Tue 9 Mar 2010
Posted by zhamm under Biodiesel
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Well, it’s March, and the biodiesel tax credit has been in limbo for it’s third month, with no real idea when it will be reinstated.
Given the media hype in the recent past about renewable fuels causing food prices to skyrocket, you’d think that the market would breathe a huge sigh of relief and that commodity food prices would have plummeted to the bottom. After all, almost 85% of the biodiesel plants in the USA are either idled or out of business. So where’s the pressure to keep price up, right?
Well, as of today, soybean oil is $.40 /lb. That’s $3.00 per gallon. Waste Vegetable Oil (WVO), another biodiesel feedstock, is $.26 / lb, or $1.95 per gallon. The average price per gallon for biodiesel right now is just slightly more than petroleum diesel, at around $2.25. What were prices for soybean oil and WVO back in March of last year? Around $.32 / lb for soybean oil, and around $.21 lb for WVO.
So who’s driving the price of raw feedstock materials up? Not biodiesel, that’s for sure. To me, it looks like the agricultural and food industries, just like they were before. They are currently exporting oils to Asia and South America. That’s good for everybody, except biodiesel. But yet the public perception when I talk to people is that we’re driving the price of food up. Alternative feedstocks, such as algae oil, hold high hope for renewable fuels. It provides a cheaper feedstock for us, and shuts up the critics of current feedstock supplies, unless they find something wrong with algae…
Soybean Oil Price Graph 2009
Fri 5 Mar 2010
Posted by zhamm under Biodiesel
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Well, just as the NBB predicted, the Senate and House delays on reinstating the federal tax credit for biodiesel has caused the biodiesel industry to grind to a halt. I got a call yesterday from another company in NC that is going out of business. That makes three total within 6 months.
We’re still here. We’re still producing biodiesel every day, although in much less capacity than before. As far as I can tell, we’re the only biodiesel plant in North Carolina that is still actively producing truckload quantities of biodiesel. Our price is still roughly the same, about $.60 per gallon higher than petroleum diesel fuel.
North Carolina could help by adding additional tax incentives to biodiesel like many other states already do, but so far, nothing appears to be happening at the state level. We’re hearing rumblings that the US Senate may be getting something approved in the next several weeks. What we’re hoping for is a multi-year tax incentive that is retroactive back to January 1st. Anything less than that puts us right back in the same situation next year and will only further to inhibit the growth of renewable fuels like biodiesel.
Wed 2 Sep 2009
Posted by zhamm under Biodiesel
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Finally, it looks like Ford and GM are getting their products inline and recognizing that biodiesel is not going away. Prior to this and the GM announcement (see older posts), most of the domestic diesel vehicles could only handle up to B5.
From the NBB Bulletin for September 2, 2009:
Biodiesel supporters are cheering Ford Motor Company’s announcement that its all-new Ford-built 2011 Ford F-Series Super Duty® diesel pickups will be fully compatible with a 20 percent biodiesel blend (B20).
“This is the first of what we expect to be many formal announcements of B20 approval in new clean diesel technology,” said Steve Howell, technical director for the National Biodiesel Board. “With the formal approval and acceptance of B20 in the 2011 Super Duty, Ford now has a clean and green engine of tomorrow that will also reduce NOx emissions by more than 80 percent. NBB already has inquiries from biodiesel fans wanting to purchase a new B20 pickup!”
The NBB and the National Renewable Energy Laboratory have spent more than $10 million testing B20 and understanding how it works in the new diesel engines and after-treatment technology during the last five years. That’s in addition to research and development efforts by the individual Original Equipment Manufacturers like Ford.
Ford’s support for B20 could have substantial market implications. Ford currently dominates the on-road diesel truck market with nearly a 46 percent market share of the diesel vehicle registrations in the U.S. according to the Alliance of Automobile Manufacturers.
The 2011 models will be arriving at dealerships in the first half of 2010.
