Tyson Renewable Fuels Plant Complete, Operations Underway

By Tina Caparella


Construction of the Dynamic Fuels renewable diesel plant in Geismar, LA, is complete and work is now underway to prepare for the start of operations. The plant was turned over to Dynamic Fuels, LLC, a joint venture of Tyson Foods and Syntroleum Corporation, by the contractor on July 9, 2010.

“The commissioning activities we have in progress include flushing of all lines, verifying operation of the control system, and installation of catalysts and absorbents,” said Jeff Bigger, director of the Dynamic Fuels Management Committee. “We currently expect to begin making fuel and ramping up production rates during the third quarter of 2010.”

The new facility is designed to convert animal fats, greases, and oils supplied by Tyson Foods into as much as 75 million gallons of renewable fuels per year. The company has filled 44 permanent full-time positions on-site and currently maintains 13 full-time start-up support personnel.

“We’re pleased with customer interest in our fuel and the sales arrangements we’ve made so far,” commented Bob Ames, vice president of Renewable Energy, Tyson Foods. “We’re anxious to begin producing and selling our renewable fuel products.”

Australia Looks into Dumping Allegations

On June 22, 2010, the Australian Customs and Border Protection Service initiated an investigation following an application lodged by Biodiesel Producers, Ltd., alleging that biodiesel is being exported to Australia from the United States at “prices less than their normal value, that countervailable subsidies have been received in respect of the goods exported from the United States to Australia, and that the dumping and subsidization has caused material injury to the Australian industry through lost sales volumes, loss of market share, price undercutting, and reduced profits and profitability.”

The investigation covers the period April 1, 2009, to March 31, 2010. The Customs and Border Protection Service will examine biodiesel exports to Australia during that period to determine whether dumping and/or subsidization has occurred. The agency will examine details of the Australian biodiesel industry from July 1, 2007, for injury analysis. The customs service has 60 days to release a preliminary opinion.

The Biofuels Association of Australia (BAA) congratulated the government on its investigation initiation. The BAA admits U.S. figures are difficult to track, but estimates about 25 million liters (6.6 million gallons) of U.S. biodiesel has entered Australia prior to the end of the year. The Australian biodiesel industry produces about 100 million liters a year, primarily from tallow and used cooking oil.

“The BAA understands that action taken by Customs and Border Protection can be extensive in its support,” said Heather Brodie, BAA chief executive officer. “Indeed if there is a positive finding for countervailing subsidies, there is a risk that subsidized biodiesel imported between June 22, 2010, and the date of the finding may also be subject to the countervailing action. We will certainly be supporting this to ensure that the Australian industry receives an affirmative determination.”

In July 2009, after an investigation that began in June 2008, the European Union imposed a five-year tariff on U.S. biodiesel following a formal complaint by the European Biodiesel Board stating that imports of U.S. biodiesel represented dumping, U.S. subsidies to encourage biodiesel production were unfair, and that the situation caused severe damage to the EU biodiesel industry.

BDI Changes Name

To reflect the company’s broader focus on the “waste to biofuels” field, the Austrian company BDI-BioDiesel International AG began operating under the new name BDI – BioEnergy International AG July 1, 2010.

In addition to multi-feedstock biodiesel plants, BDI has begun supplying biogas technology this year, which is designed primarily for demanding industrial users. The economical multi-feedstock biogas technology developed by BDI’s corporate partner Enbasys GmbH processes industrial and municipal residual and waste materials into high quality biofuels.

“Following the extension of our product and service portfolio as well as the acquisition of UIC and, more recently, of a majority interest in Enbasys, the specialist for biogas technology, it was a logical step to reflect the broader portfolio in the company name too,” explained Wilhelm Hammer, BDI chief executive officer. “The new name enables the company and its purpose to be clearly identified.”

California Awards Grants for Biodiesel Terminals, Job Training

Community Fuels has received a $2 million grant award through the California Energy Commission’s Alternative and Renewable Fuel and Vehicle Technology Program. The company’s project, titled “Expanding access to renewable fuels – Port of Stockton terminal,” encompasses the design and construction of a biodiesel fuel terminal on a parcel of land adjacent to the existing Community Fuels biodiesel production facility at the Port of Stockton, CA. The terminal will include equipment for fuel storage, final product purification, tanker truck loading, rail car loading and unloading, red dye injection, and an automated fuel delivery system.

