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Home > Archive > Alternative Power sources > September 2005 > Current Economics Of Biodiesel
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Current Economics Of Biodiesel
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| Bob Adkins 2005-09-13, 2:24 pm |
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What are the current economics of bio diesel? Has $60 oil made a
significant impact in the economics of large scale commercial production? Is
the business model feasible for a large scale refinery? If not, would $75
oil make it feasible?
All I have been hearing is "the oil is free", but I know there are limited
quantities of used french fry grease. I wonder what a gallon of B-99 bio
diesel would cost if produced in huge quantities in a state-of-the-art
refinery, made with virgin oil? Are there even any bio diesel refineries
under construction? Would the tree huggers block them like they have fossil
fuel refineries?
I suppose the key is veggie oil yield from soybeans and cotton seed. (or
those desert plants which I can't remember the name of right now) I guess
genetically engineered crops that would nearly double oil yield per acre
could make a huge difference in the ultimate price per gallon.
I have a feeling that the first entrepreneur that can get bio diesel to
market in huge quantities would be the next great business mogul.
Thoughts?
--
Bob
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| I think its like PCs and MACs... two parallel universes that barely
intersect..... the farmers and oilseed associations dont have anything
to do with the oil business except buying some diesel fuel, and the oil
business doesnt care anything about commodities. But the info on
soybean yield per acre is on the web, and so is the oil per acre. I
called Ward Oil in Tampa couple weeks ago... they were wholesaling a 55
gal barrel of B100 at $210...thats $3.18 a gal, but price varies
daily... I think a coop of farmers could give the oil companies some
big competition at the point where B100 can undercut the price of
imported oil and make a profit for the producers. Products compete on
features and price... the biodiesel features that are attractive are
better lubricity (trucks get 5% better mileage with B20), and if the
price is competitive, its a win win.
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| Ptaylor 2005-09-13, 2:25 pm |
| Bob Adkins wrote:
> What are the current economics of bio diesel? Has $60 oil made a
> significant impact in the economics of large scale commercial production? Is
> the business model feasible for a large scale refinery? If not, would $75
> oil make it feasible?
>
> All I have been hearing is "the oil is free", but I know there are limited
> quantities of used french fry grease. I wonder what a gallon of B-99 bio
> diesel would cost if produced in huge quantities in a state-of-the-art
> refinery, made with virgin oil? Are there even any bio diesel refineries
> under construction? Would the tree huggers block them like they have fossil
> fuel refineries?
>
> I suppose the key is veggie oil yield from soybeans and cotton seed.
Or even better,Hemp.
Hemp produces more oil than Soy,by a fairly big margin.
Ohh,but the government won't allow that,cause some moron might try to
smoke it..eventhough it contains *very* little THC (like 0.001%). The
most you'd get is a headache..Like smoking burlap.
> those desert plants which I can't remember the name of right now) I guess
> genetically engineered crops that would nearly double oil yield per acre
> could make a huge difference in the ultimate price per gallon.
>
> I have a feeling that the first entrepreneur that can get bio diesel to
> market in huge quantities would be the next great business mogul.
>
> Thoughts?
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| H. E. Taylor 2005-09-13, 2:25 pm |
| In article <XpsUe.93$Se2.3403@news.uswest.net>,
<Ptaylor@nospam.qwest.net> Ptaylor wrote:[color=darkred]
> Bob Adkins wrote:
>
> Or even better,Hemp.
> Hemp produces more oil than Soy,by a fairly big margin.
> Ohh,but the government won't allow that,cause some moron might try to
> smoke it..eventhough it contains *very* little THC (like 0.001%). The
> most you'd get is a headache..Like smoking burlap.
>
So how many bushels of hemp/soy/corn/cotton/whatever does it
take to make a gallon of fuel? And what could you sell that
hemp/soy/corn/cotton/whatever for on the market?
<curious>
-het
--
"In all of history, we have found just one cure for error -- a partial
antidote against making and repeating grand, foolish mistakes, a remedy
against self-deception. That antidote is criticism." -David Brin
How's yer crap detector? http://www.autobahn.mb.ca/~het/detector.html
H.E. Taylor http://www.autobahn.mb.ca/~het/
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| Actually I think Sunflowers have more oil yield per acr than soutbeans.
There is a Russian hybrid that was selected for oil content.
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| Bob Adkins 2005-09-13, 2:25 pm |
| On Sat, 10 Sep 2005 08:37:43 -0400, Steve Spence <sspence@green-trust.org>
wrote:
>http://journeytoforever.org/biodiesel_yield.html
Nice chart!
