Biodiesel is a fuel made mostly from crops with seeds that contain oil. Oilseed crops in the U.S. include soybeans and canola (called “rapeseed” in Europe). In tropical regions, palm and jatropha are promising oilseed crops. Palm trees are abundant oil producers, but, in some places, native forests have been cleared to allow their cultivation, raising environmental concerns. Jatropha bushes grow well under adverse conditions and are seen as a tool to fight desertification. Biodiesel can also be made from used cooking oil and animal fats.

Raw vegetable oil is turned into biodiesel through a chemical process called transesterification that separates out glycerin for use in soaps and other products and leaves behind methyl esters (the technical term for biodiesel). The process can also produce valuable by-products. For example, for each pound of soybean oil crushed out of the beans, more than four pounds of a high-protein animal feed called “meal” is created.

U.S. biodiesel production is growing rapidly, from 28 million gallons in 2004 to 91 million gallons in 2005. That is still only 0.15% of the U.S. diesel market and less than 10% of the 1 billion gallons produced in Europe, but production in 2006 was estimated at 245 billion gallons.

Biodiesel can be used in diesel engines as a pure fuel or blended with petroleum with little or no modification. In the U.S., biodiesel is usually blended with petroleum at low levels, from 2% (B2) to 20% (B20). But in other parts of the world such as Europe, higher-level blends -- up to B100 -- are used.

• In 1897, Rudolf Diesel demonstrated his first engine – running on peanut oil.

Biodiesel typically has a higher cetane rating than petroleum diesel. The cetane rating is a measure of diesel’s combustion quality – similar to an octane rating for gasoline.
Biodiesel also has better lubricity – a measure of lubricating properties – than current low-sulfur petroleum diesel and much better lubricity than the ultra-low-sulfur petroleum diesel introduced in 2006. This quality makes it attractive for blending. Lubricity is important for fuel injectors and some types of fuel pumps. A 1- or 2-% blend of biodiesel in low-sulfur petroleum diesel improves lubricity substantially.

At low temperatures, diesel fuel can clog fuel lines and filters in a vehicle’s fuel system. At even lower temperatures, diesel fuel becomes a gel that cannot be pumped. The performance of biodiesel in cold conditions is markedly worse than that of petroleum diesel, and biodiesel made from “yellow grease’’ sources such as french fry oil is worse than soybean biodiesel. However, additives can be used to alleviate these problems.

Because the energy content of biodiesel is roughly 10% lower than that of petroleum diesel, B20 has very slightly lower power, torque, and fuel economy, although some users have seen gains in fuel economy, possibly due to the increased lubricity.

Biodiesel dramatically reduces most emissions, including carbon dioxide. A recent analysis of biodiesel emissions found a life-cycle greenhouse gas reduction of 41%. However, the effect of biodiesel on emissions of nitrogen oxides (NOx), which lead to smog formation, remains unclear. Engine tests have shown an increase of more than 13% for pure biodiesel and nearly 3% for B20, but some on-road tests have shown a decrease.

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Biodiesel from soybeans costs an estimated $2 to $2.50 per gallon to produce. Biodiesel from yellow grease is about $1 a gallon cheaper, but the available supply in the U.S. is much smaller – enough to make 100 million gallons per year. Producers of biodiesel from pure vegetable oil are eligible for a federal excise tax credit of $1 for every gallon blended with conventional diesel. Biodiesel from used cooking oil earns a credit of 50 cents per gallon.

Attempting to use domestic fats and oils to replace a large share of the 60 billion gallons of diesel consumed in the U.S. each year could quickly exhaust available feedstock supplies and push vegetable oil prices significantly higher, due to the steady demand for vegetable oils in food consumption. According to one analysis, the U.S. could produce 300 to 350 million gallons of biodiesel from animal fats and greases and soybean oil without major disruption of soybean oil markets but would need to utilize other feedstocks or import other oils to expand biodiesel production much beyond this level. The largest markets for biodiesel probably will be as a lubricity additive, as a cetane booster, and in situations where low emissions are highly valued, such as school and transit buses.

“I think what we’re doing will be a light at the end of the tunnel for farmers everywhere.” – Singer Willie Nelson, promoter of BioWillie biodiesel

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Biodiesel is defined in U.S. law as “monoalkyl esters of long chain fatty acids derived from plant or animal matter.” However, it is possible to make renewable diesel from other organic materials, through thermal conversion processes, or even directly from algae. These technologies enable the use of abundant, low-value feedstocks, including municipal waste and even smokestack emissions.

The Fischer-Tropsch process can produce a high-quality diesel fuel from biomass, as well as from fossil fuels. For the past 50 years, Fischer-Tropsch fuels have powered some of South Africa’s vehicles; the company Sasol produces more than 150,000 barrels a day from domestic low-grade coal. The fuel is said to be competitive with oil that costs more than $40 a barrel. The first commercial-scale Fischer-Tropsch plant using biomass, with a capacity just over 4,000 barrels per day (60 million gallons per year), is planned to begin operation in Germany after 2008.

Thermal conversion is a general term encompassing various forms of pyrolysis, such as that used to make charcoal out of wood. Pyrolysis uses heat and pressure to break apart the molecular structure of organic solids – any kind of organic solids. One variant, known as “thermal depolymerization,” is being used to convert turkey offal into bio-based crude oil at ConAgra’s Butterball turkey plant in Carthage, Mo., by a company called Changing World Technologies. Production costs are reported at $80 a barrel but would be lower if the company received a “tipping fee” for disposing of a waste product.

Another promising technology captures smokestack emissions of carbon dioxide for use in an “algae farm,” where the gas stimulates the rapid growth of algae that can be converted into biodiesel and ethanol. GreenFuel Technologies first tested the process on a 20-megawatt cogeneration facility at the Massachusetts Institute of Technology in 2004 and then commissioned a second, larger unit in 2005 at a 1,060-megawatt power plant in the southwest United States. According to the company, the results suggest that every acre of the algae farm would yield 5,000 to 10,000 gallons of biodiesel annually and a comparable amount of ethanol.

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