I grew up in the farm state of Iowa. Though I lived in the city, a short drive in any direction would put me in the midst of sprawling corn and soybean fields. At the time, nobody thought food crops might have potential for being an alternative fuel source. But when the Organization of Petroleum Exporting Countries (OPEC) hit us with the first oil embargo back in 1973, perceptions changed.
In 1980, I wrote a book on "How To Make Your Own Alcohol Fuels." At the time, everybody was gungho over ethanol alcohol as a way to reduce our dependence on foreign oil. There was a lot of buzz about energy independence, and a lot of people (farmers mostly) were investing in small scale alcohol fuel production facilities. Some of these were not much more than backyeard moonshine stills, but others were modern facilities capable of producing thousands of gallons of fuel per month. Then oil prices came back down and the alcohol fuel movement collapsed, except for a few politically connected big time alcohol producers who got special tax breaks and incentives.
Fast forward to today. Oil prices are again being driven by politics in the Mideast. Ethanol alcohol is back again as both an octane booster and as an 85% ethanol/gasoline blend in "E85" for "flex fuel" vehicles. And now there's a new kid on the energy block called "biodiesel" vying for acceptance as an alternative renewable fuel to diesel fuel made from crude oil.
Biodiesel Made from Renewable Non-Petroleum Resources
Biodiesel is essentially diesel fuel made from renewable non-petroleum resources. Most biodiesel is currently made from soybean oil, but it can also be made from sunflower seed oil, or less expensive animal fats such as beef tallow or chicken fat, or even recycled restaurant grease. Biodiesel can be blended with conventional diesel fuel much like ethanol is blended with gasoline. Most diesels can run mixtures of 10 to 15% with no modifications, and up to 100% straight biodiesel with minor modifications. Biodiesel tends to gel when temperatures drop below 40 degrees F (depending on the base stock), so the blend typically has to be cut back for reliable cold weather operation. Some municipal bus fleets run a 75% biodiesel mixture in the summer and switch to a 20% blend in the winter.
Nobody really questions the viability of biodiesel as an alternative fuel for diesel engines. But the economics are questionable.
Biodiesel Economics
According to industry sources, biodiesel currently costs about $1 a gallon more to produce than conventional diesel fuel when soybean oil is used as the primary ingredient. This makes the fuel about 10% more expensive than conventional diesel ($3.13 a gallon for biodiesel versus $2.70 a gallon for conventional diesel). A recent rise in soybean prices has created a financial pinch for many biodiesel producers, and a few have actually had to shut down their operations. So there is growing interest in using less expensive animal fats. Chicken fat, for example, sells for about 19 cents a pound versus 33 cents a pound for soybean oil.
Biodiesel relies heavily on federal tax breaks to make it economically viable. If the tax breaks continue, biodiesel probably has a strong future. The new Congress that just convened in January will debate a bill called the Biofuels Security Act. If passed, the law would require the nation to use up to 30 billion gallons of ethanol and biodiesel by 2020, and 60 billion gallons of alternative fuels by 2030. The National Petrochemical & Refiners Association (NPRA), which is the voice of Big Oil, opposes the legislation because they see alternative fuels as a threat to their record high profits.
Biodiesel Boom
Whether the Biofuels Security Act passes or not, biodiesel is proceeding full speed ahead. According to the National Biodiesel Board, biodiesel production went from 25 million gallons in 2004 to 75 million gallons in 2005. The final numbers for 2006 are not yet in as of this writing, but are estimated to be 150 to as much as 225 million gallons! By 2010, production may hit one billion gallons of biodiesel a year.
Frost & Sullivan recently issued a report that said the biodiesel market earned $217 million in 2005, and may earn as much as $4.9 billion by 2012 if federal tax incentives remain intact.
It looks like the biodiesel boom is on -- at least for now. Biodiesel plants are popping up across the country. Michigan's first biodiesel plant just went online in December. Wisconsin has three new plants under construction with a combined capacity of 45 million gallons a year. Even Hawaii is getting in on the trend. The number of fuel stations that offer biodiesel is also growing. South Carolina currently has the most with 64, followed by Missouri with 47, North Carolina with 43, Texas with 40, Tennessee and Pennsylvania with 34 each, and California with 31. The only states that do not yet have any biodiesel outlets are North and South Dakota.
Will history repeat itself? Will oil prices tumble once again and strangle the alternative fuels industry once again? With all of the political unrest in the Mideast creating market volatility, it's hard to say which way the price of crude oil will go. Some analysts say any serious disruptions may send crude prices soaring to over $100 a barrel once again. Nigeria, which supplies about 10% of our imports, appears to be the next hot spot for conflict.
China's booming economy is demanding more and more oil imports, and expanding vehicle populations across Asia will need fuel from somewhere.
To me, ethanol and biodiesel make political sense if not economic sense even if alternative fuels cost more than conventional petroleum-based fuels. I'd rather see my energy dollars go into the pockets of American farmers and producers of renewable alternative fuels than Arab oil sheiks, oil company CEOs and foreign speculators.
February 25, 2008
I received a book a couple of weeks ago called "Do It Yourself Guide to Biodiesel" by Guy Purcella, It's a new book that details how to make your own biodiesel fuel from used cooking oil. Restaurants all across the country have tons of this stuff to dispose of, so why now make it into biodiesel and burn it in a diesel engine? The author details all the steps that are required to test, transport and store used cooking oil, and how to use enzymes, lye and methanol to convert it into biodiesel. The author also tells how to build your own biodiesel processor (or buy one of his ready-made units), and how to separate the biodiesel from the glycerine that is left over after the conversion process is complete.
This book is must reading for anyone who has questions about what's involved in making your own biodiesel fuel. After reading this book, I'd say that making biodiesel on a small scale is probably more effort than it's worth for the average person. It takes a working knowledge of basic chemistry and a lot of babysitting to produce a good batch of biodiesel fuel. It also requires a fair amount of work to collect, haul and process the used cooking oil. You need various supplies to make the fuel, a place to do it, and a way to get rid of the waste products that are left over. The author covers all of these issues, and provides solutions in every instance.
The step-by-step instructions are easy to follow, and the author does a good job of explaining the entire process from start to finish. The book is 230 pages long, sells for $19.95 and is published by Ulysses Press.
ISBN10: 1-56975-624-4
ISBN13: 978-1-56975-624-9
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