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Association discusses soy bean diesel fuel

Tuesday, August 3, 2004

Many new uses for soybeans and their by-products have been discovered in the past several years. In 1996, West Central, based in Ralston, Iowa, began making diesel fuel with soy oil. A representative of the company, Myron Danzer, visited Goshorn Park Orange Building in Clay City Monday night to talk to the Eel River Soybean Association about what goes into setting up a biodiesel plant.

Indiana State Senator John Waterman, who introduced Danzer at the meeting, has put great efforts into passing legislation requiring the use of cleaner fuels. Waterman said three locations are being considered as sites for a biodiesel plant, one being near Sullivan, just north of Shelburn.

"Probably one of the main reasons people use biodiesel now," Danzer stated, is the lower sulfur content. By 2006, legislature will necessitate sulfur levels to be even less. "This is when I see the boom in biodiesel really happening," Danzer said.

A major disadvantage to using biodiesel is that it costs about a dollar more per gallon on average than regular diesel. However, after 2006, the removal of sulfur from petroleum-based diesel will likely cause a rise in its price.

In recent years, Danzer has seen what he described as a "keen interest" in the use of biodiesel in place of traditional petroleum-based fuel. "We know what fuel prices are doing," he said, also noting the current dependency on foreign oil.

"The whole country is looking for something better," he added. A great benefit of using biodiesel is that it "can be produced right here in the United States."

Another advantage, according to Danzer, is that "we create 3.24 units of energy for every unit (of biodiesel) we use". Energy is lost during the production of petroleum.

Danzer also predicts more diesel-run automobiles to come out on the market in the near future because they are more fuel-efficient than those that burn gasoline. The annual United States demand for diesel is already 55 billion gallons. The use of biodiesel would again mean "less foreign oil" being imported.

In addition, there are "many state initiatives going on ... to help promote biodiesel." Biodiesel is also endorsed by companies such as John Deere, Caterpillar and CASE International, just to name a few.

For a "stand-alone biodiesel plant", Danzer recommended that at least 10 to 20 acres be set aside. Essential site components include a biodiesel process area, oil pretreatment area, utility/lab building, tank farm and receiving/loading area.

West Central partnered with Todd & Sargent, an engineering company, to form Renewable Energy Group (REG). REG, Danzer said, tries to produce the highest quality fuel at the lowest possible cost. The company also educates on how to use biodiesel, utilizing additives as needed in colder areas.

West Central also helps plants with marketing. Part of successful marketing, said Danzer, is to make sure people continue to use biodiesel and that it becomes easier to obtain.

Another part of a successful plant is finding a market for glycerin. For every gallon of soybean oil produced, 10 percent is glycerin. Danzer said West Central is "looking at glycerin-refining and other uses".

There are "supposedly 1,500 uses", in toothpaste, cosmetics, moisturizers, food products, water treatment and many more, so Danzer does not see it as a major problem.

The cost to get a plant up and running would be around $15 million for a 15 million-gallon plant or around $18-19 million for a 30 million-gallon plant. Cost efficiency goes up with more production because the computer system, no matter what the plant size, is basically the same.

Danzer said he usually tells people to allow six months for obtaining permits and approximately 10-12 months after that for construction.

For more information, visit www.west-central.com, www.renewable-energy-group.com, or www.eelrivermarketing.com.

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