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Biomass Energy Development 1 Biofuels: Opportunities and Constraints To Community Energy Generation Briefing Paper Three of Black, Brown and Green 65 Broadway, Suite 1800, New York NY 10006 | (212) 248-2785 www.centerforsocialinclusion.org FOR IMMEDIATE RELEASE For more information, contact: Mr. Denis Rhoden Jr. M.B.A, AICP The Center for Social Inclusion New York, NY 10006 [email protected] 646.442.1457 Ms. Jeanne Baron The Center for Social Inclusion New York, NY 10006 [email protected] 646.442.1454 October 2009

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Page 1: Biofuels: Opportunities and Constraints To Community ......The most common biofuels are ethanol and biodiesel. Biodiesel is manufactured from plant oils (soybean oil, cottonseed oil,

Biomass Energy Development 1

Biofuels:

Opportunities and Constraints

To Community Energy Generation Briefing Paper Three of

Black, Brown and Green

65 Broadway, Suite 1800, New York NY 10006 | (212) 248-2785 www.centerforsocialinclusion.org

FOR IMMEDIATE RELEASE

For more information, contact:

Mr. Denis Rhoden Jr. M.B.A, AICP The Center for Social Inclusion New York, NY 10006 [email protected] 646.442.1457

Ms. Jeanne Baron The Center for Social Inclusion New York, NY 10006 [email protected] 646.442.1454

October 2009

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Biofuel Energy Development 2

Table of Contents Renewable Energy is Black Brown and Green ............................................................................. 3

Technology Prospects .................................................................................................................. 5

Why Distributed Generation Works for Communities ................................................................ 6

Biofuels as a Distributed Generation Source ............................................................................... 8

Opportunities ............................................................................................................................. 10

How Policy can Help Communities ............................................................................................ 11

Suitability ................................................................................................................................... 12

Entry Risks .................................................................................................................................. 13

Build Out Costs ........................................................................................................................... 15

Hurdles ....................................................................................................................................... 16

Longer Term Look Ahead ........................................................................................................... 18

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Biofuel Energy Development 3

Renewable Energy is Black Brown and Green Black, Brown and Green, a program of the Center for Social Inclusion, explores the

economic opportunities and hurdles facing green business models serving

communities of color. Black Brown and Green will offer resources to help

communities and companies identify their needs and develop a strategy to enter

the Green Energy Sector.

Policy makers, investors and stake holders need a firm grasp of business structures that

protect community control. They also need strategies for raising the right type and levels of

capital, and knowledge of accessible technology. Promoting control and ownership of the

green energy supply by communities of color enables these communities to share in the

tremendous economic potential of the green energy market and adds depth to the broader

economy.

Businesses and communities must lay a foundation for success, one that expands and

strengthens individual and community prospects today. The third paper in our series,

Biofuels: Opportunities and Constraints To Community Energy Generation, explores the

environmental, economics, technology and policies shaping the process of converting crops

and waste feedstock into energy. The briefing paper examines outlines the forces enabling

community commercialization as well as the hurdles to participation in the biofuels segment

of the Green Energy sector.

About CSI The Center for Social Inclusion is a national policy advocacy organization with the goal of

building opportunity for all by dismantling structural racism. We perform applied research,

conduct trainings, support the development of multi-racial alliances and networks, and

develop transformative policy models.

Policy makers,

investors and stake

holders need a firm

grasp of business

structures that protect

community control

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Biofuel Energy Development 4

Environmental Overview What is biofuel? The most common biofuels are ethanol and biodiesel. Biodiesel is

manufactured from plant oils (soybean oil, cottonseed oil, canola oil), recycled cooking

greases or oils (e.g., yellow grease), or animal fats (beef tallow, pork lard). Biofuel energy

derived as ethanol is primarily made from corn (in the United States). Biofuels offer the

following environmental advantages: 1

It is renewable.

It is energy efficient.

