I still remember the day my parents first installed cable television in my childhood home in Colorado. It was in the early 1980s when the man came to our door with the faux-wood cable box. This installation happened to correspond with the early years of MTV&rsquo;s existence, and as a preteen this literally rocked my world. &nbsp;
From that box, I would come face-to-face with the &ldquo;real-life&rdquo; personas lining the walls of my bedroom: Duran Duran, David Bowie and Madonna. The same box would later expand my horizons beyond Top 40, to bands like the Smiths, Love and Rockets and New Order. The band names aren&rsquo;t important, but the music to which we come of age defines a piece of us for life, and the introduction of MTV helped infuse the sounds of that decade into many people my age.
Of course, I couldn&rsquo;t know at the time that Channel 31 on my cable box would also lead to shattering changes in the music industry, its relationship with consumers, and how music would forever be delivered. Remember that iconic clip of the astronaut planting his MTV flag on the moon? &nbsp;How apropos. &nbsp; &nbsp;
A Game Changer on Four Wheels &nbsp; I&rsquo;m reminded of that time now, because unlike my teenage years, these days I thoughtfully consider new technology and products in a cultural and historical context. As a diehard fan of biodiesel and other alternative energies, the object of my more recent desire (post-Simon Le Bon) arrived with the introduction of the 2014 2.0-liter turbocharged diesel four-cylinder Chevy Cruze, approved for a 20 percent blend of biodiesel (B20).&nbsp;
Like my much-loved MTV of years past, I see the diesel Cruze as a potential game changer. This is because it bridges the gap between biodiesel and the average consumer/motorist, delivering for the first time a sedan that is B20 approved.&nbsp;
Although more than 78 percent of major U.S. auto and equipment manufacturers approve of B20 in some or all of their diesel models, the Cruze is an exciting development for biodiesel. It means every ordinary consumer, in addition to fleet managers, farmers, semi-truck drivers or pickup owners, can now relate to B20. It makes America&rsquo;s advanced biofuel tangible and real to potentially everyone. It builds a bridge between B20 and the masses, even if mostly symbolic for now. (For one thing, there was no evidence in the showroom that GM is marketing the B20 approval as part of its green branding, the way some other automakers have.)
The Cruze&rsquo;s launch also verifies a resurgence in diesel technology interest from the automakers as an ultra-fuel-efficient and clean technology that rivals any hybrid. With 36 new clean diesel vehicle models available now or launching in the 2014 model year, 2013 shaped up to be one of the most exciting years for clean diesel vehicles in U.S. history. In fact, Popular Mechanics named 2013 the &ldquo;Year of the Diesel&rdquo; in a recent article, saying, &ldquo;The dirty and unreliable diesel cars of the 1980s gave this tech a bad name in the U.S. But Rudolph Diesel&rsquo;s engine delivers long range, excellent torque, and high mileage, and a stable of new cars is ready to revive the diesel in America.&rdquo;
We&rsquo;ve hoped for an American diesel passenger car for years. Now, we actually have one. And I have one, too! &nbsp;
I bought my crystal red Cruze in early August, the first one my local dealer had sold. It has many amazing mechanical and techie features which you can find more about on Edmunds.com or other sources. All I know is my car has some great &ldquo;toys,&rdquo; like XM Radio and Pandora, a reverse camera, Bluetooth with audio streaming, remote start and more. My Cruze also has two car seats in the back for now, and a few Cheerios, which personally I don&rsquo;t think detracts from its stylishness. &nbsp;
Of course the responsible environmentalist in me cares most about the B20 approval and its 46 mpg EPA highway fuel economy rating. In the first week I owned the car, which included the usual school, work and gym runs, a lunch meeting, an airport run (40 miles roundtrip) and a trip to the National Biodiesel Board headquarters in Jefferson City, Mo. (70 miles roundtrip), I used just less than a half tank of fuel.&nbsp;
A Deep-Seated Belief Before buying, I did some research on the Cruze&rsquo;s main competitor, a brand I drove for 100,000 miles prior to my latest purchase. But my loyalty to biodiesel and its potential to alter our energy landscape surpasses any other brand loyalty I may have formed, and I never even went to the competitor&rsquo;s showroom.&nbsp;
Hopefully the B20-approved Cruze spurs further approvals among the holdouts. With 36 new clean diesel vehicle models available now or launching in the 2014 model year, automotive industry experts predict that consumers will have more than 54 diesel vehicle models to choose from in North America by 2017.
I have a deep-seated belief (that&rsquo;s a pun) that using alternative energy is a serious commitment. To me it is a personal value as important as good nutrition and recycling. As Americans, our values are often reflected in our purchases. If more of us chose the wealth of cleaner-burning fuels like biodiesel that we have between our shores, it could propel us away from fossil fuels and imported oil faster than &ldquo;Video Killed the Radio Star&rdquo; hit the top of the music video charts. &nbsp;
Maybe that day is closer to us than we think. Renewable energy use will grow at a much faster rate than fossil energy use through 2040, according to projections in the Annual Energy Outlook 2013, a product of the U.S. Energy Information Administration. &nbsp;
Alternative Fuels Rock Someday, my five-year-old&rsquo;s first car could be my Cruze. Technologically speaking, he will grow up in a very different world than mine. Even my three-year-old can navigate the iPhone and iPad without asking for help. And they won&rsquo;t need MTV like I did. Today&rsquo;s teens have all the music and videos they want at their fingertips. They will never know what it&rsquo;s like to have to wait. What used to be novel and exciting has become ordinary. &nbsp;
My hope is that the same will be true for renewable energy. When my kids come of age, maybe B20, B100 and other alternative fuels won&rsquo;t be the alternative anymore&mdash;petroleum will. And my kids won&rsquo;t understand why we ever chose fossil fuels when we had a bounty of renewable energy at our fingertips.&nbsp;
Did video kill the radio star? Actually it didn&rsquo;t, but it did change our expectations. And so might the diesel Cruze.&nbsp;
Author: Jenna Higgins Rose Founder, Rose Media LLC 573-234-8935 jenna@rosemedia.biz

RIDE-AND-DRIVE:  The Chevrolet Cruze, shown here with proud owner Jenna Higgins Rose, is one of 36 clean diesel vehicle models available today. 

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FEWER FUEL-UPS:  The B20-approved Chevy Cruze gets 46 miles per gallon, meaning owners like Jenna Higgins Rose have to make fewer trips to the pump. 

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GREEN POWERHOUSE:  The new B20-approved diesel Chevy Cruze comes with a 2.0 liter, four-cylinder turbocharged engine.

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PRECIOUS CARGO:  The B20-approved Chevy Cruze has plenty of room for two car seats in the rear, for those environmentally conscious, on-the-go parents. 

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MTV brought music videos to the masses. Can the diesel Chevy Cruze do the same for B20? The Cruze is a potential game changer because it bridges the gap between biodiesel and the average consumer/motorist, delivering the first B20-approved sedan.

The Cruze Offers B20 Mass Appeal

Enzyme-catalyzed biodiesel production has long been on the cusp of revolutionizing the way &nbsp;biodiesel is produced. &nbsp;Historically, the high cost of enzymes has outweighed any benefits they might offer, such as their ability to convert low-quality, high free fatty acid (FFA) feedstocks, savings on energy consumption, and coproduction of technical-grade glycerin. Recently, the hurdle of making the process economically viable on a commercial scale has been overcome.&nbsp;
Viesel Fuel LLC, in collaboration with Novozymes and Tactical Fabrication LLC, has developed and implemented a biodiesel production process that uses enzymes to produce at a rate of 5 million gallons annually. Further, this process is easily scalable to larger capacities. Recovery and reuse of the enzymes to catalyze several batches makes the enzymes economically feasible, and simple resin-based technology is used to bring the crude biodiesel into ASTM specifications. Additionally, this process requires a lower capital investment, works at a production cost per gallon that is comparable to that of traditional biodiesel, and most importantly, allows the use of less expensive, more varied feedstocks with free fatty acid content as high as 100 percent.&nbsp;
Feedstocks in the Market Demand for biodiesel in recent years has greatly increased due to consumer acceptance as well as incentives and mandates, such as the renewable fuel standard (RFS), which are in place through state and federal governments. Consequently, the economic viability of many biodiesel facilities relies heavily on the ever-changing policies related to biodiesel. Because the cost of feedstock is the largest single expenditure in the production of biodiesel, the flexibility enzymes allow to use any feedstock that may appear in the marketplace, from brown grease to virgin oil, is economically advantageous and offers a reprieve for biodiesel producers whose sustainability shifts and destabilizes with the changing value of tax credits and RIN prices.
Pretreatment of feedstock is required to remove impurities that may be harmful to the reaction kinetics (in this case the enzymes) and/or prohibit compliance with ASTM D6751 standards. The use of low-quality feedstocks has been problematic for traditional processes and catalysts, even after all other impurities have been neutralized, due to their high FFA content. A major advantage of enzymes is their ability to easily convert FFA to fatty acid methyl esters (FAME) at temperatures around 95 degrees Fahrenheit, and with less methanol. The appropriate pretreatment method depends on the feedstock, and might include water washes and settling, neutralization of pH, or filtration. Sulfur is one of the more troublesome contaminants in low-quality feedstocks, but research and development of technologies including filtration and resins for sulfur reduction to 15 ppm in either feedstock or crude biodiesel assists in making inexpensive, high-FFA feedstock a viable option.&nbsp;
Enzymatic Reaction The enzymes are able to convert high-FFA feedstock because the reaction chemistry occurs in two steps: the glycerides are first hydrolyzed to FFA, and then the FFA and methanol are esterified to produce FAME. When using high-FFA feedstock, the hydrolysis step has already occurred and the main job of the enzyme becomes the conversion of FFA to FAME. In the esterification step, water is produced and absorbed into the heavy phase, which also consists of glycerol, excess methanol and enzymes. Conveniently, water is a necessary component to activate the enzymes and does not lead to soapy contaminants, as it does in many traditional processes.&nbsp;
Careful monitoring during the reaction of methanol, water and enzymes in the heavy phase, temperature, and rate of conversion are critical to ensure high-quality finished biodiesel and optimum number of enzyme reuses. The &ldquo;happier&rdquo; the enzymes are, the longer they will remain active, and the more economical they become.
Enzyme Recovery and Reuse&nbsp; To recover the enzymes, the reaction mixture must go through two different stages of settling. Initial settling results in a heavy phase that includes glycerol, methanol, water and enzymes, as well as a light phase of crude biodiesel. At this point, the crude biodiesel can be withdrawn from the reactor and refined, while the heavy phase requires further separation. The second stage of settling results in a transparent glycerin phase, which falls to the bottom of the reaction vessel, and the enzymes, which migrate to the interface between crude biodiesel and glycerin. This second separation can be expedited by the use of flocculants or mechanically separated with membranes. A portion of the glycerin phase is withdrawn and refined, while the remaining glycerin and the layer of active enzymes are retained in the reactor and reused to catalyze the next reaction. Combining proper feedstock pretreatment and optimized reaction conditions allows Viesel to run a series with a minimum of eight to 10 enzyme reuses, with a 10 percent addition of fresh enzymes to each batch. &nbsp;
The glycerin can be cleaned easily to 80 percent purity with simple vacuum distillation to remove methanol and water. If a processor chooses to add additional processing, such as resins, filtration or active carbon, this glycerin could be purified to greater than 97 percent. In either event, the glycerin can be sold into value-added applications not normally available for crude glycerin.
Biodiesel Refining The use of enzymes results in a crude biodiesel with 1.5 to 2.0 percent unreacted FFA. Viesel Fuel initially used a caustic wash to turn this FFA to soap, followed by washes and centrifugation to remove the soap and water. The recovered soap was acidulated back to FFA, for reuse as a blend component in the feedstock.
Viesel Fuel has most recently adopted the use of resin technologies, both as a catalyst to convert FFA to FAME and in an ion exchange capacity to adsorb any remaining FFA. The optimization of resins makes the refining process simpler, reduces yield loss, and has allowed Viesel Fuel to transition to a continuous flow process for the biodiesel refining section of the plant. Viesel Fuel will further develop the capability to convert the current batch enzymatic reaction process into a continuous process throughout 2014.&nbsp;
Conclusion The benefits of enzyme catalysts in the production of biodiesel have long been apparent, but until now their adoption on a commercial scale has not been economically feasible. With production approaching 150 batches in six months, Viesel Fuel&rsquo;s process has demonstrated that enzymes are an exciting catalyst that require less energy and fewer chemicals. When coupled with resin technologies for refining to ASTM specifications, the process becomes cost comparable to traditional catalysts. But the true economic benefit of enzymes comes in their ability to handle a variety of inexpensive feedstocks, making enzymes a financially prudent route for biodiesel producers, allowing them to thrive despite low RIN prices and the disappearance of tax incentives.
Author: Rebecca Hobden Chemical Engineer, Viesel Fuel LLC 772-678-9934&nbsp; rhobden@vieselfuel.com