The California Energy Commission also awarded a $1.79 million grant to Pearson Fuels, doing business as RTC Fuels, LLC, for its project relocating three biodiesel tanks to McClellan Air Park’s diesel terminal in Northern California to allow blending with an existing 600,000 diesel tank already onsite. The company, based in San Diego, CA, is also installing a smaller blend terminal at a yet undisclosed Southern California location with the same grant money.

Under the California Labor and Workforce Development Agency’s Green Innovation Challenge, $19 million in grants were awarded to train nearly 3,000 Californians for jobs in a wide range of clean and green industries, including hybrid and electric vehicles, alternative fuels, and renewable energy generation. Two county agencies received $7 million in grants toward job training in alternative and renewable fuels and vehicles: the San Diego Biofuels Initiative/San Diego Workforce Partnership received $4 million, and the San Mateo County Community College District received $3 million.

Canadian Renderer Cuts Emissions with Biodiesel

Rothsay, a division of Maple Leaf Foods, Inc., has revealed that its program to fuel its own fleets with biodiesel blends reduced carbon output by approximately 700 metric tons in 2009 – the equivalent of removing approximately 130 cars from the road.

Three of Rothsay’s truck fleets have been fueled with biodiesel blends since 2009, with the total number of trucks in the fleet program at 137. In 2009, the fleets consumed more than 2.3 million liters (607,595 gallons) of biodiesel blends, and traveled a combined 3.3 million miles at an average blend rate of 9.2 percent with no mechanical issues or decrease in mileage.

“This is a great step forward for Rothsay Biodiesel and the emerging biodiesel industry in Canada,” said Todd Moser, vice president, Alternative Fuels, Rothsay. “Our biodiesel blends, which are produced from inedible animal by-products and recycled restaurant grease, have proven they perform well in our Canadian climate and real-life operating conditions – it’s a sustainable solution for cleaner, more environmentally sound commercial fueling.”

Rothsay converts animal fats and recycled cooking oils into biodiesel using a process pioneered and developed at the company’s biodiesel plant in Montreal, Quebec. It opened the first commercial-scale biodiesel facility in Canada in 2005 and currently produces approximately 45 million liters (11.8 million gallons) annually.

Rothsay began fueling its Montreal fleet with biodiesel in 2002 and added the Dundas and Moorefield, Ontario, fleets in 2009. Based on the success of the program, Rothsay is looking to expand it to other Maple Leaf Foods fleets in Ontario in the future.

EPA Proposes 2011 RFS Targets

The U.S. Environmental Protection Agency (EPA) has proposed the 2011 production volumes for the four fuels categories under the agency’s Renewable Fuel Standard program, known as RFS2, which went into effect July 1, 2010.

The Energy Independence and Security Act (EISA) of 2007 established the annual renewable fuel volume targets, reaching an overall level of 36 billion gallons in 2022. To achieve these volumes, EPA calculates a percentage-based standard for the following year. Based on the standard, each refiner, importer, and non-oxygenate blender of gasoline determine the minimum volume of renewable fuel that it must ensure is used in its transportation fuel.

The proposed 2011 overall volumes are:

• Biomass-based diesel (which includes biodiesel) – 800 million gallons

• Advanced biofuels – 1.35 billion gallons

• Cellulosic biofuels – between five and 17.1 million gallons

• Total renewable fuels – 13.95 billion gallons

To formulate the biomass-based production number, EPA examined both industry capacity and recent production rates as of April 2010. According to the agency, the aggregate production capacity of biodiesel plants in the United States was estimated at 2.2 billion gallons per year across approximately 137 facilities. EPA is proposing a 2011 cellulosic volume that is lower than the EISA target based on analysis of market availability.

EPA will finalize the 2011 volumes after receiving and evaluating public comments.

Connecticut Mandates Renewable Fuel, Another State Suspends Mandate

In June, Connecticut Governor Jodi Rell signed legislation creating the cleanest home heating fuel in the nation by virtually eliminating sulfur from heating oil and requiring a renewable fuel content in the state’s heating oil that begins at two percent and scales up to 20 percent by 2020. The law takes effect July 1, 2011.

According to the Independent Connecticut Petroleum Association (ICPA), one of the supporters of Senate Bill 382, eliminating sulfur and instituting a renewable fuel content in heating oil will reduce greenhouse gas emissions by more than 40 percent. ICPA also stated that similar legislation is pending in New York and Rhode Island. SB 382 will go into effect as soon as those bills pass to ensure Connecticut’s supply markets are properly coordinated with its neighbors.

