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Biodiesel Benefits from Legislative Progress
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Last month, the Farm Bill became law when Congress successfully overrode the President's veto. Among its many provisions, the legislation reauthorizes the Commodity Credit Corporation (CCC) Bioenergy Program and provides $300 million from Fiscal Year (FY) 2009 through FY 2012 in funding for the initiative. This important program provides support to biodiesel producers to help offset high feedstock costs. In addition, the Farm Bill also continues funding for the USDA Biodiesel Education Program to increase the awareness and ultimately utilization of biodiesel.
In addition, the U.S. House approved H.R. 6049, the Energy and Tax Extenders Act of 2008. Among its many provisions, the legislation extends the biodiesel tax incentive through Dec. 31, 2009. Under the bill, the $1 per gallon incentive would be available for all biodiesel, regardless of feedstock. H.R. 6049 also shuts down the "splash and dash" loophole that currently allows foreign-produced fuel to enter the U.S, claim the biodiesel tax incentive, and be shipped to a third country for end use. Lastly, H.R. 6049 properly defines the renewable diesel tax incentive as it applies to co-processed renewable diesel.
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Anti-Biofuels Arguments Lose Some Credibility
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"Don’t buy what the grocers are trying to feed you." That's the message from Joe Jobe, CEO of the National Biodiesel Board, in response to the Grocery Manufacturers Association's (GMA) campaign to blame biofuels for rising food costs.
In May, Senators Charles Grassley (R-IA), Byron Dorgan (D-ND), John Thune (R-SD), Ben Nelson (D-NE), Kit Bond (R-MO), and Ken Salazar (D-CO), exposed the GMA's public relations plan to discredit biofuels. The USDA also fought back against some of these unfounded attacks.
"It turns out that a $300,000, six-month retainer of a beltway public relations firm is behind the smear campaign, hired by the Grocery Manufacturers Association," said Senator Grassley.
The senators agreed that the GMA's attempts to blame biofuels for food price increases are not based on sound science, sound economics, or common sense. In addition, they expressed strong support for continued federal programs that encourage biofuel production and use.
Also in May, the U.S. Department of Agriculture released economic analysis that shows high energy prices, increasing global demand, drought and other factors are the primary drivers of higher food costs (press conference pictured here). USDA has posted economic analysis and charts (www.usda.gov) that document that "even with the current uptick in food price inflation, it is much lower than it was in the 1970s and early 1980."
"The feeding frenzy on biofuels as the reason for higher food prices has got to stop. Let's not lose sight of all the benefits biodiesel has to offer. It is a green fuel, creating green jobs and beefing up our national energy security. We should continue to support biodiesel as part of our long-term energy strategy," Jobe said.
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Minnesota Passes Statewide B20 Requirement
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Minnesota has taken another step towards promoting domestic energy security and reducing the state's carbon footprint. In May, Gov. Tim Pawlenty signed a bill that will increase the current 2 percent biodiesel mandate to 20 percent by 2015 with incremental increases starting in 2009. The legislation language allows biodiesel producers and other stakeholders to gauge supply and demand impacts before moving to a higher blend.
The legislation requires that 5 percent of the feedstock come from non-traditional Minnesota agricultural resources such as algae, waste oils, tallow and oilseed plant that can grow on marginal soils. The legislation also includes quality assurance and ASTM fuel specifications to ensure only quality fuel enters the marketplace.
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BQ-9000 Program Reaches One-third of U.S. Production; Announces Seminars
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The BQ-9000 biodiesel quality assurance program has welcomed two biodiesel producers and one marketer to its ranks including: an 85 million gallon capacity biodiesel plant operated by Archer Daniels Midland (ADM) in Velva, N.D.; biodiesel producer Freedom Fuels of Mason City, Iowa; and biodiesel marketer Caljet of America located in Phoenix, Az. With these additional facilities, the program has reached more than 40 companies and accounts for about 33 percent of the biodiesel production capacity in the U.S.