GAME CHANGER: Viesel Fuel out of Stuart, Fla., in collaboration with enzyme maker Novozymes and Tactical Fabrication, recently upgraded its 5 MMgy facility to enzymatic production of biodiesel. 

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CLEAR SEPARATION: A sample of enzyme-catalyzed product is shown with the glycerin phase on the bottom, the enzyme phase in the middle, and the biodiesel phase on top. 

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REACTION BENEFITS: A major advantage of enzymes is their ability to easily convert FFA to fatty acid methyl esters at temperatures around 95 degrees Fahrenheit, and with less methanol. 

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INTERNATIONAL COOPERATION: Viesel Fuel tanks feature the Danish flag beneath the U.S. flag, in a showing of partnership with the Denmark-based enzyme maker. 

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FEEDSTOCK OPTIONS: The flexibility of enzymatic processing allows a variety of feedstocks to be used. Here Viesel Fuel shows samples of biodiesel from used cooking oil (left), distillers corn oil (middle) and brown grease (right). 

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Viesel Fuel, in collaboration with Novozymes and Tactical Fabrication, has developed and implemented a biodiesel production process using enzymes to produce at a rate of 5 MMgy. The company says its process can be easily scaled to larger capacities. 

Commercializing Enzymatic  Biodiesel Production

While 2013 was a banner year for U.S. biodiesel producers, smashing production records and far surpassing the federal renewable fuel standard (RFS) volume obligation of 1.28 billion gallons by more than 400 million gallons, the end of the year brought with it anxiety, dismay and uncertainty. In a move no one foresaw, U.S. EPA proposed stalling this year&rsquo;s biomass-based diesel RVO at 1.28 billion gallons, which, when considering the RIN carryover from last year, would be more like 1 billion gallons. If the final rule comes out at 1.28 billion, this could essentially mean an industry contraction of 700 million gallons, particularly if the $1 per gallon biodiesel tax credit is not reinstated early in the New Year. This would put elevated pressure on producers to be as efficient and low-cost as possible.&nbsp;
When EPA&rsquo;s draft proposal was leaked prior to its official publication, Steve Bond with Blue Sun Biodiesel told Biodiesel Magazine, &ldquo;One of the things we look at as the industry matures is, the more efficient plants are going to be able to stay near or at near capacity of 80 to 90 percent. So the impact will hit some plants that have been simply hanging on for the past few years, those that are either single feedstock or just less efficient&mdash;most of the impact will be felt by these plants,&rdquo; he said. &ldquo;In our Blue Sun Biodiesel plant in St. Joseph, Mo., we&rsquo;ve invested a lot to make it efficient. But, it&rsquo;s still a concerning issue. It&rsquo;s clear the biodiesel industry can do more.&rdquo;&nbsp;
Ramon Benavides, founder of Global Renewable Strategies and Consulting LLC, says if the RVO final rule remains at 1.28 billion gallons, he believes 4 percent of the market will be affected, meaning some plants will idle&mdash;those that haven&rsquo;t realigned their facilities to prepare for such a policy catastrophe with the payout of the retroactive tax credit extension, which passed early last year retroactive back to Jan. 1, 2012, along with profits from this monumental year.&nbsp;
The largest U.S. biodiesel producer, Renewable Energy Group Inc., announced in mid-December it was acquiring renewable diesel technology firm Syntroleum Corp. along with its 101 patents and 50 percent stake in the 75 MMgy Dynamic Fuels plant in Geismar, La. When the official RVO proposal came out, REG President and CEO Daniel J. Oh said, &ldquo;REG&rsquo;s lower-cost multifeedstock business model, network of biorefineries and terminals, and strong position within the industry should allow us to continue to succeed as the markets inevitably adjust to reach a new equilibrium.&rdquo; Benavides says while large, public biodiesel companies like REG&rsquo;s stock may fluctuate with the uncertainty, they will &ldquo;be OK.&rdquo;&nbsp;
Clearly, the nexus between low-cost production and low-cost feedstocks, which can represent 80-plus percent of production expenses, is new technologies that allow effective conversion of &nbsp;low-grade, high free fatty acid (FFA) materials to quality biodiesel. Biodiesel Magazine has put together a sample cross-section of such technologies being deployed commercially today.&nbsp;
Menlo&rsquo;s Clean Carbon Technology Menlo Energy LLC, a subsidiary of Menlo Capital Group, began its biodiesel R&amp;D work in 2007. &ldquo;Our initial foray was into jatropha in India,&rdquo; says Sunil Suri, Menlo Capital Group principal and managing member. Menlo funded R&amp;D efforts in jatropha seed botany and, according to Suri, became the largest plantation owner and operator of jatropha with farms in excess of 100,000 hectares in several Indian states. The farms were commissioned in collaboration with certain village governments (&ldquo;Panchyats&rdquo;) in India. This work expanded into the manufacturing of biodiesel.&nbsp;
Menlo acquired the former Agri-Source Fuels plant in Dade, Fla., now called Menlo Energy Florida LLC. The company says it&rsquo;s expanding the 12 MMgy biodiesel plant to 60 MMgy, and it continues to operate the on-site glycerin refinery. Menlo also has a 20 MMgy biodiesel project in Richmond, Calif., which the company says will be expanded to 100 MMgy. Two additional projects, one in Mansfield, La., and the other in Bakersfield, Calif., are under development.&nbsp;
Clean Carbon Technology is what Menlo calls its continuous flow, heterogeneous catalyst multifeedstock biodiesel process. Suri, the inventor of the process, says, &ldquo;No one has been able to make a solid catalyst to execute both esterification and transesterification and also use a single catalyst for an extended period of time, and also to keep the cost of the catalyst very competitive.&rdquo; He says it&rsquo;s both a fixed-bed solid catalyst and a recoverable granular catalyst, &ldquo;as we execute esterification and transesterification differently but off one stream.&rdquo; Suri says while the company began experimenting with crude jatropha oil, it has since moved to investigating working with waste fats, oils and greases (FOG) and municipal solid waste. &ldquo;We have no foreseeable scale-up issues, as we have executed a full commercial-scale plant, albeit not for ourselves where we own it 100 percent,&rdquo; he says, &ldquo;but very soon, this year, we will have several plants placed into commercial production.&rdquo; He says Menlo is engaged with several counter parties, all sovereign, in Canada, the U.K., Italy, Austria, Saudi Arabia, Indonesia, Australia and Japan. The company has applied for 17 patents, five have been issued, &ldquo;and others have been allowed,&rdquo; Suri says.&nbsp;
Suri explains the core elements, or novelties, of the CCT approach are that it involves no acids, chemicals or water; puts out no effluents; is mass-balanced; has &ldquo;the lowest carbon footprint known to man;&rdquo; operates at ambient temperature and low atmospheric pressure; can process feedstock with any FFA or moisture, insolubles or unsaponifiables (MIU) range; removes sulfur, for instance, from brown grease; generates 99.7 percent pure colorless glycerin; requires a 4-hour residence time; uses all stainless steel; and is fully automated, continuous flow, 24/7&mdash;&ldquo;No down time ever,&rdquo; Suri says. &nbsp;
&ldquo;Our work is such that we do not need any form of assistance or subsidy,&rdquo; Suri says of a future where federal mandates and incentives are in question. &ldquo;Our business is profitable without any such largesse.&rdquo;&nbsp;
Benefuel&rsquo;s Ensel Technology Flint Hill Resources and Benefuel made headlines in May when they announced a joint venture partnership, Duonix LLC, to develop biodiesel projects in the U.S. based around Benefuel&rsquo;s registered Ensel process technology. The first project: the former Beatrice Biodiesel plant, a 50 MMgy facility in Beatrice, Neb., that was built several years ago with Axens solid catalyst technology but never became fully operational. The acquisition was a natural fit, with Benefuel developing several of its own proprietary heterogeneous catalysts for esterifcation and transesterification, for industrial chemical, biodiesel and biolubricant production.&nbsp;