The renewable fuel portion of the Connecticut mandate is already law in Massachusetts, and was due to go into effect July 1, 2010. However, the state’s Department of Energy Resources (DOER) suspended the mandate, along with the requirement of renewable fuel in the state’s diesel transportation fuel, due to “unreasonable cost.” One of the reasons for the suspension was the expiration of the federal biofuels blender credit of $1.00 per gallon that expired January 1, 2010, and has yet to be reinstated by Congress.

“Currently, the incremental cost of biodiesel compared to petroleum is $1.50 per gallon, translating to three cents per gallon incremental fuel cost to consumers for the two percent mandate,” DOER stated in an announcement. “Due to the practical challenges of achieving industry-wide compliance and the cost implications of doing so, implementation of the Massachusetts mandate is determined to be infeasible at the present time.”

The department will instead move forward with a voluntary program to encourage the use of biofuels that meet the standards of the Clean Energy Biofuels Act passed in 2008, and continue to work toward full implementation of the biofuel mandate at an appropriate time in the future.

European Biodiesel Production Increases

The European Biodiesel Board (EBB) is reporting that the European biodiesel industry produced nine million metric tons of biodiesel in 2009, a 16.6 percent increase over 2008 figures. Although the increase is well below the substantial production increases seen in previous years (35 percent in 2008, 54 percent in 2006, and 65 percent in 2005), it is the same increase the industry saw in 2007 versus 2006 production numbers.

A number of European Union (EU) member states saw a decrease in production in 2009, including Germany, from 2.8 million metric tons in 2008 to 2.5 million metric tons last year, the United Kingdom, from 192 million metric tons in 2008 to 137 million metric tons in 2009, and Greece, from 107 million metric tons in 2008 to 77 million metric tons last year. On the other hand, production expansions have taken place in countries such as Austria, Belgium, Finland, Italy, the Netherlands, and especially in Spain, which, at 859 million metric tons in 2009 (up from 207 million metric tons in 2008) has taken the place of Italy as the third largest EU biodiesel producer behind Germany and France.

The EU remains the leading biodiesel producing region worldwide, representing about 65 percent of global output, with biodiesel being the main biofuel produced and marketed in Europe. In 2009, biodiesel represented about 75 percent of biofuels produced in Europe (bio-ethanol fuel production last year was approximately three million metric tons).

Current EU biodiesel production capacity is 22 million tons with 245 existing biodiesel plants as of July 2010, a slight decrease from 2008 due to reorganization of the industry.

Hawaiian Utilities Approve Biodiesel Use

The Hawaii Public Utilities Commission (PUC) has approved a two-year contract for a subsidiary of Iowa-based Renewable Energy Group to supply three to seven million gallons of renewable biodiesel annually to fuel Hawaiian Electric Company’s new 110-megawatt combustion turbine generator unit at Campbell Industrial Park Generating Station. The biodiesel is processed from used cooking oil and waste animal fat.

In a separate ruling, the PUC approved a contract for Sime Darby, Malaysia’s leading multinational conglomerate, to provide approximately one million gallons of palm oil-derived biodiesel for use in Maui Electric Company’s Biodiesel Demonstration Project at its Ma’alaea Power Plant. The demonstration will assess the use of biodiesel in place of petroleum diesel in Maui Electric’s diesel generating units and other diesel units around the state. Converting to biodiesel will be an important part of meeting Hawaii’s renewable energy goal of 40 percent of electricity from renewable resources by 2030.

Maui Electric has long used clean-burning biodiesel for start up and shut down of its diesel generators but the demonstration will test biodiesel for four months to determine its long-term effect on air emissions, heat rate, operations and maintenance costs, and other factors.

Both contracts require that the biodiesel supplier meet all technical specifications, environmental, and legal requirements as well as the terms of the Environmental Policy for Procurement of Biodiesel from Sustainably-Produced Palm Oil and Locally-Grown Feedstock adopted in August 2007 by the Natural Resources Defense Council and Hawaiian electric companies.

“We are moving forward in our quest for locally grown and processed biofuels for our units,” said Robbie Alm, Hawaiian Electric executive vice president. “At the same time, this short-term contract for the new Campbell Industrial Park generator and the biofuel to test on Maui will allow us to provide power to our customers today as we create a market in Hawaii to nurture an agricultural energy industry for tomorrow.”

The PUC approvals, which came after considering the contracts and input from the Hawaii Office of Consumer Advocacy, allow Hawaiian Electric and Maui Electric to recover the cost of the fuels, transportation, storage, and related costs in the energy cost adjustment surcharge. The utilities take no mark-up or profit on such fuel costs.

