin that is roughly 98 percent pure," Oh said, noting that REG Seneca LLC is REG's only facility capable of producing refined glycerin. "This was a large investment for us, and one of the features that mattered to us was this capability," he continued. 
 
 To date, 38 full-time employees have been hired to work at the Seneca plant. "They are excellent jobs," Oh said. "In general, I describe them as family-wage, green collar, skilled positions." The population of Seneca approximately 2,000, so the reopening of the plant is expected to have a significant impact on the local economy. Oh also notes that additional jobs will be added as REG continues to bring production online at the facility. 
 
 Feedback from the local community has been very positive, Oh said. "The local village leadership, the business community, and the folks that did business with the plant previously have all recognized that REG is an excellent business partner and have been supportive of us as we've moved in," he said. Oh also noted that the state of Illinois has been very supportive of the biodiesel industry. "The support that [the state] has provided though the sales tax abatement has continued to support the industry and provide an outlet for product, and probably more importantly create a great biodiesel infrastructure for distribution and sales," Oh continued. Biodiesel produced at the facility will also aid Chicago in reducing air emissions. "The city is very focused on that, as was the state [of Illinois] as we interacted with them on this facility…We're excited to get this plant up and running, making and selling product."
 
 Thursday's grand reopening festivities will include several speakers, as well as tours of the facility and networking opportunities. At approximately 8:30 a.m., REG will celebrate the first load of biodiesel sold at the facility. The event will officially kick off at 10:00, with comments from REG CEO Jeff Stroburg, state congresswoman Debbie Halvorson, representatives of the Illinois governor's office and Illinois Farm Bureau, as well as several other local politicians and business leaders.

REG celebrates reopening of Seneca plant

Posted Aug. 11, 2010
 
 In our history, the biodiesel tax credit has been one of the most successful pieces of energy legislation, said Joe Jobe, CEO of the National Biodiesel Board. Jobe, along with Congressman Roy Blunt, R-Mo., spoke during an energy round table press conference, both expressing support for the reinstatement of the tax credit. "Somebody once said that everything should be as simple as possible, but no simpler than possible," Blunt said at the press conference. "Our goal with this should be to calculate the timing out so that we get these American jobs and this American industry to where it becomes an ongoing part of the energy picture."
 
 That picture, in case anyone needs reminding, has been bleak since the expiration of the tax credit on December 31, 2009. According to Jobe, a "significant" number of plants have shuttered, shut down or gone into idle mode while waiting for the reinstatement of the credit. 
 
 Blunt however said a short term plan for the industry is not the answer. "We can no longer have short term tax credits. We need to think about how long it will take for this industry to become a stable part of the ongoing energy future of the country," adding, "I think we all understand how dangerous and foolish it is to be needlessly dependant of people who don't like us, but its economically almost as foolish to be dependent on other economies for something you produce in your own economy."
 

 Both Jobe and Blunt noted that U.S. production of petroleum-based transportation fuel has seen government support for well over 50 years. When asked if the biodiesel credit should just expire Blunt responded, "Clearly that's not the case." We should be trying to calculate that moment when the industry can stand on its own, he added, "but we don't want to get their sooner then we should." Blunt has previously voted against a bill that would reinstate the tax credit, citing other tax provisions as the main deterrents for voting yes.

Jobe, Blunt promote biodiesel tax credit

Posted Aug. 11, 2010
 
 A report recently published by New Zealand Parliamentary Commissioner for the Environment Jan Wright calls for a more strategic approach to biofuels development within the nation. The report, titled "Some biofuels are better than others: Thinking strategically about biofuels," addresses the pros and cons of various biofuels. According to Wright, in order for biofuels to play a significant role in New Zealand's energy future, drop-in biodiesel made from wood must be developed. 
 
 The report states that New Zealand should focus on diesel replacements rather than gasoline replacements. "We run our trucks, tractors and fishing boats on diesel, and, if we are concerned about energy security, diesel is more important than petrol," said Wright in the report. The New Zealand gasoline market, by comparison, is more flexible. 
 
 Approximately 1 million liters (264,000 gallons) of biodiesel is currently sold in New Zealand. According to the report, 100 percent of the biodiesel manufactured by the nation's local producers is made from tallow, canola oil and used cooking oil feedstocks. However, the report also states that the local processing capacity for biodiesel is very limited, access to feedstocks is limited, and building new facilities poses significant economic and commercial challenges. 
 