It displaces petroleum-derived diesel fuel.

It can reduce global warming gas emissions.

It can reduce tailpipe emissions, including air toxics.

It is nontoxic, biodegradable, and suitable for sensitive environments.

Replacing fossil fuels with biofuels can result in a much cleaner fuel supply chain and a better

protected environment. For instance, biofuels based on soybean oil as the raw material, also

known as a feedstock, produces 71% fewer life-cycle emissions per gallon compared to a

gallon of petroleum diesel. When the indirect land impacts are included, soybean-based

biodiesel would reduce greenhouse gas (GHG) emissions by 34 percent%.2

Using animal fats and recycled greases instead of agricultural crops results in greater GHG

reductions than crop feedstocks, such as soy, because energy inputs (e.g., fertilizers and

farming equipment) are not directly needed to grow feedstock. They also have the added

benefit of recycling waste products. Feedstocks used in biodiesel production vary by region.

Canola oil is generally used in Europe, soy oil in North and Latin America and palm oil in

Southeast Asia. Biodiesel can also be produced from numerous other feedstocks including

1 National Renewable Energy Laboratory, Biodiesel Use and Handling Guide 4

th Edition 2009

2 California Air Resources Board (CARB). “Detailed California-Modified GREET Pathway for Biodiesel (Esterified

Soyoil) from Midwest Soybeans,” 2008.

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Biofuel Energy Development 5

vegetable oils, tallow and animal fats, restaurant waste (“yellow grease”), and restaurant trap

grease (“brown grease”).

Biofuels can be categorized in three major groups:

Conventional (Primarily ethanol and biodiesel)–Conventional fuels are produced from

mature technologies with decades of commercial production history in the US, Brazil,

and Europe. Biodiesel production is small–and growing–and located in Europe.

Renewable diesel–Produced by hydrotreating vegetable oil or animal fat within a

conventional refinery. Renewable diesel is chemically distinct from conventional

biodiesel. Neste Oy, Petrobas, ConocoPhillips, BP, and Eni are in the process of

developing this technology for commercial production.

Next generation–Biobutanol (more energy dense ethanol substitute that can work in

today’s gasoline powered engines), cellulosic ethanol produced from non-edible plant

feedstock, and synthetic diesel produced from biomass. Large scale Federal and

venture capital investment is fueling innovation in this group.

Technology Prospects In comparison to technology used to generate fuel from other renewable energy sources the

technology used to produce biodiesel is relatively simple and well-developed. To produce

biodiesel the feedstock is chemically treated in a process called transesterification (see

graphic on page 6), in which the oils or fats are combined with an alcohol (usually methanol)

and a catalyst to produce fatty acid methyl esters. Virtually all biofuels produced today are

based upon conventional, mature technology.

Biodiesel is similar to conventional petroleum-based diesel fuel and can be used in

compression-ignition (CI) engines with little to no modification. While it can be used alone as

pure biodiesel (“B100”), it is often blended with petroleum-based diesel fuel.

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Biofuel Energy Development 6

Why Distributed Generation Works for Communities Today’s energy supply is often generated in large facilities and flows in one direction, from

central power stations to transmission and distribution facilities and then to consumers (see

graphic on page 7). Changes in technology, consumer preferences and recently regulation are

changing this structure. Distributed generation is a well developed cooperative concept, but

in energy terms, it refers to the option for energy consumers to use and sell the energy they

generate to other consumers. This approach to harnessing and distributing energy from many

small energy sources is fueling new market opportunities and enhanced industrial

competitiveness.3 This model raises an exciting question, “how can consumers also act as fuel

producers? “ There is more than one answer to this question, and each raises the prospect of

new economic relationships that have the potential to bring structural changes that improve

infrastructure and increase wealth and political capital controlled by communities of color.

