By Tina Caparella
With the stroke of a pen, Washington Governor Chris Gregoire made her state the second in the nation to require biodiesel be used in the state’s diesel supply.
Following on the heels of Minnesota, whose two percent biodiesel fuel mandate went into effect in September 2005, Washington will require that at least two percent of the total annual diesel fuel sold in the state is biodiesel beginning December 2008, or 180 days after the Department of Agriculture (DOA) director determines and publishes in the Washington State Register that feedstock grown in Washington can satisfy the two percent requirement, whichever is sooner.
“We are moving Washington forward as a leader of a dynamic, 21st century industry,” said Gregoire, who requested the measure, Senate Bill (SB) 6508. An executive order issued in October 2004 requires state agencies to use a 20 percent biodiesel blend by September 1, 2009, and encourages agencies to use a five percent blend as soon as practicable. SB 6508 adds that effective June 1, 2006, agencies complying with the ultra-low sulfur diesel mandate of the U.S. Environmental Protection Agency for on-highway diesel fuel shall use biodiesel as an additive for lubricity, provided that the use of a lubricity additive is warranted and the use of biodiesel is comparable in performance and cost with other available lubricity additives. The amount of biodiesel added to the ultra-low sulfur diesel fuel shall not be less than two percent.
Under the measure, the DOA director will establish a biofuels advisory committee to advise on implementing or suspending the minimum renewable fuel content requirements. The National Biodiesel Board (NBB) will work cooperatively with the committee to help ensure a smooth transition and expects the new law to create demand for 20 million gallons of biodiesel annually in the first year.
The bill also requires that gasoline contain two percent denatured ethanol by December 1, 2008, or higher percentages if the Department of Ecology director determines that ethanol content greater than two percent will not jeopardize continued attainment of federal Clean Air Act standards and the DOA director determines that sufficient raw materials are available within Washington to support economical production of ethanol at higher levels.
An executive order by Washington’s governor can suspend all or portions of the minimum renewable fuel content requirements if they are temporarily technically or economically infeasible or pose a significant risk to public safety.
In other state news, Iowa is waiting for the governor’s signature on a renewable fuels bill and California agencies have been directed to expand their biofuels use.
Iowa House File 2754 includes tax credits for biodiesel and ethanol, and sets a renewable fuel goal starting at 10 percent in 2009 and increasing to 25 percent by the year 2020. According to NBB, the bill contains a three-cent-per-gallon biodiesel tax credit until 2012; a requirement of 50 percent or more of total diesel sales be biodiesel blended fuel (two percent or higher) for retailer eligibility; a retroactive application of the tax credit program to January 1, 2006; an increased penalty for advertising or selling non-certified biodiesel blends; and a reporting system to track biodiesel sales in Iowa.
The Iowa Renewable Fuels Association says that by the end of 2006, the state will have at least six biodiesel plants capable of producing over 120 million gallons per year.
In late April, California Governor Arnold Schwarzenegger issued an executive order establishing targets for the use and production of biomass products such as biofuels and biogas as an integral part of California’s renewable portfolio standard. Under the order, the state will produce a minimum of 20 percent of its own biofuels by 2010 and 40 percent by 2020. Currently, of the 900 million gallons of ethanol consumed in California (which is 25 percent of the entire nation’s consumption), only five percent is produced in California. To achieve these targets, Schwarzenegger directed the California Energy Commission, the Resources Agency, and other state agencies to collaborate, research, promote, and identify funding to advance biomass programs in the state.
Australian Market Taps into Animal Fats
Renewable fuels and rendered products in Australia got two big boosts in March – one from a new biodiesel plant and another from a worldwide refiner and distributor.
Australian Renewable (AR) Fuels, Ltd., opened the country’s largest biodiesel plant in Largs Bay in South Australia, the first in a series of five plants to be rolled out by AR Fuels by 2007. The new plant has an annual production capacity of 45 million liters (11.8 million gallons) of biodiesel, produced primarily from animal fats supplied by Gardner Smith, a market leader in the delivery and storage of fats in Australia. AR Fuels also signed a distribution agreement with Dermody Petroleum for up to 45 million liters per annum with a guaranteed minimum volume component.
“We are delighted to have commenced production and to have become a significant force in the rapidly emerging Australian biodiesel industry,” commented AR Fuels Managing Director Darryl Butcher.
AR Fuels’ second plant, located in Picton, Western Australia, was scheduled to begin production at the end of April 2006. When all five plants are completed, the company will have more than 220 million liters (58.1 million gallons) of production capacity.