 Even if the production of traditional biodiesel could be ramped up significantly, the report noted that heavy vehicle manufacturers usually only support the use of biodiesel in low-percentage blends, such a B5. If biofuels are to comprise a substantial portion of the New Zealand fuel market, the report states that the country needs more plentiful feedstock sources and compatible drop-in fuels that won't be limited in their blend percentages. 
 
 According to the report, hydrogenated renewable diesel and hydotreated renewable jet fuels have potential as drop-in fuels. However, since they are produced using traditional biodiesel feedstocks, they are still subject to feedstock constraints. The report also states that there is some potential for the produce of "green crude" from algae, but those technologies are currently facing significant scale-up limitations. In addition, the report also notes a great deal of potential in New Zealand to produce biodiesel from wood using the Fischer-Tropsch process. 
 
 In conclusion, the report states that New Zealand has a great deal of biofuel production potential, but that the outlook for first-generation production is limited. There are simply not enough fats, oils and fermentable materials within the country to produce large volumes of traditional biodiesel and ethanol, said the report. While production of these first-generation fuels should continue to be encouraged, greater utilization of biofuels within New Zealand will ultimately depend on the development of drop-in substitutes.

Potential for drop-in biofuels in New Zealand

Posted Aug. 12, 2010

 
 Alfa Laval, a leading heat transfer, centrifugal separation and fluid handling company, has acquired the remaining shares in the Swedish biodiesel company Ageratec AB. Ageratec will be fully integrated into Alfa Laval and the company stated it will become an application center for biodiesel in the market unit vegetable oil technology segment, located in Norrkoping, Sweden. 
 
 "The integration of Ageratec is in line with our strategy to strengthen our position within the biodiesel industry," stated Bent Sarup, market unit manager, vegetable oil technology. "We see very good synergies between Ageratec's skid mounted turn-key biodiesel plant concept and our pretreatment process technologies for biodiesel. We are confident that the full integration of Ageratec will create good opportunities for the future." 
 
 Ageratec, founded in 1998, is a technology provider of modular biodiesel plants scalable for capacity of 1 to 90 gallons (2 to 340 liters) per day. The plants are built to industrial quality standards, capable of producing ASTM or EN compliant biodiesel. Feedstocks include a broad range of fats and oils, with a clear focus on inedible feedstocks having a high-fatty acid content (up to 100 percent free fatty acids) offering superior cost advantages to the buyer. 
 
 SOURCE: ALFA LAVAL

Alfa Laval acquires Ageratec

Posted Aug. 16, 2010
 
 New Mexico Gov. Bill Richardson recently announced that $200,000 in Recovery Act funding has been awarded to New Mexico State University. A portion of that funding will go to the university's Renewable Energy, Water and Arid Lands Task Force to support an algae biodiesel project. 
 
 According to Abbas Ghassemi, NMSU professor of chemical engineering and director of the university's Institute of Energy and Environment, the algae project will include the development of test beds that will be used to evaluate several algae strains. The facility that will house the project is currently undergoing renovation. "It is a greenhouse facility we had on campus," Ghassemi said. "It's under renovation to be able to include the indoor raceways…and the rest of the equipment."
 
 As part of the project, researchers will be evaluating several aspects of algae production, including yields, harvest methods, extraction and performance. The project will also include research into the effects of environmental factors, such as temperature and water quality, on algae growth and performance. "Our intent is to look at the species that are out there that have the promise for growth and development in the environment [where algae biofuels facilities are most likely to develop]," Ghassemi said. "The species that we are interested in are going to be species that are…tolerant to…brackish water." 
 

 While the projects findings will likely be most beneficial to those looking to develop algae biofuel projects in New Mexico, Ghassemi said that most areas in the Southwest have similar environmental conditions and water chemistry. "The state of New Mexico would be the primary [region to] benefit from the [project], but that doesn't mean that other places that have similar water chemistries and similar environments won't be able to benefit from it." Ghassemi also notes that the funding for this project was acquired through NMSU's International Relations Institute, which works to transfer research findings around the globe.

New Mexico algae project receives funding

Posted Aug. 16, 2010
 
 Employees at the Enterprise, Ala., Public Works Facility can add a new duty to their job descriptions: biodiesel production. After 15 years of development, the city officially announced its new biodiesel facility is up and running, with major supporter Gov. Bob Riley in attendance. 
 
