RECENT NEWS
Motley Fool  Apr 16  Comment 
The renewable stock is up 23% since the decision.
Biomass Magazine  Mar 5  Comment 
This year is setting up to be a long year for the biofuels industry. First on the agenda is the fate of the biofuels tax extenders, including the biodiesel blenders, renewable diesel credit, second-generation and alternative fuels credits, which all
Biomass Magazine  Feb 26  Comment 
The U.S. Department of Energy awarded the University of Illinois a $10.6 million, five-year grant to transform two of the most productive crops in America into sustainable sources of biodiesel and biojet fuel.
The Economic Times  Jan 17  Comment 
The Bangalore Water Supply & Sewerage Board (BWSSB) has permitted Eco Green Fuels, a private firm, to see if it can convert waste into feedstock for biodiesel.
The Economic Times  Jan 8  Comment 
Bengaluru generates a huge quantity of oil and grease waste but lacks guidelines or a system to dispose of used edible oils.
Biomass Magazine  Dec 19  Comment 
Brian Jennings, CEO of the American Coalition for Ethanol, is asking the conference committee negotiating changes to House and Senate tax bills to extend the cellulosic biofuel tax credit and biodiesel tax credit as part of the Tax Cuts and Jobs Act.
OilVoice  Dec 15  Comment 
Source: U.S. Energy Information Administration, Monthly Biodiesel Production Report Throug ...
Biomass Magazine  Dec 14  Comment 
The board of directors of the California Biodiesel Alliance has voted to broaden the scope of membership to include advanced biofuels. To reflect the change, the organization has changed its name to the California Advanced Biofuels Alliance.
Biomass Magazine  Dec 13  Comment 
With more private and government fleets using biodiesel than ever before, it has never been more important to learn about the basics of cold flow improvers—why they are needed, how they work, and the various options for different applications.




 
TOP CONTRIBUTORS
Biodiesel is a nearly perfect substitute to petroleum derived diesel fuel. It is derived from the transesterification of biogenic oils such as vegetable oil and animal fats. The US biodiesel industry is burgeoning- it has tripled each year during the past few years. So much so, in fact, that vegetable oil prices, which account for around 80% of production costs, have almost become prohibitive to biodiesel's production as demand for biogenic oils - mainly soybean, palm, and rapeseed (canola) - has pushed their prices to unprofitable levels. Biodiesel has a well defined place in a sustainable energy portfolio, but the nascent biodiesel industry has a long way to go.

State of the Industry

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Recent Soybean Oil Prices

The National Biodiesel Board(NBB) just published the latest US biodiesel capacity numbers. 148 existing plants are reported (up from 105 in January 2007), for a total of 1.39 billion gallons/year of capacity. 96 new projects, and 5 expansions are currently underway, which will account for 1.89 billion gpy of capacity when they come online by the end of 2008. Here are the maps: existing and in construction.

The total is 3.28 billion gallons. This is a nameplate capacity: the output possible when running 24/7, 350 days/year. Collectively, US biodiesel plants run at about 25% of their capacity, a severe underutilization of assets. To put that 3.28 billion gallons per year capacity in perspective, at full capacity it would replace 5.1% of US diesel consumption, take up 126% of US soy oil production, take up 113% of all US vegetable oil production, and take up 84% of all US animal fat and vegetable oil production.

Future Developments

Food for Fuel

Clearly, biodiesel demand pushes up food prices. High oil prices, and subsequently biofuel prices, will cause food prices to rise, potentially pricing out poor people. This effect is well recognized, and many countries, including China, have set limitations on biofuels to combat the possibility of hunger problems resulting from biofuels.

Carbon Credits

Biodiesel reduces carbon dioxide emissions significantly- 70% is a frequently quoted percentage reduction of carbon emissions. The reduction won't approach 100% any time soon- it takes fertilizers, diesel tractors, petroleum powered transportation measures, and methanol to get biodiesel to the pump. However, [Carbon Trading] has the potential to benefit biodiesel producers immensely- on an energy basis, substituting a gallon equivalent of biodiesel for diesel (biodiesel has about 92% of the energy content of petroleum diesel) saves about 6.5 kg of CO2 emissions. It takes about 150 gallons to eliminate a metric ton (mt, or 1000kg) of CO2 emissions, making the roughly $4/mt carbon credit that the Chicago Climate Exchange offers reduce the price of a gallon of biodiesel by a mere 2.6 cents. To eliminate the need for the $1/gallon subsidy currently in place, the price of a ton of CO2 would have to be about $150.

Alternative Feedstocks

In its current form, the biodiesel market scope is small. For the long term, soybean, rapeseed, and palm biodiesel are not great solutions: soybean and rapeseed crops compete with food and have low oil/area yields relative to plants like palm and jatropha. Palm oil is a great feedstock, however it is currently being developed in a highly unsustainable form: deforesting land for palm oil production. It takes many decades to recapture the carbon emitted from forest destruction by planting biodiesel crops. Renewable fuels must become globally traded commodities if they are to have any significant impact on the world's energy portfolio.

Who stands to benefit

Companies who have their hands in jatropha plantations and those with logistics favorable to an international oilcrop market.

Who stands to lose

Companies in the middle of Iowa.

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