Posted Nov. 1, 2010
 
 Bio-NRG LLC is moving forward with plans to construct a new biodiesel plant in LaHarpe, Ill. The facility, which will be operated under the name LaHarpe-NRG LLC, will have an estimated production capacity of 15 MMgy. 
 
 According to Bio-NRG President and CEO Jon Hall, the new facility has been uniquely designed to be economically feasible. "Over the past three or four years…we spent quite a bit of time, as a group, researching the different companies that were out there; those that were successful and those that had faced challenges," he said. "Based on those case studies that we did, we learned a lot of things that some folks did wrong, and we found out some things that folks did right. We're not interested in reinventing the wheel; we just wanted to make it roll a little smoother, so to speak."
 

 As a result, the business model for the LaHarpe plant has been designed to be a vertically-integrated biorefinery. "It's actually a bit more complete in that we involve three arms in this business model, Hall said. "Obviously, we have our production facility for our fuel, which involves technology that is a very true multi-feedstock process. We also do our own oil seed crushing, which helps provide us with our feedstocks. We also work within research and development, and right now we are primarily focused on algae development. So, it's kind of a three pronged approach." As for selling the resulting fuel, Hall notes that Bio-NRG is targeting government and military markets rather than consumer fuel markets. 
 
 The city of LaHapre recently commissioned a third-party feasibility study of the project to ensure the projected economics of the plant add up. The results of that study, completed by Tennessee-based Frazier Barnes & Associates, were overwhelmingly positive. "It came back favorable, even perhaps a little bit more so that we had anticipated," Hall said. 
 
 To date, the project has received a great deal of support from the local community, as well as from state and federal governments. Several grants have been awarded to support development of the project, including one from the USDA and another from the Illinois Department of Commerce and Economic Opportunity. The U.S. DOE has also been involved. Construction on the plant is expected to begin in 2011 and take approximately 12 to 15 months to complete, Hall said, noting that the intention is to be operational by 2012. 
 
 In addition to building a new biodiesel plant, Bio-NRG is also working to develop an algae process that could be used to provide feedstock to the facility in the future. The technology is patent-pending, Hall said, and involves the growth, harvest and extraction of the lipids from the algae. "It's kind of a hybrid system that is designed to work in all climates," Hall continued. "We believe that part of the problem with the algae industry is with so much focus being on the southwest…We believe that in order to make it feasible, you have to be able to have a production method in place that you can use in any climate in the world. Our system is based on that theory. It's a continuous process, which is rather unique, both in its growth and extraction phases. We're in the beginning stages of working through some of the more challenging things we have with it, but moving forward." If all goes as planned, Hall estimates that the algae production system could be supplying LaHarpe-NRG with a significant amount of algae feedstock in approximately five years.

Proposed plant in Illinois moves forward

Posted Nov. 1, 2010
 
 A research team at the Massachusetts Institute of Technology has won a $50,000 ConocoPhillips Energy Prize to support the development of a carbohydrate-to-biodiesel process. The technology, which is designed to significantly increase yields, may also provide a pathway for the direct conversion of hydrogen and carbon dioxide into biofuels. 
 
 According to Gregory Stephanopoulos, an MIT processor of chemical engineering who is leading the project, the technology utilizes an engineered microbe to convert carbohydrate feedstocks into lipids. While Stephanopoulos noted that he is unable to disclose specific details of the process due to its proprietary nature, he said that the patent-pending technology can be applied to a wide portfolio of carbohydrate feedstocks, including sugars, glucose, glycerin, hydrolysates from biomass and algae. 
 
 "The yields that we obtain from this microbe are very remarkable," Stephanopoulos said. "They are very close to the theoretical maximum. For a project like biodiesel, you need to have very high yields, otherwise the cost of the feedstock becomes prohibitively high." The microbe that the process utilizes is a heterotrophic microbe, Stephanopoulos continued, meaning that it grows on carbohydrates-not light and water. "In other words, it is not an algae type of application," he said. "That's why the yields are important, because the feedstock-the raw material that you put in the [process] costs money. It's not free carbon dioxide."
 

 Once the carbohydrates are converted into lipids by the microbe, the process to convert those lipids into biodiesel is rather straightforward, Stephanopoulos said. This can be done using the standard transesterification process. 
 
 The funding provided by ConocoPhillips will expand upon the initial research to explore the use of hydrogen and CO2 as process inputs. "The ConocoPhillips project uses this technology as the core, but at the same time is expanding this technology for the fixation of CO2 using hydrogen, and we aim the fixation of CO2 towards the production of other types of organic molecules that we then feed as a feedstock to the oil-producing microbe," Stephanopoulos said. 
 
 The goals of the ConocoPhillips project are broad, Stephanopoulos continued. "Principle among them is the production of some significant amounts of oil in order to test its properties and establish that it is indeed suitable for operations in different kinds of engines, and process it for the production of jet fuel and the like," he said. 
 
 According to Stephanopoulos, it will be unnecessary to construct a new facility to evaluate the process on a pilot scale. Rather, existing facilities will likely be used to test the scalability of the technology. Stephanopoulos estimates that initial scale-up evaluations could begin within six months. Hussain Abidi, an MIT postdoctoral associate, has been working with Stephanopoulos on the project.

Carbohydrate-to-lipid project wins award

High-profile banks such as AIG made headlines when they got bailed out by the federal government during the economic nosedive in 2008. But despite receiving bailout funds, they weren't too keen on giving up any of that money to small companies scrambling to find much-needed working capital. To get any form of cash today, small businesses are often asked to fork over major collateral, which defeats the purpose of getting a loan in the first place. In fact, many of the big banks were so shocked by their own balance sheets that they tightened lending requirements, making it nearly impossible for struggling business owners to qualify for loans. Small businesses, including small-scale biodiesel producers, waste oil collection firms and other upstream and downstream cogs in the biodiesel wheel that were targeted for growth in the American Recovery and Reinvestment Act of 2009, were stymied getting any form of credit. 

 
 When President Barack Obama signed the Recovery Act into law in February 2009 to create jobs and promote spending, the law included $56.1 million for microloans for small businesses, which were doled out by the Small Business Administration. The original program, which ran until September, is administered by banks of the SBA's choosing. Since September, however, Obama signed the Small Business Jobs Act of 2010, which expanded provisions previously set in the Recovery Act.
 
 Designed to serve startup, newly established and growing small businesses, microloans are short-term loans with a ceiling of $50,000-an increase from $35,000 found in the original Recovery Act provision prior to the newly-signed SBJA. Microloans are distributed through specially selected nonprofit intermediary lenders across the country. Typically associated more with developing countries, microcredit has emerged as a mainstream practice in the U.S. with the microloans averaging about $13,000. Microloans can be used as working capital to pay employees, purchase new equipment and supplies, and rehire staff. 
 
 For small-scale biodiesel producers and others involved in the industry who are having trouble getting approved for loans elsewhere, the microloan program is a potential lifeline for obtaining immediate funding to supplement other capital sources, or to expand businesses, especially during a time when the $1 per gallon federal blender tax credit is expired. One biodiesel company in the Northeast found that obtaining a microloan fit the bill for its business.
 
 
 Microloan at Work
 
 Like many small biodiesel businesses caught in the credit crunch, Tri-State Biodiesel LLC was in dire need of working capital for equipment upgrades and to retain and hire employees. 
 
 "It's very difficult to get any kind of credit now," says founder and CEO Brent Baker, adding that he was turned down by three major commercial banks that had previously financed his company, prior to turning to Boc Capital. "It was just a hard sell [to commercial banks] to get any type of credit. Traditional banks are so risk averse these days." 
 
 Facing the possibility of layoffs or an inability to compete in the biodiesel market with old equipment, the Bronx, N.Y.-based company, which distributes biodiesel and collects waste cooking oil from 2,700 restaurants in the New York City area and cleans it up for sale as a biodiesel feedstock, managed to get a five-year $50,000 loan at a reasonable rate from Boc Capital. Boc is an intermediary lender through the SBA, which received $750,000 from the federal government thanks to the 2009 stimulus package. For Baker, the microloan was a solid option for his company to help finance upgrades to its oil rendering equipment, and hire more staff. "It helped us to increase our profitability," Baker tells Biodiesel Magazine. "We've actually grown and hired people as a result."
 

 Before the economy sank in 2008, TSB planned to install biodiesel reactors at its rendering facility at a cost of about $5 million. Since the commodities markets crashed, Baker says the company adjusted its business model and settled for more frugal options. "What we did instead was we built a more modest oil recycling facility," he says. "We were able to do that for a lot more of a reasonable price."
 
 When a potential borrower seeks out a microlender to obtain a microloan, intermediary banks are required to provide technical assistance throughout the life of the loan, which Baker says was an added benefit. Boc Capital, he says, provided TSB with a staff member from a local business outreach network center to help employee staffing and other administrative tasks for the company.
 
 Other advantages Baker saw that helped his company when he applied for the microloan was that the application process was much simpler and quicker than the experience he would've had with traditional lenders. Though credit score requirements vary by each intermediary, microlenders seem to be more forthright when evaluating a business plan, and in helping the borrower plan, before funds are issued. 
 
 "They look at the business with a little more depth I think than a conventional bank would," Baker says. "Hopefully, programs like these can fill in the blank."
 
 
 Pros and Cons
 
 While the SBA's microloan program may be a viable finance mechanism for TSB to support business growth, the prospect may not be as appealing for others involved in the industry as a way to get through tough economic times. 
 
 AZ BioDiesel, a Gilbert, Ariz.-based biodiesel producer, is building a 10 MMgy facility two miles from from its 500,000-gallon-per-year plant in Gilbert. Rather than looking to a microlender, AZ BioDiesel instead turned to a local community bank where it obtained a $2 million loan to help with feedstock purchase and cover start-up costs of the new plant, according to President Dan Rees.
 
 "If you're a tiny company, $50,000 may do something for you," he says. "For my company to continue at its growth rate, we really needed something like $150,000."

 
 Midwest Biodiesel Products LLC, which operates a 12 MMgy multifeedstock facility in South Roxana, Ill., received a $300,000 loan in September from the St. Louis Business Development Fund and St. Louis Private Fund to rehire laid-off workers and buy soybean and vegetable oil. According to President Terry Zintel, a microloan shouldn't be viewed as a primary source of credit to sustain operations, since many have leveraged themselves into deep debt when financing the construction and start-up of their plants. He asserts that producers should be on the lookout for complete debt refinance packages they could apply for. 
 
 "These little band-aids generally don't help in the long run," Zintel says. "Lots of plants need a complete recapitalization effort, but that's nonexistent from the banks right now."
 
 There are other loan provisions within the SBJA that provide similar benefits to the microloan program. One of those was a raise in loan maximums for plant acquisition, construction and expansion of biodiesel and ethanol plants from $4 million to $5.5 million. 
 
 Depending on its position and needs, a microloan may not be a funding solution for all biodiesel companies, but the microloan TSB received fit its needs, Baker says. "It's a good option to look at in terms of people in need of a smaller loan amount to get over a hump," he says. "For us, it was just what we needed."
 
 Bryan Sims is a Biodiesel Magazine associate editor. Reach him at (701) 738-4974 or <a href="mailto:bsims@bbiinternational.com">bsims@bbiinternational.com</a>

Baker, left, with New York Sen. Charles Schumer PHOTO: JASON GREEN PHOTOGRAPHY

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Baker heads Tri-State Biodiesel, which collects waste cooking oil from more than 2,000 restaurants in the New York City area. PHOTO: TRI-STATE BIODIESEL

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Biodiesel companies need credit fast. Small, short-term microloans may be a viable finance option to sustain operations.

Microloans for Small Biodiesel Businesses

More than a year ago, when the U.S. EPA announced it would combine the 2009 and 2010 biomass-based diesel mandates under RFS2, bringing the obligated parties' required blend volume to 1.15 billion gallons, the future for biodiesel seemed very bright. This was before the agency determined that soy biodiesel achieved advanced biofuel status by virtue of producing 57 percent fewer greenhouse gas (GHG) emissions over its life cycle compared to that of petroleum diesel. 
 
 Then, early this year when that milestone announcement was made, the industry had even more to look forward to, despite the fact that the important federal blender tax credit for biodiesel had expired. It was early in the year, and everyone figured Congress would get its priorities together and pass the biodiesel tax credit, right? EPA set July 1 as the implementation date for RFS2. Weeks passed and hopes rose in the biodiesel industry as the House of Representatives continued to pass bills that included a retroactive tax credit extension. But those hopes were shattered as the Senate, time after time, stripped the credit away before passing these respective packages. 
 
 More and more plants began to idle, and even though July 1 came and went, obligated parties were gobbling up renewable identification number (RIN) credits from as far back as 2008, keeping actual production at a small fraction of installed capacity. Despite these mitigating circumstances, people continue to ask about the future of biodiesel-specifically, the biomass-based diesel mandate-given the situation with the lapsed tax credit. This was the topic of a recent F.A.M.E. Forum blog post of mine, initiated by a reader who sent me the following email: 
 
 "I keep reading articles about the RFS mandates on the use of biodiesel but also about the government not passing the tax credit, so very few companies are producing biodiesel. An article tying the two together would be interesting since it seems this is going to come to a head in the future when the supply can't meet the demand. Then what happens?" 
 
 The gist of my response argued that the mandate was passed irrespective of the tax credit, so the absence of one should not affect the other. Yes, oil lobbies can argue that without it, biodiesel is cost-prohibitive, but let's not forget RIN credit prices, which for 2010 biodiesel credits, are more than 50 cents a credit. Add the fact that one gallon of biodiesel carries 1.5 ethanol equivalent RINs, this would mean a biodiesel RIN credit price surpassing 75 cents. 
 
 Joe Jobe, the National Biodiesel Board's CEO, left an extensive comment on this posting, adding very good perspective and some positive situations to watch for in 2011. "It is worthwhile to note that the uncertainty in the marketplace caused by the 18-month delay in implementing the RFS2 program, together with the unprecedented use of allowing biodiesel RINs generated in 2008 to be used for compliance with the RFS2 program in 2010, created a dramatically reduced volume requirement for biodiesel in 2010 (only 345 million gallons)." For 2011, however, there is an 800 million gallon biomass-based diesel mandate, and even with the 20 percent carry over allowance of RINs from 2009, at a minimum this equates to a doubling of production in 2011 versus this year-with or without the tax credit in place. Thanks Joe for the great comment on my blog, and let us, the industry producing America's first advanced biofuel, not lose sight of these positives.

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The Promise of 2011

For many biodiesel companies, the Securities and Exchange Commission's adoption of eXtensive Business Reporting Language interactive data reporting mandates have been nothing but a passing consideration of things to come. But what once seemed distant is now reality, with nonaccelerated and smaller reporting company filers subject to the new requirements beginning with quarterly reports covering fiscal periods ending on or after June 15, 2011. 
 
 Under the new rules, a reporting company must "tag" financial statements, footnotes and quantitative disclosures with one of the 17,000 existing XBRL tags (which are expected to continue to grow in number), or a custom tag accepted by the SEC when the element does not exist in the standard XBRL list. Tags generally consist of descriptive labels, definitions and generally accepted accounting priniciples and regulatory references that aim to provide the context necessary for software recognition of interactive, financial data. The tagging process is akin to a barcode system that enables those reviewing financial statements, notes and schedules to more easily analyze and compare the relevant financial information to similar information for different reporting periods, companies and industries. 

 
 The XBRL tagging requirements will be implemented in two tiers; the first requiring filers to tag financial statements as well as the accompanying footnotes and schedules as a single block of text. After a year of tier one tagging, tier two will require a registrant to tag: (i) each footnote as a single block of text; (ii) each significant accounting policy, contained in the significant accounting policies footnote, as a single block of text; (iii) each table within a footnote as a separate block of text; and (iv) each amount (e.g., percent, monetary value, etc.) within each footnote. Filers will be given an additional 30 days to submit interactive data for the first quarterly report filed in each of the two tiers. The 30-day grace period will have no effect, however, on the submission deadline for a periodic report, with the XBRL supplement filed as an amendment to the applicable report. XBRL reports must also be accessible on the registrant's website by the report's filing date or the periodic report deadline, whichever occurs first.
 
 Failure to comply will have harsh consequences which may include loss of eligibility for shortened registration statements on Forms S-3 and S-8, loss of the Rule 144 safe harbors-restricting the resale of company shares or units-and/or potential liability arising from a private action or SEC enforcement action based on the company's noncurrent status with SEC-reporting obligations. These consequences are not permanent, however, and will apply only while the filer is delinquent and noncompliant with XBRL requirements.
 
