By Tina Caparella
Valley Proteins and Capital Technologies International (CTI) have entered into a joint venture to produce biodiesel at Valley’s former rendering plant on Neville Island, west of Pittsburgh, PA. The 10 million gallon biodiesel plant is expected to be operational before the end of this year and will become Pennsylvania’s first commercial biodiesel producer. CTI will be the general partner in the venture and Valley Proteins will be a minority partner.
Based in Pittsburgh, CTI will use a patent-pending process developed in collaboration with Carnegie Mellon University’s Center for Advanced Fuel Technology to produce the alternative fuel on the 20-acre site. The existing plant will be renovated with new equipment.
Valley Proteins acquired the Neville Island rendering plant in 1999, but soon after experienced problems with odors emitting from the facility. With the decline in raw material in the area not supporting the cost of renovations to correct the odor issues, Valley decided to close the plant in mid-2004. The renderer will continue to operate their relay facility at the site.
CTI will use a combination of used cooking oil and animal fats, as well as domestic agricultural products such as soybean, corn, and canola oil, in a high yield process. Valley Proteins will provide much of the feedstock, according to CTI President Richard Jackson.
Funding for the plant conversion is being sought from local and state sources, as well as from venture capital firms. According to Jackson, CTI has established joint ventures to use their process in Turkey, Brazil, and Malaysia, and active negotiations are underway in Ireland, Columbia, Canada, Israel, and other countries.
Initially, 10 to 12 workers will be employed at the biodiesel plant, with plans to add additional workers in the next few years.
Cold Flow Study to be Released
There is word that the long-anticipated study on the cold flow properties of biodiesel is due to be released in June by the National Biodiesel Board (NBB). It has been reported that testing has been completed, with the objective to blend biodiesel at various rates within acceptable standards documenting temperature parameters being met. The technical report and data have been accepted and verified by the study’s consortium members. The U.S. Department of Energy’s National Renewable Energy Laboratory (NREL) has agreed to provide technical report writing for public use by early June. According to sources, the test data substantiates previous findings and reports as found in the NREL’s 2004 Biodiesel Handling and Use Guidelines, available on the Internet at www.nrel.gov/vehiclesandfuels/npbf/feature_guidelines.html.
The study’s objective to address the most cost effective options for handling and blending 100 percent biodiesel into diesel fuel at terminals was accomplished using a custom blending system constructed by Additive Systems, Inc., of Broken Arrow, OK. Biodiesel produced from various oil feedstocks (soy, yellow grease, and tallow) was blended with several noted generic diesel fuels found within the Minnesota marketplace to determine at what temperatures biodiesel and No. 1 and No. 2 diesel blend at different blend rates that will be within acceptable standards for the petroleum industry.
Consortium members will have proprietary access to the study’s equipment for testing on regionally available biodiesel products. Once members have completed testing, the equipment will be made available to others through the NBB, who will oversee rental of the equipment.
The study’s consortium members comprised of the Fats and Proteins Research Foundation, biodiesel producers (including renderers), refined fuels members, terminal operators, government entities, and fuel additive companies. Members have discussed conducting additional testing in the future to include sequential blending, splash blending, and better understanding of wax crystal formations.
British Columbia to Use Millions of Gallons
Hundreds of municipal vehicles throughout the lower mainland British Columbia, Canada, and Whistler began using biodiesel April 1, 2005. The demonstration project is designed to increase awareness of biodiesel’s environmental benefits and stimulate its use and production.
Six British Columbia municipalities, including Vancouver, Richmond, Whistler, Delta, Burnaby, and North Vancouver, will purchase and use up to 80 million liters (21 million gallons) of blended biodiesel in their vehicle fleets over the next five years. A number of provincial government and private sector fleets will also participate in the demonstration project.
“Biodiesel is a proven and potentially homegrown fuel that we can use to improve air quality and green our provincial fleet,” said Richard Neufeld, British Columbia Minister of Energy and Mines. “We are moving forward on actions in our 2002 Energy Plan to ensure cleaner air and healthy communities. This project will showcase British Columbia as a leader in sustainable environmental management.”
