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One might anticipate doom following the loss the Biodiesel Mixture Excise Tax credit, a federal tax subsidy that paid $1 (€0.8) for each gallon of biodiesel or renewable diesel fuel blended into petroleumbased diesel fuel, which expired at the end of 2011. The credit was allowed to expire at the end of 2009, and biodiesel production in the US plummeted while plants shut down in 2010. It was... a disastrous year for the industry, with many companies filing for bankruptcy. The tax credit was reinstated in December 2010 for one year, while also made retroactive for 2010. After a slow ramp up in 2011, biodiesel production surged. [read more]

The month of January does not bring much positive news. The activity on the used cooking oil methyl ester (UCOME) market during late December 2011 and beginning of January 2012 was substantial. However, the rules for double counting for biofuels in Germany and Italy seem to be holding back the demand for biofuels on the current market and do not allow prices to rise as much as producers may wish.... The lack of legislation clarity leaves buyers in a position where they prefer to stop purchasing biodiesel for the moment to observe which way the market will develop after the clarification. [read more]

The German biofuels association UFOP has dismissed claims in a new report carried out by the International Food Policy Research Institute (IFPRI) into the predicted emissions to be created by indirect land use change policy. The UFOP says it opposes the adoption of ILUC factors specific for biofuels outlined in the report and says more investment protection needs to be given for existing... biodiesel production plants around Europe. The report, which was published in November 2011 after the European Commission asked for more research to be conducted into ILUC, says proposed European biofuels mandates are ‘likely to cause significant indirect land use change emissions’. [read more]

In a key development for European transport policy, the European Commission (EC) published the White Paper on Transport in 20111. The paper sets out the overall policy strategy for the coming decades and includes both short and long term targets, up to the year 2050 in some cases. The most important part of this package is the greenhouse gas reduction target2 for transport – it proposes... that emissions should be reduced by 20% from 2008 levels by 2030, and by at least 60% from 1990 levels by 2050. More recently, the European Parliament’s transport committee has asked the EC to set more concrete 2020 targets, suggesting overall CO2 emissions from transport should be cut by 20% from 1990 levels3. [read more]

Global biofuel use has increased sixfold over the last 10 years. More than 90 billion litres of biofuel are produced every year, equivalent to 3.5% of fuel use in transport. The drivers for developing biofuels vary; in the UK and the EU biofuels are primarily being developed to address climate change. In the US, the key driver is energy security while in Brazil, developing the agricultural... economy is important. The markets for biofuels are also diverse. To date, biofuels have primarily been considered for use in road transport. However, there is growing interest in their use in other modes, especially aviation. [read more]

Even though consumption figures remained stagnant last year, biodiesel production in Europe dropped. This is in contrast to 2010 where biodiesel production rose by 5.5%. Issues such as imports from Argentina, US and Indonesia flooding the market; the debate over indirect land use change (ILUC); and member states not being clear on double counting measures have all been factors in the decline.... ‘In 2010, 9.5 million tonnes of biodiesel was produced and although we’re not yet sure of the exact number expected for the 2011 production figures, we expect them to be lower,’ says Raffaello Garofalo, secretary general of the European Biodiesel Board (EBB). ‘The new regulations are creating some problems for production for the first time in 12 years.’ [read more]

The Port of Rotterdam, already one of the world’s biggest ports in biofuel production and storage, is looking for potential investors to build a proposed bio-based development that will be part of a larger project, Maasvlakte 2. Although Maasvlakte 2 is already under development, scheduled to receive its first cargo in 2013, the expansion includes increasing the size of the port by 20% to... cover a further 2,000 hectares. Of this expansion, around 200 hectares has been put aside for industrial developments such as the establishment of a biobased cluster. This could be interesting especially for companies looking into new opportunities for investing in greenfield projects. [read more]

As with most other countries promoting renewable fuels, targeted policies and support from federal and state governments are critical components for determining the transport fuel mix in the Australian economy. The real question is whether government intervention will have the intended effect on changing consumer behaviour towards biofuels? Mandates are a key tool used by governments to promote... biofuels. However, economists continue to argue about their effectiveness and how they interfere with free market mechanisms, creating price distortions. In Australia, the introduction of biofuel mandates has rested with state governments which are keen to promote regional development and investment. [read more]

Protecting against property damage and liability losses during the transportation of biofuels requires producers, marketing companies and transporters to fully appreciate not only the different types of liabilities and claims that can arise but the different products and contractual protections that are available. Just as a ship builder must make sure the ship is 100% watertight before it is... launched, producers, marketing companies and transporters must be assured that they have purchased or contracted complete protection. Failure to have proper insurance in place at any stage of the production or transportation stream can give insurance companies and third parties an opportunity to shift risks back to the producer, marketing company, or transporter. [read more]

Crude glycerin is the major byproduct of the common transesterification reaction used to produce biodiesel from fats and oils; a typical biodiesel plant will produce 1lb of crude glycerin for every 10lbs of biodiesel. In its crude form, typically containing significant amounts of methanol, water, salts and organic heavies, the glycerin produced from a biodiesel plant is essentially worthless.... Therefore, historically, many biodiesel producers have been content to dispose of it. In a purified form however, glycerin is one of the most versatile and useful chemicals known to man, with over 1,500 end uses in various industries including oral care, cosmetics, soaps, foods, beverages and plasticisers. [read more]