Rob Tripp, Benefuel&rsquo;s CEO, says the Ensel process combines both esterification of FFA and transesterification of triglycerides into a single process&mdash;&ldquo;a long sought technological advantage for the biodiesel and oleochemical industries,&rdquo; he says. &ldquo;[Transesterification] can occur without catalysts at very high temperatures, or with alkaline or acid catalysts at varying temperatures,&rdquo; Tripp says. &ldquo;The weakness of the conventional biodiesel process lies in its application of alkaline catalysis&mdash;liquid or solid, like Axens.&rdquo; They, of course, cannot convert FFA into biodiesel, but instead make soaps that must be removed, resulting in a yield loss.&nbsp;
In 2011 and 2012, Benefuel validated its Ensel technology at two 1-ton-per-day, fully integrated demonstration plants with its current equity partners, Flint Hills Resources and Itochu Corp., using a broad range of commercially available, low-cost feedstocks. &ldquo;Feedstock costs drive biodiesel process economics,&rdquo; Tripp says, &ldquo;contributing 75 to 90 percent of total processing costs. Benefuel&rsquo;s efficient use of low-cost feedstocks means superior economics to current processes.&rdquo; Tripp also says Benefuel&rsquo;s capital cost structure, in general, will be similar to or lower than a conventional esterification and transesterification refining process. To put it in perspective, a company like REG spends $20 million to upgrade a 60 MMgy soy biodiesel facility (Albert Lea) to be able to process high and low FFA.&nbsp;
&ldquo;There were a number of attractive features of Beatrice,&rdquo; Tripp says. &ldquo;Namely its low acquisition cost and location for accessing feedstocks.&rdquo; He adds that while the project at Beatrice has not officially been approved, it is moving through a full project review process. &ldquo;We are excited and optimistic that it will receive final funding approval during the second quarter of 2014,&rdquo; Tripp says. The Duonix JV that Benefuel has established with Flint Hills Resources has exclusive rights to the U.S. market and has plans to grow beyond Beatrice. Tripp says retrofit and greenfield construction are both viable options and will depend on the opportunity.
When asked how important he thinks low-cost biodiesel production and technology are when faced with the possibility of a lapsed federal tax credit and a stalled biomass-based diesel RFS, Tripp says, &ldquo;In a commodities market, it is always beneficial to be the low-cost producer. In the biodiesel market, the flexibility across feedstocks while maintaining strong operating yields is key to ensuring a low cost of production. Benefuel and its partners have spent more than seven years working to bring this technology to a commercial scale, and we are excited with the opportunity of leveraging this work to position ourselves as a low-cost producer here in the U.S., as well as abroad.&rdquo; Internationally, Benefuel is working with partner and investor, Itochu Corp., particularly developing opportunities in Asia.&nbsp;
Jatrodiesel&rsquo;s Super Process In late November, Patriot Holdings LLC announced that its board of directors approved formation of a new subsidiary&mdash;Patriot Fuels, Biodiesel LLC&mdash;to build a 5 MMgy biodiesel production facility adjacent to the Patriot Renewable Fuels LLC ethanol plant in Annawan, Ill. The plant will use distillers corn oil from the 40 million bushels a year of corn PRF processes. While co-location of biodiesel production at ethanol refineries has long been a much-discussed concept, implementation has been slow&mdash;until just recently. Adkins Ethanol in Lena, Ill., also announced earlier that month it was using WB Services to build a biodiesel facility co-located next to its ethanol plant. The Patriot Fuels, Biodiesel LLC plant will be the first commercial installation of Jatrodiesel&rsquo;s new Super process, a supercritical biodiesel technology under development for five years.&nbsp;
&ldquo;We built the first lab-size process in 2008-&lsquo;09,&rdquo; says Jatrodiesel President Raj Mosali. &ldquo;We built a bench-top model in 2010 that was 2,000 times the lab size, and we built a large pilot model in 2012.&rdquo; The pilot plant was scaled at 350,000 gallons per year, or about 2,000 times the bench-top size. &ldquo;We have tested quite extensively to check yields, any discrepancies between various sizes&mdash;energy, yields&mdash;and tested the equipment, metallurgy, scalability, safety and other aspects of the process. Over the years, we have refined the process quite a bit to be able to address various things, including the changes in ASTM specifications.&rdquo;&nbsp;
The Super process can handle any level of FFA without use of acid or base catalysts. Mosali says its advantages are savings in catalyst costs because no catalyst is used, simplicity of the process, true multifeedstock capability and high-quality glycerin. The supercritical process, does, however, use more energy than traditional technologies. &ldquo;But all in all, if you do normalized comparisons between traditional processing&rdquo;&mdash;esterification/transesterification, or glycerolysis or enzymatics&mdash;&ldquo;to our Super process, you have between 12 and 18 percent savings overall considering utilities, chemicals, operational expenses and more,&rdquo; Mosali says. &ldquo;If you consider soft costs such as training the operators, the savings are even higher.&rdquo; The pretreatment involves only filtration to remove MIU in the feedstock. &ldquo;The Super process,&rdquo; which is fully continuous, &ldquo;will take over at this point,&rdquo; he says. Glycerin purity is upwards of 92 percent. The biodiesel is water-washed and then distilled to remove any color. He says the yield is 98 percent by weight and is comparable to traditional processing.&nbsp;
&ldquo;Our turnkey costs for a Super process are about 15 percent higher than the conventional process,&rdquo; Mosali says. &ldquo;The payback on the cost increase is less than six months of operations, so the cost increase is minimal on the construction end as compared to the operational savings it brings.&rdquo;&nbsp;
He says Patriot has been following Jatrodiesel&rsquo;s progress in this technology development for some time. &ldquo;They were checking up on our progress a couple of times a year,&rdquo; he says. &ldquo;Patriot and its management are incredibly forward-looking in their decision to choose this market-changing and paradigm-shifting technology.&rdquo;&nbsp;
Concrete and foundation work at the Patriot biodiesel plant are expected to begin in December, and it&rsquo;s scheduled to begin operations by third quarter 2014. &ldquo;As far as we know, this is the first time a fully scaled supercritical-based technology that does not use any catalyst has been used for biodiesel,&rdquo; Mosali says. &ldquo;We think our expertise in using supercritical temperatures and pressures, and our ability to design the processes and reactors that are economical, greatly helps us to diversify as a technology company into other fields.&rdquo;&nbsp;
On the importance of technology and low-cost production in a time of uncertain federal policy, Mosali says, &ldquo;Having the flexibility in your process plus being a low-cost producer from the operational-cost perspective, with the ability to use low-cost feedstocks, is very important. This new process perfectly fits both. Having said that, I do think this is a temporary setback in the policy, but in the long run, there is really nothing from the science or political perspective that&rsquo;s going to impede the growth of alternative fuels. If you ask the question, will we be burning fossil fuels with no restrictions two, three, five or 10 years from today, the answer is no. So the future looks bright for biodiesel.&rdquo;&nbsp;
Author: Ron Kotrba Editor, Biodiesel Magazine 218-745-8347 rkotrba@bbiinternational.com

SLEEPING GIANT:  The old Beatrice Biodiesel plant in Beatrice, Neb., never got its chance to operate, as innovative as it was for its timeâ€”but new life for the industrial behemoth may be moments away. 

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COMPLETE REACTION: Menlo's technologies are in use at the former Agri-Source Fuels plant it acquired in Dade County, Fla., now called Menlo Energy Florida LLC. 

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EVAPORATION STATION: Menlo is outfitting several plants across the country with its suite of biodiesel process technologies. 

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SUPER PROCESS:  Jatrodiesel's Super process, which utilizes supercritical temperatures and pressures, employs ancillary equipment like the dryers shown here. 

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As federal biodiesel policy uncertainty rises, low-cost biodiesel production with new technologies to allow processing of cheaper, lower quality feedstocks, is paramount. Biodiesel Magazine provides a cross-section of new technologies being deployed.