 XBRL requirements are supplemental to and do not replace existing disclosure requirements, including the delivery of ASCII- or HTML-formatted financial statements. As a result, reporting companies will undoubtedly feel the time and money crunch of compliance. The SEC projects each registrant's average yearly burden under the new requirements to be 226.1 internal hours with $27,300 out-of-pocket expenses and 251 internal hours and $27,800 out-of-pocket expenses for years one and five, respectively. On the heels of a down-turned economy and biodiesel industry, XBRL mandates stand to affect the bottom line of biodiesel producers for the foreseeable future; especially those smaller producers without the deep pockets of industry leaders. In an effort to reduce these adverse effects, it will be critical that reporting companies, big and small, begin and continue to familiarize themselves with the tagging process and XBRL format in general.
 
 
 Karen L. Karr provides legal services in corporate and business transactions, estate planning and real estate. Kristi L. Harshbarger practices in securities, estate planning and corporate transactions. Both are attorneys with BrownWinick, a Des Moines, Iowa-based law firm serving the renewable fuels industry. Reach Karr at (515) 242-2424 or <a href="mailto:karr@brownwinick.com">karr@brownwinick.com</a>. Reach Harshbarger at (515) 284-6627 or <a href="mailto:harshbarger@brownwinick.com">harshbarger@brownwinick.com</a>.

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Generation X: eXpensive, eXtensive  XBRL Reporting Requirements

There has been plenty of confusion about the laboratory side of compliance with ASTM D6751 specification for biodiesel and the BQ-9000 reduced specification, otherwise known as the critical testing criterion. With many companies touting their high-quality biodiesel product, or touting a specific process or analytical instrument to produce or discern ASTM-grade biodiesel, the phrase ASTM-grade biodiesel itself has become an industry buzzword, with unfortunate consequences. Being in the analytical chemistry analyzer business for more than 22 years, and selling complete laboratories specifically to the biodiesel industry for the past five years, I would like to set the record straight as to the future use of the term ASTM-grade biodiesel and the critical testing criterion. Like many other words or phrases in the English language, once they start to become overused, it slowly loses its exact meaning. The phrase "you know," for example, used to be defined as "you understand." Now you hear it overused all the time, and most of the time it means "um-m-m." I am afraid that the phrases "ASTM grade biodiesel," "reduced specification" and "critical testing criterion" are falling prey to this same overuse syndrome as "you know." You know? The ASTM D6751 specification requires every single test be run on each production batch of biodiesel before it can be called ASTM-grade. That specification includes flash point (ASTM D93) or alcohol content (EN 14110); water and sediment (ASTM D2709); kinematic viscosity (ASTM D445); sulfated ash (ASTM D874); sulfur (ASTM D5453); copper strip corrosion (ASTM D130); cetane number (ASTM D613); cloud point (ASTM D2500); carbon residue (ASTM D4530); acid number (ASTM D664); cold soak filterability (ASTM D6751-Annex A1); free and total glycerin (ASTM D6584); phosphorus content (ASTM D4951); calcium and magnesium, combined (EN14538); sodium and potassium, combined (EN14538); vacuum distillation (ASTM D1160); and oxidation stability (ASTM 14112). There are alternate methods allowed, but those listed are the referee if any dispute should arise. Each and every one of the tests above are the required by almost every state in the union as a minimum to be called biodiesel. If you are marketing your biodiesel outside the U.S., then several other tests would also be required. If a company claims that its process can provide ASTM-grade biodiesel from waste vegetable oil that has a sulfur content of 38 ppm, without somehow removing that sulfur with a pretreatment process, then they are not being truthful in their claims. Petroleum companies have spent millions of dollars for treatment technologies to get rid of the excess sulfur to make the ultra-low sulfur diesel that the U.S. EPA requires, and biodiesel companies will not be exempt from those same requirements if they are using higher sulfur-content feedstock. The only way around these stringent specifications are if your facility becomes a BQ-9000 certified producer. In the BQ-9000 regulations, once your process passes all the ASTM D6751 specifications listed above on the first seven batches produced, and if your feedstock remains the same, then you can start running the reduced specification or the critical testing criterion for every batch and only test monthly or yearly on the remaining tests. The critical testing criterion includes eight tests: flash point or alcohol content; water and sediment; sulfur; cloud point; acid number; cold soak filterability; free and total glycerin; and oxidation stability. If you change your feedstock, you are back to square one in the BQ-9000 process of being enabled to run the critical testing criterion only. Some analytical instruments companies are claiming that their infrared technology analyzer is able to discern all the critical testing criterion. They are also not being truthful in their claims. The only way to analyze for sulfur down to the maximum 15 ppm specification limit is by using the referee method ASTM D5453 UV-Fluorescent technology (and some alternate method listed in ASTM D6751, which does not include IR). Analyzers using IR technology simply cannot do elemental analysis. The whole science behind IR is based on molecular bonds, thus elemental analysis is impossible with IR. I propose that we use the phrases critical testing criterion and ASTM-grade biodiesel the way they are defined by ASTM and BQ-9000. We should be very careful not to fall in the "you know" syndrome when it comes to our nation's fuel in the future. You know? Mark Fashian is president of Biodiesel Analytical Solutions and director of Mcgyan Biodiesel LLC. Reach him at (740) 369-5475 or <a href="mailto:mark@biodieselanalytical.com">mark@biodieselanalytical.com</a>.

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Defining Key Terms

SelectIon Technologies Inc. launched an on-site and on-demand sodium methylate production system called NaSelect, which can generate high-purity sodium methylate efficiently and inexpensively at desired concentrations in methanol while cutting down water content and eliminating costly and hazardous transportation and storage, according to general manager Bill Christie. NaSelect systems can also be integrated into small- and large-scale biodiesel plants, Christie added, in the form of individual modules with minimal modifications while in operation.

SelectIon Technologies' NaSelect sodium methylate systems can be installed as separate modules in existing small- and large-scale biodiesel facilities. PHOTO: SelectIon Technologies

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SelectIon Technologies offers on-site SMO production systems

The Ohio Department of Development is using $8 million in funding from the American Recovery and Reinvestment Act, to help biodiesel and ethanol companies fund new or additional refining equipment. As part of the Advancing Biofuels Beyond the Basics program, the state can award any amount from $500,000 up to $1 million for each applicant. "These federal stimulus resources are critical to implementing energy savings measures that will bring long-term benefits to our businesses, communities and the environment," said Lisa Patt-McDaniel, director of the Ohio Department of Development. 
 

 The $8 million funding package is part of the $96 million the state received from the ARRA State Energy Program. Mark Shanahan, energy advisor to Gov. Ted Strickland, said that the governor understands that combining the state's agriculture and manufacturing sectors can make Ohio a leading player in biofuels. Along with a requirement that all applicants must reside in the state, the program guidelines also stipulate the applicant must be able to invest a minimum of 25 percent of the total costs needed for the equipment. The installation of any equipment must be completed within 12 months and provide a direct economic impact to the state. The applicants will be judged on four categories: project readiness, financial ability to meet the 25 percent requirement, economic/employment impacts on Ohio and possible job creation and retention during construction phases.

Ohio makes $8 million available for biofuels equipment

California's Board of Equalization has released the state's gasoline and fuel consumption numbers for June and the second quarter of 2010, and the numbers show diesel consumption is up 12.4 percent or 27.7 million gallons. If the state accounts for refunded gallons of 18.4 million gallons, the increase is still at 3.8 percent. For the second quarter of 2010, Californians used 661 million gallons of diesel, up from 653 the same time last year. In June alone, diesel sold in the state equaled 251 million gallons, compared to 224 million gallons the same time a year ago. To monitor the fuel consumption and sales numbers, the BOE uses tax receipts paid by fuel distributors.

California diesel use increases

The U.S. DOE's National Renewable Energy Laboratory released its BioEnergy Atlas, a Web portal that allows users to layer related bioenergy data onto a single map to gather information on biomass feedstocks, biopower and biofuels potential, production and distribution and more. User-friendly and easy to use, the tool also combines geographic visualization of regional resources and energy usage with high-level yield calculations to provide first-level screening of project feasibility and state bioenergy potential. The BioEnergy Atlas is accessible at http://maps.nrel.gov/bioenergyatlas.

NREL releases BioEnergy Atlas

Two of the leading advanced biofuels organizations have teamed up, urging the Senate to pass an extension for the biodiesel, renewable diesel and alternative fuel tax credits. Nearly a year has passed since the credits expired, and now the National Biodiesel Board and the Advanced Biofuels Association have issued a joint letter asking Congress not to leave for the campaign trail without retroactively extending the credits. While the inability of Congress to reinstate the incentives is nothing new, the news that the NBB and the ABFA are speaking with one voice is something of a first, but Manning Feraci, vice president of federal affairs for the NBB said that both "share the opinion that Congress should pass an extension of these biofuel incentives before they adjourn for the year." Michael McAdams, ABFA president, added that the industry cannot be expected to continue and develop if the government doesn't hold up its end of the bargain.

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Advanced biofuels organizations team up

The Missouri Department of Natural Resources has awarded grants to support two biodiesel-related feasibility studies within the state. One of the grants has been awarded to Dexter, Mo.-based Global Fuels LLC. The biodiesel producer is using the funding to explore the technical and economic possibility of producing next-generation biofuels. Global Fuels currently operates a 3 MMgy biodiesel plant. According to Jason Harris, the facility's plant manager, his company is looking to implement a process that would be economically sustainable without subsidy. 
 
 The second grant was awarded to Columbia, Mo.-based H20'C Engineering to study the feasibility of recycling the fat, oil and grease (FOG) found in urban sewer systems into biodiesel. The study will focus on collecting FOG from two Missouri metropolitan areas, Kansas City and St. Louis. H2O'C has partnered with Pennsylvania-based BlackGold Biofuels in the project. The study will be complete in January. "It's going to be a kind of road map or template that would help other communities forge their way down this path of capture and reuse of this fats, oils and grease waste product," said Tom O'Connor, owner of H2O'C Engineering.

Missouri biodiesel feasibility studies a good sign

Using canola-based biodiesel provided by Ontario, N.Y.-based biodiesel producer Northern Biodiesel, LPP Combustion LLC successfully created a natural gas substitute trademarked LPP Gas by vaporizing biodiesel to power a 30-kilowatt Capstone C30 gas turbine loaned from plastics manufacturer Harbec Plastics. When operated at full load on LPP Gas derived from biodiesel, results showed an emissions profile of 5.6 parts per million by volume (ppmv) NOx and 9 ppmv carbon monoxide, which improved upon baseline natural gas emissions.

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Biodiesel vaporized for  natural gas turbines

November weather in the Golden State may be sunny and comfortable, but the climate surrounding California's controversial Assembly Bill 32 could be severe. The bill's future, which requires the state to reduce greenhouse gas (GHG) levels back to 1990 levels by 2020, will be determined by November voters. To earn a spot on the ballot, roughly 800,000 signatures were gathered on a petition requiring only 435,000, giving the voters a chance to continue or end another highly debated program. The Low Carbon Fuel Standard, many argue, incorrectly figures indirect land use change modeling into estimations that determine the GHG benefits of biofuels such as soy-based biodiesel and corn ethanol.
 
 "Most people I talk to don't think the proposition will pass," said Shelby Neal, director of state governmental affairs for the NBB, but, "there is nothing [stating] a future governor couldn't issue an executive order reinstating [the] LCFS." Even though Californians generally support climate change legislation, early polling on Prop 23 is close because AB 32 is viewed by some as a "job killer," as opponents have termed it. The petition filed in June calls for a freeze on the law until unemployment levels in the state drop below 5.5 percent for a period of one year. Current unemployment levels in California, however, are closer to 10.5 percent, meaning that the likely effect of the proposition is termination of the AB 32 program. While fears of even greater job losses in California threaten the GHG reduction program, as Neal points out, the policy could continue.
 
 "The key for biodiesel will be the results reported by the LCFS Expert Workgroup," Neal said. "Based on this information, CARB (California Air Resource Board) is going to reevaluate all these greenhouse gas scores on or before Jan. 1, 2012." Because the GHG benefits of biofuels such as soy-based biodiesel are significantly less in the CARB study relative to those reported in the more highly regarded U.S. EPA study, the value certain biodiesel feedstocks bring to the policy varies. But, because biodiesel is currently one of only a few fuels that can meet the requirements of the LCFS, the fuel, regardless of feedstock, should have a role in the California's clean energy future.
 
 Depending on revisions by CARB to alter the GHG benefits of certain pathways, obligated parties in the state will have several decisions to make. For 2011, the overall average carbon intensity of the fuel that the refiners are selling has to be one quarter of a percent less than the baseline of petroleum, Neal explains, but how they get there is totally up to them. If soy biodiesel is 12 percent better than petroleum, then one gallon of B100 of soy biodiesel earns approximately 50 gallons of compliance, Neal said, but one gallon of B100 made from a waste oil feedstock would earn an obligated party roughly 325 gallons or so of compliance. The obligated parties "just have to obtain an overall percentage reduction, so if they used waste cooking oil-based biodiesel, which scores better in CARB's current analysis, they can blend fewer gallons and still achieve compliance." 
 
 With only a quarter of 1 percent of reduction required for 2011, California's early year requirements may not do much, but Neal said once you get into the third or fourth year, the reductions start getting real and affect the market share. No matter what, Neal said, "What we know is that if CARB makes decisions based on sound science, especially as it relates to the indirect land use change theory, biodiesel will play a major role in the California LCFS."

California's Low Carbon Fuel Standard, if enacted, will require drastically lower GHG levels over the coming years, requiring the state to meet 1990 levels by 2020. 

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California's November election may impact biodiesel

The wait for the federal government to reinstate the $1 a gallon federal blender tax credit has left the biodiesel industry in most states suffering. Illinois, on the other hand, had policies in place that have allowed its industry to thrive more so than others. 
 
 A major driving force behind Illinois' success rides on the fact that it has excise tax abatement for biodiesel blends of B11 or higher sold in the state, which is good through Dec. 31, 2013. Created in 2003, the sales tax incentive provides a partial sales tax exemption of 20 percent on biodiesel blends from B1 to B10. Blends above B10 receive a total exemption from the state sales tax of 6.25 percent, effectively creating an Illinois-specific market for B11. 
 
 For those involved exclusively in downstream operations of the industry, waiving the sales tax on B11 or higher blends provides a significant cost advantage for retailers looking to blend biodiesel with No. 2 on-road diesel fuel, according to Kevin Lockart, energy consultant for Tremont, Ill.-based agricultural cooperative Ag-Land FS Inc.
 

 "With that tax incentive, B11 still has a five-cent advantage over regular diesel even without the $1 per gallon blenders tax credit," Lockart said. "That tax abatement is everything to us."
 
 Biodiesel producers such as Iowa-based Renewable Energy Group Inc. have taken full advantage of the excise tax abatement as a means of leveraging upstream and downstream market capabilities, according to REG's director of marketing Jon Scharingson. "For us, the value of the Illinois excise tax abatement more than offsets the lack of the $1 per gallon blenders tax credit," he said. "It's made it risk-free and still profitable for retailers to consume biodiesel in Illinois because of the tax abatement in the state."
 
 Currently, Illinois has five operating biodiesel plants with a combined installed capacity of 170 MMgy. REG captured a significant amount of that total when it acquired two biodiesel plants in the state: the 60 MMgy facility in Seneca, and the 45 MMgy plant in Danville. "Without that Illinois excise tax abatement we would not have acquired those plants, and those plants would likely not be running," Sharingson noted.
 
 The remaining three plants in the state include Incobrasa Industries Ltd., which operates a 31 MMgy facility in Gilman; Midwest Biodiesel Products LLC, which operates a 12 MMgy plant in South Roxanna; and Stepan Co., which operates a 22 MMgy facility in Joliet. 
 
 "Illinois is a very attractive market to sell into because of the B11 sales tax exemption and, because of that, a lot of biodiesel is consumed in the state," said Terry Zintel, president of privately-held Midwest Biodiesel Products LLC.
 
 REG estimates total national production of biodiesel to be between 350 MMgy and 400 MMgy, according to Sharingson, with 25 to 35 percent of that volume coming out of Illinois. "Without that [excise tax abatement] in Illinois, the biodiesel market in the U.S. would be well below 300 MMgy," he added.
 
 Last year, Illinois passed a law that increased the biodiesel blend required for use by state and local government fleets from B2 to B5. Illinois also offers an attractive loan guarantee program that provides funds to existing in-state biodiesel producers to modify or retrofit their facilities. Proposed projects in the state with a capacity of at least 30 MMgy are also eligible for this grant.

REG's recently acquired plant in Seneca, Ill., can produce 60 MMgy and is a major supplier of the state's blended biodiesel volume. PHOTO: REG INC.

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Excise tax abatement bolsters Illinois biodiesel industry as other states struggle

While the absence of the federal tax credit is a major contributing factor behind the decision for many plant managers to scale back production or cease operations altogether, some see this time of crisis as an opportunity to restart idled facilities or propose new projects.
 