Financial support for the project was provided by the following entities:
• Government of Canada, $235,000 (Western Economic Diversification Canada, $150,000; Natural Resources Canada, $75,000; Environment Canada, $10,000);
• Vancity Credit Union, $25,000;
• The Province of British Columbia, $20,000;
• The City of Vancouver, $10,000; and
• West Coast Reduction, Ltd., a renderer headquartered in Vancouver, $10,000.
Illinois Passes Rebate Bill
Illinois Governor Rod Blagojevich was expected to sign Senate Bill 769, which unanimously passed the general assembly and changes the Alternative Fuels Act to make biodiesel fuel blends of 20 percent or higher eligible for the Illinois Environmental Protection Agency’s (IEPA’s) Alternative Fuels Rebate Program and the Department of Commerce and Economic Opportunity’s (DCEO’s) Alternative Fuels Infrastructure Grant Program. Previously, only biodiesel blends of 80 percent or higher were eligible for IEPA rebates to reflect the additional costs of more environmentally friendly fuels and for DCEO grants to help build additional fueling facilities. The rebates and grants are financed by an existing $20 user fee per vehicle on fleets of 10 or more vehicles within the Chicago metro area, raising about $1.5 million per year.
Early in his administration, Governor Blagojevich signed an executive order requiring increased use of both ethanol and biodiesel by state employees.
Indiana Gets Biofuel Bill
Indiana Governor Mitch Daniels signed House Bill 1032 in early April that requires state government to fuel state vehicles with agriculture-based fuels, such as biodiesel, ethanol, or gasohol, whenever possible. The bill was authored by Representative Steve Heim, R-Culver, and sponsored by Senator Vic Heinold, R-Kouts.
According to the governor’s office, sales of biodiesel in Indiana are expected to increase tenfold from 2004 to 2005, from 20 million to 200 million gallons.
Iowa Ordered to Use Biodiesel
Iowa Governor Thomas J. Vilsack signed Executive Order 41 in April that directs state agencies to improve upon their current practices of conserving energy. Among other things, the order requires agencies to ensure that all bulk diesel fuel procured contains at least five percent biodiesel by 2007, 10 percent by 2008, and 20 percent by 2010, provided fuel that meets American Society of Testing and Materials Standard D 6751 is available. The order also instructs state agencies to ensure that diesel vehicles operate on biodiesel blends whenever the blends are available.
According to the governor’s order, Iowa has the capacity to produce more than 20 million gallons of biodiesel per year. To ensure progress is being made, all agencies will be required to submit quarterly reports on their progress toward the goals of the executive order.
IRS Updates More Tax Forms
The International Revenue Service (IRS) has published updated versions of two additional forms associated with the new federal biodiesel tax incentive bill passed in October 2004. Forms 637 and 720 are available on the IRS Web site at www.irs.gov/formspubs/lists/0,,id=97817,00.html.
Form 637 is the registration application that all biodiesel producers and blenders must complete. According to the National Biodiesel Board, becoming officially registered may take a considerable amount of time so producers and blenders should plan accordingly to meet the deadlines prescribed by the IRS.
For biodiesel producers, there are two new activity letters: “AB” is for producers and importers of agri-biodiesel (biodiesel produced with first use oils such as animal fats); “NB” is for producers and importers of biodiesel other than agri-biodiesel (biodiesel produced with recycled oils such as yellow grease). An entity can register under multiple activity letters to accurately reflect their activities. Current producers must have their application reviewed and approved by the IRS by July 1, 2005. New production facilities coming on-line must have their application reviewed and approved by the IRS before commencing production.
For blenders, the updated Form 637 deletes the current activity letter “T.” Blenders must now use the activity letter “M.” Current “T” registrants will be accepted as “M” registrants until June 30, 2005. After that date, existing “T” registrants who are blenders must be re-registered using activity letter “M.”