Low-Cost Biodiesel Production

Sometimes breakthroughs in biodiesel production technology come in the form of sophisticated processes, complex equipment and migraines from grueling hours spent climbing the learning curve&mdash;for both the inventors and the implementers. Other times, a simple, effective problem-solving approach can achieve more promising results. Without question, the suite of process innovations employed at biodiesel plants is, in and of itself, remarkable. From enzymatics to solid acid catalysis, ultrasonic mixing or supercritical processing, the goal of each novel approach is ultimately to lower the cost of production and provide the best possible margins for producers. The fact is, in most cases, biodiesel is manufactured using conventional sodium or potassium hydroxide or methylate catalysts. So, for those producers who are simply looking for ingenious ways to increase production at reduced costs, without gutting their plants and spending millions of dollars on new equipment, systems and engineering expenses, perhaps they should consider an approach described in the recently issued U.S. Patent No. 8,420,841 developed by Drs. Uzi Mann and Stan Emets at Texas Tech University.&nbsp;
The patent is the culmination of more than five years of lab-scale and pilot-plant biodiesel research. Chemical engineering professor Mann has just retired after 35 years at TTU. Emets, Mann&rsquo;s former postdoctoral researcher at TTU, is now working as a process engineer for Phillips 66. After leaving TTU and prior to joining Phillips 66, he worked at Global Alternative Fuels LLC, a 15 MMgy commercial biodiesel production facility in El Paso, Texas.&nbsp;
&ldquo;From a very fundamental point of view, if you look at the transesterification reaction, you have two problems that are related to each other,&rdquo; Mann says. &ldquo;Problem No. 1 is, you have two reactants, one is the oil or triglycerides and the other is alcohol, which are immiscible under normal conditions. When you try to have a reaction between two immiscible reactants, the reaction takes place only at the interface between the two phases. Because the transesterification reaction is slow in the beginning due to the interfacial limitations, some producers use large reaction vessels with long residence times to carry out the reaction to completion. So, the first problem is how to create a very large interfacial area or, in general, how to eliminate altogether the problem of the interfacial area limitations?&rdquo;&nbsp;
Problem No. 2, Mann says, is the level of the reactor temperature, which is determined by the boiling temperature of the alcohol. &ldquo;High reactor temperature is desirable for two reasons,&rdquo; he says. &ldquo;First, the transesterification reaction rates are faster, and second, because the reactions are slightly endothermic, their equilibrium compositions contain higher levels of biodiesel. If you want to operate the reactor at high temperatures, a pressurized tank is needed because the reactor pressure should be maintained above the respective boiling point of methanol.&rdquo; Large, pressurized tanks are inherently expensive, he adds. &nbsp;
The main purpose of the patent is to provide a process for biodiesel production that overcomes these two fundamental problems.&nbsp;
Atomization of Alcohol Ultrasonics isn&rsquo;t new to biodiesel; several plants use the technology, vibrating the reactor vessel at high-frequency in order to speed the reaction between the oil or fat and alcohol. Several years ago, Mann&rsquo;s colleague mentioned the use of ultrasonics in biodiesel production. &ldquo;With ultrasonic devices vibrating the whole tank, it may affect the reaction in some way, but it&rsquo;s not addressing the main issue of limiting interfacial area between the two reactants,&rdquo; Mann says. &ldquo;Stan and I were fortunate because we were working on another project using ultrasonics&mdash;totally different than biodiesel&mdash;and then it just occurred to us. We were using ultrasonics to generate very fine droplets of liquid&mdash;it was water for that project, but it can apply also to alcohols&mdash;and we said, aha, we can make very fine alcohol droplets and mix them into a large volume of oil and, in essence, we are achieving the objective of creating a very large interfacial surface area between the alcohol and the oils or fats.&rdquo; Thus, the idea was born to use an ultrasonic atomizer to generate ultrafine alcohol microdroplets, and to devise a simple method to disperse them into the oil feed stream using guided inclined plates. Once a dispersion of fine alcohol droplets in oil is created, the rates of the transesterification reactions increase by several orders of magnitude, and a much smaller reactor volume is needed.
Consequently, Mann says, continuous tubular reactors can be employed, which can be readily operated at high temperatures and higher pressures. &nbsp;Figure 1 is a schematic that shows a biodiesel process based on ultrasonic atomization of the alcohol feedstock. The process was demonstrated at TTU on a pilot plant, using a tubular reactor 3 inches in diameter by 20 feet long.
&ldquo;We developed a continuous process with tubular reactors, and if we want to increase production, we can do so easily in one of two ways,&rdquo; Mann says. &ldquo;We can use tubes with a larger diameter, or we can add tubes in parallel. Regardless, we can operate the reactor at higher temperatures, which enable us to recover and recycle most of the alcohol, which hasn&rsquo;t been converted in the reactor.&rdquo; A valve is installed at the reactor outlet to control the reactor pressure and maintain it above the corresponding boiling point of the methanol. &nbsp;Mann recommends installing a flash tank at the outlet of the reactor. As the unreacted methanol passes through the valve, it vaporizes out of solution in the flash tank and is recovered in the condenser and recycled back into the process. &ldquo;I know many producers that either discard the unreacted methanol with the glycerin, and some producers are adding a distillation column to remove the methanol from the glycerin,&rdquo; he says. &ldquo;In our process, the reactor temperature is so high (greater than 120 degrees Celsius), relative to the normal boiling point of the methanol, that by using a flash tank and an air condenser, we can recover and recycle most of the methanol.&rdquo;&nbsp;
Emets adds that by removing the methanol at the outlet of the reactor, the ability to separate the glycerin from biodiesel is substantially enhanced. &ldquo;That&rsquo;s an important component of the plant operation,&rdquo; he says. &ldquo;Even if methanol is only partially removed, the time needed to separate the glycerin stream from the biodiesel is reduced substantially. When the separation step is the &lsquo;bottleneck,&rsquo; this can increase plant production. Some may employ additional purification systems after the separation tank for the biodiesel and glycerol, and I agree with that, but one of the main benefits we&rsquo;re trying to show in the patent is that you should not ignore the fact that having a flash tank after the reactor enhances the performance downstream.&rdquo;
&ldquo;When you compare this atomization approach to other patents using ultrasonics to vibrate the whole reactor, the amount of energy needed to vibrate the reactor is tremendous,&rdquo; Mann says. &ldquo;We are interested only in generating very small droplets of methanol in oil. We use the ultrasonic energy just to form droplets of alcohol with high surface area. The size of the droplets can be controlled by the ultrasonic frequency, and the droplet size distribution is very narrow. Cavitation, which occurs in other ultrasonic applications, requires relatively large amount of power.&rdquo; Emets says, &ldquo;There&rsquo;s nothing wrong with achieving cavitation, but the question becomes, what&rsquo;s the cost of that reactor and the operating expense versus the type of reactor we worked on?&rdquo; Also, the main drawback of cavitation reactors, they say, is their inability to operate at high temperatures and pressures. &ldquo;Because,&rdquo; Mann says, &ldquo;the bottom line is, in a cavitation reactor, you want to mix up the oil and alcohol, but you don&rsquo;t want the alcohol to be in the vapor phase.&rdquo;
Another potential benefit of the process is a smaller amount of excess methanol may be needed because of the higher reactor temperature. In most applications, twice the required theoretical amount of methanol is used in order to push the reversible transesterification reactions in the direction of biodiesel production. If higher equilibrium conversions at high temperatures can be achieved, smaller amount of excess methanol is needed. This is especially important for the competitiveness and economics of large-scale facilities. &nbsp;
Biodiesel as a Cosolvent In the lab at TTU, Emets observed that, as the reaction proceeds, the dispersion mixture of oils and methanol droplets becomes a clear, homogeneous phase. This implies that a certain amount of biodiesel can serve as a cosolvent for oil and alcohol, forming a homogeneous phase of the mixture. The significance of this observation is that, in the homogeneous phase, the reaction rates are not limited by the interfacial area of the two reactants anymore. Part two of the patent, to be issued shortly, describes a biodiesel process that employs biodiesel as a cosolvent. Figure 2 shows a schematic diagram of this process. A recycle loop carries a slipstream of biodiesel product back to the inlet of the reactor, where it is mixed with the methanol and the oil in the desired proportions.
&ldquo;Once we don&rsquo;t have limitations of the interfacial area, the reactions proceed at their intrinsic rates, and we can carry them in a tubular reactor and at a higher temperature and pressure, and push the conversion to the biodiesel direction,&rdquo; Mann says. &ldquo;You can look at the biodiesel that is fed into the inlet of the reactor as an inert, a cosolvent, so we are diluting the reactants a bit with the cosolvent.&rdquo; The penalty for this is a slightly larger reactor. &ldquo;But the reactor volume is still much smaller than the size of a reactor we would need to react the two immiscible reactants,&rdquo; Mann explains.&nbsp;
Like many discoveries, the idea of using biodiesel as a cosolvent was stumbled upon in the lab. &ldquo;We were atomizing ethanol and mixing it with the oil, and we saw that after a short time we got a homogeneous solution,&rdquo; Mann says. &ldquo;There was no more two phases.&rdquo; Again, with a single phase, there were no more limitations by the interfacial area between the two reactants. &ldquo;We ran some experiments to see how much biodiesel we would need in order to get a homogeneous mixture at room temperature&mdash;we did it with methanol and ethanol.&rdquo;&nbsp;
Emets says, &ldquo;You can consider it like the limits of making very, very fine droplets of methanol in the oil. When you try to create the smallest droplets possible, you are approaching that condition of biodiesel as a cosolvent. The cosolvent provided the best possible scenario for us, and it gave us the idea that we don&rsquo;t even have to use ultrasonics to generate alcohol droplets. And when we did that, now the question becomes, what would be the benefits in addition to that?&rdquo; They found that by adding biodiesel as a cosolvent, they were able to cut the rate of methanol needed for completing the reaction. &ldquo;In doing some optimizations, we actually created a much simpler setup to get the biodiesel going, and after that, we significantly simplify the process downstream in the purification of biodiesel,&rdquo; Mann says. Interestingly, Mann&rsquo;s and Emets&rsquo; discovery of using biodiesel as a cosolvent, which is covered in a forthcoming U.S. patent, eliminates the need to implement their original idea&mdash;atomizing the methanol. &ldquo;Adding biodiesel would eliminate the need for ultrasonics or atomization because, in essence, we are forming a homogeneous liquid, so there is no interfacial surface between the reactants anymore,&rdquo; Mann says. &ldquo;The reactants are all in one phase, with biodiesel as a cosolvent.&rdquo;
Mann and Emets cannot explain why biodiesel performs as an effective cosolvent&mdash;they are chemical engineers, not chemists. But Mann speculates. &ldquo;Since biodiesel contains chemical groups from both the oil and the alcohol,&rdquo; he says, &ldquo;perhaps it facilitates such that both the alcohol and the oil are miscible in the biodiesel.&rdquo;&nbsp;
When performing their research at TTU, the benefactor of their work was searching for a solvent that would blend the oil and the methanol into a single phase. &ldquo;We were looking at if there was a possibility of not introducing any additional chemicals into the process, such that we don&rsquo;t have to remove it later on,&rdquo; Emets says. &ldquo;We can simplify the whole process by not introducing any additional stream other than oil and methanol, resulting in biodiesel, which we can recycle back to the reactor in using it as a cosolvent.&rdquo;&nbsp;
Next Steps The patent is owned by TTU, and the university is pursuing commercialization to find a biodiesel producer who&rsquo;d like to adopt the technology, or technologies, for royalties. &ldquo;I would like to find a commercial partner to develop the technology on a larger scale and take advantage of it,&rdquo; Mann says. Ryan Reber, the intellectual property manager at the Office of Technology Commercialization with TTU, tells Biodiesel Magazine, &ldquo;That&rsquo;s definitely our first option, trying to find corporate partners and transfer the technology to them. But if that can&rsquo;t be done, or if they want to see more data or information before they jump in and make a commitment to the technology, we&rsquo;re looking at talking to some venture investors and entrepreneurs to develop this technology to a point where we can have more information, have more of a proven concept, so we can talk to many of these established companies.&rdquo;&nbsp;
Emets says even though these approaches are set forth in the published patent now, there are several ways to further improve the technology in the future. &ldquo;It would be good to show manufacturers where the improvements can be,&rdquo; he says. &ldquo;The idea is to concentrate on the reactor itself, which simplifies a lot of other headaches in biodiesel production. It also creates a future for biodiesel technology that addresses other issues like not overdosing the methanol, or reusing as much as possible. Another item that wasn&rsquo;t discussed in the patent is reduction of the amount of catalyst needed for the reaction to take place, and the negative effects associated with caustic such as production of soaps. After that, utilization of biodiesel as a cosolvent, which is part of the process on a large scale, simplifies the operations of the biodiesel plant.&rdquo;&nbsp;
Author: Ron Kotrba Editor, Biodiesel Magazine 218-745-8347 rkotrba@bbiinternational.com

HIGHER LEARNING: Uzi Mann, who recently retired after 35 years as a chemical engineering professor at Texas Tech University, is the inventor of a patented technique that can help simplify biodiesel production and lower costs. 