 ME Bio Energy LLC reopened a 5 MMgy multifeedstock plant in Lilbourn, Mo. Formerly owned and operated by Great River Soy Processing LLC, the facility had been idle for nearly three years. ME Bio Energy took ownership in May and began producing its first batches of biodiesel in August, according to owner and partner Mike Ellis. Since ME Bio Energy restarted operations, Ellis said, approximately 14,000 gallons of biodiesel had been produced daily at the plant.
 
 "It was in pretty good shape when we got it," he said. Stuttgart, Ark.-based Agri-Process Innovations made final startup repairs to the plant. "We had to replace some gaskets, motors, do some recalibrating and so on," Ellis added. "We also had to renew with the U.S. EPA and all the regulatory licenses. It takes time."

 
 Under Great River Soy Processing's ownership, the plant operated for two weeks in October 2007 before it shut down due to rising soybean oil prices. During those two weeks the refinery produced 94,000 gallons of biodiesel. Ellis said plans are to expand the plant's installed capacity three-fold to 15 MMgy in the near future. Though the Lilbourn plant is the only one currently owned by ME Bio Energy, Ellis said the company is considering acquiring other idled biodiesel plants similar in scale and annual capacity. "They're not cheap, but we still see value in them," he said.
 
 Biocardel Quebec Inc. received a seven-year investment worth $18.79 million from the Canadian government's ecoENERGY for Biofuels program for startup and operation of a 40 MMly (10.5 MMgy) multifeedstock plant in Richmond, Quebec. The plant, which broke ground in 2007, had been in R&D mode during the operation of the company's sister plant, a 4 MMgy biodiesel refinery in Swanton, Vt., that operated under the name Biocardel of Vermont LLC. The plant subsequently closed in mid-August due to unfavorable economic conditions. Biocardel Quebec General Manager Stephen Daigle said the Richmond facility is expected to produce commercial volumes by mid-October.
 
 "We passed ASTM specifications for our biodiesel," said the elated Daigle, who previously served as general manager for the Swanton facility. "We transferred a lot of the equipment from the Vermont plant to the Richmond plant. We hope to branch out using animal fats and possibly using algae oil as well."
 
 Meanwhile, Integrated Energy Partners Inc. proposed a biodiesel project to the Santa Rosa County Commission valued at $30 million, which IEP intends to build near Jay, Fla., after providing revenue bonds in the county's name. The proposed facility would produce a suite of biofuel and biochemicals such as green power, propane, kerosene and biodiesel, from various agricultural products. According to county commission documents, IEP intends to use camelina as feedstock during winter and cottonseed for year-round production of biofuels. Additionally, municipal and other waste products are likely to be utilized as fuels. 
 
 Initially, IEP plans to have an electricity generation capacity between 5 and 12 megawatts. According to county court documents, IEP's biofuels production segment would produce approximately 3 MMgy of biodiesel, 353,000 gallons of cellulosic ethanol, 9 million gallons of kerosene and 437,000 gallons of propane.

Freshly produced B100 is loaded on a tanker truck at ME Bio Energy's plant in Lilbourn, Mo., for delivery. PHOTO: ME BIO ENERGY LLC

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Positive developments continue in spite of tax credit situation

Following the success of an informative webinar dealing with the theory and practice of biodiesel earlier this year, the Diesel Technology Forum held another successful biodiesel-based webinar in September. Featuring some of the most prominent biodiesel voices around the country, the webinar, titled, "Biodiesel Policies and Mandates: What's Really Involved," received a good response, according to Dawn Fenton, director of policy. But more importantly, it dealt with several pressing issues in the industry. "There was a broad range of questions asked, including ones about the role of biodiesel in California's Low Carbon Fuel Standard and how the reduced production in biodiesel was affecting mandates," Fenton said.
 	
 The presentations, five in all, were given by Ralph Groschen from the Minnesota Department of Agriculture, who spoke about the state's success and experience with a biodiesel mandate; Randy Jennings from the Tennessee Department of Agriculture, who touched on the importance of fuel quality; Dr. Juergen Fischer from Germany's AGQM Biodiesel e.V., who provided a European perspective; Dwayne Berger, director of renewable energy for the Massachusetts department of energy resources, who outlined the Bioheat and biodiesel environment in his state; and Shelby Neal, director of state governmental affairs for the National Biodiesel Board, who provided a nationwide look at mandates. 
 
 After the webinar, Fenton outlined three main areas the speakers touched on. The first involved the important term used recently to classify biodiesel-advanced biofuel. As a biofuel having more than 50 percent less greenhouse gas emissions than petroleum, the advanced biofuel classification "will be a significant factor promoting biodiesel production," Fenton said. 
 

 The second topic, which was covered by Jennings, Groschen, Fischer and Berger, was something that Fenton said has improved over the past few years: fuel quality. In 2007, 27 states had adopted the ASTM D6751 specs. Now 47 states use the specs and 21 states have active fuel quality enforcement efforts in place, up from eight in 2007, Fenton noted. "Fuel quality has also benefited from the passage of ASTM D7467 specification for biodiesel blends B6-B20," she said.
 
 And as Berger pointed out during his presentation on Massachusetts' inability to implement its biodiesel mandate, Fenton also said that doing so can be quite complicated, particularly in regional markets when fuel enters from out-of-state terminals and pipelines. "In the case of Massachusetts, the decision to postpone the mandate was due to costs related to the expiration of the production tax credit and complications around the law's requirement that 'advanced biofuels' be used," she said. 
 Presentations for the next webinar will be more technical, Fenton said, and will include a detailed look at the potential challenges of using biodiesel blends in diesel passenger cars. To learn more about this and other DTF webinars, or to view presentations, visit www.dieselforum.org.

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DTF webinar discusses pressing biodiesel issues

Interplay between various government policies and economic drivers in the private sector can create a complex, sometimes confusing, biodiesel market environment. This has been especially true the past year as the renewable fuels standard transitioned into its second phase (RFS2), and the blenders credit for biodiesel was allowed to lapse. While several unique challenges have been posed to those in the biodiesel industry, things are looking up as 2011 approaches. 
 
 Regarding federal mandates and incentives for biodiesel, National Biodiesel Board CEO Joe Jobe said it's important to note that the RFS2 and the biodiesel tax incentive are two separate and distinct, yet complimentary, federal policies. "The RFS2 volumes mandated by law must be implemented regardless of the status of the biodiesel tax incentive," he said. 
 
 The tax credit for biodiesel is designed to complement the RFS2 program. "The tax incentive helps makes biodiesel price-competitive in a manner that is familiar and proven in the marketplace, and provides a powerful incentive to use biodiesel at levels beyond the minimum amounts required by RFS2," Jobe continued. 
 
 Renewable identification number (RIN) credit values have begun to rise, filling the financial gap created by the tax credit loss. RINs are used by the EPA to track obligated parties' compliance with the RFS2. They are attached to each eligible gallon of biofuel that is produced, and transferred to obligated parties when that fuel is purchased. The price of RINs has been very low, however, their value has risen in recent months.
 
 While the RFS2 was originally scheduled to be implemented Jan. 1, 2009, it was not launched by the U.S. EPA until this July 1. As a result, EPA issued combined volume requirements for 2009-'10 that must be met this year. Due to the way the volume requirements were formatted for the 2009-'10 transition period between the RFS1 and the RFS2, obligated parties have been able to use carry-over RINs from 2008 and 2009 to meet their volume requirements, said Jon Scharingson, director of marketing at Renewable Energy Group Inc. "This situation will not carry forward into future years because all 2008 and 2009 RINs will be used or retired going into 2011," Jobe said. "This situation was unique to the first year of the program and the transitional rules from RFS1 to RFS2. Thus, we are hopeful that the volume requirements under the program for next year will be stable and readily apparent to stakeholders in the marketplace."
 
 The price history of biodiesel RIN values seems to underscore this phenomena. According to Clayton McMartin, president of Clean Fuels Clearinghouse and founder of RINSTAR, the value of biomass-based diesel RINs has increased significantly since the beginning of the year. "This trend can be attributed to two primary factors: the new renewable fuel standard and the lapse of the biodiesel tax credit," McMartin said. "The RFS2 set demand for biodiesel in 2010. However, the failed tax credit has had a dramatic downward impact on overall biodiesel supply. Consequently, the price of [biodiesel] RINs has increased."
 
 According to Scharingson, the increased value of RINs is helping to overcome the financial implications of the expired tax credit. "2010 biodiesel RINs were trading at approximately 60 cents per RIN," he said, noting that 1.5 RINs are generated per gallon of biodiesel. "That's a value of about 90 cents per biodiesel gallon, so that offset 90 percent of the blenders tax credit." However, Scharingson also said RIN values are expected to fall once the tax credit is reinstated. 
 

 In addition to federal policies, state mandates and incentives are also working to drive biodiesel demand. Although state mandates do play a role in creating and maintaining local and regional markets for biodiesel, Scharingson said that state incentives are even more powerful. "In places like Illinois, which has 6.25 percent tax abatement, those state incentives have really created a majority of the market demand that we've seen for biodiesel in the U.S. during 2010." Furthermore, Scharingson noted that states with mandates will consume the vast majority of RFS2 volume requirements in the near-term. 
 
 While there has been some speculation that the lack of the biodiesel tax credit may drive obligated parties to use biodiesel imports for RFS2 compliance, neither Jobe nor Scharingson think that will happen. 
 
 "There is no question that our industry has had a couple of very tough years," Jobe said. "However, these trials will ultimately yield a stronger, healthier industry. The people who are involved in the biodiesel industry believe in their product because they know that biodiesel is one of the only alternative energy technologies that actually delivers what it promises. Biodiesel stakeholders are scrappy and innovative and those who count them out will be sorely mistaken. So take heart, biodiesel nation. We ain't done yet. We're just getting started."

Tying it all together

At the upcoming National Biodiesel Board membership meeting in St. Louis, a new chairman will be taking over to lead the governing board and the industry through the next chapter in the ongoing history of biodiesel in North America. I have been very proud to serve as the board chairman for the past 3 years. My time as chair has been both challenging and rewarding.
 
 When I took over the role of chairman in the fall of 2007, the biodiesel industry was reaching a crescendo of growth and excitement. We celebrated the accomplishment of a new legislative achievement when Congress included a role for biodiesel in the landmark RFS2 in December 2007. A record 700 million gallons were produced that year, nearly 3,800 people attended the annual conference in Orlando, and many, including me, worried that the industry could be going too far too fast. We could not have guessed the multiple challenges that awaited us over the next two years.
 
 My second year as chairman saw out-of-control crude oil and feedstock prices, a closing off of important export markets, and a barrage of coordinated attacks on biofuels, all followed by a series of collapses in the financial, housing, commodities, and stock markets. Why the RFS2 was necessary, even with the tax credit in place, was illustrated in 2008-'09. The RFS2, which was required by Congress to be in place by Jan. 1, 2009, was delayed. Many believed that the best part about 2009 was that it couldn't get any worse. That is when 2010 came along and we learned what it was like to operate with neither the tax credit nor the RFS2 effectively in place.
 
 
 Darkest Before Dawn
 
 Virtually all new, emerging industries evolve with some degree of inelegant expansion, contraction, consolidation and shakeout before reaching more normal business conditions and cycles. The biodiesel industry was simply unfortunate enough to have experienced an adult dose of it all within a few years. But it is my view that a recovery is on the horizon for this industry. And I believe it will not only be a full recovery, but one that will see a stronger and healthier industry as a result of the struggles we have been through over the past two and a half years.
 
 Without question, the transition from RFS1 to RFS2 in 2010 presented the U.S. biodiesel industry with significant challenges. A variety of factors, including delayed implementation of the program, unanticipated complexity, improper accounting of unused 2008 biodiesel RINs from the RFS1 program, and multiple lawsuits undermined the effectiveness of the RFS2 program in 2010. These uncertainties and barriers should be resolved by the next calendar year and will not confront the program in 2011. 

 
 The NBB estimates that this will result in a stable domestic demand for at least 700 million gallons of biodiesel in 2011. And as the RFS2 program matures, the industry will work to responsibly increase the volume requirements beyond the 1 billion gallons of biomass-based diesel that is required in 2012 and beyond. 
 
 Members of the media and biofuel opponents continue to try to define biodiesel as a conventional biofuel, which is being increasingly labeled as a bad thing. However, the U.S. EPA has made it clear that biodiesel from a wide range of diverse, domestic feedstocks has been deemed to be an advanced biofuel. Currently biodiesel is the only advanced biofuel that has reached commercialization in the U.S. As America's first advanced biofuel, it is imperative that biodiesel succeed if America is to reach its goal of 21 billion gallons of advanced biofuel by 2022.
 
 Biodiesel will succeed, and I predict 2011 will be the most successful year to date for the industry as we recover from the past two and a half years of pain and move on to a more stable policy framework. NBB and the industry will need to transition its programs in ways that compliment and support this new policy framework and market dynamics. Federal and state policy efforts will remain critically important to the industry, as will the leveraged communications, technical, and educational programs that support their success. 
 
 It will also continue to be imperative that the industry remain unified with all stakeholders working with one voice through NBB. It is a source of some satisfaction to me that the industry and all stakeholders have remained unified during my chairmanship, even under some of the most extreme pressures imaginable. I remain committed to this goal of industry unity. I pledge my ongoing service in supporting industry unity in any way. 
 
 Finally, I want to express my sincere appreciation for the excellent and hard working individuals who continue to work together to make this industry possible. This includes the producers and marketers who invest their resources and talents to find innovative ways to make better fuels and claw out new markets. It includes feedstock producers such as the soybean farmer leaders who continue to step up with generous and benevolent financial and policy support. And it includes an excellent staff and management team, whose talent and dedication I have always recognized, but have come to appreciate even more these past three years. Thank you again for the opportunity to serve this industry as NBB chairman. I look forward to supporting our next chairman and supporting the industry in any way that I can.
 
 
 Ed Hegland, chairman, National Biodiesel Board

Ed Hegland and Joe Jobe address attendees at the 2008 Biodiesel Conference & Expo.

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Hegland and Jobe sing on stage at the 2009 Biodiesel Conference & Expo.

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Ed rides along in a TDI Jetta race car running on biodiesel.

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Ed Hegland chairman, National Biodiesel Board

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Passing the Torch

For anyone who has spent time in Northern Minnesota during the frigid, white days of winter, one thing becomes clear: cold weather causes problems. Engines start slowly, windows freeze shut, and in a few, isolated incidents, above-ground biodiesel and petrodiesel tank dispenser filters get clogged above the fuel's cloud point, due to what could be called "the freezer effect." Spend a day sitting inside a deep freeze and you get the point. In an effort to help biodiesel producers and purchasers operate vehicles and machinery in such extreme conditions, ASTM is currently voting on a measure to create two grades of biodiesel, one of which would be specifically suited for those extreme winter days. Some in the industry favor the dual grades, noting the additional biodiesel option as a benefit to consumers. But others oppose the idea, citing confusion to those same consumers as a reason to continue the status quo. The ballot is currently at the main committee level and the results are expected sometime in December. 
 
 
 Reasons to Vote
 

 Along with a few reports from BP and ExxonMobil, Steve Howell, technical director for the National Biodiesel Board, says during the past year in Minnesota the current D6751 spec worked for "just about everybody." But, he says, "There were a couple of isolated incidents where biodiesel fuel didn't operate down to its cloud point." The reason for the clogging, at least what ASTM has indicated, was the monoglyceride content in the biodiesel. Because the majority of the incidents were mainly tank and dispenser filter related, Howell says the group (ASTM members, who are also government officials, biodiesel producers, users and members of academia) believes that if there are known cases of minor components in filters, then remaining in the fungible diesel fuel pool requires giving an option to help resolve the issue. 
 
 The new option would provide a No. 1 and a No. 2 grade similar to petro diesel, which features Nos. 1, 2, 4 and 6. "The proposed grade No. 2 would be the current specs we have now," Howell says. "But if for some reason that No. 2 grade biodiesel doesn't operate down to its cloud point, then the group has proposed a No. 1 grade, and that No. 1 grade would have tighter controls on minor components." 
 
 
 The Issues
 
 "A mandate does not happen in a vacuum," said Ralph Groschen, senior marketing specialist for the Minnesota Department of Agriculture, when he spoke during a webinar on the problems that occurred and the experience that was gained in Minnesota, the first state to pass a biodiesel mandate. And this concept-that other outside variables not considered within the realm of possibilities may ultimately be the cause of an "incident"-represents one sticking point for those considering the dual grades. "The particular way we chose to address these minor components was to use saturated monoglycerides as an indicator for all other minor components that could show this phenomenon in rare circumstances," Howell says. But, he adds, there are still desires to move to a more performance-based test rather than using one set of compounds as a surrogate for a whole bunch of others. "That," he says, "is the crux of the issue," as some disagree that monoglyceride levels should be the only factor to test for or change in the new grade. 
 