Iowa Biodiesel Board Launches Web Site

Iowans wanting to learn more about biodiesel now have a one-stop shop on the Internet: www.iowabiodiesel.org, the Iowa Biodiesel Board’s new Web site.

The new site provides educational resources such as a section listing all biodiesel plants in the state. Another section lists educational opportunities like Webinars for petroleum marketers and information about a training program for diesel technician instructors. Other features include where to buy biodiesel in Iowa, biodiesel quick facts for those new to biodiesel, economic benefits of the biodiesel industry to Iowa, legislative updates and reports, latest biodiesel news, and links to additional valuable resources such as a cold weather guide to using biodiesel.

The Iowa Biodiesel Board is a state trade association dedicated to the commercial success of biodiesel in Iowa. Its members include state biodiesel producers, petroleum distributors, and biodiesel users.

Renewable Fuels Adds $2 Billion Yearly to Canadian Economy

The first-ever comprehensive third-party economic impact assessment of renewable fuels investments in Canada has concluded that, “the grand total of the annual positive economic impact of renewable fuels is $2.013 billion.” The assessment was conducted by econometric firm Doyletech Corporation under contract with the Canadian Renewable Fuels Association.

The report studied 28 ethanol and biodiesel plants across Canada and added that there were major benefits from renewable fuels in “rural re-vitalization, increased oil exports from western Canada, industrial development, and valuable options for re-balancing fuel mix.”

The economic impact of the construction phase of renewable fuels plants was assessed to include:

• a total direct investment of $2.326 billion;

• a total net economic activity of $2.949 billion, including $100.2 million to municipal governments, $492.1 million to provincial governments, and $679.9 million to the federal government; and

• the creation of 14,177 direct and indirect jobs during the respective construction periods.

The economic impact of operating the 28 Canadian renewable fuels plants was assessed to include:

• the production of a total of 2.25 billion liters (594.3 million gallons) of renewable fuels annually;

• a net annual economic benefit of $1.473 billion to the Canadian economy across Canada, including $14.1 million to municipal governments, $108.8 million to provincial governments, and $111.8 million to the federal government;

• the creation of a net 1,038 direct and indirect jobs annually; and

• an estimated annual benefit of $540 million in additional oil exports that are possible because of western Canada biofuels production (using value of $80 per barrel Canadian).

“Even making allowance for the opportunity costs of alternative investments, and the opportunity costs of alternate feedstock sales, renewable fuels plants in Canada represent a positive net economic benefit,” the report concludes.

Report Roadmaps U.S. Renewable Energy Goals

The U.S. Department of Agriculture (USDA) released a report in late June outlining both the current state of renewable transportation fuels efforts in America and a plan to develop regional strategies to increase the production, marketing, and distribution of biofuels. The report provides information on current production and consumption capacities as well as projections to meet the Renewable Fuels Standard mandate to use 36 billion gallons of biofuel per year in America’s fuel supply by 2022.

USDA’s report identifies numerous biomass feedstocks to be utilized in developing biofuels and calls for the funding of further investments in research and development of feedstocks, sustainable production and management systems, efficient conversion technologies and high-value bio-products, and decision support and policy analysis tools.

The report provides various data, including estimates by the Environmental Protection Agency (EPA) on the quantity of feedstocks available by 2022. EPA expects there will be 380 million gallons of animal fats and yellow grease available by 2022.

The report is available at www.usda.gov/documents/USDA_Biofuels_Report_6232010.pdf.

REG Expands with More Acquisitions

Ames, IA-based Renewable Energy Group (REG) has expanded its network of biodiesel plants and assumed a used cooking oil supply agreement.

First, REG acquired the Nova Biosource Fuels’ Seneca, IL, biodiesel plant and intellectual property rights out of Nova’s bankruptcy and then executed a sale/lease-back agreement with a closely related investor group. Now named REG Seneca, LLC, the facility includes three side-by-side 20 million gallon per year biodiesel process units, a technical grade glycerin refining facility, raw material and finished product storage, and rail car and truck unloading and loading with the potential for barge transportation. After being idle for more than a year, REG made significant repairs and upgrades to the facility and began operations in mid-July.