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PRAGMATIC PROCESSING: After helping Mann develop the biodiesel techniques covered in the recently issued patent, Emets joined Texas-based Global Alternative Fuels, a 15 MMgy biodiesel producer. 

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KEEPING BUSY:  Mann, now retired after 35 years teaching at Texas Tech, says he wants to find a commercial partner to further develop his biodiesel techniques on a wider scale. 

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FIGURE 1:  By atomizing alcohol into the oil at the inlet of the reactor, phase limitations are significantly reduced and the goal of a homogeneous mixture is achieved. 

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FIGURE 2:  A simple recycle loop of biodiesel from the backend of the process to the reactor inlet enhances reaction times by creating a homogeneous phase between the two reactants. 

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A recently issued U.S. patent, the culmination of more than five years of lab-scale and pilot-plant research at Texas Tech University, provides simplicity and holds great promise for economical, large-scale biodiesel production.

Elegant Engineering

Honeywell has been selected by Transport for London to provide its Fusion4 technology to allow biofuels used in London buses to be blended directly at London bus depots, rather than mixing with diesel at refineries in Scotland and transported to the capital. The solution is currently being piloted at the Barking bus depot. The new blending capability will reduce the number of fuel delivery vehicles needed to supply biodiesel to the London buses. The Barking depot took delivery in September of Honeywell Enraf&rsquo;s Fusion4 Microblender system&mdash;a preassembled, skid-mounted system for blending including a storage tank that will be delivered to the site ready to use. With the company&rsquo;s Fusion4 blending controller, operators at the depot can easily ensure an accurate mix through intuitive icon-driven menus and running screens.&nbsp;
SeQuential-Pacific Biodiesel continues to gain momentum in the Seattle market, adding Woodland Park Zoo and Husky Stadium as cooking oil recycling customers in the second half of 2013. SeQuential-Pacific is also pleased to be included in Washington&rsquo;s annual Green 50 list for the second consecutive year. The list honors companies that make significant environmental contributions in the state of Washington.
Malaysian palm oil refiner Mewah International Inc. has agreed to purchase biodiesel assets from Gomedic Sdn. Bhd for $13 million. The assets include 25,055 square meters (about 6 acres) of land and a 30 MMgy biodiesel production facility. The biodiesel plant is strategically located in the vicinity of the company&rsquo;s largest palm oil refinery in Pulau Indah Industrial Park, Westport, Malaysia. The investment is expected to further consolidate the group&rsquo;s position as an integrated palm oil processor. The purchase is expected to be complete in the first quarter of this year, and will be funded by internal accruals, Mewah International stated.
Cavitation Technologies Inc. (CTi) announced that its U.S. patent application, titled, &ldquo;Process for Producing Biodiesel Through Lower Molecular Weight Alcohol-Targeted Cavitation,&rdquo; has been approved for patent issuance. The company says this approval adds another significant accomplishment to CTi&rsquo;s extensive portfolio of patents related to cavitation-assisted technologies and cavitation devices. &ldquo;This newly patented hydrodynamic cavitation technology and process has demonstrated that it can reduce costs and significantly lessen the environmental impact associated with biodiesel production,&rdquo; says Roman Gordon, CTi chief technology officer. &ldquo;Working in cooperation with our strategic business partners, Desmet Ballestra and GEA Westfalia, the company will initially target North and South American biodiesel producers for new and retrofit installations.&rdquo;
Piedmont Biofuels has been selected as host for the 2014 Collective Biodiesel Conference, to be held Aug. 14-17. Piedmont Biofuels is known for its community-based approach to biodiesel production and distribution, as well as its process technology innovations such as the cooperative&rsquo;s trailblazing work in enzymatic production. Piedmont Biofuels&rsquo; 14-acre industrial park in Pittsboro, N.C., features multifeedstock biodiesel processing in addition to hydroponics, aquaponics, biochar production and sustainable agriculture. Co-hosting the event will be Central Carolina Community College, where many of the breakout sessions will be held.
Environmentally friendly drum handlers from Morse Manufacturing Co. Inc. offer optional batteries that contain no lead, no acid, create no gasses during charge, and are lighter than lead-acid batteries. Plus, much longer life means fewer replacements, less maintenance labor and downtime, often reducing total costs. The batteries put out up to 2,000 cycles, and achieve up to eight times longer cycle life than lead-acid batteries with no maintenance. They can be stored for up to one year without recharging and have a typical design life of five years. The 12.8V, 19.2Ah, 245.76Wh batteries are made of four 3.2V 100Ah pieces with aluminum panel, nylon handle and plastic cover on the top. Morse, &ldquo;The Specialist In Drum Handling,&rdquo; has originated most drum handling advancements and offers the widest product line of more than 100 items, plus custom engineered versions, and provides users with the most extensive and expert world wide dealer support network.
Adkins Energy LLC has been awarded a $500,000 Rural Energy for America Program grant to begin construction on a $4.5 million biodiesel plant on the east side of its Lena, Ill., campus. The 2 MMgy facility is expected to begin production this spring. Adkins Ethanol currently produces about 1.5 MMgy of distillers corn oil, which is sold either into the biodiesel production market or as a supplement to the animal feed market. Adkins will use this feedstock to produce the biodiesel in its facility, a process that will be fully integrated into existing ethanol operations, creating significant operating efficiencies in biodiesel production. WB Services of Kansas is partnering with Adkins to create this first-of-its-kind integrative project. The new plant will be about 8,500 square feet, but designed to add more equipment to double its production capabilities if needed. Baker estimates the new plant will create a number of immediate new job opportunities as well as temporary construction jobs.
&nbsp;

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Companies, Organizations & People in the News

Business Briefs

The National Biodiesel Board is the national trade association representing America&rsquo;s first advanced biofuel. The group works to create sustainable biodiesel industry growth through education, communication, governmental affairs, technical, and quality assurance, programs. Serving as the coordinating body for research and development in the U.S., the National Biodiesel Board is comprised of state, national, and international feedstock and feedstock processor organizations, biodiesel producers, fuel marketers and distributors, and technology providers.
NBB membership has grown significantly over the years from its start with seven members in 1992 to more than 200 member companies today. These companies vary from Fortune 100 companies to small, family-owned businesses. This diverse membership base has provided a strong foundation for growth with member companies representing nearly all 50 states.&nbsp;
Whether you are a producer of biodiesel, a company that supports the biodiesel industry, or simply an individual who supports biodiesel, the NBB has a lot to offer. To find out more about becoming a member, visit http://nbb.org/join-us.
NBB Mission Statement: Representing America&rsquo;s first advanced biofuel, the National Biodiesel Board will advance the interests of its members by creating sustainable biodiesel industry growth. NBB serves as the U.S. biodiesel industry&rsquo;s central coordinating entity and will be the single voice for its diverse membership base. Industry success will be achieved through governmental affairs, communications, market development, technical, and quality assurance programs. We are dedicated to inclusiveness and integrity.
For membership information, please contact:&nbsp; Doug Whitehead Director of Operations and Membership dwhitehead@biodiesel.org 800-841-5849
&nbsp;

About the National Biodiesel Board, your membership organization 

National Biodiesel Board members selected their association leadership during the organization&rsquo;s recent membership meeting in Washington, D.C. Members voted to fill eight positions on the 15-person board and new officers were elected.
&ldquo;The biodiesel industry is on pace for record production in 2013 but the challenges facing this industry are significant,&rdquo; said new NBB Chairman Steven J. Levy. &ldquo;I am optimistic about our future as we face those challenges with a strong and diverse trade association membership united for the good of the industry, consumers, and the general public.&rdquo;&nbsp;
Officers elected to lead the board are: Steven J. Levy, chairman; Ron Marr, vice chairman; Mike Cunningham, treasurer; and Greg Anderson, secretary.&nbsp;
Newly elected governing board members include:&nbsp; &bull; Todd Ellis, Imperium Renewables&nbsp; &bull; Kent Engelbrecht, ADM&nbsp; &bull; Gary Haer, Renewable Energy Group&nbsp; &bull; Ed Hegland, Minnesota Soybean Research &amp;&nbsp; Promotion Council&nbsp; &bull; Ron Marr, Minnesota Soybean Processors&nbsp; &bull; Bob Metz, South Dakota Soybean Research &amp;&nbsp; Promotion Council&nbsp; &bull; Robert Stobaugh, Arkansas Soybean Promotion Board&nbsp; &bull; Ed Ulch, Iowa Soybean Association&nbsp;
 The following members continue to serve on the&nbsp;governing board:&nbsp; &bull; Greg Anderson, Nebraska Soybean Board&nbsp; &bull; Jennifer Case, New Leaf Biofuel LLC&nbsp; &bull; Mike Cunningham, American Soybean Association&nbsp; &bull; Brandon Foley, Sanimax Energy&nbsp; &bull; Steven J. Levy, Sprague Operating Resources LLC&nbsp; &bull; Timothy Keaveney, Hero BX&nbsp; &bull; John Wright, Owensboro Grain Co.&nbsp;
&nbsp;

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Industry elects association leaders, new chairman

Do you believe in miracles? There are few industries that have faced and overcome more adversity than biodiesel. Yet as the American energy landscape begins to experience a meaningful transformation, biodiesel is right there in the mix, coming off another record year of production. While challenges like uncertainty over the federal renewable fuel standard continue to push our industry to its limits, biodiesel has proven one thing: we&rsquo;re strong and getting stronger, while making our nation stronger, too.&nbsp;
Winning as an underdog is something the National Biodiesel Conference &amp; Expo keynote speaker knows about. Olympic gold medalist Jim Craig, best known as the goalie for 1980 USA &ldquo;Miracle on Ice&rdquo; Hockey Team, will show us what can happen when you don&rsquo;t give up. The game made history when the U.S. hockey team beat the heavily favored Russians and went on to win the Olympic gold medal in what&rsquo;s been labeled the greatest sports moment of the 20th Century.&nbsp;
Craig is currently president of Gold Medal Strategies, a motivational speaking and sales training company. During the past 30 years, he has inspired and provided strategic and winning direction for employees and associates from more than 500 organizations and some of the world&rsquo;s most recognized brands. Craig&rsquo;s latest business book, Gold Medal Strategies, Business Lessons from America&rsquo;s Miracle Team, was published in 2011.
For additional details on the 2014 National Biodiesel Conference &amp; Expo visit <a href="http://www.biodieselconference.com">www.biodieselconference.com</a>.&nbsp;

Jim Craig, 
President, Gold Metal Strategies

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Winning as an underdog is something the National Biodiesel Conference keynote speaker knows about. Olympic gold medalist Jim Craig, best known as goalie for 1980 USA "Miracle on Ice" Hockey Team, will show us what can happen when you don't give up. 