 While the new No. 1 grade would call for lower monoglyceride levels, Stu Porter, director for BBI Biofuels Canada, says the limits in the manner proposed are maybe not the best approach and seem to be somewhat subjective. "The proposed limits are built on a series of assumptions that estimate saturated monoglyceride content. This assumes that saturated monoglycerides are the root cause." For Porter, the amount of evidence supporting the idea that a multigrade biodiesel specification is needed is insufficient. ASTM is operating under the agreement, Howell says, however, that the research, data and evidence presented during the balloting process at the subcommittee level is the most accurate and complete package of information. Randy Jennings of the Tennessee Department of Agriculture says, "When you can positively identify the reasons for those problems and those problems can be corrected by amended fuel specifications, I think it is entirely appropriate to pursue those specifications."
 
 The procurement specifications that are already in place and used by petroleum companies may, however, already present an answer to the level of monoglycerides allowed and the resulting issues ASTM has identified. "The reality is that many of the refiners in the U.S. have a limit of 0.8 percent (monoglycerides) in the summer and 0.5 percent for some refiners and 0.4 percent for others in the winter, already in their procurement specs," Porter says. "In a sense, the petroleum companies are already finding a common way to address the issue through their procurement specs." He adds that this seems to be a much more sensible approach, and can minimize market confusion. 
 
 Apart from fuel specifications created by the particular testing method ASTM proposes, or the individual minor component to be tested for, the two-grade possibility may indeed present confusion. "There are already issues in the marketplace in just how to price biodiesel," Porter says, "and there is already a great deal of trading confusion. Although this seems like a short-term solution, it seems that it may result in a more long-term problematic outcome." Jennings seems to agree on the possibility. "Someone not understanding why the new grades may be added could potentially cause a little confusion as to which fuel is best suited for each application." 
 
 It is possible, Jennings adds, that some producers, who may not really understand the specifications and the reason that the new grades were added, may think this new grade is the highest grade fuel, and the result would create a buyer who wants a No. 1 grade but doesn't need it. Howell says this new grade makes sense for a lot of reasons, but the most important thing "is giving people the confidence to use biodiesel in any condition they want." For Howell, along with consumer confidence, one of the main factors many in favor of the ballot see as a positive is the lack of requirement for a user to use either No. 1 or No. 2. "You can use whichever one you choose depending on your local conditions," he says. 

 
 On the opposite side of the spectrum, producers may have their own issues to deal with as well. Because the proposed new grade would tighten monoglyceride levels, producers using tallow or yellow grease would have to adjust production methods in order to make the No. 1 grade. "Any producer using a TME or even yellow grease," Porter says, "would have to use distillation as part of their process. And this would not be necessary for other feedstocks." According to Porter, there are more producers using tallow or yellow grease as opposed to soy, in comparison to four years ago. But Howell says the added grade will simply allow the marketplace do its job figuring out which one is really needed. "Every time we make a spec change it is important to the industry," he says, adding, "I kind of view it as biodiesel really starting to mature as an industry and to become accepted within the petroleum industry infrastructure. It's something very few other alternative fuels have been able to do." 
 
 	
 Next Steps
 
 If the main committee votes yes, then the multigrade spec will be passed. If the vote is no, then it won't, and those in favor of the measure will go back to the drawing board to adjudicate the negatives. As Howell notes, along with consumer confidence, the petroleum sector's confidence in biodiesel is also a positive. If the ballot passes, it won't pass simply on the judgment of the biodiesel producers or users. "At ASTM you have the petroleum guys, the biodiesel guys and the engine guys all sitting down at the same table, and it's really a team effort," Howell says. The team effort will hopefully result in a system that can implement another fuel grade, much in the same vein as the petroleum industry has done in the past, and because the biodiesel industry may be following in the footsteps of the petroleum industry, the relationships between the two may benefit, according to Howell. 	
 
 "I think this is probably the fairest way ASTM could address this particular issue," Jennings says. But, Howell points out, "Even in really, really cold weather in International Falls, Minn., they are using No. 2, biodiesel and not having a problem. Why should they have to go to a different fuel when what they are using is working fine for them?" For some, those frigid days do create problems, as ASTM has documented, but the question is whether an isolated incident is important enough to create another grade of biodiesel. For the answer, check back this winter.
 
 Luke Geiver is a Biodiesel Magazine associate editor. Reach him at (701) 738-4944 or <a href="mailto:lgeiver@bbiinternational.com">lgeiver@bbiinternational.com</a>.

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In extreme winter environments, such as far northern reaches of the U.S., even No. 2 diesel is cut or replaced with No. 1, to lower cloud point. Proponents of dual biodiesel grades say methyl ester users should have the same option. PHOTO: SUGARBUSH 

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Most filter clogging in Minnesota last winter occurred in dispensing tanks, not in vehicles. The events, while enough to suspend the mandate, were rare. PHOTO: NRDDI

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Experts still say one great possibility contributing to the rare instances of filter clogging in extreme winter environments has to do with unknowns regarding ULSD, and how the low-aromatic fuel blends with biodiesel. PHOTO: NRDDI

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An ASTM ballot to create a new grade of biodiesel is in the final stages, but not everyone is hopeful for the same result.

Winter-Grade Biodiesel

The National Biodiesel Board recently presented retiring Sen. Christopher Bond, R-Mo., with a Lifetime Achievement Award for his long-standing support of the biodiesel industry. NBB headquarters are located in Jefferson City, Mo., due to the deep ties the industry has in the state.
 
 Commercial biodiesel development began, thanks in part to Sen. Bond's early support of research at the University of Missouri, and collaboration with the Missouri Soybean Association. His leadership in the state helped the industry grow nationally. 
 "America is striving for energy security and clean air, and Sen. Bond deserves our thanks for helping to make biodiesel viable," said NBB CEO Joe Jobe.
 

 As part of the ceremony, the NBB planted a chestnut tree on the office grounds. One of Sen. Bond's interests outside his job in Washington is in innovative agriculture, which includes an expansive chestnut tree orchard at his home in Mexico, Mo. The tree planted was a starter tree that originated on Bond's farm. 
 
 "I want to thank you all here at NBB for this award and for your support," said Bond. "In 40 years of public service, I have seen many ideas come and go. Biofuels, or generating energy from crops we have in abundance is an idea that is here to stay. It makes sense environmentally, it makes sense from a business perspective, and it means we don't have to import as much energy from foreign sources. Congratulations to all of you for seeing that and for advancing biodiesel and this young, promising industry."

Sen. Kit Bond accepts the lifetime achievement award at a ceremony at the NBB headquarters.

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NBB presents Missouri senator with Lifetime Achievement Award

The National Biodiesel Board membership includes state, national, and international feedstock processor organizations, biodiesel suppliers, fuel marketers and distributors, and technology providers. All will have a voice at the November meeting where members will elect representatives to serve on the governing board. 
 
 NBB member elections were carefully designed to reflect the trade association's unique makeup and accompanying complexity. Members elect representatives in farmer, render/producer, producer and at-large categories. 
 
 The elections include both a straight and weighted voting selection process. The straight voting (one vote per voting member) elects one candidate from the farmer category, one candidate from the render/producer category and two candidates from the producer category. The weighted voting (member votes are calculated in consideration of total financial contribution to NBB) elects three candidates at-large. Candidates serve two-year terms. The election of officers-chairman, vice-chairman, secretary and treasurer-follows the governing board election. All officers serve a one-year term.
 
 Seven of the 15 directors' terms are set to expire, including Greg Anderson, farmer; Greg Hopkins, producer; David Lyons, at-large; Denny Mauser, producer; Doug Smith, producer/renderer; Robert Stobaugh, at-large; and David Womack, at-large. 
 
 The election will be held at the Nov. 15-17 NBB member meeting in St. Louis. The NBB governing board directs the strategic planning, project development and overall direction of the NBB. All NBB members are encouraged to participate.

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NBB governing board elections will capture diverse membership

The revised renewable fuel standard, RFS2, went into effect July 1. NBB has spent a significant amount of time, effort and resources working with U.S. EPA to create and implement a program that displaces petroleum with advanced biofuels such as biodiesel. By rule, 800 million gallons of biodiesel must enter into the marketplace in 2011, in addition to the 345 million gallons EPA anticipates will be required in 2010. NBB producer members are working out the kinks to make the RFS2 a reality as the required volumes are a bright spot for the industry. 
 
 The details of the program are a bit hazy, and the NBB has spent a great deal of time reaching out to its members to ensure biodiesel producers understand the requirements of the program. 
 
 "We ended the first compliance period under the RFS2 in September and understanding EPA's Moderated Transaction System, how to sell biodiesel, whether the renewable identification number is attached or separated from the biodiesel gallon, and a whole host of new reporting requirements are issues every biodiesel producer must address," said NBB's Larry Schafer. "We are providing information to our members that will help them comply with the program in the most efficient way possible. The first time through this process is difficult and we are trying to demystify the program." 
 
 "Biodiesel is a fuel, and all fuels in America are highly regulated by the government," said Ron Marr, NBB member with Minnesota Soybean Processors. "NBB is developing as the expert in the regulatory arena that the biodiesel industry deals with every day, starting with the RFS2. This expertise is a great service, and a real benefit to NBB members." 

 
 The series of training workshops this year have included on-site training in Houston, Los Angeles, New York, Atlanta, Des Moines, and 10 webinar sessions.

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NBB's RFS2 training sessions offer in-depth look at implementation

This year's theme for the National Biodiesel Conference & Expo is summed up in one word: advance. It's time that all biodiesel businesses advance, and at last, we are in a position to do so. 
 
 RFS2 will help generate significant demand for biodiesel. But what is its true impact, and how can biodiesel producers and marketers put themselves in a winning position? For a second year, this will be a primary focus of the conference. Educational sessions, the exhibit hall, and networking opportunities will empower you to use the RFS2 to your greatest advantage. 
 
 We'll also confront another key issue that almost wiped biodiesel out of the RFS2: pseudoscience. Keynote Michael Shermer, founder of Skeptic Magazine, columnist for Scientific American, and world-renowned "debunker," will explore the fuzzy land between science and pseudoscience, an area likely to shape public opinion on biodiesel for years to come. You won't want to miss this dynamic presentation addressing one of the biggest challenges facing our industry: junk science presented as fact. 
 
 The demographics of our conference attendees indicate most are high-level decision-makers in their respective areas. This conference truly has developed into an annual meeting of the minds, and anyone who wants to advance with our industry will be there. 
 
 The 2011 conference, to be held at the Phoenix Convention Center Feb. 6-9, will include an array of networking and social events in this exciting city, along with our always popular and exciting Expo. To register, visit www.biodieselconference.org/2011.

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Advance your business at the 2011 National Biodiesel Conference & Expo

Rock legend Neil Young made a special appearance Sept. 23 in support of his Repowering the American Dream Lincvolt automotive environmental initiative. The event was held in the lobby of the Hollywood, Fla.-based Seminole Hard Rock Hotel & Casino and offered a rare opportunity to see Young's prototype, a zero-emissions 1959 Lincoln Continental convertible. During the event, Young remarked that he likes old cars and he likes driving on American roads but he felt guilty over the gas consumption of the old convertible. So he set out to find a team of skilled professionals that could make the vehicle more sustainable to drive. The Lincvolt is a diesel-electric hybrid that uses a biodiesel-powered microturbine engine to recharge batteries that power an electric motor. The combination of biodiesel and electric batteries gives Lincvolt a range of more than 400 miles, while the efficient, biodiesel-powered engine and electric motor allow the vehicle to achieve 80 miles-per-gallon. 
 
 A new skid-mounted pilot esterification unit, developed by Dow Water & Process Solutions with a $750,000 grant from the Pennsylvania department of environmental protection's alternative fuels incentive program, is now making its way around the state's biodiesel plants. Al Schulz, senior scientist with Dow Water & Process Solutions, told Biodiesel Magazine that the transportable pilot unit was created to help teach customers and suppliers in Pennsylvania how to use Dow's Amberlyst BD20 solid acid esterification catalyst for optimum results. Bayer Technology Services helped design the system and Pittsburgh-based CTI Biofuels LLC built and initially ran the unit for Dow. United Oil Co., also out of Pittsburgh, supplied feedstock for the trial runs, and took finished product back once converted, Schultz said. 

 
 Green Equity Holdings Inc. recently signed a letter of intent with Florida-based clean energy solutions provider Strategic Energy Supplies Corp. to jointly build and deploy brown grease waste recycling facilities across the country. The transaction was expected to be finalized by the end of October. The agreement states that SESC would begin construction of three or more brown grease recycling plants within the first year of the partnership. GEH plans to invest $1.5 million for each plant under construction in the first year in exchange for scaled ownership interests in the proposed plants. GEH would have a 70 percent ownership interest in the first plant, a 60 percent ownership interest in the second, and a 50 percent ownership interest in the third and all subsequent plants. Each plant would be capable of producing between 50,000 and 100,000 gallons of brown grease a day. 
 
 BDI-BioEnergy International AG recently won a contract to upgrade Altorricon, Spain-based Aragon SL, a biodiesel plant that began operating in 2008 designed to process virgin oils, with an installed production capacity of 100,000 metric tons (about 30 million gallons) per year. The order is worth around €4.6 million ($6.3 million). The upgrade will allow the plant to utilize multiple feedstock such as cooking oil and animal fats for the production of high-quality biodiesel meeting the European Standard EN 14214. The scope of the contract includes engineering, installation and commissioning, in addition to all of the process steps for distillation, and steel work and associated equipment, and seamless integration into the existing system. The technology for the distillation is built in cooperation with the German BDI subsidiary UIC GmbH, a leader in short-path distillation. Completion is planned for September 2011. 
 
 Flint, Mich.-based OnSite Energy LLC has launched a line of small biodiesel processing units capable of converting virgin and used cooking oils into fuel. Operational manager Jeff Woolman said OnSite Energy's biodiesel processors are fully automated and, with a simple push of a button, the units can produce high-quality biodiesel in less than 20 minutes. The company offers three processing unit models. The Genesee processor model, the smallest, features a 110-gallon mixing tank with an 80-gallon output. The Huron and Marquette models have an output of 150 and 220 gallons, respectively. The processors can also be mounted on trailers for easy storage and portability. The cost of a Genesee model is about $12,000. The units are the result of a two-and-a-half year collaborative effort with the USDA, Mott Community College's Regional Technology Center, the Center for Advanced Manufacturing and others. One school district in Flint has purchased a Genesee model, with the Mass Transportation Authority also expressing interest.
 
 Kingsport, Tenn.-based algal technology company Renewable Algal Energy LLC received $3 million in grant money appropriated under the U.S. DOE's Small Business Innovative Research Phase III Xlerator program for its project titled, "Algal Biodiesel via Innovative Harvesting and Aquaculture Systems." According to RAE CEO Jeff Kanel, the company intends to use the funds to further refine-and eventually scale up-its patent-pending algal aquaculture, harvesting/dewatering and extraction technologies at its demonstration facility in Arizona, which has an aquaculture capacity of approximately 200,000 liters (52,800 gallons). 
 
 Neste Oil recently applied for patents covering technology developed to produce microbial oil from waste and residues with help from various yeasts and molds. The oil could then be used as feedstock for the company's NExBTL renewable diesel process. Research work began with the Aalto University School of Science and Technology in late 2007, and since then the process technology challenges have been resolved. Microbial oil produced this way has already been refined into NExBTL renewable diesel. Following the success of the lab work, the emphasis will now shift to evaluating microbial oil's potential for pilot-scale production. Commercialization is possible by 2015 at the earliest. 
 
 Wade L. Watson, CPA, CFE and assurance partner was recently named an industry practice leader in Weaver's Renewable and Energy Compliance practice. With more than nine years of experience in public accounting, Watson specializes in providing auditing and advisory services to the petroleum and renewable fuel industries. His specific experience includes performing financial statement audits and attestation services as required under the U.S. EPA's Code of Federal Regulations, Title 40, Part 80. He earned a bachelor of business administration degree from the University of Houston where he graduated Cum Laude. Watson plans to grow this practice through existing services and focusing on newly established regulations, such as the EPA's Mandatory Greenhouse Gas Reporting Rule.
 
 Renewable Energy Group Inc. and ARES Corp. announced on Sept. 22 that REG will acquire biodiesel assets in Clovis, N.M., from ARES, which will concurrently invest an additional $8 million into REG in an all common stock transaction. Burlingame, Calif.-based ARES, an engineering, risk management, software/IT and project management company, owned the 15 MMgy facility in Clovis. Viant Capital represented REG in the transaction.&#61500;

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Business Briefs

The National Biodiesel Accreditation Commission, which facilitates the BQ-9000 quality management program, was founded in 2000. In the decade since its inception, 37 producers, 21 marketers and three laboratories have been accredited through the program. Five additional organizations are currently undergoing the certification process. 
 