3 European Union, Energy Research

Source: NREL, Biodiesel Use and Handling Guide 2009

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Biofuel Energy Development 7

At the community level distributed generation is

stimulating policy and investment resulting in new

direct and indirect roles for communities to preserve

and increase their social equity, environmental

quality, energy independence and wealth. For

instance, shorter travel distances from supplier to

consumer mean greater efficiency. This would save

an estimated 30% on electric bills4 Distributed

generation requires fewer large centralized plants to

provide energy and reduces the number of power

lines constructed.5 Fewer plants and power lines

means more land can be freed up for other uses. In

addition, over time the costs are lower. In a recent

article published by VentureBeat, the CEO of EcoVolve said “a distributed energy system has

the advantages of being more efficient, low maintenance, less carbon-intensive and, most

importantly, cheaper.”6 Critically important from an ongoing cost perspective, distributed

generation “does not require an army of engineers” to achieve economic viability for a

generator of any scale.

4 European Union, Energy Research

5 Definition used in this report for the term Distributed Generation can be found on Wikipedia

6 Jacquot, Jeremy “Distributed energy is the future of renewable energy production, says Ecovolve” VentureBeat

October 2, 2009.

Source: European Union, Energy Research

Distributed generation provides new direct and indirect roles for

communities to preserve and increase social equity, environmental

quality, energy independence and wealth.

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Biofuel Energy Development 8

The pros and cons of renewable generation at community scale versus centralized large scale

generation are: (see table)

Central versus Distributed Generation approach

Distributed System

Pro Con

Low transmission or distribution losses Can operate with or without transmission grid

connection and support micro-grid systems Reduce local energy portfolio risk by reducing

energy imports Expand business, technology and policy

innovations to communities globally

No accessible tools to promote greater individual responsibility Ownership of resources is unclear Lack of standards for quality and

cooperation

Central Systems Serving Community

Pro Con

Facilities and policy infrastructure are well understood by the industry Reliable supply and established monitoring

protocols Clearly defined industry participants

Transmission and distribution losses Dependence on imported fuels Environmental impact of GHG and other

pollutants Ongoing maintenance and upgrade

expense for transmission and distribution facilities.

Biofuels as a Distributed Generation Source Distributed generation favors biofuels because the feedstock is renewable, widely dispersed

(not concentrated n one area of the country), and, unlike wind and solar, it’s not dependent

on variable weather conditions. There is opportunity, especially in urban settings, to collect,

dispose and transport waste feedstock to biorefinery facilities).

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Biofuel Energy Development 9

Infrastructure for both generation and refueling operations can be located in close proximity

to each other in rural and urban settings. A community can set up a series of refueling

stations which primarily consists of a large tank and dispenser, supported by local feedstock

collection and delivery systems. There are several small scale biodiesel operations across the

United States.

Case Examples

Organization: SFGreasecycle (San Francisco, CA)

SFGreasecycle was launched in San Francisco in November 2007. The program is operated out

of the San Francisco Public Utilities Commission’s (SFPCU) wastewater division. The SFPUC

collects used cooking grease from restaurants, schools and hotels at no charge. The cooking

grease is processed at a commercial waste oil transfer station located at a waste water

treatment plant. The grease is then sold at discount to four local biodiesel manufacturers who

pick it up at the transfer station. Currently, more than 500 restaurants participate in the

program. The initiative is helping fulfill the Mayor Newsom’s Biodiesel Directive. In addition,

the effort reduces the expense associated with dislodging fats and greases from city sewers.

Prior to the implementation of this program, the SFPUC spent $3.5 million on this annually.

SFGreasecycle also plans to develop a residential grease recycling program. The residential

program will include the establishment of grease collection sites within the city’s household

hazardous waste drop-off locations.

For more information visit: http://www.sfgreasecycle.org/

Organization: Piedmont Biofuels (Pittsboro, NC)

Piedmont Biofuels Cooperative (Piedmont) began in 2002 and is owned by its workers and

members. From its inception Piedmont Biofuels focused on small scale biodiesel production.