New blenders must also register with the IRS and have their registration officially approved by the IRS before starting any blending activities.
Form 720, the Quarterly Federal Excise Tax Return, is updated to provide a line to report sales or removal of biodiesel mixture other than removal at a terminal rack (IRS No. 60c). Biodiesel mixture credits are calculated on Schedule C, Line 13, and the value of the calculated credits is reported in Part 3, Line 4-Claims, on the Form 720.
Nevada Plant Construction Underway
Bently Agrowdynamics in Minden, NV, about 50 miles south of Reno, has begun building its first biodiesel production facility that will use recycled cooking oil from area restaurants and locally grown canola seed oil as feedstocks. The 500,000 gallon per year facility is scheduled to begin producing biodiesel for use on the Bently Agrowdynamnics ranch and for commercial sales in August 2005.
The company’s waste cooking oil recycling program provides delivery of empty grease drums and pick-up of the full containers at no charge to the restaurant, provided no water or trash is mixed with the cooking oil. In addition, Bently is paying up to 40-cents per gallon for the used oil.
The plant will re-use all of the process streams with some of the by-products being recycled into Bently Agrowdynamics’ current composting program. The new building will be designed to minimize energy consumption with solar hot water heat used to supplement a boiler that can burn the brown grease that is not converted into biodiesel.
Navy to Increase Biodiesel Use
Exercising “federal leadership in the use and development of alternative fuels,” the U.S. Department of Navy recently announced a new policy that will lead to greater use of biodiesel, reduce the United States’ dependence on foreign oil, and improve the nation’s air quality. A memorandum issued on January 18, 2005, by Principal Deputy Assistant Secretary (Installations and Environment) Wayne Arny specifies that all diesel vehicles not specifically exempted shall operate on B20, a blend of 20 percent biodiesel and 80 percent diesel, no later than June 1, 2005, where B20 can be supplied by the Defense Energy Support Center, adequate fuel tanks are available, and the use of biodiesel fuel is allowable and practicable considering federal, state, and/or local regulatory requirements.
“Over the past several years, the Navy-Marine Corps Team has demonstrated exceptional leadership in the acquisition and use of AFVs [alternative fueled vehicles] and alternative fuel use,” the memorandum states. “Expanded use of biodiesel fuel [B20] can improve our leadership role in the use of alternative fuels and allow the Navy and Marine Corps to obtain additional AFV credits under the Energy Policy Act.”
The memorandum also instructs that biodiesel or biodiesel blends not be used in tactical military equipment or deployable commercial equipment intended to support contingency operations.
Researcher Develops New Method
Michael Haas, a biochemist with the Agricultural Research Service (ARS) Eastern Regional Research Center’s Fats, Oils, and Animal Coproducts Research Unit in Wyndmoor, PA, has developed a new approach to synthesizing biodiesel.
The method developed by Haas and his colleagues eliminates the use of hexane, an air pollutant regulated by the U.S. Environmental Protection Agency, from the production of soy oil for biodiesel synthesis. Hexane, a colorless, flammable liquid derived from petroleum, is traditionally used to extract vegetable oil triglycerides from soy oil before biodiesel production.
The new method eliminates the conventional oil extraction step. Instead, the oilseed is incubated with methanol and sodium hydroxide, which are currently used to process extracted oil.
The researchers found that the moisture naturally present in soybeans – as much as 10 percent in soy flakes – requires that a large amount of methanol be used in this reaction. However, using dried flakes greatly reduced the methanol requirement. Processing costs using dry flakes were estimated at $1.02 per gallon, which is $2.12 less than for biodiesel made from full-moisture soy flakes.
The researchers are refining their economic model to account for income from the sale of the lipid-free, protein-rich flakes left over from the biodiesel reaction for use as animal feeds, and to account for differences in the cost of the refined oil and flaked soybean feedstocks.
ARS has filed a patent application on the process.