 Unlike ASTM fuel standards, the program is not designed to guarantee fuel quality, says NBAC Chairman George Kopittke. Rather, the program ensures that accredited organizations have quality management programs in place. "The BQ-9000 certification recognizes that an organization has a quality management system that is being effectively followed, such that the product is adequately being tested to meet biodiesel ASTM specification," says Kopittke, who is also employed as projects director at Griffin Industries Inc. "The BQ-9000 certification also requires that an organization have procedures in place to prevent product not meeting specifications from entering the marketplace. The BQ-9000 certification does not guarantee fuel quality, nor is there a BQ-9000 biodiesel."

 
 The first program developed by the NBAC was designed for producers. The manual for that certification also included a section that allowed marketers and distributors to seek accreditation. In 2005, the BQ-9000 program was updated to include a separate certification pathway specifically designed for marketers and distributors. The laboratory accreditation program was launched in 2009.
 
 Each of the three BQ-9000 certification pathways has its own unique requirements and objectives. The objective of the producer program is to allow customers purchasing fuel from a BQ-9000-certified producer to forgo extensive fuel testing, while the object of the marketer certification program is to maintain fuel quality and ensure blend accuracy, Kopittke says. The laboratory program is designed to provide customers with assurance that fuel testing practices are accurate and well-managed. 
 While non-BQ-9000 producers are not required to test fuel before it is sold, BQ-9000 certified producers are required to have a regular testing regimen for each production lot of biodiesel, Kopittke says. 
 
 BQ-9000 marketers must test fuel that is sourced from noncertified producers. However, when purchasing fuel from a BQ-9000-certified producer, certified marketers are only required to test for water contamination. Marketers accredited under the program are also required to have a storage tank management system in place to ensure biodiesel is not contaminated with water during storage, Kopittke says, noting that they must also validate blending processes to insure customers actually receive the blend they purchase.
 
 Accredited laboratories are required to have a system in place to manage samples, and must train all personal that perform testing activities. They are also required to calibrate instrumentation, and establish a verification program to evaluate the quality of their testing. "While most laboratories may have some or all of these programs in place," says Kopittke, "a BQ-9000 laboratory certification indicates that the laboratory has all of these requirements and is faithfully executing them."
 
 
 Reaching New Milestones
 
 In August, the National Biodiesel Board announced that the Iowa Central Fuel Testing Laboratory became the first organization to earn BQ-9000 laboratory accreditation. The laboratory is housed on the Iowa Central Community College campus.
 According to ICFTL Director Donald Heck, interest in developing the laboratory began in 2006. "We had put together a two-year biofuels program [at the college], and that's actually what sort of snowballed into the fuel testing laboratory," he says. The college was hosting a meeting to organize a trucking study, the 2 Million Mile Haul. During that meeting, NBB Technical Manager Steve Howell took a tour of the teaching that was under development. "I went out and purchased top-of-the-line industry quality systems, and I guess he was really impressed by that," Heck says. "That is what hatched the idea. The thought was that with some extra funding, ICCC could actually build a fuel testing laboratory and run it as an independent third-party laboratory."
 

 ICCC is already benefiting from the laboratory due to the exposure it has garnered for the college. Community colleges don't usually have this type of science and instrumentation present in the lab, Heck says, which is helping to set ICCC apart from other community colleges. In fact, Iowa Congressman Tom Latham recently gave tribute to ICFTL in the U.S. House of Representatives. "It was really good exposure for the campus," Heck says. 
 
 There are also clear benefits for the students. Although the lab is not used for class exercises, students do have exposure to it. "I tell my students about what is going on in there, and they know it exists," Heck says. "They can walk in there and look at all the instruments. Just to have it on campus brings the academic rigor up a notch."
 
 Iowa's Weights and Measures Bureau will also benefit from the lab. In order to access appropriate testing facilities, the bureau had been required to send fuel samples out of state. The development of ICFTL will allow that work to be done locally. "I think it's going to work really well," Heck says. "We can give them a little more personal attention, work together a little more closely. I think it should be more efficient and more effective for them."
 
 In addition, the lab is likely to benefit local biodiesel producers and marketers. ICFTL is a nonprofit organization, which should allow it to price its services very competitively. "We want to at least break even, we want to be self-supporting, so we do need to charge something for all the equipment, fees, materials, and so on," Heck says. "There are a lot of costs, but we just want to bring in enough revenue to be self-sufficient. We are not trying to make a profit, so hopefully we can keep our costs fairly competitive."
 
 
 The Process
 
 Heck says going into the accreditation process, his initial impression was that it was going to be a nightmare characterized by mountains and mountains of paperwork. Although it was a lot of work, he says that it was much more streamlined than he expected. One action the lab took to help facilitate the process was to hire a consultant who was familiar with the BQ-9000 program. "That was probably the smartest thing we did, just having somebody who knows what they are doing help us through the process," he continues. "There is a fair amount of paperwork, a lot of documents to put together, a lot of things to do, and a lot of preparation. The whole process took about six to eight months, but having that consultant there to take us through it actually made it a very manageable task. It made it very doable."
 
 An important first step for any organization seeking BQ-9000 certification is to develop a quality manual that addresses each specific program requirement, Kopittke said. If an organization doesn't have anyone on staff with quality management experience, it should consider hiring a consultant to help write the manual, he suggests, noting that the manual must contain work instructions so that activities are well documented. 
 
 According to Kopittke, entities seeking accreditation are generally required to operate under their quality management system for six months before they are eligible for certification. Before this six-month period can begin, the quality manual must pass a desk audit. After the six-month threshold is reached, an on-site certification audit is completed by an NBAC auditor. The audit is then sent to the NBAC, where commission members vote on the certification. 

 
 "The most important issue with organizations seeking and maintaining BQ-9000 certification is keeping focus on their quality system," Kopittke says. "It is imperative for BQ-9000 organizations to understand the importance of their quality management te<a href="mailto:evoegele@bbiinternational.com">am meetings and their annual internal audit so that program requirements are understood and dealt with."
 
 In the case of ICFTL, Heck notes that the accreditation process took a great deal of commitment and dedication from an entire team of people. There is no way any one of us could have done this alone, he says. In addition to Heck's laboratory expertise, the team also consisted of very skilled individuals who secured the necessary funding. The ICCC also contributed a lot of commitment to the project. "It was a huge undertaking," Heck says. "It took a lot of people, a lot of time, a lot of focus, and a lot of involvement to get it done," noting that the actual accreditation process was only one component of much larger project. 
 
 "After having gone through the whole process, putting the lab together, running these tests, and working with these instruments, I could see where there could be a huge difference between an accredited laboratory and one that is not accredited," Heck says. "Quite honestly, I don't think I would want to take samples to a laboratory that is not accredited."
 
 
 The Future of BQ-9000
 
 In early 2011, NBAC is expected to release revisions to the producer and marketer certification programs. "Most of these revisions are clarifications of program requirements," Kopittke says. "Over the years we have developed policies on issues such as certification suspension, appeals of NBAC decisions, idle production facilities, change in ownership, and provisional producers and marketers status. These documents have been on the BQ-9000 website, but we are planning to add these documents to the producer, marketer and laboratory requirements to manuals so that the BQ-9000 organization has these policies in print and on hand."
 
 Despite the economic difficulties in the biodiesel industry, biodiesel producers and marketers are continuing to seek, and maintain, BQ-9000 certification. "Most of the certified producers are working to maintain their certifications even with their production facilities idle," Kopittke says. "This is in recognition that the end-use customers are demanding fuel quality and expect to purchase quality fuel from BQ-9000 organizations. Most of the major fuel purchases now require BQ-9000 certification as a precondition of buying fuel, and many OEMs are now putting BQ-9000 in their owners' manuals. Since producers, marketers and end users have recognized the importance of the BQ-9000 certifications, we expect the program to grow in numbers certified."
 
 Erin Voegele is a Biodiesel Magazine associate editor. Reach her at (701) 850-2551 or evoegele@bbiinternational.com.

In August, the National Biodiesel Board announced that the Iowa Central Fuel Testing Laboratory became the first organization to earn BQ-9000 laboratory accreditation. The laboratory is housed on the Iowa Central Community College campus. PHOTO: Iowa

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The BQ-9000 accredited ICFT lab is outfitted with higher-caliber equipment than most community college labs. PHOTO: ICFTL

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Producers continue to pursue or maintain BQ-9000 accreditation, indicating optimism in the future.

BQ-9000: Moving Forward

Posted Oct. 26, 2010

 
 The U.S. EPA and U.S. DOT's National Highway Traffic Safety Administration have released proposed regulations to establish the nation's first standards to improve the fuel efficiency and reduce the greenhouse gas (GHG) emissions of medium- and heavy-duty vehicles. The regulations are essentially an extension of the Clean Cars Program, which established similar requirements for light-duty vehicles earlier this year. While the renewable fuel standard (RFS2) aims to reduce GHG emissions through the increased use of renewable fuels, the Clean Cars Program and proposed rulemaking for medium- and heavy-duty trucks seeks to reduce emissions through greater vehicle efficiency. 
 
 The agencies have proposed new standards for three categories of heavy-duty trucks; combination tractors, heavy-duty pickups and vans, and vocational vehicles. For combination tractors, the agencies have proposed engine and vehicle standards that begin with model year 2014 vehicles and achieve up to a 20 percent reduction in carbon dioxide (CO2) emissions and fuel consumption by model year 2018. For heavy-duty pickups and vans, the proposal separates gasoline and diesel truck standards. A 10 percent CO2 and fuel reduction would be required for gasoline-fueled vehicles in the category, with diesel-fueled vehicles required to achieve a 15 percent CO2 and fuel reduction. Both standards would be phased in from model year 2014 to model year 2018. Finally, the proposal would require vocational vehicles to achieve up to a 10 percent CO2 and fuel consumption reduction between model year 2014 and model year 2018. 
 
 For the purposes of the proposal, the agencies have defined heavy-duty to incorporate all on-road vehicles rated at a gross vehicle weight at or above 8,500 pounds and the engines that power them, except for those already covered by the current GHG emissions and CAFE standards for model years 2012-2016. According to information released by the EPA, heavy-duty vehicles addressed by the proposal include both work trucks and commercial medium- and heavy-duty on-highway vehicles as defined by the Energy Independence and Security Act. The scope of the two agencies is largely the same with one major exception: The EPA is proposing to include recreational on-highway vehicles, such as motor homes, while the NHTSA is not. Trailers are not covered by the proposal. 
 
 Regarding heavy-duty combination tractors, or semi-trucks that pull trailers, the agencies have proposed specific standards for nine subcategories based on a combination of three attributes; weight class, cab type and roof height. The standards for heavy-duty pickups and vans would establish a set of target standard curves based on what the agencies call a "work factor." This would be calculated using a vehicle's payload, towing capabilities and the presence or absence of 4-wheel drive. The standards for vocational vehicles are markedly different than the requirements of the other two categories, as the vocational subsection encompasses a wide range of vehicles. This includes delivery trucks, utility trucks, transit and school buses, emergency vehicles, tow trucks, etc. The agencies propose to regulate the chassis manufacturers of these vehicles and divide the segment into three subcategories consistent with engine classification. According to information released by the EPA, the proposed program for vocational vehicles in this phase of regulatory standards would be limited to tire technologies and hybrid power trains, in addition to the separate engine standards. 
 
 The specific requirements for each category and associated subcategory can be accessed on the EPA's <a target="_blank" href="http://www.epa.gov/oms/climate/regulations/420f10901.pdf" rel="external">website</a>. 
 
 "These new standards are another step in our work to develop a new generation of clean, fuel-efficient American vehicles that will improve our environment and strengthen our economy," said EPA Administrator Lisa P. Jackson. "In addition to cutting greenhouse gas pollution, greater fuel economy will shrink fuel costs for small businesses that depend on pickups and heavy-duty vehicles, shipping companies and cities and towns with fleets of these vehicles. Those savings can be invested in new jobs at home, rather than heading overseas and increasing our dependence on foreign oil." 
 
 While the new proposed standards affect both gasoline and diesel powered heavy-duty vehicles, the impact on the diesel community will be significantly more pronounced. "More than 95 percent of all heavy-duty trucks are diesel-powered, as are a majority of medium-duty trucks, said Allen Schaeffer, executive director of the Diesel Technology Forum. "Diesel power is the driving force today of goods movement by truck in our economy. This proposal clearly envisions clean diesel power as the centerpiece of freight transportation in the clean energy economy of tomorrow."
 

 A 60-day public comment period on the proposal will begin following publication in the Federal Register.

New heavy-duty standards proposed

Oct. 26, 2010 
 
 Frontier Airlines, a wholly-owned subsidiary of Republic Airways Holdings Inc., and Canopy Airport Parking formed an extended promotional partnership aimed at providing fliers a chance to park at Canopy's ecofriendly facility in Commerce City, Colo. Canopy's state-of-the-art parking facility, expected to open in late November, will provide continuous shuttle service between the lot and the Frontier ticket counters using its seven biodiesel and hybrid shuttles.
 
 A 3,000-gallon tank will be installed on-site to refuel the bus fleet, according to Karl Kelman, Canopy's marketing manager. "We also have buses that run on compressed natural gas and have a gasoline hybrid bus as well," he said.
 
 In addition to biodiesel being used by Canopy's shuttle buses, the innovative parking facility is expected to feature other environmentally friendly technologies, including solar power, geothermal and wind power. When the parking facility opens, Kelman said it should be the country's first to feature energy efficient technologies from renewable sources. "We're hopeful that at some point there will be other parking facilities like Canopy that integrate similar green features."
 
 Canopy is a cooperative venture of Greenscape Capital and Propark America. Greenscape enhances profitability through energy savings and other environmental efficiencies while Propark provides custom parking management solutions for more than 400 parking facilities. Both Greenscape and Propark developed Canopy as a prototype for parking industry environmental and energy-efficiency standards.

Green parking facility uses biodiesel shuttles

Posted Oct. 27, 2010
 
 Enzyme developer Verenium has renewed and extended for five years its joint marketing agreement with Alfa Laval, the heat transfer, separation and fluid handling company, for its patented Purifine PLC enzyme. Under terms of the extended agreement, Alfa Laval will market Purifine PLC to edible oils processing customers in agreed territories and continue its efforts on developing the Purifine PLC enzymatic degumming process. The renewed agreement supersedes the initial agreement announced in early 2009.
 
 "Our collaboration with Alfa Laval has been successful on a number of levels," said Janet Roemer, Verenium's president and chief operating officer. "In addition to expanding Purifine PLC's global market penetration, through working with Alfa Laval, we've also been able to enhance support of the Purifine PLC enzymatic degumming process. We look forward to building upon this successful collaboration as we work to secure continued growth for both businesses in the important global vegetable oil market."

 
 According to Verenium, the company's Purifine PLC enzyme improves operating efficiency and reduces byproducts by allowing a higher percentage of the crude vegetable oil extracted from seeds to be recovered and converted into edible oil or biodiesel. In conventional processing, phospholipid impurities are removed as emulsified gums with an associated oil yield loss. Verenium's Purifine PLC enzyme works by reacting with the phospholipids releasing both the oil entrained in the gum and the oil component of the phospholipids. Compared to other degumming methods, oil yield losses are reduced by up to 75 percent using Purifine PLC enzymatic degumming, the company states, depending on the phospholipid content of the oil. Purifine PLC also offers significant benefits to the refining process by improving operating efficiency, and reducing the need for harsh chemicals and other processing aids.
 
 "Alfa Laval is pleased to be able to extend our partnership with Verenium, which will allow us to continue to offer Purifine PLC's novel enzyme technology to the vegetable oil processing industry," said Bent Sarup, general manager for Alfa Laval's Vegetable Oil Technology Business. "Under the agreement, we expect to further enhance the value created for our customers through continuous process improvements of this technology."

Alfa Laval, Verenium extend joint venture

Posted Oct. 27, 2010
 
 In the face of petroleum scarcity, increasing oil prices, market volatility and climate change, leaders in government and industry are looking to renewable fuel sources such as algae-based biofuels to reduce expenses and mitigate their acute vulnerability to petroleum supply chains. Yielding two to 20 times more oil per acre than leading oilseed crops, algae's productivity and scalability are seen as its greatest advantages, and a number of key industry players are gearing up their operations to meet the opportunity. Algae biofuels have the added advantage of utilizing nonfood-based feedstock, with the abilities to grow on nonarable land and utilize a wide variety of water resources including wastewater and seawater. 
 
 According to a new report from Pike Research, algae biofuels production will grow rapidly over the next decade, reaching 61 million gallons per year and a market value of $1.3 billion by 2020. While barely a drop in the bucket for biofuels, this represents a compound annual growth rate (CAGR) of 72 percent, roughly on par with early development in the biodiesel industry. 
 