In 2005, Piedmont started making commercial-scale biodiesel by converting an abandoned

chemical plant to a production facility. It manufactures markets and sells biodiesel, mostly

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Biofuel Energy Development 10

from used vegetable oil. The price of biodiesel for members fluctuates depending on

feedstock and manufacture cost. Commercial biodiesel that is EPA registered and ASTM

certified is available to co-op members either delivered in bulk or retailed at select locations.

A cost of a co-op share is currently $50 per year. In 2008 Piedmont Biofuels Cooperative had

over 550 members, and fuel revenue was approximately $50,000. Piedmont has also acted as

an advisor to many small producer coops to help them get “up and running.”

For more information visit: http://www.biofuels.coop/

Community Commercialization

Our analysis considers the technical risk and expertise required, the availability of turn-key

technology, environmental impact, financing models and competitive risk in our

measurement of suitability and entry risk. We have determined biofuel commercialization at

the community scale has a moderate suitability rating for communities and a moderate level

of entry risk to businesses interested in entering the segment.

Opportunities Ethanol and biodiesel are the two most common and thus easiest to implement on a

community-level.

o However, based on the lack of consumption and emission savings as well as

the current production overcapacity, it does not make sense for communities

to undertake ethanol production projects.

Community

Entry Risk: Moderate

Community

Suitability: Moderate

MODERATE

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Biofuel Energy Development 11

Biodiesel production, especially using yellow and brown grease, represents the

greatest sustainable energy opportunity for community-level development within

the biofuel power segment.

Processed waste vegetable oil sells for approximately $1 per gallon.7 A community

could adapt existing infrastructure and relationships using private and public-private

approaches with solid waste agencies. Not only would the community benefit from

selling the grease, it would also reduce expenses associated with improper disposal of

grease.

Communities producing or purchasing biodiesel for municipal fleets will benefit from

increased demand for biofuels by this segment and lower transportation costs

because of the benefits of locally produced biodiesel. In addition, by replacing

conventional diesel fuel, the use of biodiesel can lower GHG emissions from the

transportation sector. Remember: the potential GHG reductions from switching to

biodiesel from petroleum-based diesel depend largely on the type of feedstock used

to produce the fuel (to date biodiesel provides greater GHG reduction potential

benefits than ethanol).

How Policy can Help Communities Communities do not just need technology but policies to give them a toehold in biofuels

generation. Businesses need reliable relationships to secure access to targeted raw materials.

Government can also provide long-term buying contracts and set price rates to provide

additional incentives for biofuel production. At the local level, land use, environmental and

zoning regulations will affect what kind of energy business will be viable. Communities will

need to work in partnership with environmental advocates and regulatory bodies.

Some opportunities created by existing polices are clear. At the local level, land use,

environmental and zoning regulations are an important consideration. In some localities, food

7 Feasibility Report: Small Scale Biodiesel Production; Illinois Waste Management and Research Center

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Biofuel Energy Development 12

safety rules require quick disposal of waste feedstock. This important service can create

opportunities for allied businesses to supply a variety of feedstock to producers.

Suitability

The production of biodiesel from waste feedstock, such as grease from restaurants, is a fairly

mature and simple process that can reduce a community’s carbon footprint as well as reduce

the instances and expense of damage from improper disposal of waste grease. The greatest

opportunity in the biodiesel value chain is for the collection and refining of waste grease.

While biodiesel, especially produced from waste-feedstock, represents a real opportunity for

communities to reduce their carbon footprint, there are several factors that also need to be

considered before deciding to undertake such a project:

Economic issues–Incentives to produce biodiesel are directly linked to the price of oil.

In early 2009, several large biodiesel plants stopped producing fuel due to recent

decreases in the cost of oil. Some expect biodiesel production in 2009 to be lower

than production levels for 2008.