In other news from down under, BP Australia has signed two contracts and a memorandum of understanding to provide to consumers over 200 million liters of biofuels per year by 2008. The announcement signals the delivery by a single company of over half of the Australian government’s national target of 350 million liters (92.4 million gallons) by 2010.
BP will invest in the company’s Bulwer refinery in Queensland to allow production of 110 million liters (29 million gallons) per year of biodiesel through a new technology, with the fuel being made available to the market by 2007. The feedstock has been secured through a contract for tallow from Colyer Fehr Tallow Pty, Ltd. To meet the remainder of its biofuels commitment, BP will be purchasing 103 million gallons of ethanol.
“BP believes biofuels have an important role to play in strengthening Australia’s security of supply,” said company President Gerry Hueston. “This announcement is the culmination of many years of work by BP.”
Australian Prime Minister John Howard congratulated AR Fuels’ recent opening and BP’s partnerships and pledged to amend relevant legislation so that biodiesel made from tallow using new technology that does not form esters receives the same favorable tax treatment as biodiesel made by existing esterification processes. Biodiesel and ethanol in Australia are subject to excise, but are effectively tax free until July 1, 2011. The amendments are expected to be included in a major excise legislative reform package to be introduced prior to July 1, 2006.
European Production Hits Record High
European Biodiesel Board official figures confirm that overall biodiesel production in the 25 European Union (EU) member states has increased from 1.9 million metric tons in 2004 to nearly 3.2 million metric tons in 2005, representing a 65 percent yearly growth. From 2002 to 2004, biodiesel production rose by 30 to 35 percent when compared to the previous year. For 2006, production capacity is estimated to reach six million metric tons. The U.S. biodiesel industry produced around 250,000 metric tons (75 million gallons) in 2005.
Although most biodiesel production can be attributed to 15 EU member states, the number of EU countries with a biodiesel industry nearly doubled in 2005. Today, 20 countries are producing biodiesel on an industrial scale, up from 11 in 2004.
Within the EU, Germany is the confirmed leader with a production of 1.6 million metric tons last year. Rounding out the top three producers in 2005 are France, 492,000 metric tons, and Italy, 396,000 metric tons. New EU member states, such as Poland, 100,000 metric tons, and Czech Republic, 133,000 metric tons, have emerged as major producers within the EU-25 over the course of 2005.
Given that biodiesel makes up around 80 percent of EU biofuels production – bioethanol being the other major biofuel – these figures confirm that the two percent global biofuels target for 2005 set by European Commission Directive 2003/30 has not yet been met. Considering only EU diesel markets, biodiesel production was closer than expected to the two percent target, representing approximately a 1.5 percent market share of the conventional EU diesel market in terms of energy content.
EPA Honors Biodiesel Supporters
The Environmental Protection Agency Region 9 Environmental Awards honored 39 groups and individuals in recognition of their efforts to protect and preserve the environment in California, Arizona, Nevada, Hawaii, Pacific Islands, and tribal lands in 2005. Two of those recipients hail from the biodiesel industry: Greenline Industries, Inc., San Rafael, CA, and country music legend Willie Nelson.
Greenline Industries designs and builds advanced biodiesel plants for small to medium sized production facilities. Their new plant boasts a waterless flow-through system that produces fuel with little waste. The company has six plants either completed, under construction, or in the planning stage totaling almost 25 million gallons of biodiesel per year.
Nelson opened his first California biodiesel outlet in San Diego in February, and is a supporter and spokesperson for biodiesel. His interest in the alternative fuel stems from the fact that diesel trucks put out an inordinate amount of pollutants.
Restaurant Goes to "the Dog”
Burgerville USA in Vancouver, WA, is using “the dog,” a small, stainless steel tank and pump combination on wheels, to drain their used cooking oil before it is picked-up and hauled to a biodiesel producer.
Demonstrating for local reporters, Burgerville Manager Chris Wurtz towed “the dog” to the deep fryer, opened a steel cabinet door, turned a valve, and started the oil flowing into the low-slung tank. When he had a big enough sample, he towed the pump to the back of the restaurant to transfer the used oil into a tall, stainless steel holding tank. The larger tank is emptied by MRP Services, a family-owned plumbing and drain service company, who in turn takes the used oil to SeQuential Biofuels in Portland, OR, where it is converted to biodiesel. All 39 Burgerville locations throughout the Pacific Northwest will be serviced by MRP.
News reports state that Burgerville restaurants produce about 7,500 gallons of used cooking oil per month, which can be converted into 6,400 gallons of biodiesel.
Biodiesel Bulletin - June 2006 Render