BioCycle October 2003, Vol. 44, No. 10, p. 43
Fuels from biomass like biodiesel have come a long way to gain marketing and technical acceptance, but challenges still persist.
A DOZEN YEARS of determined work have assembled the scientific, technical, regulatory, economic and political tools to launch the biodiesel industry onto the main transportation fuels highway. The federal energy bill, now in conference, calls for a renewable fuels standard (RFS) requiring their increased use in the transportation sector. Pending legislation also provides for the volumetric ethanol – spearheaded by Sen. Charles Grassley (R-IA) excise tax credit (VEETC). This will shift payment of the ethanol excise tax exemption (the new provision includes biodiesel) from the highway trust fund to a payment of 52 cents a gallon from the general fund to the blender of the ethanol and gasoline (or biodiesel and fossil diesel). These factors are providing additional traction pushing biodiesel ahead.
All this progress would not be happening without involvement of such organizations and companies as the National Biodiesel Board in Jefferson City, Missouri (www.biodiesel.org), American Soybean Association, National Renderers Association, New Uses Council and companies such as Biodiesel Industries, Renewable Oil International, Griffin Industries, West Central Cooperative and others. (Ed. Note: At the BioCycle Renewable Energy Conference in Minneapolis, November 17-19, 2003, Russ Teall of Biodiesel Industries will speak on ‘The Business of Making Biodiesel,’ and Phil Badger of Renewable Oil International will discuss ‘Bio-Oil Technologies and Markets.’)
Biodiesel is produced by ‘transesterification’ of vegetable and tree oils, animal fats and tallow, and used cooking oil and yellow grease (recycled oils and fats). In short, one or more of these feedstocks are mixed with methanol (generally) or ethanol and a catalyst – sodium or potassium hydroxide. The mixture is processed into biodiesel and glycerin.
However, several problems and marketing challenges exist: 1) Bio-oils can be produced from a variety of biomass (i.e. nonoils or fats) into a middle distillate that can be used as a diesel fuel or further processed into a high quality, renewable diesel type fuel. These fuels do not qualify for benefits under the RFS or the VEETC; 2) Under VEETC, recycled oils and fats essentially receive only half the benefits as compared to virgin oils, fats and tallow; 3) Dedicated small businesses and individuals promote filtering used vegetable oils, and using exhaust and/or engine thermal energy to heat this fuel before it is introduced into the engine. They claim good results, but there are likely violations of standards, regulations and the tax code.
LEVELING THE PLAYING FIELD
The first order of business is enable all forms of diesel fuels made from biomass – regardless of whether they are produced from vegetable or tree oil, transesterified or derived at through some other biorefinery process, virgin or recycled – to be treated equally under the federal tax code. If Missouri wants to give soy oil a break, they can do it through the state tax code. If New York wants to favor used cooking oil and trap grease to help rid major cities of rats and other vermin, prevent plugging up their sewer system, and reduce the burden on their wastewater treatment plants, they can do so within their state highway fuel tax code. To treat biofuels preferentially in the tax code based on feedstocks deviates from the standard practices used in the gasoline, diesel and ethanol industries where only the end product determines the tax status. The complications of verifying the tax benefits from the point of sale back to the producer, particularly when the producer is using a mixture of feedstocks, has yet to be tested and certainly encourages ‘creative’ bookkeeping.
The next challenge is to pave the way for individual and small businesses to use virgin vegetable/tree oils or recycled oils and greases in diesel engines without going through the transesterification process. This is being done now by filtering the used cooking oil and preheating the filtered oil using engine exhaust and/or cooling water heat before the biofuel is injected into the engine. (See www.greasel.com for details).
That brings us to compost. Urban composters have diesel engines in the collection vehicles and/or on-site equipment. It may be cost effective during food residuals collection to pick up recycled cooking oil, filter it, and use it in vehicles and equipment as described.
These are the challenges that face the New Uses Council (NUC) and others. NUC assists farmers, ranchers, foresters, communities and their respective industries, in promoting the use of agriculture and forestry crops and residues as well as tree and garden trimmings, and the clean biomass fraction of municipal wastes into biofuels of all types, biopower and cogenerated thermal energy, and a wide range of biobased products.
Bill Holmberg is Chair of the New Uses Council, contact him at firstname.lastname@example.org.
October 16, 2003 | General
BIODIESEL ON THE TRANSPORTATION FUELS HIGHWAY
BioCycle October 2003, Vol. 44, No. 10, p. 43