Land use–Biodiesel production directly and indirectly impacts land use. The clearing of

grassland or forests to plant biofuel crops is a direct land use change that can

adversely affect the GHG emissions due to the loss of a natural carbon sink. The

Rendering

•Collect from restuarants

•Central depositaries

Feedstock Transport

Biodiesel Production

Biodiesel Distribution

Customers

•Buying cooperatives

•B100: Mining, marine, national parks, sensitive environments

•B20: School buses, urban buses, government fleets

•B5-11: Incentive driven

•B2: Farm, state mandates, truck fleets, general use

Waste-Feedstock Biodiesel Value Chain

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Biofuel Energy Development 13

practice of clearing peatland in Malaysia and Indonesia to produce palm oil for

biodiesel has particularly raised concerns. However, land use concerns are minimal for

waste-feedstock biodiesel production.

Impact on commodity prices and environmental resources–Biodiesel produced from

soy, palm, rapeseed, or sunflower oil competes with other agriculture uses for those

products, including food, feed, and timber. Increased demand for fuel production

leads to increased prices for the crop. This results in more land being diverted for

biofuel crop production. In addition to impacts on land use and agricultural prices,

biodiesel production can also affect water supply, habitat and ecosystems, and soil,

air, and water quality.

It is estimated that approximately 390 million gallons of biodiesel could be made from waste

feedstocks in the US: 150 million gallons from yellow grease and 240 million gallons from

animal fats. Of the 700 million gallons of biodiesel produced in 2008 in the United States,

about 60 percent was derived from soybean oil.8 Biodiesel production is currently centered in

the East and Mid-West regions. However production, especially using recycled oils, can be

located anywhere in the country. Waste-feedstock production would likely be easiest in urban

areas where centralized disposal locations would be convenient to access.

Entry Risks

Supplies of Raw Materials–Feedstock prices are often volatile, making the economics to

produce biofuels far from stable. Transmission and distribution activities add costs that may

make biofuels economically infeasible for some market participants. There’s some

speculation large commercial plants will see limited opportunity in the biofuel segment in its

present form. (Nevertheless, some big companies have begun making investments to collect,

transport and refine waste feedstock.) Volatility will deter large-scale centralized operations

from controlling supply until technology and consumption patterns alter these conditions. For

8 Weber, J. Alan. Feedstock Supplies for U.S. Biodiesel Production. MARC-IV Consulting, Inc., 2008.

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Biofuel Energy Development 14

community-level entrants, these market dynamics provide a favorable shield from most forms

of entry by large scale competitors and offers several entry points into the growing biofuels

supply chain: collection, transport and small scale refining to name a few.

Infrastructure Investment–Unlike wind and solar power generation, producing biofuels has

higher ongoing generation costs such as physical asset maintenance, feedstock (grease, etc),

licensing expenses and the chemicals used to produce the fuel. Operating expenses include

the cost of feedstock, methanol, catalyst, labor, transportation, insurance, etc. The processing

cost per gallon of biodiesel, including the cost of materials, labor, energy, plant depreciation,

and interest is about $0.50 per gallon for a 5 million gallon per year plan. Working capital,

credit lines and debt financing for small scale biodiesel refining is generally limited during

normal economic cycles.

Adjacent industry entry–The infrastructure and cost structure required to produce biofuels is

quite similar to the existing fossil fuels industry and require scale to be commercially viable.

Large concerns such as ExxonMobil and British Petroleum have cautiously entered the

segment.

Recent Deal Activity by large scale adjacent threats9:

Exxon Mobil partners with Synthetic Genomics, in a deal estimated at $600 million for

research into photosynthetic methods of biofuel production

In 2008, Dow Chemical and Algenol Biofuels joined forces to study how algae can be

used to turn carbon dioxide into ethanol.

British Petroleum and Martek Biosciences, a company that converts algae into

microbial oils and biofuels, entered a partnership agreement valued at $10 million to

jointly develop fermentation technology.

