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Insurance Journal  Apr 4  Comment 
The state fire marshal’s has ruled as an accident the January fire and explosion at JNS Biofuels plant near New Albany. The Northeast Mississippi Daily Journal reported the fire marshal found the likely cause of the incident was a problem...
Automotive World  Apr 2  Comment 
No other manufacturer has managed to develop five biodiesel engines configured for Euro 6 Scania is now adding yet another environmentally oriented alternative to its industry-leading palette with Euro 6 certified truck engines. The Scania...
Biomass Magazine  Mar 28  Comment 
Biomass Magazine  Mar 21  Comment 
Red Orbit  Mar 18  Comment 
American Chemical Society Chicken fat, pork fat or beef fat –– none is the cornerstone of a healthful diet –– but animal fats, including those from alligators, could give an economical, ecofriendly boost to the biofuel industry,...
Reuters  Mar 12  Comment 
Indonesia's Pertamina plans to float a third tender to buy palm oil for blending into biodiesel, an official of the state-owned oil firm said, signalling a strong start to the nation's drive to step up usage of the alternative fuel.     
DailyFinance  Feb 26  Comment 
CAMBRIDGE, ON -- (Marketwired) -- 02/26/14 -- W2 Energy, Inc. (OTC Pink: WTWO) is pleased to report our biodiesel plant installation is nearing completion at our Cambridge facility. Our move to a new location resulted in a delay in...
SeekingAlpha  Feb 17  Comment 
ByRobert Wagner: Editor’s Note: This article covers stocks trading at less than $1 per share and/or with less than a $100 million market cap. Please be aware of the risks associated with these stocks. I wrote an article earlier regarding the...
SeekingAlpha  Feb 14  Comment 
ByRobert Wagner: Editor’s Note: This article covers a stock trading at less than $1 per share and/or with less than a $100 million market cap. Please be aware of the risks associated with these stocks. Executive summary: The...
SeekingAlpha  Feb 11  Comment 
ByRobert Wagner: Editor’s Note: This article covers a stock trading at less than $1 per share and/or with less than a $100 million market cap. Please be aware of the risks associated with these stocks. ” One of the...




 
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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