According to the chart, soy and cotton are not even in the running... except
that oil is a byproduct of an otherwise valuable crop.
It appears that tung, pecan, sunflower, rape, and olives would be more
practical to grow purposely for oil. Pecan is just about ruled out because
it takes 15-20 years to produce.
I hope we have the climate to grow palm nuts! They produce 235 gallons of
oil per acre. A small 100 acre farm could produce 23,500 gallons of oil
annually. 1,000,000 acres scattered throughout the south could produce
235,000,000 gallons of oil per year, or perhaps 560,000 barrels. Perhaps
with rape or other crops grown between the palm trees, that could be
improved to say 700,000 barrels of oil per million acres at best.
I'm discouraged by those numbers. It appears that it would take more land
than we have to make a dent in our needs. Looks like bio diesel has no
future in the mass market other than being a small supplement to fossil
fuels.
--
Bob
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| Steve Spence 2005-09-13, 2:25 pm |
| Bob Adkins wrote:
> I'm discouraged by those numbers. It appears that it would take more land
> than we have to make a dent in our needs. Looks like bio diesel has no
> future in the mass market other than being a small supplement to fossil
> fuels.
Biodiesel was never meant to be anything but a small supplement to the
whole energy alternative. Ethanol (a co-product of biodiesel),
biomethane ( a related product), solar, wind, nukes and hydro are also
part of the alternative to fossil fuels.
--
Steve Spence
Dir., Green Trust, http://www.green-trust.org
Contributing Editor, http://www.off-grid.net
http://www.rebelwolf.com/essn.html
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| Anthony Matonak 2005-09-13, 2:25 pm |
| Bob Adkins wrote:
> On Sat, 10 Sep 2005 08:37:43 -0400, Steve Spence <sspence@green-trust.org>
> wrote:
>
....[color=darkred]
> I'm discouraged by those numbers. It appears that it would take more land
> than we have to make a dent in our needs. Looks like bio diesel has no
> future in the mass market other than being a small supplement to fossil
> fuels.
From what I've heard, algae can have a better yield than most anything
else and it grows in salt water as well. We've got a lot of salt water
in the world. In fact, more of the planet is covered in water than land.
Besides, biodiesel doesn't have to replace the entire mass market in
order to make a dent and be useful. Changing over to electricity for
transit (high speed intercity rail, personal rapid transit, electric
cars and delivery vans, etc.) can make a pretty big dent also. If you
come up with enough alternatives, none of them have to take the place
of big oil all by themselves.
Anthony
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| Arnold Walker 2005-09-13, 2:25 pm |
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"Bob Adkins" <bobad@charter.net> wrote in message
news:h87bi1lfqmrjuqnudmfdg3jjr9fq1n6aru@4ax.com...
> On Sat, 10 Sep 2005 08:37:43 -0400, Steve Spence <sspence@green-trust.org>
> wrote:
>
>
>
> Nice chart!
>
> According to the chart, soy and cotton are not even in the running...
except
> that oil is a byproduct of an otherwise valuable crop.
>
> It appears that tung, pecan, sunflower, rape, and olives would be more
> practical to grow purposely for oil. Pecan is just about ruled out because
> it takes 15-20 years to produce.
>
> I hope we have the climate to grow palm nuts! They produce 235 gallons of
> oil per acre. A small 100 acre farm could produce 23,500 gallons of oil
> annually. 1,000,000 acres scattered throughout the south could produce
> 235,000,000 gallons of oil per year, or perhaps 560,000 barrels. Perhaps
> with rape or other crops grown between the palm trees, that could be
> improved to say 700,000 barrels of oil per million acres at best.
>
> I'm discouraged by those numbers. It appears that it would take more land
> than we have to make a dent in our needs. Looks like bio diesel has no
> future in the mass market other than being a small supplement to fossil
> fuels.
> --
> Bob
I am amazed at your remark.....given that none of the major wood products
companies Champion,International,Owen Illinois ,or Temple.
have less a million acres of timber in the south.20million acres according
the US dept of Ag.Given also that trees are not the only Ag. crop in the
south.
Given that trees are not the biggest Ag. crop in the south.
Do you even have a clue about what you are talking on land?
Do you even have a answer ,to replace biodiesel for a fuel?Given your
disapproval of that fuel source.
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| Arnold Walker 2005-09-13, 2:25 pm |
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"Anthony Matonak" <anthonym40@nothing.like.comcast.net> wrote in message
news:UqudnVybTqGzNLjeRVn-iQ@comcast.com...