9 Ricketts, Camille “BP gives nod to algae biofuels with $10M to Markek” VentureBeat October 22, 2009.

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Biofuel Energy Development 15

Build Out Costs Biodiesel can be produced from soybean oil for $1.80 to $2.40 per gallon and from yellow

grease for $0.90 to $1.10 per gallon.10 The cost of producing biodiesel depends on a number

of factors, including the following:

Feedstock–The overall cost of biodiesel production depends mainly on the feedstock

used and its price. The prices of most feedstocks are subject to market fluctuations,

which can also make biodiesel production costs vary over time. Although the price of

conventional diesel is not a direct result of production costs, it provides a baseline to

compare the cost of biodiesel production. The appetite for biodiesel production is low

if the price of petroleum diesel is low.

o Feedstock accounts for seventy-five percent of operating expenses of biodiesel

produced from soybean oil.

o Waste feedstock biodiesel production (e.g., yellow or brown grease) expense

depends on the source and procurement method. In some places, feedstock

suppliers pay biodiesel processors to collect the waste, in others, the

processors pay the suppliers. In either case, biodiesel produced from waste

feedstocks is cheaper, although the overall supply of these feedstocks is

limited. Biodiesel from animal fat is currently the cheapest option for

producing biodiesel. It is also highly regulated and requires rapid disposal,

which puts downward pressure on overall supply (and higher prices) if

sufficient transport and processing is not in place.

Facility Capital Expenditures–The cost of building a biodiesel plant depends upon

capacity, location, design, and equipment cost, which varies by type of feedstock. It

10

National Renewable Energy Laboratory, Biomass Oil Analysis: Research Needs and Recommendations, NREL/TP-510-34796 June 2004.

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Biofuel Energy Development 16

costs an estimated $1.00 per gallon of annual capacity to build a biodiesel plant with

economies of scale starting at 5M gallon capacity.11

Operating costs–Operating expenses include the cost of feedstock, methanol, catalyst,

labor, transportation, insurance, etc. The processing cost per gallon of biodiesel,

including the cost of materials, labor, energy, plant depreciation, and interest is about

$0.50 per gallon for a 5 million gallon per year plant. 12

Disposal/Sale of byproducts–The major byproduct of the biodiesel production, crude

glycerin, can be sold to the pharmaceutical, food, and cosmetics industries. This can

offset the per-gallon cost of production.

Hurdles

Here are hurdles communities must consider as biofuel operations enter and grow locally:

Community financial support from external sources–Attracting capital to the segment

is becoming increasingly costly and larger scale is not enough to overcome these

hurdles. A greater diversity of financial products must be offered that allow

communities to absorb costs later and at reasonable terms. This is feasible when

buyers provide long-term contracts that can be leveraged against physical assets in

competitive markets. For instance, the government’s increasing economic role in the

renewable energy market is not accessible to all businesses. Not-for-profit structures

(such as cooperatives) are more likely to receive debt financing to build coal-fired

power plants, than to receive grant dollars to support renewable energy generations

because government support of biofuel development often comes in the form of tax

credits. Non-tax paying entities are ineligible. In the for-profit community, overall

investor appetite for these credits may be curbed due to the broad economic

slowdown. 11

Economic Issues Related to Biofuels, written testimony for Senate Committee on Appropriations Subcommittee on Agriculture, Rural Development, and Related Agencies, Keith Collins, Chief Economist, USDA, 2006 12

Ibid.

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Biofuel Energy Development 17

Financing Community Biofuel–a large-scale biodiesel production plant will cost millions

of dollars, but the expense of setting up a grease collection initiative is relatively small

and could likely be funded through the community’s waste water department or a

local, state, or federal grant. Such an initiative reduces the expense of grease-related

sewage backups. Those savings mean the upfront investment will be recouped within

two years. Founding a cooperative requires even less capital investment, with the

major expense being a method of storing the fuel. Charging a one-time membership

fee would likely cover capital costs. Funding from local, state, and federal agencies

may also be available.