 Businesses such as the Greenside Grill, McDonald's, and the local high school will all provide waste cooking oil to the plant, helping the community-scale biodiesel refinery scaled at 70,000 gallons a year secure local feedstock. The plant will only run at 30 percent now, however, producing about 21,000 gallons of biodiesel per annum. 
 
 The plant has already received a $300,000 grant from the Alabama Department of Economic and Community Affairs, and anticipates partnering with surrounding communities for feedstock access and fuel supply agreements. 
 
 "By aggressively pursuing grants through ADECA and Governor Bob Riley's assistance, we were able to turn this concept into reality," Enterprise Mayor Kenneth Boswell said. Rather than throw waste grease down the drain, Rachel Davis, special projects coordinator for the city said they'll take the material that was once considered waste and turn it into biodiesel. Davis said doing so will reduce costly sewer repairs and "save the tax payers future dollars." 
 
 The city fueling station, which provides fuel for 85 city diesel fleet vehicles, six mental health and seven rescue squad diesels, will now carry B20 for those same vehicles. 
 
 "This is a great milestone," Boswell said, adding, "I look forward to the many benefits it [will] offer our residents." The plant will use existing space at the current public works facility including donated storage tanks. Previously used as a recycling center, the new plant will now collect waste cooking oil for biodiesel production and Boswell hopes the city can set up other oil collection sites. Davis estimates each gallon of biodiesel will cost about $1.10 to make.

Alabama's newest plant opens in Enterprise

Posted Aug. 17, 2010

 
 Looking to bolster its biodiesel footprint in Latin America, Cargill Inc.'s Argentinean operating branch Cargill Argentina (Cargill SACI) invested $112 million towards the cost of building a 240,000 metric-ton (72 MMgy) biodiesel plant in the rich soybean-growing region of Villa Governador Galvez within the Santa Fe Province in Argentina. 
 
 In addition to the biodiesel facility, Cargill intends to build an 18 megawatt co-generation plant on site with the biodiesel facility. Both projects are slated to come online in September 2011.
 
 "Both projects clearly ratify Cargill's confidence in the potential of the Argentine agribusiness industry and the role of our country in the international trade, demonstrated by over $500 million of investments made by Cargill in the period '04-'09, through the building of new processing plants and ports as well as joint ventures with highly renowned local enterprises, all of these focused on adding value to the national agribusiness production thus improving Argentina's competitiveness in the international market ," said Hugo Krajnc, president of Cargill Argentina. 
 
 The biodiesel plant will be located next to a Cargill-owned port terminal that will use soy oil originating from its 13,000-ton-per-day soybean processing plant in Santa Fe, Cargill's largest soybean processing complex in the world. Cargill employs 4,000 workers in Argentina in 50 locations and its assets include export terminals, country elevators, malt plants, oilseed crushing plants, beef processing plants and four mills.
 
 According to Cargill, it's estimated that the investment in goods, machinery, equipment and services of local origin represent approximately 77 percent of its total investment amount towards the projects. Additionally, approximately 90 percent of the production from the future plant will be exported to China, Spain, Peru, Egypt, Brazil, the Netherlands, India, South Korea, Malaysia and Chile, according to the company. 
 
 In July, Argentina lifted the required mix of biodiesel in its diesel fuel pool to B7 from B5. The increased mandate to a B7 blend is anticipated to launch in September.

Cargill to build biodiesel plant in Argentina

Posted Aug. 17, 2010
 
 The European Commission launched an investigation into imports of U.S.-based biodiesel to Europe as it seeks to find out if anti-dumping measures that were imposed on the U.S. in March 2009 are being circumvented. Specifically, the EC intends to probe into whether U.S.-based biodiesel containing B20 or higher blends entering European ports are honoring imposed duties. B19 blends are not covered by last year's tariffs, according to the European Biodiesel Board, whose members produce 80 percent of the region's fuel. 
 

 According to the EBB, new patterns in the transatlantic biodiesel trading regime emerged followed by an imposition of anti-dumping duties, with U.S.-based biodiesel being increasingly shipped to the EU through other countries, mainly Canada and Singapore, in order to conceal its origin. The EBB also asserts that substantial volumes of U.S.-based biodiesel continue to flood into European ports in the form of blends-typically B19--not covered by the EU duties and practices in which "are a mere attempt to evade the anti-dumping and countervailing duties," the EBB said in a statement. 
 