Tour Boat Project Successful
One dozen tour boats docked at the Old Port of Montreal in Quebec, Canada, successfully ran on 100 percent biodiesel last summer, helping to cut greenhouse gas (GHG) emissions released by the boats and reducing carbon dioxide equivalent emissions by roughly 356 metric tons.
The BioMer project used 117,000 liters (30,908 gallons) of biodiesel provided by Rothsay, a Canadian renderer, who produces the alternative fuel from recycled cooking oil. Four cruise companies participated in the project that was an initiative of Maritime Innovation, the Sine Nomine Group, and Rothsay, a Maple Leaf Foods Group subsidiary. The Canadian government provided a total of $323,000 to the project through a partnership between Natural Resources Canada, Environment Canada, and Canada Economic Development for Quebec Regions.
“Since the transportation sector produces nearly a quarter of the country’s GHG emissions, and 40 percent of Quebec’s emissions, it becomes crucial to innovate with biofuels so we can ensure a clean environment in the years to come and achieve our ultimate objectives regarding climate change,” declared the Honorable R. John Efford, minister of Natural Resources Canada.
Because of the success of the BioMer project, another project designed to demonstrate the use of biodiesel to run generators aboard ships docking at the Port of Montreal will be carried out later this year.
Trap Grease to be Feedstock in Pennsylvania
Philadelphia Fry-o-Diesel, LLC, has received a $369,696 grant from the Pennsylvania Department of Environmental Protection to partially fund project development and implementation of a demonstration-scale production facility to convert trap grease to burner fuel and biodiesel. The company was one of 34 recipients of $5 million in grants in the second round of the annual Pennsylvania Energy Harvest Initiative. The grants will leverage more than $13 million in private funds to promote advanced energy technologies proven to generate jobs, improve air quality, preserve land, protect watersheds, and enhance energy security.
According to the company’s Web site, Philadelphia Fry-o-Diesel will leverage the demonstration project to attract an estimated $3.5 million in additional funds to establish a commercial scale facility to produce biodiesel from trap grease and yellow grease. The company states that restaurants and food service companies in the Philadelphia area generate an estimated four to five million gallons of yellow grease each year, and over two million gallons of trap grease is collected each month in southeastern Pennsylvania and New Jersey.
Warranty Coverage to Include B5
In mid-March, Volkswagen AG announced its decision to extend warranty protection for the use of biodiesel blends up to five percent (B5) in all of its U.S. market diesel powered automobiles.
Volkswagen’s commitment to B5 comes after a year of extensive testing and development in cooperation with Archer Daniels Midland (ADM) Company, and discussions with the biodiesel industry about technical specifications required for the fuel to be compatible with current and future diesel technology. Volkswagen and ADM have also undertaken testing and analysis regarding B20, a blend of 20 percent biodiesel and 80 percent diesel fuel, with a plan to address policies toward that in the future.
Zoo Receives Grant for Biodiesel
The North Carolina Zoo has been awarded a 2005 Mobile Source Emissions-Reduction Grant for $23,000 from its parent state agency, the North Carolina Department of Environment and Natural Resources. The grant will help the zoo continue its project of replacing its current petroleum fuels with biodiesel.
The zoo plans to use the grant to have a biofuel company design and build a processor capable of converting used vegetable oil from the zoo’s food operations into 12,000 gallons per year of B20, a blend of 20 percent biodiesel and 80 percent diesel. The B20 will fuel a majority of the zoo’s trams, buses, and other equipment. In addition, the zoo will promote the use of biodiesel through educational exhibits, graphics, and programs.
Once the zoo has successfully processed the used vegetable oil from its restaurants into biodiesel and used it to fuel its vehicles and equipment, the zoo plans to expand the project to produce all the biodiesel it needs by developing partnerships with local fast-food operations to obtain the necessary used vegetable oil. The zoo is currently purchasing its biodiesel as part of a grant from the North Carolina Solar Center.
Biodiesel Bulletin - June 2005 Render