 "On paper, algae could displace worldwide petroleum use altogether, however, the industry has yet to produce a drop of oil for commercial production," said Pike Research president Clint Wheelock. "Although the algae-based biofuels market will grow rapidly once key cost hurdles are overcome, widespread scale-up will be hampered by a number of difficult challenges including access to nutrients, water and private capital." Wheelock added that, with the cost of production still a key obstacle to widespread production, many companies are refocusing production efforts on low-volume, high-value coproducts to develop revenue streams over the next decade. 
 
 Pike Research anticipates that, with 50 percent of all algae activity, the U.S. is poised to ramp up production the earliest among world markets. Pilot- and demonstration-scale facilities are beginning to break ground across the country. The EU market, which is home to about 30 percent of algae activity, will be limited initially by the industry's focus on university research, and later by insufficient access to water, land and nutrient sources. Latin America and Asia Pacific, which are home to fewer projects in operation today, are set to gain significant market share in the long run. 
 
 Pike Research's study, simply called "Algae-Based Biofuels," examines the key growth drivers behind the algae-based biofuels market and outlines unresolved supply challenges. It compares advantages and disadvantages of algae production pathways, leading cultivation technologies, and end-market opportunities. The report includes detailed 10-year market forecasts, segmented by world region, along with analysis of market conditions in key countries and profiles of key industry players that are shaping the emerging algae biofuels business. 
 

 SOURCE: PIKE RESEARCH

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Forecast: Algae biofuels at 61 MMgy by 2020

Posted Oct. 27, 2010
 
 Aurora Algae Inc. is in the process of constructing a demonstration-scale facility in northwestern Australia, which is expected to be operational by the end of the year. Plans for an adjacent commercial-scale plant are also underway. 
 
 The company, formally known as Aurora Biofuels Inc., recently changed its name to reflect a new focus. According to Aurora CEO Greg Bafalis, the original focus of the business was on biofuels development, but with the name change Aurora has shifted its focus to algae production. "When I joined the company it was really apparent to me that the platform is algae-and what you can make from that algae," he said. "So, we've transitioned into what I call higher value products, such as omega-3 EPA. Moving towards those higher-value products allows us, with our current yields and current cost structure, to actually go out and build a commercial facility in a profitable manner."
 
 While Aurora plans to initially focus on the production of high-value algae-based products, the company hasn't abandoned the idea of biofuels production. "We haven't completely dropped biodiesel production," Bafalis said. "I would say instead of being the primary product, it's more of a byproduct in our process." Ramping up and optimizing a new technology is always an expensive and time consuming process, he continued. "By going towards higher-value products, it gives us the time to go out on a very large commercial scale and prove out our system, grow our algae, and find the optimizations we need to get the costs in line to produce a product like biodiesel," Bafalis said. "We think the evolution will be there, and down the line-whether its five years or 10 years-maybe the costs will come into line, and at that point we'll not only to serve the attractive markets that we are going after in nutriceuticals, but also evolve back into the fuel markets."
 
 Work on Aurora's demonstration-scale facility is nearly complete. "Over the past 10 months, we have been developing and constructing a demonstration facility in northwestern Australia," Bafalis said. "We currently have 38 micro-ponds, which are basically two square-meter ponds. We've been growing algae in those ponds for the past few months and gathering a lot of very important data. We are also in the middle of constructing six one-acre raceway ponds, which will come into operation at the end of the year." 
 
 Aurora is also in the process of permitting and securing land rights to build a large-scale commercial facility adjacent to the demonstration plant. According to Bafalis, construction on that facility could begin as soon as 2012. The goal is to have all the required permits in hand to construct and operate the commercial facility in hand by the fourth quarter of 2011, Bafalis said. "We've already secured a CO2 supply, and we're looking to actually be in a position to break ground in January 2012 and be operating by January 2013," he continued. 
 
 The exact production capacity of the two facilities has not yet been determined. "We're actually gathering growth data right now in Australia, so the definitive amounts have not been determined," Bafalis said. "We believe that those facilities will focus primarily on biomass production, so we're looking at somewhere in the neighborhood of 30,000 to 40,000 tons per year of biomass produced out of the large commercial scale facility. Out of that we'll extract our omega-3 EPA oil as well as produce some biodiesel."
 
 According to Bafalis, Aurora has developed a pale green cultivar of algae. "In very simplified terms, it lets light penetrate farther into the pond and creates a much higher yield in production," he said. "So we are able to get better penetration of light, better use of energy, better efficiency, and therefore better yield from the algae. We have some proprietary process enhancements on how we mix our ponds, how we move the water, and the shape of the ponds, but it's basically the traditional open-pond concept."

 
 The extraction process that Aurora has developed is based on existing industrial processes used in wastewater treatment and traditional agriculture, Bafalis said. "It's basically a traditional hexane extraction…and the harvesting that we use is basically a flocculation with other systems used in wastewater treatment," he continued. "We've gone the very traditional route, so that we can actually ensure that we can achieve the results we say we can."
 
 Aurora has a total of 27 patents for its biology and technology platform. "We believe that based on existing data, we can achieve the costs that we need to make our process profitable," Bafalis said. "Without going into all of the proprietary details, I think that some of our cultivation and harvesting techniques allow us to do it in a very cost effective, energy efficient manner. Energy is your biggest cost in growing and producing algae, and we've been able to reduce those costs significantly with some of the enhancements we've done to this traditional equipment." While Bafalis said he can not disclose the projected price for Aurora's algae oil products, he did say that based on what they've seen in the marketplace and the projected cost of production, Aurora believes that the business will be very profitable. 
 
 According to Bafalis, one of the primary benefits of Aurora's new business plan is that focusing on higher-value markets will allow more rapid scale up and commercialization of the technology. "I think if we stayed on the biofuel-basis approach, right now we'd be like everyone else and talking about five to 10 year horizons," he said. "I think we've positioned ourselves nicely to go out and develop a large-scale business on a much more rapid basis with a defined plan to actually be in operation by 2013."

Aurora Algae unveils new business plan

Posted Oct. 27, 2010
 
 An initiative in Saline, Mich., is seeking a $50,000 grant through the Pepsi Refresh Project to establish a small-scale biodiesel production facility that would serve the Saline Area School District. "The purpose of the Pepsi grant is to reduce dependence on the petrochemical industry for propane, fertilizer and electricity," said David K. Mellor, an instructor at Saline High School who is involved in the project. If funded, the biodiesel production facility will convert waste vegetable oil from the district's cafeterias into fuel. 
 
 The grant is being sought by the Green Hornet Initiative, a group of students, faculty, staff and community members in the district that are working to create a more sustainable future. The group, which is pursuing several projects including the production of biodiesel and organic fertilizer, aims to raise environmental awareness on campus and throughout Southeast Michigan. According to Mellor, the projects will inspire students to pursue careers in alternative energy and sustainable agriculture. 
 
 Biodiesel produced through the project would primarily be used to fuel diesel-powered grounds equipment, said Mellor. The fuel could also potentially be used to heat a greenhouse that has been developed under the Green Hornet Initiative. "We would have to get state approval to use biodiesel experimentally to heat it [versus] wood chips," he continued. "But, I plan to apply for the variance permit when, and if, we get the Pepsi grant-not before." The greenhouse will initially be heated with propane. "We would have to look at a different heating system to use biodiesel as the fuel," Mellor said. Chris Schilling, department head of engineering at Saginaw Valley State University, is currently experimenting with biodiesel as a heat source and is serving as an advisor for the project, Mellor continued. 
 
 The grant proposal is scheduled to go live on the Pepsi Refresh Project website on Nov. 1, at which time the public can vote for the project. Proposals with the most votes will receive funding.

MI students seek biodiesel production funds

Posted Oct. 27, 2010

 
 China Integrated Energy Inc. closed on the acquisition of a newly constructed 50,000 metric ton (15 MMgy) biodiesel production facility from Chongqing Tianrun Energy Development Ltd. in Chongqing City, China. According to CIA, the newly-acquired plant is located adjacent to the company's existing 100,000 metric ton facility in Tongchuan City, Shaanxi Province, China. The company expects to conduct initial testing in December, followed by ramping up production. 
 
 "This acquisition will be accretive to our revenue and net income immediately," said CEO Gao Xincheng. "With our newly constructed 50,000 metric ton biodiesel production facility, which will come online later this year, we will double our biodiesel production capacity to 200,000 metric tons this year."
 
 According to CIA, it paid approximately $16.5 million in cash from the $58.7 million it had in hand as of June 30 for the Chongqing Tianrun biodiesel plant. CIA anticipates that the acquisition could add approximately $32 million in revenue and $8 million in pretax income in 2011. 
 
 The newly acquired plant, according to CIA, will use first-generation biodiesel production technology, similar to the production process used in the company's existing 30 MMgy plant located in Shaanxi Province. With its expertise in production and its established distribution network, the company expects the new facility to achieve gross margins of approximately 30 percent. 
 
 "With continued government support for renewable energy sources such as biodiesel and strong domestic demand for energy, we are confident in generating strong earnings and cash flows over the next several years," Xincheng said.

China Integrated Energy acquires new plant

Posted Nov. 3, 2010
 
 General Biodiesel Inc. tapped digital prototyping and piping and instrumentation diagramming (P&ID) software from Autodesk Inc. to streamline the production process at its 15 MMgy multi-feedstock facility in Seattle, Wash. The improvement project cut more than $500,000 on traditional upgrade costs to the plant, according to the company.
 
 As part of its plant improvements, General Biodiesel used Autodesk Inventor and Auto CAD P&ID software to design a sophisticated pretreatment system that allows higher yields from converting used cooking oil into biodiesel. By using Autodesk Inventor software, General Biodiesel could produce compelling 3D digital prototypes of the plant and equipment to quickly visualize and explore the viability of proposed changes. 
 

 "Autodesk software was extremely helpful in streamlining and organizing our processes," said Cameron Hewes, president and chief financial officer for General Biodiesel. "Using Autodesk Inventor and AutoCAD P&ID helped us design and make real-time incremental process changes that improved efficiency and throughput for our plant."
 
 The company also used AutoCAD P&ID to generate the bill of materials, making for more accurate reports and saving money through greater efficiency. Autodesk's partner IMAGINiT assisted with training and to ensure successful deployment of Autodesk's software. 
 
 "By creating process flow diagrams, bill of materials and piping and instrumentation diagrams with Autodesk software, we significantly reduced our costs while improving our collaboration and efficiency," Hewes said.
 
 The plant improvement project was part of Autodesk's Clean Tech Partner Program, which aims to provide software for emerging cleantech companies in North America and Europe, such as biodiesel producers.

General Biodiesel streamlines operations 

Posted Nov. 3, 2010
 
 California Gov. Arnold Schwarzenegger was on hand Oct. 28 for the grand opening of a new alternative fuel filling station in San Jose, Calif. The station, which was developed by Propel Fuels, offers both B5 and E85 to retail customers. 
 

 The new station is part of Propel's rollout of 75 retail alternative fuel stations within the state. The project is funded, in part, by a $10.9 million grant from the U.S. DOE and California Energy Commission. Government funding for the project has been matched by $16 million in private investment. As part of the initiative, Propel is working with community partners to educate consumers and fleets on the benefits of renewable fuels. 
 
 "We cannot address our environmental concerns without also addressing the cars we drive and the fuels that power them," Schwarzenegger said. "That's why I have challenged businesses and entrepreneurs to innovate and to develop alternative fuels and cleaner modes of transportation, which is exactly what Propel is doing here today with the opening of their newest renewable fuel station. Building stations like this up and down the state creates jobs while helping clean our air and giving motorists better access to alternative fuels. This is great for the environment, the economy and California."
 
 During his speech, Schwarzenegger also noted his personal excitement regarding the new availability of biodiesel in the region. "I have one of my Hummers that is a biodiesel Hummer," he said. "It was a regular diesel and I converted it over to biodiesel so I can put vegetable oil or just drive up to any gas station and to get it. But if you want to find a fueling station it's very hard to find a fueling station, a regular gas station that can provide the fuel." With Propel's development of the new filling location, Schwarzenegger noted that 13 locations currently make biodiesel available to retail customers, with a total of 75 planned to be brought online over the next two years. 
 
 Schwarzenegger also spoke about the job creation benefits of Propel's project. "As we expand those fueling stations there will be 450 jobs created," he said. "And this is again proof-because there are some people that say when you are environmentally friendly you lose jobs-no, you can gain jobs. Here is a perfect example of that."
 
 In addition to job creation, Propel CEO Matt Horton said the project will also create significant energy security and environmental benefits. The 75 stations developed by Propel will help reduce up to 39 million gallons of petroleum use within the state each year. It is estimated the project will also reduce statewide carbon dioxide emissions by up to 187,000 tons annually. 
 
 "Thanks to the Governor's leadership, California is at the forefront of both advanced fuel production technology and the infrastructure to provide access to those fuels," Horton said. "There are currently more than one million alternative fuel-ready vehicles on the road in California-vehicles that can immediately speed our transition to renewable fuel sources."

Schwarzenegger attends fuel station opening

Posted Nov. 3, 2010
 
 Decatur, Ill.-based agribusiness firm Archer Daniels Midland Co. plans to build a 164,000 metric ton (49.2 MMgy) biodiesel facility in Joacaba, Santa Catarina, Brazil. Construction on the plant is slated to begin in March 2011 with completion during the first half of 2012. 
 
 The Joacaba biodiesel plant will be constructed adjacent to an ADM soybean crushing facility and a vegetable oil refinery. Acquired from Sadia in 1998, these operations currently process nearly 475,000 metric tons of soybeans and are capable of refining approximately 73,000 metric tons of soybean oil annually. Once operational, the biodiesel production facility is expected to increase oil refining capacity to approximately 110,000 metric tons per year. In addition, the facility will be the first in the state of Santa Catarina, which boasts an ample supply of soybeans produced mainly by small family farms. 

 
 "We see exciting opportunities for ADM within the Brazilian biodiesel industry," said Patricia Woertz, chairman, CEO and president of ADM. "By locating the plant adjacent to our Joacaba soy operations, we're able to leverage our origination, transportation and processing assets."
 
 ADM launched operations in Brazil in 2007 after purchasing soybean processing plants in Rondonopolis, Campo Grande, Joacaba, Tres Passos and Paranagua. In 2002, ADM opened a fertilizer blending facility in Rondonopolis and, in 2007, the company initiated biodiesel production in Rondonopolis. 
 
 Meanwhile, rising commodity prices and a shifting supply of crops dropped ADM's net income by 31 percent for its first quarter ending September 30. ADM posted net earnings of $345 million, down $151 million compared to the same period last year. 
 
 Operating profit for its oilseeds processing segment increased to $308 million from $284 million. Crushing and origination increased $41 million to $176 million for the quarter. Crushing volumes increased more than 6 percent over its year-ago quarter, though volumes decreased sequentially. 
 
 ADM said that "North American margins benefitted from good raw-material positioning; South America gained from better origination margins and strong fertilizer results in advance of the planting season; and Europe saw strong softseed margins."
 
 Refining, packaging, biodiesel and other results increased $6 million to $76 million for the quarter. "South American biodiesel continued to improve", ADM said in its quarterly statement, "driving good margins and volumes in that business."

ADM announces Brazil plant, net earnings drop 

Posted Nov. 3, 2010
 
 A recent tour put on by the Sustainable Sandhills organization of North Carolina at the state's largest military institution has revealed a new use for biodiesel and other biofuels. The tour, called the Green Living & Design Tour, was held to showcase the efforts by Fort Bragg to create a sustainable future. The tour highlighted recycling efforts, energy efficient buildings and a shuttle system that runs on B20. 

 
 Jon Parsons, executive director for Sustainable Sandhills, an organization founded in 2001 in part by Fort Bragg, said the non-profit organization works in the communities surrounding Fort Bragg on air quality, water quality, energy use and waste material issues. The group first started working with biofuels as part of their air quality efforts due to the cleaner burning nature of fuels like biodiesel, according to Parsons. Now, the organization is considering a new use for biodiesel that will help Fort Bragg training sessions run at full capacity and without any geographic restrictions. 
 
 Because the fort is nearly the size of an entire county, Parsons said the institution plays a major economic role in the region, drawing in more and more people that work inside the fences while also benefiting from economic activity outside the fence. "What has happened is that because Fort Bragg is such a major economic engine for the region, and so many people work there, it is a very attractive place to live close too," Parsons said. "The communities surrounding the installation are building homes right up to the boundaries." This really means, Parsons said, that the training exercises, whether it be live fire training or airborne forces training, have to make a sacrifice and create a buffer zone if there is residential or commercial activity close to the boundary of the fort, all to make sure those training sessions don't negatively impact civilian development outside the fence.
 