A gold medal strategy: Jim Craig to give keynote address at biodiesel conference

The U.S. biodiesel industry smashed previous record production numbers with an estimated 1.7 billion gallons of biodiesel produced in 2013. According to an economic study commissioned by the National Biodiesel Board and conducted by LMC International, a global economic research firm, this record production supported more than 62,000 jobs and $2.6 billion in wages this year alone.
<div>
<div>The study looked at three production scenarios for 2014 to help provide data to the EPA on proposed 2014 renewable fuel standard (RFS) volumes. First, under status quo production of 1.7 billion gallons, supported employment would remain at 62,200 jobs with supported wages of $2.6 billion and total economic impact of nearly $16.8 billion. If production were to fall back to 1.28 billion gallons, the number of supported jobs would drop to 54,500, with supported wages falling below $2.3 billion and total economic impact reduced to $12.2 billion. A third analysis looks at a high-volume scenario, consistent with third-and fourth-quarter volumes averaging roughly 170 million gallons, or an annualized rate of 2 billion gallons. It found that the number of supported jobs would rise to 66,600, supporting wages of nearly $2.8 billion and total economic impact of more than $20 billion.</div>
</div>
<div>
<div>&ldquo;The difference between 1.28 and 2 billion gallons in 2014 could result in a swing of 12,000 jobs supported, $500 million in wages paid, and $7.8 billion in total economic impact,&rdquo; said Anne Steckel, vice president of federal affairs at NBB. &ldquo;This is further evidence that a growing biodiesel industry and a strong renewable fuel standard are good for the economy. Biodiesel is a true RFS success story, and we should continue that momentum with modest growth that will create even more jobs in 2014.&rdquo;</div>
</div>
<div>
<div>Biodiesel is the first and only commercial-scale fuel produced across the U.S. to meet the EPA&rsquo;s definition as an advanced biofuel&mdash;meaning the EPA has determined that it reduces greenhouse gas emissions by more than 50 percent when compared with petroleum diesel. The industry has exceeded RFS requirements in every year of the program, producing more than 1 billion gallons annually since 2011.</div>
</div>
<div id="_mcePaste" class="mcePaste" style="position: absolute; left: -10000px; top: 0px; width: 1px; height: 1px; overflow: hidden;">All-time high production supported record jobs, economic activity</div>

If EPAâ€™s 2014 RVO for biomass-based diesel remains at 1.28 billion gallons in 2014, about 8,000 biodiesel-supported jobs would be lost. 

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All-time high production supported record jobs, economic activity

The biodiesel industry has faced its share of challenges. If you have been around the industry very long, you might say we have faced more than our fair share. But one thing is certain, when we face challenges, even if they seem monumental, we come together and we succeed.&nbsp;
We are officially on the clock for what may be our biggest challenge faced to date. On Nov. 29, the EPA formally published its proposed rule for 2014 and 2015 biodiesel volumes under the RFS. This started the 60-day comment period and sets a deadline of Jan. 28 to make our voices heard on this damaging proposal.
The U.S. biodiesel industry is the leading producer of EPA-designated advanced biofuel, and the first to break 1 billion gallons of annual production. With commercial-scale refineries across the country, the industry has exceeded RFS requirements in each year of the program including 2013 with an all-time record production estimated at 1.7 billion gallons. Biodiesel is a clear RFS success story and the industry is calling on the EPA to support a modest increase in the proposal that is consistent with actual, real-world production.
The EPA&rsquo;s proposed rule for next year would set biodiesel volumes at 1.28 billion gallons while shrinking the overall advanced biofuel requirement to 2.2 billion gallons. Additionally, because excess biodiesel production in 2013 can be carried over for compliance into 2014, the 1.28 billion gallon proposal for 2014 could mean an effective market closer to 1 billion gallons&mdash;a dramatic reduction from current production levels.
Because this proposal has the potential to do serious damage to the industry, we are doing everything we can, but we need your help. We will not be successful without vocal and aggressive outreach from the industry. We have set a goal of submitting at least 5,000 letters supporting an increased biodiesel volume above the 1.28 billion gallon proposal. We have made it easy by embedding a form letter at the Fueling Action Letter Writing Campaign page linked from the homepage of www.biodiesel.org. The message can be edited to include your personal story, or it can be sent as is. It can be sent throughout your social media networks, shared with friends and family during the holidays, or left open on a computer in the break room for employees to send directly from your facility.&nbsp;
Along with a high volume of letters, we know that a wide variety of individual letters from stakeholders is extremely important. We urge you to customize letters to discuss the specific impacts lower biodiesel production numbers will have on your business, job, or organization. You can use the template letter online and submit just by clicking &ldquo;Send,&rdquo; or you can use one of the following methods to send it manually. If sending manually, be sure to direct your submission to Docket ID No. EPA-HQ-OAR-2013-0479:
&bull; Submit via email to a-and-r-docket@epa.gov;&nbsp;Mccarthy.gina@epa.gov; &nbsp; HShelanski@omb.eop.gov;&nbsp;dmancini@omb.eop.gov; oecc@who.eop.gov;&nbsp;agsec@usda.gov. &bull; Submit electronically from www.regulations.gov and searchfor Docket ID No. EPA-HQ-OAR-2013-0479. &nbsp; You will seea link for Renewable Fuel Standard Program; 2014&nbsp;Standards and click the &ldquo;Comment &nbsp; Now&rdquo; link on the righthand side. &bull; Submit via mail to Air and Radiation Docket and&nbsp;Information Center, Environmental Protection &nbsp; Agency,&nbsp;Mailcode: 2822T, 1200 Pennsylvania Ave. NW.,&nbsp;Washington, DC 20460.
We would like to be able to track our progress throughout the 60-day comment period so if you do send a letter, or your friends submit 50 letters, please let Ben Evans know at bevans@biodiesel.org.
Another tactic that we know will be crucial to the effort is to have senators and representatives weigh in with the EPA and the administration on behalf of the industry. In November, we saw a bipartisan group of 32 senators sign a letter urging administration support led by industry champions Sens. Franken, Blunt, Murray and Grassley. On the House side, Reps. Mike McIntyre and Tom Latham circulated a similar support letter that was sent to the administration in December. We know that this show of support from Congress has made an impact, and the administration needs to continue hearing from them throughout the process. This type of political pressure will be key, so everyone needs to pick up the phone, call their senators and representatives, and urge them to reach out to the administration and EPA over the next several months.&nbsp;
Nearly two dozen NBB members and staff testified at a marathon EPA hearing Dec. 5 on the volume proposal. Of the more than 150 people who spoke during the 12-hour hearing, nearly every panel had a biodiesel industry representative on it. EPA clearly heard the effects the proposed rule would have if finalized during the hearing, and I want to thank all of those who participated.&nbsp;
Since the proposed rule has come out, NBB staff and members have conducted a series of meetings with top EPA officials, the White House&rsquo;s Office of Management and Budget, the White House&rsquo;s office on Energy and Climate Change, USDA Secretary Tom Vilsack, and countless senators and representatives.
While getting this proposed rule changed seems like a monumental task, it is one that we must do as an industry. We must continue the growth of advanced biofuels, the reduction in emissions, and the growth in economic activity in cities and towns across the country. Our more than a billion gallons of production each of the past three years has been a real success story for the RFS, and EPA needs to hear from you that a reduction to America&rsquo;s advanced biofuel is a step in the wrong direction.
Joe Jobe, CEO, National Biodiesel Board

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NBB members prepared for Hill visits as part of the recent NBB membership meeting in Washington, D.C. 

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EPA's proposal to keep the biomass-based diesel RFS standard at 1.28 billion gallons has potential to do serious damage to the industry, and the NBB needs your help. We will not be successful without vocal and aggressive outreach from stakeholders. 

Coming Off Record Year, RFS Proposal Poses Significant Challenge

German biodiesel exports have skyrocketed this year. The German Federal Statistical Office puts foreign sales between January and September 2013 at 1.1 million metric tons (330 million gallons), almost 14 percent up on the same period in 2012. In other words, Germany has become an even larger net exporter as imports have dropped by one quarter from the previous year, to 446,833 tons. Export surplus amounted to well over 672,000 tons, significantly more than the previous year&rsquo;s 264,000 tons.
The EU countries continue to be the top recipients of German biodiesel, receiving around 89 percent of the total quantity. Top of the list by far is Netherlands, importing more than 355,000 tons, around one-third of German deliveries to the EU. They are followed by Poland and Austria, at around 113,000 tons each, and France, at 76,000 tons.
Furthermore, 2013 was the first time Germany delivered nearly 100,000 tons of biodiesel to the U.S. In previous years, exports to the U.S. had averaged a meager 500 tons.&nbsp;

SOURCE: GERMAN FEDERAL STATISTICAL OFFICE

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German biodiesel exports on the rise