In mid-July, REG also acquired Tellurian Biodiesel, Inc., a California-based biodiesel company and marketer, and American BDF, LLC. American BDF – a joint-venture owned by Golden State Service Industries, a wholly-owned subsidiary of Golden State Foods of Irvine, CA; Restaurant Technologies, Inc., (RTI) of Eagan, MN; and Tellurian Biodiesel – previously focused on building a national array of small biodiesel plants that would convert used cooking oil into high quality biodiesel. The acquisition connects RTI’s national used cooking oil collection system – with more than 16,000 installations – with REG’s national network of commercial-scale biodiesel facilities.

Used cooking oil will augment the company’s current national, multi-feedstock procurement program that supplies the company’s commercial-scale biodiesel facilities. The REG network has a combined annual production capacity of more than 200 million gallons.

Schools Continue to Support Biodiesel

More and more educators are supporting the use of biodiesel and renewable fuels in schools, school buses, and as school projects.

The Baltimore (Maryland) City Board of School Commissioners has approved a long-term boiler test and evaluation of renewable fuels produced by New Generation Biofuels Holdings, Inc. The company’s biofuel, which is made from virgin and recycled vegetable oils and animal fats, will be used and tested in two of Baltimore City’s public schools over a one-year period. Up to one million gallons will be used, but can be increased to two million gallons if both parties agree.

In North Carolina, 16 counties participated in a blitz to use 20 percent biodiesel in public school buses during April and May 2010. The 214,000 gallons of biodiesel used was produced at Piedmont Biofuels’ Pittsboro, NC, facility and blended with petroleum diesel. In 2007, the state legislature established an annual target of a minimum of two percent biodiesel in public school buses statewide.

A group of middle school students in Rhode Island turned their passion for community service and climate change into a successful biofuel project that earned them a regional President’s Environmental Youth Award (PEYA) from the Environmental Protection Agency. The students from Westerly Middle School in Westerly, RI, convinced the local town council to place a grease container at the town’s transfer station to collect waste cooking oil from residents, and also convinced 64 local restaurants to donate their used cooking oil. A local company collaborated with the students to collect the oil and deliver it to a biodiesel producer, who in turn paid the students for the waste oil. The group then used the money to buy Bioheat, a biofuel used for home heating, from a local distributor to give to local charities.

The project continues to be a success – the students have collected over 36,000 gallons of waste oil and donated 4,000 gallons of Bioheat to local charities, which helped 40 families with emergency heating assistance.

Another group of students has also received a PEYA for their project that began as a science fair endeavor. Members of the Oak Hall School Biodiesel Project team in Gainesville, FL, collected and processed used vegetable oil into biodiesel for the school’s diesel-powered lawn equipment and at some point in the future, school buses. The high school students obtained all necessary local and state regulatory approvals for biodiesel production; raised funds for the reactor, a facility to house the reactor, and supplies to manufacture biodiesel; collected more than 250 gallons of waste oil; and produced over 25 gallons of biodiesel. The students also wrote an instruction manual to encourage other schools to replicate the biodiesel project.

Used Cooking Oil Fuels Helicopter

UOP, LLC, a Honeywell company, has used its Green Jet Fuel to power a Boeing AH-64D Apache helicopter flown by the Royal Netherlands Air Force. The flight was conducted at Gilze-Rijen Airbase, home of the Royal Netherlands’ combat helicopter fleet. Used cooking oil and algae oil were converted into fuel using process technology developed by Honeywell’s UOP. The aviation biofuel was blended in a 50 percent mixture with traditional jet fuel and used to power one of the Apache’s engines for a series of test maneuvers. No modifications were made to the engine or airframe for the flight.

Honeywell Green Jet Fuel has been used in four previous commercial biofuel demonstration flights, including a KLM Royal Dutch Airlines flight in November 2009. The fuel has also been demonstrated in fixed-wing flights with the U.S. Air Force and Navy as part of a joint program for alternative fuels testing and certification under the U.S. Defense Energy Support Center.

Waste Hauler Produces Biodiesel in Alaska

The first commercial-scale biodiesel is now being produced in Alaska.

Alaska Green Waste Solutions began producing the alternative fuel in early June at its new Anchorage biodiesel plant using waste cooking oil collected from 240 local restaurants, groceries, hotels, and hospitals. Within a month, the waste hauler was using the fuel in a dozen of the company’s trucks with plans to start using biodiesel in more of the fleet very soon.

The facility has a 1,000 gallon per day capacity and was designed and built by Pacific Biodiesel Technologies in Salem, OR. The plant was then dissembled for shipment and reassembled in Anchorage. The facility includes storage for feedstock, biodiesel, and glycerin.


Biofuels Bulletin – August 2010 RENDER | back