 One possible answer to help those training sessions run without restrictions, according to Parsons, is in biofuels. With the support of Fort Bragg, Parsons said they would like to have a ban of undeveloped land outside the fence so the institution could use one hundred percent of their training land inside the fence. "There is not only an interest in biofuels from an emissions point of view," he said, "but also for protecting and buffering a military institutions training mission." Maintaining farm land around the fort would be a great buffer Parsons said. "A working farm or a working forest would be the next best use from the army's perspective for land right up against the fence," he added. 
 
 According to Parsons, the fort would love to have soybeans growing around the perimeter that could be part of a closed loop system involving the fort and the surrounding communities, which would eventually result in biofuels production. The fort already uses biodiesel made from waste cooking oil to fuel a few skid steers and forklifts along with the B20 that fuels the shuttle system on the fort. As Parsons points out however, the common idea of biofuel use as an energy independence provider and enabler of national security can be extended to situations similar to Fort Bragg, where biofuel feedstock acres could help the military train and perform the necessary tasks from fence to fence by providing a buffer zone made up of soybeans, corn acres or any other energy crop.

Fort Bragg may have new use for biofuels

Posted Nov. 4, 2010
 
 BBI International's Southeast Biomass Conference & Trade Show in Atlanta this week featured a biodiesel-exclusive panel titled, Biodiesel from Waste and Low-Value Feedstock. The diversity of the panel-a professor/researcher, a small-scale producer, a pretreatment specialist and a representative of a global biodiesel process technology provider-mirrored the eclectic nature of the biodiesel industry. 
 
 Christina Borgese, formerly with BiofuelBox and now the senior engineer and cofounder of consulting firm PreProcess Inc., opened her discussion with the importance of diesel power and how just a 2 percent blend can replace all the lubricity lost in ultra-low sulfur diesel. 
 

 She gave an overview of the wide range of feedstock available for biodiesel processing, and spoke about the three D's of waste feedstock: the diverse array, distributed concentration and diluted fatty acid content. She said fats oils and greases in sewage waste water for instance is as low as 35 parts per million, since most of it is water and solids. 
 
 Borgese said her company uses a controlled algorithm to manage an intensified heat method that puts the heat where it's needed for feedstock pretreatment. This is a cost-saver, she said, because conventional plants use tanks with heated coils on the bottom to keep the sludge soluble, costing 3.5 cents a gallon for heating, which is relatively expensive for such a thin-margined business. Borgese also spoke about using liquid-liquid extraction with finished biodiesel to help pull the FOG out of the diluted waste feedstock. PreProcess Inc. is also working on an in situ super critical extraction method. 
 
 Frank Yeboah with North Carolina A&T University discussed his department of defense project looking at the impact of taking all the military waste vegetable oil for conversion to biodiesel. 
 
 He said if DOD was a country, its fuel consumption would rank 34 in the world, a testament to how much fuel our military operations use. He mentioned a project in Guantanamo Bay, Cuba, where they took the 1,500 gallons of WVO produced monthly and, using a 40-gallon batch process, converted the waste to biodiesel. 
 
 Yeboah's project hopes to find exactly how much WVO is produced on military bases and barracks around the country, and what beneficial impacts that would have if all of it were to be converted to biodiesel. He said thus far nothing much at all is done with the waste oils produced by DOD. 
 
 Panelist Brandon Spence, cofounder and CEO of Midlands Biofuels in South Carolina, a community-scale biodiesel plant, said Midlands Biofuels is the only ASTM-certified biodiesel production facility in the state. He and his team also started the first green apprenticeship in South Carolina. 
 
 Spence said his company provides a service to the local food service industry that they are already paying for. "People like the local service," he said. 
 
 Regarding the lapse of the $1 per gallon blenders credit, Spence said, "We collect our own feedstock and we stand on our own two feet, we don't need the dollar. In order for this business to survive, we can't do it with subsidies." 

 
 Spence also said Midlands Biofuels is looking into solar applications for their process. Already the plant uses a lot of low heat, and does not use a centrifuge for dewatering. Midlands Biofuels also uses woody biomass for filtration, but one issue with that is the premature exhaustion of the wood chips. 
 
 The company also runs its process on boilerless technology. This began by taking apart a tankless hot water heater, and having an engineering firm look at the possibilities for using a modified device to provide process heat. The plant uses two modified tankless hot water heaters to preheat the feedstock to 198 degrees in a 4,000 gallon tank with two-inch heating coils. "It cost us only $400 for our heating system," Spence said. 
 
 The final speaker was Klaus Ruhmer, BDI BioEnergy International's North American business development manager. He spoke on RepCat, a process developed by BDI to process high free fatty acid feedstock. RepCat does esterification and transesterification in one step. "It's not quite super critical but it's elevated temperatures and pressures for conversion of lower grade high FFA feedstock," Ruhmer said. 
 
 He also says quality must remain a number one priority for producers, and one of the biggest jumps in technology to improve quality over the past few years has been distillation. 
 
 "In order to achieve profitability, quality must be the foundation, no shortcuts," he said. "The most important pillar after that is yield. You can't run on 80 to 85 percent yield." 
 
 Other necessities to make a biodiesel business profitable, he said, include having to sell high volumes of fuel as a commodity that's competitively priced with diesel fuel, as well as being feedstock flexible. 
 
 "The subsidy was great for producers, but bad for investors," Ruhmer said, "because they would never know if it was going to go away." 
 
 If feedstock prices change 5 percent, that can have a 40 percent impact on profit, he said. A 5 percent change in the price of biodiesel, or in the yield, can have a 50 percent impact on profitability. "For a 30 MMgy plant, a 1 percent loss in yield can cost $1 million."

Biomass conference features biodiesel panel

Posted Nov. 5, 2010

 
 The Global Biofuels Alliance has officially launched. The nonprofit organization will work to "give a voice to the producers, traders, feedstock providers, and equipment manufacturers of the emerging biofuel industry." Made up of 10 founding members from various energy sectors including energy trading companies, start-up biodiesel companies and large biodiesel production facilities, the alliance has already set its sights on the hottest topic in the biodiesel industry. "The biodiesel tax credit is a key agenda," said Wade Randlett, a founding board member of the alliance and cofounder of Enagra Holdings LLC, a holding company for renewable energy projects worldwide. "Although it's a bit broader than that. I think having some form of longer term incentive for any kind of a renewable diesel, regardless of the feedstock, the source or the technology is important." 
 
 For Randlett and the other members of the alliance, including Hero BX, a 45 MMgy plant from Pennsylvania, the understanding by those in Washington on the subject of biodiesel is very narrow; especially the potential role biodiesel could play in the nation's future fuel supply. "We think there should be a much broader conversation about the new technologies that are coming online or are online right now," Randlett said. "Whether it's a traditional feedstock or a broader biomass-based feedstock, we need to have the conversation about the opportunity to displace imported crude petroleum oil." 
 
 With a meeting scheduled in Washington during the week the new Congress starts, Randlett said the organization already has plans to talk with the right people at the right time. "We certainly are not forming because we are in opposition to anybody's stated agenda," he said. "It's really about highlighting our first hand awareness that there is a lack of understanding among elected officials and administration officials that we need to make sure occurs over the next year or two." One example of a misunderstanding in Congress is one Randlett said happened two years ago when a bunch of people were saying algae and jatropha are going to be the thing. "We knew that there was just no way that was going to be economical any time soon and so what they did was to create a false expectation that there was going to be what I would call these magic crops that could sprout up in the desert and solve our energy independence," and Randlett said, "that was just never going to be true." Now, Randlett said, there are non-magical crops that have evolved that we can use to create renewable fuel that are true, and more importantly, that don't provide false hope. 
 
 The Global Biofuels Alliance is currently seeking members, especially those that want to be aggressive advocates in Washington, Randlett said. "Whether or not we are twenty people or two hundred people," he said, "the point is to have this message get across to the people in Washington from the people who intend to aggressive." 
 
 To learn more about the new alliance, visit <a target="_blank" href="http://www.globalbiofuels.org" rel="external">www.globalbiofuels.org</a>

Global Biofuel Alliance formed

Posted Nov. 10, 2010
 
 Research conducted by the UDSA's Agricultural Research Service has identified a promising new feedstock for biodiesel production, Thlaspi arvense. More commonly known as field pennycress, the plant is a member of Brassicaceae family, which includes canola and camelina. 
 

 The project is being completed at the Peoria-Ill.-based ARS National Center for Agricultural Utilization Research. According Bryan Moser, an ARS research chemist, the research team has been studying field pennycress for approximately seven years, while the biodiesel component of the project has been ongoing for the past four years. 
 
 "The work that we do in our unit, the Bio-Oils Research Unit, spans basically everything from agronomic development and oil process, all the way to the production of biodiesel and evaluation of the properties of methyl esters that result from field pennycress oil," Moser said. 
 
 The work completed by Moser and other members of the field pennycress research team have shown that field pennycress seeds contain roughly 26 percent oil by weight. "On a yield-per-acre basis, you could expect to obtain somewhere around 100 gallons [of oil] per acre of field pennycress," Moser said. The plant is best suited for growth in the northern region of the United States.
 
 One of the primary benefits of field pennycress is that it can be grown on existing soybean fields during the winter. This is because it's a winter annual, Moser said. In this application, the crop could be planted in the fall after the soybean harvest takes place. "After your soybean harvest, you would plant field pennycress on the same field," Moser continued. "You wouldn't have to apply any water, fertilizer or pesticides. The field pennycress overwinters on the farm field, which is actually also a [benefit] because it reduces or prevents erosion of the topsoil." In the spring the seeds can be harvested with existing farm equipment prior to soybean planting. "The planting of field pennycress doesn't affect soybean yield, which is a good thing," Moser said. "It also doesn't compete with food production, because the same farm field would be fallow over the winter anyway. You basically get a free oilseed crop by planting field pennycress in the fall and harvesting in the spring."
 
 Part of the research conducted ARS research team involved the evaluation of biodiesel produced from field pennycress oil. The team produced a small lab-scale batch of the fuel, approximately one gallon, and evaluated it under applicable ASTM specifications. Findings have shown that field pennycress methyl ester characteristics, such as acid value, oxidative stability, cetane number, cold flow properties, viscosity, sulfur content, and phosphorous content, are all satisfactory under ASTM D6751. 
 
 The results of cold flow property testing were particularly notable. "We found a cloud point for field pennycress methyl esters at minus 10 degrees Celsius…and the cold filter plugging point…at minus 17 degrees Celsius," Moser said. "It definitely has better low temperature properties than soybean-based biodiesel."
 
 According to Moser, future work will include trying to shorten the growing season for the crop. "At the moment, the harvest date for field pennycress is a little too late in the spring to allow for corn rotation," he said, noting that a shorted growing season would allow farmers to rotate the crop with both soybean and corn cultivation. "It would also be nice to improve the oil content of the seeds," he continued. "Although 36 percent is still good, it would be nice if it were even better…We'd also like to so some vehicle testing with actual engines to measure emissions."
 
 Additional members of the research team included chemists Gerhard Knothe and Terry Isbell and plant physiologist Steven Vaughn. Results of the team's study were published in Energy & Fuels.

Pennycress is a winter annual that is harvested in the spring. // PHOTO: TERRY ISBELL, USDA ARS

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ARS research chemist Bryan Moser and technician Benetria Banks prepare pennycress biodiesel. // PHOTO: STEPHEN AUSIMUS, USDA ARS

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Field pennycress shows feedstock potential

Posted Nov. 10, 2010

 
 On Nov. 9, Darling International Inc. announced its board of directors has unanimously approved a merger agreement to acquire Griffin Industries Inc., a provider of value-added rendering and cooking oil recycling services. Under the merger agreement, Darling will acquire Griffin Industries for approximately $840 million in cash and stock. Griffin Industries' holdings currently include 12 rendering plants and one biodiesel production facility. 
 
 "Our combined companies will make us the leading independent renderer, bakery products recycler, used cooking oil recycler and grease trap maintenance provider in the United States," said Darling Chairman and CEO Randall Stuewe. "Specifically, the combination makes sense because it provides for a more diversified supply of raw material, the leading position in bakery recycling business, completion of Darling's national footprint, increased feedstock supply for our potential green diesel venture, and the ability to transfer best practices between two industry leaders."
 
 During a conference call to discuss the merger, Stuewe specifically spoke about how the acquisition will benefit Darling's green diesel project. "Our combination effectively grows our biofuel feedstock availability and improves our capabilities to serve our green diesel venture previously announced with Valero," he said. 
 
 The green diesel project was initially announced by Darling in September 2009. At that time, the company said it was seeking to form a joint venture with a subsidiary of Valero Energy Corp. to develop a 135 MMgy renewable diesel facility adjacent to an existing Valero refinery. As announced in 2009, the facility would convert waste grease supplied by Darling into renewable diesel. Darling and Valero also announced the two companies are jointly seeking a loan guarantee from the U.S. DOE for the proposed project. 
 
 Stuewe offered a brief update on the project when he announced the pending Griffin Industries acquisition. "We've made a lot of progress with Valero," he said, noting that engineering data, cost estimates, and other necessary documentation has been submitted to the DOE for review. "The Department of Energy is aware, or will be aware of the transaction this morning, and we're hopeful that we can continue to move forward on favorable terms with the Department of Energy," Stuewe continued. "Valero has been made aware of the transaction, [and] understands that this actually positions the company better. We're a stronger, larger company than we were before, and as we say-our bucket of fat to make the fuel has just grown again by 50 percent."
 
 Under the terms of the agreement formed for the acquisition of Griffin, Darling will pay Griffin's shareholders an aggregate purchase price of $840 million, of which $740 million is payable in cash and approximately $100 million is payable in Darling common stock. The transaction is anticipated to close by mid-December.

Darling to acquire Griffin Industries

The California Energy Commission has approved eight grants that leveraged more than $9.6 million in state funding and $11.9 million in private funds to advance the manufacture of electric vehicles and vehicle batteries, add vehicle charging stations, and to encourage the use and distribution of ethanol and biodiesel. 
 
 The two biodiesel projects that received funding to help accelerate production and consumption within the state include East Bay Municipal Utility District and Western States Oil.
 
 East Bay Municipal Utility District received $1 million to make an estimated 300,000 gallons of biodiesel annually at its existing wastewater treatment plant in Oakland. The process will utilize waste fats, oils and grease as feedstock. For the research project, EBMUD and its project team will provide $1,575,000 in matching funds to construct a facility to receive feedstock and install two 30,000-gallon storage tanks. Since lighter fats and oils are well suited to become biofuels, but heavy greases such as brown grease are challenging to convert, EBMUD aims to test improved ways to harvest the heavy greases and to reduce the sulfur content of its biodiesel. 
 

 Western States Oil Co. was awarded $69,233 to convert an existing 8,000-gallon retail tank used for premium gasoline into one that can dispense wholesale biodiesel. Because the tank is immediately adjacent to a Kinder Morgan pipeline terminal in San Jose, delivery trucks leaving the terminal will be able to easily access the biofuel. The wholesale tank will contain B99 blends, which will be mixed in a truck or trailer truck to make blends of B5, B20 and up to B99. The project is expected to lower the price of biodiesel by reducing the cost of distribution in the southern part of the San Francisco Bay area. By displacing petroleum-based diesel, the 5.25 million gallons of biodiesel the new facility can blend and distribute each year will reduce greenhouse gas emissions by an estimated 32,000 tons of carbon dioxide. Western States Oil will provide funding of at least $217,380 in matching funds. 
 
 "Three years ago California crafted innovative legislation that is paying dividends in groundbreaking advances in transportation," said Energy Commissioner Anthony Eggert. 
 
 Hundreds of jobs are expected to be created as a result of the grant-funded projects, while also helping the state reduce its petroleum use and pollution emissions. 
 
 "Partnerships between government and the private sector are encouraging new industries that can rebuild California's manufacturing base," Eggert said. "The projects the Commission approved will improve California's economy and its environment by fostering green, clean advancements in transportation."

CEC awards grants for biodiesel projects

Posted Nov. 10, 2010
 
 The process to develop jatropha seeds into a biodiesel feedstock has taken a step forward. SG Biofuels, a San Diego-based jatropha seed developer and breeder, has joined forces with oil seed giant Bunge Limited. The alliance will utilize Bunge's experience in process development, giving SG Biofuels' existing customers a resource for further jatropha seed development. "Bunge is the largest oilseed processor in the world," said Brian Brokowski, vice president of SG Biofuels. "Their expertise and industry knowledge, combined with their global footprint, makes them the most logical choice to provide processing capabilities to our customers." 
 
 Through the partnership with Bunge, Brokowski believes SG Biofuels has now created a fully-integrated model for deploying successful and profitable jatropha plantations. "Bunge brings to the table their expertise in oilseed processing and will work directly with our customers to establish an efficient and effective model for processing jatropha seeds into crude jatropha oil," Brokowski said. And to do so, Bunge will take a region-by-region approach due to the "unique characteristics of each region," according to Brokowski. 
 