The ADM plant is located adjacent to its canola crushing facility and produces biodiesel made from canola oil. It is ADM's first biodiesel plant.
Freedom Fuels operates its 30 million gallon capacity biodiesel plant using locally grown agricultural products. The company’s founders included local soybean producers. The plant produces biodiesel and glycerine.
Caljet of America, LLC, the Southwest's largest independent motor fuel terminal operator, is making a commitment to biodiesel by expanding its terminal to include 25,000 barrels of biodiesel storage capacity. This will allow for blending a wide variety of biodiesel blends across nine loading racks. Caljet is also heavily involved in biodiesel as a lubricity additive at low levels.
There are currently 28 biodiesel production facilities certified as producers under the program, and 13 as marketers of biodiesel.
To continue the positive momentum of increasing in-spec fuel in the marketplace, the National Biodiesel Accreditation Commission is offering upcoming seminars for companies interested in becoming a BQ-9000 producer or marketer. The remaining 2008 workshops, "BQ-9000 Internal Auditor Training," will be held July 30 or Nov. 19. Visit www.bq-9000.org for information.
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Hedging Webinar Announced
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All Things Biodiesel.com has partnered with FC Stone LLC, Biodiesel Financial Services, and Huntleigh McGehee Insurance for a series of value added presentations to NBB members. The first is on capital requirements of various hedge structures available for the biodiesel industry. FCStone, a commodity risk management firm and NBB member, will present this online workshop, offering insight in the dynamic commodity market.
In this discussion of biodiesel hedging, attendees will learn how to utilize financial instruments to help secure margins. Anyone who is planning on investing in the biodiesel market could benefit from this discussion. The event takes place on Wednesday, June 4th from 2:00 to 3:30 CDT. Attendees can sign up at www1.gotomeeting.com/register/668409526.
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USDA Researchers Honored With SDA/NBB Glycerine Innovation Award
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Researchers from the U.S. Department of Agriculture are creating new eco-friendly uses for natural glycerine - a by-product of biodiesel production, and are receiving kudos for it. Natural glycerine could be used in place of petroleum-based glycerine in everything from disposable razors to credits cards.
For their research on the applications of natural glycerine, Drs. Richard Ashby, Daniel Solaiman and Thomas Foglia of the USDA's Agriculture Research Service Eastern Regional Research Center (EERC) in Wyndmoor, Penn. received the 2008 Glycerine Innovation Award. The award recognizes outstanding achievement for research into new applications for glycerine, with particular emphasis on commercial viability. Sponsored by the National Biodiesel Board and the Soap and Detergent Association, the award was presented at the 99th Annual Meeting of the American Oil Chemists’ Society in Seattle, Wash., in May.
The team's research focused on replacing petroleum glycerine with natural glycerine in several applications including cosmetics and automatic dishwashing detergent formulations as well as hard items such as golf tees, disposable razor handles, credit cards, and bottles, to name a few. Products made from natural glycerine are considered "ecofriendly" as they are produced from renewable resources and can be quickly biodegraded upon disposal.
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Earthrace Reaches Halfway Point
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Earthrace, a biodiesel-powered trimaran, left the port of Sagunto, Spain, on April 27 to make a second attempt at a world record for circumnavigating the globe. The goal of Earthrace is to set a new world record for a powerboat to circumnavigate the globe, while additionally running 100% renewable biodiesel fuel (B100), and with a net zero carbon footprint.
The crew of the 78-foot vessel hopes to complete the voyage in less than 65 days, beating the previous decade-old record of minutes under 75 days. Earthrace is still on track to beat the record as it heads through its midway point of the Marshall Islands - despite losing an engine. Skipper Pete Bethune and his crew are over 12,000 nautical miles into their voyage and ahead of the world record by 2,100 nautical miles.