> Bob Adkins wrote:
<sspence@green-trust.org>[color=darkred]
> ...
land[color=darkred]
>
> From what I've heard, algae can have a better yield than most anything
> else and it grows in salt water as well. We've got a lot of salt water
> in the world. In fact, more of the planet is covered in water than land.
>
> Besides, biodiesel doesn't have to replace the entire mass market in
> order to make a dent and be useful. Changing over to electricity for
> transit (high speed intercity rail, personal rapid transit, electric
> cars and delivery vans, etc.) can make a pretty big dent also. If you
> come up with enough alternatives, none of them have to take the place
> of big oil all by themselves.
>
> Anthony
Not if you are in New Orlean waiting for a hurricane to flatten your town
according Corp of Engr. reports written in the 50's.
Walking might be a better way.....
>
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| H. E. Taylor 2005-09-13, 2:25 pm |
| In article <FAhVe.5898$u71.3798@fe11.lga>,
<sspence@green-trust.org> Steve Spence wrote:
> Bob Adkins wrote:
>[...]
>
> Biodiesel was never meant to be anything but a small supplement to the
> whole energy alternative. Ethanol (a co-product of biodiesel),
> biomethane ( a related product), solar, wind, nukes and hydro are also
> part of the alternative to fossil fuels.
>
And when one looks at the percentages currently supplied by these
alternate sources, the magnitude of the switch is daunting.
<andiamo>
-het
--
"Truth does not change according to our ability to stomach it."
-Flannery O'Connor
PV FAQ: http://www.autobahn.mb.ca/~het/energy/pv_faq.html
H.E. Taylor http://www.autobahn.mb.ca/~het/
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| So you advocate use of straight vegetable oil or waste vegetable oil in
a modified vehicle with a heater, rather than processing the oil into
biodiesel and not modifying the vehicle? My question was, how much does
the processing add to the cost of the oil?
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| Steve Spence 2005-09-13, 2:25 pm |
| BobG wrote:
> So you advocate use of straight vegetable oil or waste vegetable oil in
> a modified vehicle with a heater, rather than processing the oil into
> biodiesel and not modifying the vehicle? My question was, how much does
> the processing add to the cost of the oil?
>
Just running filtered wvo costs about $0.10 / gallon.
Processing into biodiesel adds an additional $0.70 / gallon.
We do both.
--
Steve Spence
Dir., Green Trust, http://www.green-trust.org
Contributing Editor, http://www.off-grid.net
http://www.rebelwolf.com/essn.html
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| BobG wrote:
> This site shows sunflower crude at $1.94 a gal. How much to convert it
> to biodiesel?
> http://www.markets.duke.edu/student...team4/global...
=============
Steve Spence
an additional $0.70 / gallon.
==================
That looks like $2.70 a gal about. Not much wiggle room in there for
stuff like hiway taxes and profit for distributers and retailers. Guess
we need to wait till the petro diesel hits $3.50 a gal?
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| Bob Adkins 2005-09-13, 2:25 pm |
| On 12 Sep 2005 16:48:10 -0700, "BobG" <bobgardner@aol.com> wrote:
>This site shows sunflower crude at $1.94 a gal. How much to convert it
>to biodiesel?
>http://www.markets.duke.edu/student...am4/global.html
BobG,
OK, $1.94 oil is available, and Steve says conversion adds ~$.70.
That means it's economically feasible, assuming the oil supplier is making
enough profit to have a successful business model.
If the $1.94 and .70 can be reduced by mass production or genetic
improvements, we have a winner. Problem is, I don't think we have the
acreage to make a dent in the impending oil shortages.
--
Bob
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| Mike McWilliams 2005-09-13, 2:25 pm |
| Bob Adkins wrote:
> On 12 Sep 2005 16:48:10 -0700, "BobG" <bobgardner@aol.com> wrote:
>
>
>
>
>
> BobG,
>
> OK, $1.94 oil is available, and Steve says conversion adds ~$.70.
>
> That means it's economically feasible, assuming the oil supplier is making
> enough profit to have a successful business model.
>
> If the $1.94 and .70 can be reduced by mass production or genetic
> improvements, we have a winner. Problem is, I don't think we have the
> acreage to make a dent in the impending oil shortages.
which is where algae comes in because by and large it doesn't compete
with cropland, and should bring costs down even more at the same time
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| If the $1.94 and .70 can be reduced by mass production or genetic
improvements, we have a winner. Problem is, I don't think we have the
acreage to make a dent in the impending oil shortages.
