Imperium Renewables Looks to Crop Biodiesel Prices

Written by Jaymi Heimbuch

Tuesday, 10 June 2008

Biodiesel is the green alternative to gas, but seems it takes more green to buy it these days. According to Treehugger, buying biodiesel in the Seattle area is about $1.20 per gallon more than mineral diesel, and it has nearly doubled in price over the last year. The cost of production is a major factor, since just buying enough soybeans for a gallon of biodiesel costs nearly as much as a gallon of pump-ready mineral diesel. Add on the cost of production, and it’s already more expensive, and therefore less desirable to the average consumer, than diesel, proven by the 66% drop in biodiesel sales in Washington state over the past year. Imperium Renewables hopes to ride this out by exporting more of their fuel and focusing on non-food sources, including jatrpha, an oily seed that grows in barren areas (I wonder what fuel they’d use to transport jatrpha from harvest to refinery?).

Some folks say that biodiesel is chalk full of problems, including affecting food prices and taking over farm land. Unless we are able to utilize waste materials as raw material for ethanol or figure out a solid and affordable method for solar powered vehicles, which beats out all biodiesel crops with algae coming in second, there is little we can do to keep farmers from switching to growing crops for biodiesel, regardless of what that crop is composed of, if that is more profitable for them. As proof of all the questions and concerns about biofuels, Iowa State University reports that last year the US only produced 500 million gallons of biofuel of its 1.85 billion gallon capacity, with over half of that biofuel going to Europe. Nonetheless, Imperium Renewables is taking a crack at making biodiesel consumer-friendly again, getting a little help as Washington state (home country for Imporium Renewables) will require 2% of diesel sales to be biodiesel starting in December, equating to about 20,000,000 gallons if Washington meets or exceeds the 1 billion gallons of diesel consumed in the state last year. We’ll keep an eye on their progress, as well as that of the industry as a whole.

Via Treehugger, The Seattle Times; photo courtesy Imperium Renewables

Comments (1)

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Conserv Fuel
written by Max Gladwell , June 10, 2008

Just a couple things: biodiesl is the clean alternative to diesel...not gas(oline). I know you know that, but it's a big point of confusion for consumers. In terms of farmers, they get the same price for their crops whether they sell them for food or fuel; they're commodities with market prices. And at the most, biofuels have accounted for 3% of the rise in food prices. I'd argue they've had no effect.

If you see Conserv Fuel, the price for a gallon of B99 at the pump is $5.40. This is for biodiesel from recycled restaurant oil, which is the best kind right now. Petro diesel is about $5.20. So there is a premium but there always has been.

As we saw in MN, mandates are tough to implement and lead to a backlash from those who don't want to use it. Tax incentives are a better mechanism to encourage a market for biodiesel.

P.S. Would love to be added to your blogroll.

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