 "The bottom line is our customers will have direct access to Bunge to develop a processing model that works for their particular project," Brokowski told Biodiesel Magazine. SG Biofuels also has worked with Life Technologies Corp. on a genome sequencing project to identify different jatropha gene characteristics, and has also created a cultivar of jatropha they claim will provide 100 percent greater yields when used in Guatemalan growing conditions. 
 
 According to Kirk Haney, president and CEO of SG Biofuels, "The development of a successful market for jatropha requires that all aspects of the value chain are met, from crop science and proper agronomics all the way through processing and refining."

Oil seed giant, jatropha developer partner

Posted Nov. 10, 2010

 
 After five years of research, Alternative Fuels Americas says it is going commercial. The Florida-based energy crop developer will start in Costa Rica, growing jatropha for future biodiesel production. Craig Frank, CEO, said AFA is looking at feedstock development at this point because technology already exists to produce biofuels efficiently. "The refining is no tough trick," he said. "It is just a question of dollars and putting the facilities in place." As a result, AFA has plans to develop jatropha plantations in Costa Rica, Panama and Colombia. Guatemala and Honduras are also possibilities, according to Frank. But, don't expect to see any of its jatropha-based feedstock from those countries being used in the U.S. 
 
 "We want to sell where we grow," he said. "We are not interested in growing it there and selling the feedstock in the U.S. market." After running the numbers on the profit margins created by growing and selling all in the same region, Frank said AFA can make a "very attractive" profit due to a cut in logistical costs, in combination with a healthy market that can absorb everything they make and then some. "I think initially [my thoughts weren't] much different than anybody else's, which was to go down there and grow the feedstock and ship it to the U.S. or Europe," Frank said. "What we really want to do now," he added, "is grow it, crush it, refine it and sell it all in the same place." 
 
 With experience in growing specifically for a Costa Rican climate, Frank said AFA has learned a lot through time spent consulting and working with other growers from Costa Rica. "In general terms, what we learned was that the initial hope or belief or hype about the plant itself has proved to be to us less correct then we hoped it would be. What we learned was that the better you treat the plant, the better it will treat you." The best practices for higher yields, he said, are going to require treating the plant the same as growers do for commercial plants. "That means irrigation, that means fertilizing more than once, that means trimming," he noted. 
 
 AFA has already worked with 17 different species of jatropha in various growing trials that ranged from growing with or without fertilizer, pesticides and varying levels of irrigation. While AFA has learned a lot through those trials, and will also apply those lessons (they will irrigate, fertilize and used pesticides) to future plantations, Frank said the lessons were disappointing "because it upsets the economics, but what you get back on the other end is worth the effort." The work in Costa Rica will initially be on a 200-hectare piece of land, but will eventually move to a 5,000 hectare (12,000 acres) plot. The work in Panama will start within the second quarter of next year, and the work in Colombia will begin in the fourth quarter of next year.

AFA secures land, goes commercial

Posted Nov. 16, 2010
 
 The Federal Reserve recently announced it will buy $600 billion in U.S. treasury bonds. The action, known as "quantitative easing," essentially increases the supply of money within the economy, thereby decreasing the value of the U.S. dollar when compared to other currencies. While this type of action is intended to help jumpstart the economy, Matt Cota, executive director of the Vermont Fuel Dealers Association, said it can lead to rising commodity prices, which hurts consumers. 
 
 As the Federal Reserve prints money and buys treasury bonds, the dollar is devalued, which is great for industries that export products overseas, said Cota. This is because the relative price of those products and services is reduced, making them more attractive to buyers in other countries. However, the reduced value of the U.S. dollar isn't great for everyone. It negatively impacts American citizens who must purchase commodities, such as home heating oil, at higher relative prices, Cota continued. Since rising prices will affect not only petroleum-based commodities, but agricultural commodities as well, Cota said the biodiesel industry could also be impacted through higher feedstock prices.
 
 "The idea is that we can jumpstart the economy by printing more money, making exports more attractive, and thereby those jobs will flourish-maybe they'll be created or maybe they'll stay in business because the export markets heat up," Cota said. "But at the same time, it has the debilitating effect that it slams the brakes on efforts in nearly every community to get out of the slump that we are in."

 
 This can be especially true for heating oil suppliers. "When prices are higher [fuel oil retailers] have to borrow more money in order to purchase wholesale product," Cota said, noting that higher retail prices also make it more difficult for consumers to pay their bills. "We don't like high prices…we thrive on low prices," he continued. "It's difficult for small facility heating oil dealers-of which there is very many here in the Northeast-it's harder for them to run a business when they have to carry so much in loans."
 
 Complicating matters, Cota continued, is the fact that financial regulations signed into law last summer, to stop Wall Street traders from driving up the price of oil, have yet to take effect. "Washington insiders say it is practically impossible for regulators to meet its January deadline for setting new speculative limits in energy markets," he said. "As the cold weather sets in, heating fuel retailers and their customers are facing a double whammy-lack of oversight in the commodities market and a monetary policy that hurts all consumers."

Economic policy could impact Bioheat

Posted Nov. 17, 2010
 
 Temecula, Calif.-based Promethean Biofuels Cooperative Corp. has been recognized by the California Department of Resources Recycling and Recovery (CalRecycle) for its waste reduction efforts. As a winner of the 2010 CalRecycle Waste Reduction Award Program, Promethean will receive authorization to use the WRAP winner logo with its products, advertising and business websites to publicize its waste reduction achievements. 
 
 Promethean's 2 MMgy biodiesel plant has been operating since January 2010, and is currently producing between 5,000 and 25,000 gallons of biodiesel per week, depending on how much feedstock is available, said Todd Hill, Promethean's founder. "Ninety-nine percent of our product is made from used cooking oil and kitchen grease," Hill continued, which is a primary factor that led to the CalRecycle award. "We are taking a waste product…and really increasing its value and creating something that's of value here domestically in the U.S.," Hill said. 
 
 In addition to recycling waste oils into biodiesel, Promethean is also active in recycling hazardous household wastes. While these waste materials, such as paint and motor oil, are not utilized in the production of biodiesel, Hill noted that the hazardous waste recycling initiative was another factor that led to CalRecycle recognition. According to Hill, Promethean also has an aggressive internal recycling program, which was a third component of the award. 
 
 From the standpoint of biodiesel production, Hill said that the CalRecycle award will help make the cooperative more visible to local community members. This should help increase the amount of residential waste grease and oil that is collected for conversion into biodiesel. "Every drop [of feedstock] is vital to us," Hill said. "We also really do want community involvement," he continued, noting that increased public visibility will help build Promethean's community-focused model for renewable energy production. 
 
 According to CalRecycle, Promethean helps to divert more than 15 million pounds of waste grease and oil from entering the sewer system each year. "Promethean Biofuels' community-based approach exemplifies recycling for reuse and energy independence," said the department. "Promethean Biofuels, named one of the Top Alternative Energy companies in the Inland Empire, is a rising star in California's tremendously diverse environmental technology companies."

Promethean wins CalRecycle award

Posted Nov. 17, 2010

 
 For the first nine months of 2010, BDI-Bioenergy International AG has seen an increase of 33.7 percent in sales, equaling a 304 percent increase over the previous year. The Austrian-based waste-to-biofuel technology provider attributes the nine-month span's success to the progress made in large projects, the intensified efforts for after-sales business and the optimization of existing biodiesel plants, according to BDI Chief Financial Officer Dagmar Heiden-Gasteiner. "Of the 30 biodiesel plants BDI has been building worldwide," Heiden-Gasteiner said, "26 work with multifeedstock technology," and expanding the use of that technology has also increased sales. Following the recent moves by the company, BDI said the company will continue a successful year based on the orders already on hand.
 
 BDI has patented a multifeedstock technology designed specifically to convert a wide range of raw materials including crude vegetable oils, recycled materials, animal fats, used cooking oil, trap grease and others. According to Heiden-Gasteiner, "all free fatty acids are transformed into biodiesel-therefore the achievable yield is at the highest technical level-up to 100 percent."
 
 After two consecutive oil crises in Europe in the 1970s initiated many research activities in the field of alternative fuels all over Europe, Heiden-Gasteiner said, BDI began collaborating with universities in Graz, Austria. They worked on developing a new flexible process for the production of biodiesel from all different types of oils and fats, and it was there the BDI multifeedstock system technology was born. "The first biodiesel plant built by BDI for a customer in Mureck, Austria, was in 1991 and was the first industrial-scale biodiesel plant for processing rapeseed oil worldwide," Heiden-Gasteiner said. "In the early 1990s the economic circumstances for biodiesel production worsened. Vegetable oil prices reached a high level, whereas mineral oil diesel prices dropped." In 1994, the plant in Mureck was upgraded to take advantage of low-quality feedstock like used cooking oil. "The research activities continued with regard to additional feedstock and in 1998 the first multifeedstock biodiesel plant for processing animal fats was built in the U.S. by BDI," according to Heiden-Gasteiner. 
 
 But the company doesn't plan on remaining exclusively in the biodiesel production business. "There is tremendous potential for biogas plants in the creation of added value from biologically degradable waste," Heiden-Gasteiner said, "particularly organic municipal waste in the future." BDI has already begun working with some biogas plants since purchasing 51 percent of Enbasys GmbH, a leading biogas company. In order to expand even more, Heiden-Gasteiner added, possible acquisitions are also being investigated that would add to the company's existing waste-to-biofuels portfolio. 
 
 As for the process of an upgrade to the BDI system, he said there are various approaches depending on the driving forces. "If, for example, a customer decides to improve the economic situation of the biodiesel plant, BDI elaborates several technical solutions for an upgrade to a multifeedstock plant, including feasibility studies for those solutions."

BDI reports 9-month success will continue

Posted Nov. 17, 2010
 
 Another jatropha plantation development is in the works. This time, AMG Bioenergy Resources, a startup company focused on renewable energy, has signed a letter of intent with China Zhejiang Biodiesel Co., to acquire a eucalyptus and jatropha plantation in southern China. Both existing plantations reside in the same area and will eventually be turned from a 145 hectare eucalyptus and 330 hectare jatrohpa set of plantations to one large plantation around 400 hectares. The company "is working on developing the plantation over the next two years," said Lee Shoong Lim of AMG's Singapore location. As for securing any feedstock agreements at this point, Lim said it is not an issue due to global demand for nonpalm oil-based biodiesel. 
 
 The main obstacles to developing a jatropha plantation in southern China, according to Lim, are mainly acquiring the low-cost land that is suitable for jatropha cultivation, as well as training and educating the local workforce to develop and maintain the plantations. Lim believes these challenges can be met based on AMG's experience in running a test plantation in southern China already. As for cultivating jatropha, "AMG believes that jatropha provides the ideal source of raw materials for biofuel," Lim said. "It can be easily grown on a large scale and on nonarable land," adding, "Southern China provides a large market, ideal climate plus a low-cost source of trained plantation workers that are essential to the operations." The cost of developing and operating the same plantation is low, relative to many other countries, Lim also said, while productivity of the plantations and its workers like the one in southern China are relatively higher than the rest of the world. 

 
 AMG plans to finance the plantation's acquisition via private placement of shares of the company, and also expects to receive the plantations by the end of the year. The two plantations are the first to be operated by AMG.

Chinese plantations purchased for jatropha

Posted Nov. 17, 2010
 
 In an effort to reduce emissions by taking environmental action, municipal transit service provider CityLink unveiled a fully wrapped 1999 model bus to promote the use of B20 blends in its diesel-fueled fleets during a media event on Nov. 12 in Peoria, Ill. 
 
 Using biodiesel isn't new to CityLink. The service company has been using biodiesel in its fleets since 2005, beginning with B2 and then B11. Most recently, the company moved to B20 in August last year. According to Rick Tieken, assistant general manager of CityLink, the wrapped bus serves as a reminder of CityLink's commitment to the public and other municipal fleet organizations the benefits of using B20 in fleets. 
 
 "We've had zero diesel fuel-related fuel problems," Tieken said. "We're extremely pleased with the product."
 
 Kevin Lockart, energy consultant for Tremont, Ill.-based agricultural cooperative and petroleum distributor Ag-Land FS Inc., which helped organize the event, said that the company has been supplying CityLink with B20 year-round for more than a year. Ag-Land FS buys all of its biodiesel from Renewable Energy Group Inc., which has production plants in Danville and Seneca. 
 
 "We're proud to be able to be a supplier of B20 and diesel fuel to CityLink," Lockart said. "We feel it's kind of a milestone because they run it year-round, even through the winter months. The message we wanted to leave was, it can be done."
 
 Prior to adopting B20, CityLink was aware of the technical challenges associated with engine performance and fuel economy. But, Tieken said the company didn't dive into it without doing its research first. "We went into it knowing we may have to change some fuel filters and we had some initial concerns, but once we got passed that we had no problems," he said, adding that CityLink burns about 660,000 gallons of diesel fuel annually in its bus and van fleets. "I'm proud to say that about 135,000 gallons of that fuel is going to be grown in the Midwest and reduce our dependence on foreign oil," Tieken added.
 

 He said CityLink will also be getting 46 new buses over the next year outfitted with the most up-to-date engine technology to run on B20, to replace its old fleet. "We're pleased to be part of the solution of the Peoria area, and not part of the problem," he said.
 
 Also in attendance at the media event was John DeRosa, director of environmental programs for the American Lung Association of Illinois; Bill Wykes, secretary and board member for the Illinois Soybean Association; Alicia Clancy, manager of corporate affairs for REG; Patrick Kirchhofer, Peoria County Farm Bureau manager; and Floyd Heller, general manager at Ag-Land.

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CityLink promotes B20 use in buses

Posted Nov. 17, 2010
 
 Pennsylvania Gov. Ed Rendell announced $7.9 million in statewide alternative energy grants for 21 projects in biofuels, natural gas and electric-powered vehicles. 
 
 Additional private funds, $22.1 million worth, are being matched to help finish the projects, which would bring a total economic impact worth $30 million. Rendell said the funding further strengthens Pennsylvania's reputation as a leader in clean energy innovation and use.
 
 "Two weeks ago, the Natural Resources Defense Council named Pennsylvania as the seventh least vulnerable state in the nation to oil price spikes because of our work to build a green economy here," Rendell said in a statement. "In doing so, it noted 'America's addiction to oil continues to threaten not only our national security and global environmental health, but also our economic viability.'"
 
 He continued, "That's a very accurate assessment and it's what we've been saying for the past eight years, which is why we've worked so hard to create a green energy economy here. That work has paid off and we have thousands of companies who are employing tens of thousands of workers in green collar jobs. These projects will build upon that work and will transform the way we power our vehicles."
 
 Although the majority of projects involve the use of compressed natural gas, more than $1 million of state grant monies were dedicated towards expanding the use and availability of biodiesel in various counties throughout the state. Specifically, those projects include:
 

 Chester County: West Chester University of Pennsylvania will receive $6,000 to cover the incremental cost of purchasing B20 to power its vehicles on campus.
 
 Cumberland County: Cumberland County Commissioners are awarded $15,360 to purchase 96,000 gallons of blended biodiesel. In addition, YRC Inc. will receive $250,000 to install a biodiesel blending system at its Carlisle Truck Freight Terminal.
 
 Monroe County: East Stroudsburg Area School District will leverage $10,540 to convert two existing 20,000-gallon tanks for biofuel storage and purchase B5.
 
 Philadelphia County: Energy Cooperative Association of Pennsylvania was awarded $631,787 to help 12 school districts purchase and use 1.8 million gallons of blended biodiesel and 280,000 gallons of B100; Energy Cooperative Association of Pennsylvania will receive $425,860 to help five municipalities and school districts in southeastern Pennsylvania continue fueling 500 vehicles with biodiesel; Philadelphia City Treasurer Office of Fleet Management will get $205,416 to offset the cost of purchasing more than 1 million gallons of B5 for use in the city's fleet.
 
 Westmoreland County: Western Pennsylvania Operating Engineers Joint Apprenticeship and Training Program intends to use $486,066 to convert heavy equipment construction fleets to accept locally produced biofuels and to demonstrate the performance, cost-effectiveness, maintenance, training and research necessary to prove the concept's viability.

November 2010

Business Briefs

Business Briefs

Columns

The Promise of 2011

Defining Key Terms

Featured

Microloans for Small Biodiesel Businesses

Winter-Grade Biodiesel

BQ-9000: Moving Forward

November 2010.css-7jxktu{position:absolute;bottom:0px;left:0px;right:0px;height:3px;border-radius:3px;background-color:var(--chakra-colors-brandBlack);}

Business Briefs

Business Briefs

Columns

The Promise of 2011

Defining Key Terms

Featured

Microloans for Small Biodiesel Businesses

Winter-Grade Biodiesel

BQ-9000: Moving Forward

November 2010