--
Bob
================================
Up to now, if a farmer had to decide whether to grow 40 acres of
sunflowers or 40 acres of something else, I'm sure market and prices
played a large part in the decision. I haven't used much sunflower oil
for frying recently. But now, there is an unlimited market, with a
guarantee of selling as much sunflower oil as you can produce. There
might actually be some farmers that can make more money growing a crop
for cash than they can by receiving a govt subsidy for NOT growong
tobacco or cotton or sugar or whatever.
I like the idea of a farmer-refiner-trucker coop that locates seed
presses and biodiesel processing tanks near the farms, and ships direct
to retailers. Completely bypasses Big Oil. Whole new industry. Might
even attract investors.
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| They could grow 4 crops a year on the muck farms on Lake Apopka, so
does anyone know if you could get 2 or 3 or 4 crops of sunflowers down
south in the right soil and water etc etc? That sort of quadruples the
yield, which might have some bearing on the feasibility numbers we are
trying to study.
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| Bob Adkins 2005-09-14, 2:21 pm |
| On 13 Sep 2005 08:16:27 -0700, "BobG" <bobgardner@aol.com> wrote:
>They could grow 4 crops a year on the muck farms on Lake Apopka, so
>does anyone know if you could get 2 or 3 or 4 crops of sunflowers down
>south in the right soil and water etc etc? That sort of quadruples the
>yield, which might have some bearing on the feasibility numbers we are
>trying to study.
Bob G.,
Good thinking. Multiple crops never even occurred to me.
If you can get 4 sunflower crops in Fla, I bet we could get 2 or 3 crops
here in La. and all along the gulf coast.
I think your earlier assessment was right on the money. Within a year or 2,
I bet any farmer that really wants to grow crops instead of drawing subsidy
handouts could get a reliable return on every spare acre. Commodities are
fickle, and the farmers probably get whacked by a poor market 2 years out of
5. I think oil crops, although not lucrative, would be a sure bet. Even
weather is not a big wild card when making multiple crops.
It will be very interesting to watch this unfold. We may be disappointed,
but we may be pleasantly surprised by some big developments in bio diesel.
--
Bob
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| think your earlier assessment was right on the money. Within a year or
2,
I bet any farmer that really wants to grow crops instead of drawing
subsidy
Bob A:
handouts could get a reliable return on every spare acre. Commodities
are
fickle, and the farmers probably get whacked by a poor market 2 years
out of
5. I think oil crops, although not lucrative, would be a sure bet. Even
weather is not a big wild card when making multiple crops.
It will be very interesting to watch this unfold. We may be
disappointed,
but we may be pleasantly surprised by some big developments in bio
diesel.
======================
Thanks for a nice positive upbeat reply. Boy are you a rare bird. I
just hope some rich guy with an entrepreneurial bone reads these
newsgroups. I'm just a computer programmer. I guess If I won the
lottery I could get into the biodiesel wheeling and dealing business.
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| Arnold Walker 2005-09-14, 3:21 pm |
| Farmer would probably do better ,also if he side tracked the middleman. And
had his own service station.
Or farmer marketing coop with small farmers ganging up.Maybe havivg two
pumps veggie and bio-diesel......sunflower should burn good without
refining.
At least,on the old mechical injected diesel.Might need to cut it for
Beckett furnace burner.And the stuff is tax exempt in most states.Won't be
for long if govt. smells any money coming out it.
"BobG" <bobgardner@aol.com> wrote in message
news:1126718640.885253.44840@g47g2000cwa.googlegroups.com...
> think your earlier assessment was right on the money. Within a year or
> 2,
> I bet any farmer that really wants to grow crops instead of drawing
> subsidy
> Bob A:
> handouts could get a reliable return on every spare acre. Commodities
> are
> fickle, and the farmers probably get whacked by a poor market 2 years
> out of
> 5. I think oil crops, although not lucrative, would be a sure bet. Even
>
> weather is not a big wild card when making multiple crops.
> It will be very interesting to watch this unfold. We may be
> disappointed,
> but we may be pleasantly surprised by some big developments in bio
> diesel.
> ======================
> Thanks for a nice positive upbeat reply. Boy are you a rare bird. I
> just hope some rich guy with an entrepreneurial bone reads these
> newsgroups. I'm just a computer programmer. I guess If I won the
> lottery I could get into the biodiesel wheeling and dealing business.
>
>
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