 Following an EBB legal action, the EU imposed five-year tariffs on U.S.-based biodiesel in March 2009 to help EU producers counter subsidized American biodiesel imports. The anti-circumvention investigation comes after the EBB lodged a complaint in June. 
 
 Initiated on August 12, the anti-circumvention action by the EU is backed by a parallel investigation by the EU Anti-Fraud Office (OLAF) "in order to put an end to these unacceptable trade practices which may represent more than 100 million Euros ($129 million) of unpaid import duties," the EBB said. In the event that fraudulent practices persist, unpaid duties would be collected by EU authorities retroactive three years and heavy financial penalties would be attached. 
 
 "The EBB is strongly committed to ensure that the EU duties are not undermined by unfair and artificial trade practices," said EBB Secretary General Raffaello Garofalo. "We are urging EU authorities to extend the scope of the established trade measures in order to remove the injury caused to European biodiesel producers by circumvented U.S. biodiesel." 
 
 Italian customs authorities seized 10,000 metric tons (approximately 3 million gallons) of biodiesel at the ports of Venice and Trieste in March. The product was declared as Canadian origin, but the EBB stated at that time that "strong evidences" signaled that it instead originated from the U.S. The product was namely offered at a discount of $150 to $180 per ton (50 to 60 cents per gallon) compared to EU biodiesel of comparable quality, and at a lower price than soybean oil and rapeseed oil. 
 
 As a result, the EBB concluded that material evidences such as this only corroborate its claims that biodiesel trading regimes currently taking place are part of a wider transatlantic shipment traffic aimed at evading EU anti-dumping and anti-subsidy measures on U.S.-based biodiesel.

EC launches anti-circumvention investigation

Posted Aug. 18, 2010
 
 New York City Mayor Michael Bloomberg has officially made the Big Apple and biodiesel-blended heating oil synonymous. During an official signing in the Blue Room at City Hall, Bloomberg signed Intro 194-A, requiring all grades of heating oil sold in the city to contain at least 2 percent biodiesel starting in October 2012. "I actually call it sexy," said Danny Falcone, wholesale manager for Ultra Green Energy Services LLC. There's no denying this looks good to the industry, Falcone said.
 

 Three weeks earlier, the New York City Council unanimously voted to pass legislation, originally sponsored by Chairman of the New York City Council Environmental Protection Committee, James Gennaro, requiring all heating oil to contain biodiesel. Now, according to Brent Baker, CEO of Tri-State Biodiesel LLC, the official legislation symbolizes the end or era marked by misinformation surrounding biodiesel. 
 
 "Early on they asked me if it was true what they say about biodiesel," Baker told Biodiesel Magazine in regards to governing officials weighing the facts on biodiesel nearly four years ago. "It's been a long time coming," he added, "but when the Mayor's office came on board, it was a clear signal that they got it." 
 
 During the ceremony, Bloomberg said the legislation will "significantly reduce pollution, promote the use of alternative fuels, create new 'green' jobs and vastly improve air quality throughout the city." The legislation, Bloomberg added, will promote cleaner burning heating fuels, helping the city to meet air quality initiatives from PlaNYC 2030. John Maniscalco, CEO of the New York Oil Heating Association, has said that approximately 10 percent of the city's oil heat distributors currently supply a biodiesel-blended heating oil to customers. The two-year delay, Maniscalco said, should provide the remaining oil dealers with enough time to upgrade biodiesel distribution infrastructure.
 
 "If we have the ability to do this in New York City, it should be a sign to every other city and every other state that this can work," Falcone said. Consistency in the language and factual information used to describe biodiesel is important to ensuring the fuel's place in the future, Falcone continued. "As an industry," Baker said, "we've experienced a major bump in the road, but this bill is a validation for biodiesel in the state of New York and the industry."

New York City Mayor Michael Bloomberg signs Intro 194-A into law, requiring that all heating oil sold within the city contains at least 2 percent biodiesel. The regulation will take effect in October 2012. 

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Bloomberg signs biodiesel bill

Posted Aug. 18, 2010
 
 BlueFire Ethanol Fuels Inc. has changed its name to BlueFire Renewables Inc. According to the company, the new name and rebranding more clearly illustrates its capability to produce a variety of biofuels, including ethanol, biodiesel, bio jet fuel and drop-in fuels. BlueFire Renewables will continue to trade under the ticker symbol BRFE.OB.
 