The boat is currently running on one engine after a high pressure fuel line burst, yet even on one engine Earthrace is still proceeding at 16 knots – the equivalent of about 18 miles per hour. The 24,000 nautical mile route has so far taken them into the Atlantic and Pacific oceans, and the crew has already overcome obstacles such as fuel leakages, a huge backlog of traffic in the Panama Canal and a tricky journey through an offshore dumping ground in the North Pacific.
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Our Nation’s Students Show Their Biodiesel Mettle
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The top three winners of the U.S. Department of Energy and General Motors' Challenge X: Crossover to Sustainability all used a B20 blend of biodiesel to fuel their vehicles. In its third year, the competition gives engineering schools an opportunity to participate in hands-on research and development with leading-edge automotive propulsion, fuels, materials, and emissions-control technologies.
This year's awards were presented in May by Energy Secretary Samuel Bodman. Each of the 17 teams were challenged to re-engineer a GM Equinox crossover sport utility vehicle to minimize energy consumption, emissions, and greenhouse gases while maintaining or exceeding the vehicle's utility and performance.
The winner, Mississippi State, said their team chose B20 because of the efficiency of the fuel as well as its value in reducing greenhouse gas emissions. Second place winner, University of Wisconsin, touted B20 for its fuel efficiency that allows their Equinox to go from 0-60 mph in 7.5 seconds.
Taking a step back to secondary education, in North Carolina, a group of Currituck County High School automotive students recently finished reconstructing a motorcycle to run on biodiesel. The bike, a 2003 Harley-Davidson Fatboy, took about four months and $20,000 in parts to complete. It currently runs on soy-based biodiesel and gets 99.5 miles per gallon.
The students recently showed off the bike at the Virginia Beach Bike Classic motorcycle show, where it attracted the attention of custom-bike builders. They will also be featured on an episode of SPEED Channel's "American Thunder" motorcycle program.
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New Users and Suppliers Find Innovative Ways to Support Biodiesel
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In May, several companies announced innovative uses of biodiesel from powering amphibious vehicles to keeping cool.
Boston Duck Tours is replacing five of its 24 World War II amphibious vehicles with more efficient modern replicas that run on biodiesel. The vehicles will initially run on B5 with plans to ramp up to a higher blend.
Michigan has a lot to report on user updates. DTE Energy, a Detroit-based diversified energy company, is fueling its 800 diesel-fueled construction trucks, bucket trucks and light duty vehicles with B20. Detroit's Art Van Furniture, the state's largest independent delivery fleet, began filling two delivery trucks with B20 in May. Wayne County, Michigan, has surpassed the one million gallon mark since they began using B20 biodiesel in 2006. And, from June 1 through Labor Day, Michigan-based Meijer grocery stores are taking 10 cents per gallon off biodiesel as well as ethanol, diesel and gas at their 165 gas stations when customers use their Meijer store card.
To the west, California's San Luis Obispo-based Meathead Movers began fueling all of its diesel-powered moving trucks with B20. Also, the city of Monterey has started using biodiesel in some city trucks.
Another grocery chain, North Carolina-based Food Lion supermarket is using biodiesel generators to help ease its utility energy demand during peak operations, such as on extremely hot days when commercial and residential air conditioners are running at their highest capacities.
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Tornado Destroys Patriot Bio-Fuels Facility
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Patriot BioFuels Inc. biodiesel plant in Arkansas suffered heavy damage from a tornado on May 10. According to plant co-owner Steve Danforth, the plant took a direct hit from a tornado packing winds of 136-165 mph. Another co-owner, Mike Shook said, "Nobody was hurt. That's the main thing." Both Danforth and Shook are also principals of Agri Process Innovations, the company that constructed the Arkansas plant.
In an interview with the Arkansas Democrat Gazette, Danforth said, "It's pretty much gone." Patriot's owners are in discussions with their insurance carrier. The results will determine whether the plant will reopen. "Even if we were to get the green light today to rebuild, it's going to take four or five months," said Danforth.
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