New York City-based Tri-State Biodiesel and its parent company, The Sustainable Biodiesel Co., have partnered with New Jersey-based Lard-NABF LLC to purchase and upgrade the Connecticut-based biodiesel production business, Bridgeport Biodiesel.
The partnership unites one of the region&rsquo;s largest cooking oil-to-biodiesel recyclers with one of the few biodiesel production facilities in the area and creates a powerhouse synergy of raw material access and biodiesel production capability. Through this deal, Bridgeport Biodiesel also leverages TSB&rsquo;s extensive biodiesel fuel distribution network, supplying both wholesale and retail products to gas stations, trucking fleets and heating oil consumers throughout the region.
Bridgeport Biodiesel is a fully permitted and operational 1 to 3 MMgy biodiesel facility constructed in Bridgeport&rsquo;s visionary Eco-Industrial Park. Fully operational in 2012, the plant is engineered and permitted to produce biodiesel from a variety of feedstocks, including yellow and brown grease. Ownership of the plant is transferred to the TSBC/Lard partnership with Tri-State Biodiesel&rsquo;s CEO, Brent Baker, as the new operations director of the facility.
The partnership also pledges additional capital to upgrade the plant with robust, new third-generation technology, which dramatically increases the efficiency and throughput capability at the site. Completion of the expansion is expected by third quarter, bringing the total biodiesel production capacity on site to 8 to 10 MMgy.
Effective immediately, TSBC subsidiary Connecticut Biofuels will be headquartered at the Bridgeport Biodiesel site. Connecticut Biofuels is Connecticut&rsquo;s longest-running, in-state cooking oil recycler. This will allow for locally sourced cooking oil to supply the Bridgeport plant.
TSBC, which also produces algae oil through its partnership with The Bear Group, is seeking additional space within the Eco-Industrial Park to build a commercial-scale algae farm that will provide the biodiesel facility with additional sustainably produced, carbon-neutral feedstock.
The new projects announced are anticipated to bring an additional 50 green-collar jobs that provide living wages, benefits and a dignified career pathway to an area with a historically high rate of unemployment and poverty. These projects establish Bridgeport and the state of Connecticut as national leaders in the sustainable biodiesel economy.
TSBC is the parent company of Tri-State Biodiesel, Connecticut Biofuels, Washington, D.C.-based Beltway Biodiesel, and Boston-based Independence Biodiesel. Through its network of subsidiary companies, The Sustainable Biodiesel Co. is one of the larger regional oil recyclers, collecting cooking oil from more than 5,000 restaurants from Virginia to Maine. The company was one of the first in the Northeast to offer free cooking oil-to-biodiesel recycling and the first in New York City to supply biodiesel fuel to private fleets and gas stations.
Lard-NABF LLC is owned by Alan and David Wormser, who also own Wormser Corp., a leading global importing and exporting company specializing in cosmetics products and packaging. The company has offices in the U.S., Germany, Great Britain and China. Lard has had a long history in biodiesel-related activity, including funding development for the original Bridgeport Biodiesel process equipment.

SUSTAINABLE GROWTH:  Bridgeport Biodiesel Operations Director Brent Baker, right, is pictured with Bridgeport Mayor Bill Finch, who is holding a jar of sustainably produced biodiesel.

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Tri-State, Lard purchase Bridgeport Biodiesel, plan upgrades

The end of 2013 brought a flurry of activity from the largest U.S. biodiesel producer, Renewable Energy Group Inc., with a major acquisition announcement, distribution and logistical expansions, facility openings and technology upgrades.&nbsp;
In late December, REG announced it would acquire Syntroleum Corp., including its 101 issued or pending patents, renewable diesel technology (Bio-Synfining) and 50 percent stake in the Dynamic Fuels LLC joint venture with Tyson Foods, including the 75 MMgy renewable diesel facility in Geismar, La.&nbsp;
In late November, REG entered into an agreement with Dutch Hill Terminals, a leading heating oil terminal in New Jersey, to market biodiesel and biodiesel-blended heating oil at its Clifton, N.J., location. &ldquo;This terminal position will give us additional capacity to serve the existing markets in the Northeast and prepare for potential growth moving into 2014,&rdquo; says Gary Haer, REG vice president, sales and marketing. &ldquo;As the region increases its consumption of biodiesel in transportation fuel and Bioheat, REG will continue to provide a reliable source of high-quality, clean-burning, advanced biofuel.&rdquo; REG has five other terminal locations in the Northeast, including Whippany and Bayonne, N.J., and New York locations in New Hyde Park, Port Chester, Ontario and Brookhaven.&nbsp;
In mid-November, REG formally opened its new barge loading facility at its Seneca, Ill., biodiesel plant and celebrated the accomplishment with a ribbon-cutting ceremony. State and local officials and business leaders joined REG leadership to mark the occasion, as well as witness the first barge shipment of 420,000 gallons of biodiesel from the multifeedstock, 60 MMgy plant located by the Illinois River. The barge loading facility will be supported by the addition of 2.5 million gallons of new terminal storage. REG&rsquo;s total investment in these upgrades is about $4.5 million.
&ldquo;The barge berth at REG Seneca further enhances our lower-cost, efficient business model,&rdquo; says Daniel J. Oh, president and CEO of REG. &ldquo;Adding more barge capabilities to our network of biorefineries and terminals across the country gives REG another capability for providing high-quality biodiesel to our existing and future customers.&rdquo; Biodiesel is also shipped from Seneca by truck and rail. REG has barge and deepwater ship loading capabilities at its Houston, Texas, biorefinery and its New York Harbor terminal location at the IMTT facility in Bayonne, N.J.&nbsp;
&ldquo;Every full barge that leaves Seneca equates to about 65 truckloads of biodiesel,&rdquo; says Brad Albin, REG vice president, manufacturing. &ldquo;This not only increases efficiencies, but expands the geography and customer base we can cover through the inland waterways system.&rdquo;&nbsp;
Robert Flider, director of the Illinois Department of Agriculture, speaks of how biodiesel personifies the partnership between agriculture and renewable energy. &ldquo;Illinois farmers benefit from additional markets,&rdquo; he says. &ldquo;The Illinois economy benefits from the jobs this industry provides and supports, and our country benefits from additional energy security that a domestic renewable energy source like biodiesel brings.&rdquo;
In late October, REG held a ribbon-cutting ceremony to open its recently acquired biodiesel refinery in Mason City, Iowa, formerly Soy Energy LLC, and announced it has begun a $20 million project to upgrade the plant to a multifeedstock facility. &ldquo;With these upgrades, we will be able to utilize lower-cost raw materials like inedible corn oil from ethanol production, used cooking oil and animal fats, with the majority coming from a close proximity to Mason City,&rdquo; Albin says.&nbsp;
A multifeedstock upgrade was also recently completed at REG&rsquo;s Albert Lea, Minn., facility.
&ldquo;These moves show the strength of REG&rsquo;s commitment to remaining a leader in the biodiesel industry and our ability to remain well-positioned to succeed in an evolving biodiesel marketplace,&rdquo; Oh says.

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Busy, profitable time for largest US biodiesel producer

TransMessis Columbia Plateau LLC, a wholly owned subsidiary of TransMessis Renewable Energy Inc., closed an approximately $6 million restructuring of the integrated canola crushing and biodiesel production operation in Odessa, Wash., formerly Inland Empire Oilseeds. This restructuring includes an operating agreement on the physical plant with the Odessa Public Development Authority, investment in working capital to allow an immediate restart of production, and additional investment to allow an approximately three-fold increase in the capacity of the plant.
The Phase One restart was expected to occur in December with a Phase Two expansion to be completed and operational by Feb. 1.&nbsp;
&ldquo;We are excited to be able to bring the facility back on-line and ultimately live up to the expectations of the community,&rdquo; says Damon Pistulka, CEO of TransMessis Renewable Energy. &ldquo;This facility will be a source of 30-plus jobs, and markets for the local economy. This is a unique opportunity to start up a facility with a tremendous wealth of knowledge in place from day one.&rdquo;
Once the planned expansion is completed, the Odessa facility will crush up to 300 tons of canola seed per day allowing for up to 10 MMgy of biodiesel.
TransMessis Renewable Energy Inc. is a joint venture founded by Evergreen Renewable LLC and Access Global Investments LLC.&nbsp;

Former Inland Empire Oilseeds plant restructures

As of Nov. 27, the EU imposed definitive antidumping duties on imports of biodiesel from Argentina and Indonesia. The antidumping measures consist of an additional duty of on average 24.6 percent for Argentina and 18.9 percent for Indonesia. The measures are based on a decision taken by the council, following a 15-month investigation carried out by the European Commission, which concluded that Argentinean and Indonesian biodiesel producers were dumping their products on the EU market. The exports were claimed responsible for significant negative effects on the financial and operational performance of European producers.
&ldquo;The EU is open to Argentinean and Indonesian exports but we should not stay idle and tolerate structural raw material distortions,&rdquo; says John Clancy, EU Trade spokesman. &ldquo;We&rsquo;re glad the council adopted the commission proposal, which is based on an objective investigation in line with WTO (World Trade Organization) law. Now we can be reassured that our green energy sector is not under threat and will continue developing to the benefit of all Europeans.&rdquo;
Argentina&rsquo;s Foreign Ministry said it is seeking immediate action from the WTO under the Dispute Settlement Understanding, and at press time the formal complaint had been filed. The ministry says the duties were imposed &ldquo;without a justified legal and factual basis,&rdquo; and are &ldquo;clearly protectionist in nature.&rdquo; The duties &ldquo;leave no option for Argentina than immediate action under the Dispute Settlement Understanding of the WTO, as soon as it is enforced, so as to ensure the production, foreign sales and jobs generated in our country for the sector,&rdquo; the foreign ministry says. &ldquo;Argentina is currently one of the most efficient biodiesel producers globally. The European industry, in contrast, is widely oversized, with companies that, in general, do not have quality ingredients, do not have adequate production scale and lack vertical integration necessary to be competitive globally.&rdquo;
In 2011 and 2012 combined, Argentina exported 982.8 million gallons of biodiesel, half of which was exported to Spain alone, according to the USDA Foreign Agricultural Service. The European Biodiesel Board, which initiated the investigation, insists Argentina&rsquo;s differential export taxes, which incentivize exportation of biodiesel versus raw soybean oil, allow for dumping at a cost lower than European producers can compete with.&nbsp;
The European Commission says it took great care to ensure transparency of the process that culminated the decision. All interested organizations, including raw material providers, producers, importers and users, had an opportunity to express their views during the investigation to ensure that the overall benefits of such measures go beyond any potential inconvenience. Following the so-called &ldquo;lesser duty&rdquo; rule, the duty rates to be imposed will be lower than the dumping margin itself and will instead be pitched at a level calculated sufficient to offset the injury suffered by the industry.&nbsp;
The definitive antidumping measures will apply for five years.