 While BlueFire is focusing on ethanol production in the short-term, the company's President and CEO Arnold Klann noted that BlueFire's technology is ultimately a sugar production process. "What we do is take any type of cellulosic material and break it down into its constituent components using concentrated acid hydrolysis," he said, resulting in 5-carbon and 6-carbon sugars. Once the sugars are recovered from cellulosic feedstock by BlueFire's technology, they can be converted into a variety of fuels using third-party back-end technologies. "Our technology, because we have that intermediate step of pure sugars, can produce other chemicals besides just ethanol," Klann said. "That's what makes our technology unique and different from most others." 
 
 BlueFire is currently in the process of developing two facilities, a 3.9 MMgy plant in Lancaster, Calif., and a 19 MMgy plant in Fulton, Miss. According to Klann, the Fulton plant will be dedicated to cellulosic ethanol production. The California facility will also initially produce ethanol. "However, Lancaster was designed…to be able to add on other companies' technologies on the back-end to produce other fuels as a commercial demonstration project," Klann said. "Overtime, I see that [facility] evolving from ethanol production to biodiesel or some other product."

 
 According to Klann, the flexibility offered by BlueFire's technology is advantageous. "Because our technology is a sugar producer for all intents and purposes-a cellulosic sugar producer-we can adapt very quickly to the marketplace," he said. "It really reduces the risks of the company…because we have the adaptability to go into other markets and other products." 
 
 While the U.S. has a strong market demand for ethanol, that is not the case in many other parts of the world. "With our ability to produce other fuels, it opens up the worldwide market for us," Klann said. "It allows us to build plants in other countries and supply products that would work in their existing fuel infrastructure."

BlueFire rebrands, changes name

Posted Aug. 19, 2010
 
 Broomfield, Colo.-based cellulosic ethanol and biochemical company Range Fuels Inc. has successfully produced the first batches of cellulosic methanol at its facility near Soperton, Ga. using non-food biomass. The Soperton plant is currently in its initial phase of development. 
 
 Though specific output volumes and rates of production weren't disclosed, President and CEO David Aldous told Biorefining that production of its cellulosic methanol yielded promising results. "While sections of the plant have run above nameplate capacity and provided encouraging results, the total process has not yet come up to full design run rates," Aldous said. "This is typical for early runs on first-of-a-kind technology."
 
 To produce cellulosic methanol and ethanol, Range Fuels employs an innovative two-step thermochemical pathway that uses appropriate amounts of heat, pressure and steam to convert non-food biomass, such as woody biomass and grasses, into a synthesis gas--or syngas--composed of hydrogen and carbon monoxide. From there, the syngas is passed over a proprietary catalyst to produce mixed alcohols that are separated and processed to yield a variety of low-carbon biofuels, including cellulosic ethanol and methanol.
 

 According to the company, the cellulosic methanol produced from its first phase of operations has attracted buyers; however Aldous declined to disclose who those customers are. "We have buyers for the methanol as well as for the ethanol from the plant, but information on customers is confidential," he said. 
 
 Range Fuels intends to begin production of cellulosic ethanol during the third quarter of this year. The company initially plans to use woody biomass collected from nearby timber operations as feedstock. Plans are to integrate other types of renewable biomass feedstocks such as miscanthus and switchgrass as well. The company plans to expand the plant's capacity to 60 MMgy by summer 2011. The plant is permitted to produce a maximum nameplate capacity of 100 MMgy. 
 
 In addition to cellulosic methanol and ethanol products, Range Fuels intends to broaden its revenue stream by providing saleable byproducts such as biochar, which it sells as combustion fuel, according to Aldous. "We're also exploring its use in other higher-value applications such as carbon dioxide sequestration and in agricultural applications," he said. "The process also produces higher alcohols and we'll evaluate markets for these products as we continue operations."

August 2010

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Mergers and Acquisitions in the Biodiesel Industry

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Business Briefs

Business Briefs

Columns

Small-Scale Success Stories

Collaboration Agreements-Agree Now or Fight Later

We're Small-Scale and Growing

Featured

The Resilient Community Producers

Mergers and Acquisitions in the Biodiesel Industry

August 2010