Step by Step Guide: Waste Grease Collection Initiative

1) Set up agreements–encourage restaurants, schools, and hotels to allow free pick up of

used cooking grease. Have them sign an agreement, similar to the one found on the

Piedmont Biofuel Cooperative’s website. Often this means less maintenance on their part

and participation is in their interest. Provide partners with a separate container to collect

the grease so that is considered “yellow grease” rather than taking the grease from the

grease traps (considered “brown grease”). It is important to note that a trustworthy

relationship with the restaurant must be forged because disposing of anything other than

waste oil in the receptacle will ruin a batch of biodiesel and may violate government

regulations in some places.

2) Establish a system to pick up grease–partner with waste management officials to

determine the most efficient way to collect grease from locations – how often, what

route, which kind of transport vehicle, etc

3) Build a processing facility–the collected cooking oil will need to be heated, filtered, and

settle for a few days before the usable feedstock can be distilled. Most likely a series of

storage tanks will need to be employed.

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Biofuel Energy Development 18

4) Set up vendor contracts with biodiesel producers–locate nearby biodiesel producers and

negotiate contracts to sell collected grease.

Step by Step Guide: Biodiesel Cooperative

1) Form a cooperative–interested community members develop a mission and goals for a

proposed co-op. Establish the scale of the pooled fueling needs, and create a member

contract with a schedule of dues.

2) Permits and location siting–work with local authorities from the start to determine what

permits will be needed for refueling stations and where to best locate them.

3) Secure supply of fuel–negotiate with biodiesel suppliers based on the forecasted need for

fuel. Local producers will likely be less expensive due to lower transportation costs. A co-

op can further reduce the cost of fuel by having mobile storage containers that can be

brought to the producer for refilling.

4) Purchase storage and lease site–there are a variety of options for storage at refueling

stations–mobile trailers, semi-permanent above ground tanks, below ground tanks (like

those at commercial gas stations), etc. Each has different advantages and implications on

the co-op’s business plan.

Longer Term Look Ahead By 2007, nearly 30% of all energy in the world was consumed by the transportation sector, a

figure that has been on the rise in the United States since 1960.13 The largest biodiesel

transportation fuel markets are government vehicles, urban bus fleets, farm equipment, and

school and heating.

Demand here and abroad for biodiesel has substantial room to grown. Assuming biodiesel

consumption will offset fossil fuel consumption in the transportation sector, consumption

13

Research and Innovative Technology Administration, Bureau of Transportation Statistics

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Biofuel Energy Development 19

would need to increase over five hundred-fold to meet 2007 levels. At the global level, fuel

demand is projected to increase more rapidly in the transportation sector than in any other

over the next 25 years.14

To meet this incredible opportunity massive investments are underway to diversify biofuel

feedstock in order to meet future consumption demand. In labs across the world, scientists

are performing research that will result in next-generation biofuels based on non-edible plant

materials and farther into the future, utilize plants and microbes that convert sunlight directly

into gasoline and other premium products. To achieve these goals yet-undiscovered

technology will need to be leveraged. BP, DuPont, several start-ups as well as the US DOE

have conducted several demonstration projects of next generation biofuels, but none are

ready to be commercialized.

Resources http://www.pewclimate.org/technology/factsheet/biodiesel http://projectbiodiesel.net/biodiesel_in_use.html http://www.nrel.gov/docs/fy06osti/40555.pdf http://www.biodiesel.org/ http://www.iea.org/Textbase/techno/essentials2.pdf http://www.girlmark.com/ http://www.epa.gov/region09/waste/biodiesel/funding.html http://www.oregon.gov/ENERGY/RENEW/Biomass/docs/BiodieselHandlingGuide.pdf

14

Energy Information Administration, International Energy Outlook 2009

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