EU imposes definitive duties on Argentine, Indonesian biodiesel

The process of making biodiesel is relatively simple: triglycerides are combined with an alcohol to form glycerin and methyl esters. Multiple processes and technologies can be used to make high-quality biodiesel, including: pretreating feedstock versus acid esterifying, washing the biodiesel to eliminate excess catalyst and glycerin, and distillation or cold-haze filtration to strip out other impurities. The goal of any successful biodiesel plant is to make the highest quality biodiesel in the most efficient way possible. Hero BX has combined Desmet Ballestra and Arisdyne technologies, along with a modified filtration system, in an attempt to increase plant capacity, optimize efficiencies and improve the quality of our final product.
In order to exceed the original Desmet Ballestra designed capacity of 45 MMgy, a series of bottlenecks had to be corrected, including speeding up the reaction time. Arisdyne technology was added to the initial reaction step of the process in order to increase the plant&rsquo;s flow rate. This allowed Hero BX to accelerate reaction time but created bottlenecks in the washing steps of the process. These issues were corrected by finding more efficient ways to use existing resources and by adding minimal new equipment to allow the plant to run faster. These upgrades in combination with Desmet Ballestra and Arisdyne technologies have increased the plant&rsquo;s capacity by approximately 10 percent. Hero BX is also installing additional equipment to further increase capacity in 2014. One major improvement is the addition of a larger methanol column, which will help support a new acid esterification system as well as support any other new equipment in the future.&nbsp;
After increasing plant capacity, Hero BX was able to focus on optimizing plant efficiencies to lower production costs per gallon. The first step was to increase capacity to spread fixed costs over more gallons. Additionally, multiple economizers were added throughout the process and catalyst usage was minimized, due to the Arisdyne equipment. Other ways Hero BX has developed a continuous-improvement approach to plant optimization include implementing steam trap surveys, monitoring nitrogen gas usage, constantly observing process control points, and improving wastewater oil recovery. These are just a few examples of efforts in place to optimize plant efficiencies and reduce costs to help improve the bottom line.&nbsp;
Combining all of these technologies would not be worthwhile if the finished product were not high quality. In order to keep a strong customer base, quality is one area that can never be ignored in the interest of shipping higher volumes. The Arisdyne technology has helped to ensure a more complete reaction, which has allowed Hero BX to adhere to a stricter internal spec on monoglycerides than what is required for ASTM. Another area that affects quality is the filtration process. In order to maintain the highest possible quality, Hero BX has made multiple improvements to its haze filtration system. As capacity grew, larger filters had to be installed to keep up. A great deal of research was done with multiple filter aids to find what worked best for both filterability in the process as well as producing high-quality biodiesel. In the end, Hero BX was able to lower the amount of filter aid needed as well as lower the average cold soak filtration times by about 50 seconds.&nbsp;
Process technologies will continue to improve in the biodiesel industry. Whether it is increasing plant capacity, optimizing plant efficiencies, or improving the quality of the finished product, the companies that are able to successfully implement these new technologies into their existing facilities are the ones that are going to thrive in the biodiesel industry. At Hero BX our goal is to work to continuously improve our facility in all areas and attempt to stay one step ahead, in order not to be left behind.
Author: John Nies Director of Procurement &amp; Logistics, Hero BX 814-528-9210 jnies@herobx.com

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Hero BX has combined Desmet Ballestra and Arisdyne technologies, along with a modified filtration system, in an attempt to increase its biodiesel production capacity, optimize efficiencies and improve the quality of its final product.

Hero BX Process Technology and  Plant Optimization

The renewable fuel standard (RFS) administered by the U.S. EPA has always presented a double-edged sword to biofuel producers. On the upside of the sword, renewable identification number (RIN) credits are a valuable commodity, worth billions of dollars annually. On the downside, compliance with the RFS regulations is a daunting task, with each violation creating a penalty exposure of $37,500 per day. Strict liability permeates the RFS program such that even a company&rsquo;s vigilant and good faith efforts to comply do not forge an effective shield against EPA enforcement.
The EPA&rsquo;s recent decision to establish a quality assurance program (QAP) could provide some welcome relief. As described elsewhere, the proposed QAP system provides an affirmative defense to market participants under specified circumstances. QAP audits could also provide producers with an opportunity to reduce their RFS penalty exposure. This could be particularly valuable to companies that discover they have unknowingly committed minor but persistent violations of RFS regulations. While not a universal solution, the strategic use of the EPA&rsquo;s Small Business Compliance Policy is worth understanding and considering. &nbsp;
The QAP system is voluntary, but EPA expects that most RINs purchased and used for compliance purposes will be QAP-verified. Auditors must obtain approval from EPA to provide QAP services. Upon approval, the auditor must verify RINs in accordance with the requirements of the EPA-approved QAP. Producers choosing to have their RINs verified must provide the auditor with access to personnel, records and information. The QAP audits entail a more intensive third-party review of a facility&rsquo;s RFS compliance profile than do attestations. As a result, some QAP audits are likely to reveal specific events of RFS noncompliance to facility managers.
In EPA parlance, the QAP audit may constitute a voluntary discovery of violation that provides the company with an opportunity to self-disclose and receive a penalty reduction. To qualify as a small business, the business must be one that employs 100 or fewer individuals across all facilities and operations that the business owns (i). &nbsp;Under the policy, the qualifying business must also: (1) voluntarily discover the violation, (2) promptly disclose the violation within the required time period of 21 days, and (3) expeditiously correct the violation within the proper time frame. To obtain the benefits of the policy, the facility must also meet criteria on violation history, lack of harm, and criminal conduct (ii). &nbsp;Late disclosure may be permissible in exceptional cases where there are complex circumstances. However, in our experience, EPA construes the policy narrowly, insists that the time frame be met, and only provides penalty relief for the violations specifically disclosed in writing. &nbsp;
If all criteria are met, the EPA will waive 100 percent of the gravity component of the civil penalty. EPA&rsquo;s calculation of penalties includes two components: the gravity component and the economic benefit component. The economic benefit component is the direct economic benefit that a company received as a result of not complying with the regulatory requirement. In the case of failing to file a particular type of report, the economic benefit would be the savings of not having to pay someone to prepare the report. In the case of generating RINs for biofuel not produced, the value of the RINs sold would be included as economic benefit. Distinct from the penalty, EPA typically requires injunctive relief, such as retiring valid RINs to replace invalid RINs. Thus the penalty should not be regarded as the only cost exposure that a company has in an EPA enforcement proceeding. Nonetheless, it is the gravity component that typically constitutes the lion&rsquo;s share of the overall penalty.&nbsp;
Note that this article is intended to make producers aware of the policy, but is not provided as legal advice that any company follows a particular course of conduct. In the event a potential RFS regulatory violation is discovered through a QAP audit or other means, it is recommended that counsel be consulted immediately. The 21-day time period of the policy is very short. Even if the company&rsquo;s attorney is not familiar with the RFS regulations, the involvement of an attorney enables the attorney-client privilege to provide confidentiality while the company determines the appropriate remedial action.&nbsp;
i <a href="http://www.epa.gov/compliance/incentives/smallbusiness/index.html">http://www.epa.gov/compliance/incentives/smallbusiness/index.html</a> ii Id.&nbsp;
Author: Graham Noyes Attorney, Stoel Rives LLP 916-319-4675 jgnoyes@stoel.com

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Quality Assurance Program, or QAP, audits can provide biodiesel producers an opportunity to reduce their renewable fuel standard (RFS) penalty exposure. A strategic use of EPA's Small Business Compliance Policy is worth understanding and considering.

Can QAP Audits Lead to an EPA Safe Harbor?

Welcome to the process technology and plant optimization issue of Biodiesel Magazine. Once again, the U.S. biodiesel industry finds itself in a fight for its life as EPA&rsquo;s renewable volume obligation (RVO) proposal for biodiesel under the renewable fuel standard (RFS) seeks, in effect, to reduce biodiesel growth without justification. The 60-day comment period ends late January, and hopefully you have made your voices heard. But couple the possibility of a stalled, or effectively reduced, biodiesel RVO with the potential for another year without the biodiesel tax credit&mdash;the third lapse in five years&mdash;and the outlook goes from grim to worse.&nbsp;
In preparation for such policy catastrophes, some producers have relied on technologies to get them through the storm: technologies that allow use of lower-cost, lower-quality feedstock; and technologies that simplify operations, reduce chemical inputs, and ultimately widen the potential for profit, even without a tax credit, boosted RVO or robust RIN prices. &ldquo;Our work is such that we do not need any form of assistance or subsidy,&rdquo; says Sunil Suri, a principal and managing member of Menlo Capital Group, speaking of Menlo Energy&rsquo;s Clean Carbon Technology and a future where federal mandates and incentives are in question. &ldquo;Our business is profitable without any such largesse.&rdquo; Menlo&rsquo;s suite of technologies, which employs heterogeneous catalysis, is being installed in several plants across the U.S.
Jatrodiesel is building its first commercial supercritical biodiesel plant, co-located with the Patriot Renewable Fuels LLC ethanol plant in Annawan, Ill. Jatrodiesel President Raj Mosali says the Super process can handle any level of FFA without use of acid or base catalysts, the advantages of which are savings in catalyst costs, simplicity of the process, true multifeedstock capability and high-quality glycerin. For more on these, and other, process technologies being deployed today, check out &ldquo;Low-Cost Biodiesel Production&rdquo; on page 28.&nbsp;
We also dive into a recently issued patent from retired Texas Tech University chemical engineering professor Uzi Mann. Mann and his former post-doc student Stan Emets found that atomizing methanol into the feedstock stream eliminates limitations of interfacial surface area and creates a homogeneous phase between the two reactants, thereby speeding the reaction, reducing methanol inputs and simplifying downstream operations. Mann and Emets subsequently discovered using biodiesel as a cosolvent, recycled from the backend of the process to the reactor inlet, also creates a homogeneous phase between the two reactants and eliminates the need to atomize methanol. For the full story, read &ldquo;Elegant Engineering&rdquo; on page 20.&nbsp;
In addition, Viesel Fuel discusses its commercialization of enzymatic processing on page 34, Hero BX talks about its recent plant expansion on page 7, and much more. And if you&rsquo;re reading this in sunny San Diego at the 2014 National Biodiesel Conference &amp; Expo, enjoy the show!
&nbsp;

January/February 2014

Business Briefs

Business Briefs

Columns

Hero BX Process Technology and Plant Optimization

Can QAP Audits Lead to an EPA Safe Harbor?

NEW TECHNOLOGIES FOR A NEW ERA

Featured

Low-Cost Biodiesel Production

Elegant Engineering

Contributions

The Cruze Offers B20 Mass Appeal

Commercializing Enzymatic Biodiesel Production

January/February 2014.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

Hero BX Process Technology and Plant Optimization

Can QAP Audits Lead to an EPA Safe Harbor?

NEW TECHNOLOGIES FOR A NEW ERA

Featured

Low-Cost Biodiesel Production

Elegant Engineering

Contributions

The Cruze Offers B20 Mass Appeal

Commercializing Enzymatic Biodiesel Production

January/February 2014