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Biodiesel Refinery Will Depend On Foreign Oil At Start

More than 250 luminaries and guests celebrated the opening of the nation's biggest biodiesel refinery in Hoquiam, Washington Wednesday.  Speeches touted the benefits of keeping our petro-dollars at home.  But the new plant still relies on imported oil — vegetable oil in this case.

Correspondent Tom Banse reports that energy independence remains a hard nut to crack in the Northwest.

Biodiesel Plant
 Imperium Renewables' new Grays Harbor biodiesel refinery

Imperium Renewables chief executive Martin Tobias turned the ceremonial spigot amidst a spaghetti-tangle of gleaming pipes and tanks. A golden drip and then a gush of fresh biodiesel filled his beaker.

Sound:  "There's our fuel… first half gallon!"

Tobias took a sniff and then a sip, which you wouldn't dare with regular diesel.

Martin Tobias: "It tastes just like regular canola oil, because basically it is 90 percent canola oil and about ten percent alcohol - methanol."

Taste is the least of the attributes that excites the opening day crowd.  Burning biodiesel produces significantly fewer global warming gases than regular diesel.

The alternative fuel can power diesel cars, trucks, ships, and generators with few, if any, engine modifications. U.S. Senator Maria Cantwell has supported tax subsidies for biofuels.  She says the expanded refining capacity opens a welcome "new chapter" in America's energy story.

Maria Cantwell: "I think biodiesel is a supreme fuel and it is going to carry us down the road in giving American consumers an alternative in their pocketbooks of making their fuel cheaper."

A vice president at the National Biodiesel Board, Manning Feraci, hit another popular note.

Manning Feraci: "We're committed to enhancing America's energy independence. That's what we're all about.  We want to replace foreign oil and foreign petroleum with domestically renewable fuels. What you see here today will
do exactly that."

The rub here is that this new biodiesel plant is so big it far outstrips the regional supply of oilseeds.

Imperium Renewables says in the early going it'll refine almost all its biodiesel from imported vegetable oil. Canada is a cheap source for canola oil.  The company also signed a contract for palm oil from Indonesia and Malaysia. Hence the new refinery was built on a coastal harbor.

Company officials say they can't force Northwest farmers to plant oilseed crops if they don't want to.  Eastern Washington farmer Terry Morgan figures he'll earn twice as much from growing wheat instead of canola this year.

 Biodiesel product
 First production at Imperium Grays Harbor

Terry Morgan: "The biggest barrier of course is price.  With the price of wheat and barley where it is, it's difficult to get somebody to try a new crop that they haven't raised before."

Refinery builder Martin Tobias says we have a "chicken and egg" scenario here.  He views himself as the proud new owner of "kind of a hen house."

Martin Tobias: "What we decided is you build the biodiesel processing plant. That creates demand for 100 million gallons of oil. That validates the market for the farmers.  Now the farmers know that we are sending money to
farmers in other states or in other counties.  Therefore if they planted the crop, they know they are going to have a market for it. "

Oregon State researchers recently published a study that concluded large scale production of canola in their state is unrealistic.  Currently, Idaho has the most canola plantings in the Northwest, though that's not saying much. Then there's the eastern Washington farmer experimenting with peanuts for biofuel. 

Long-term, Martin Tobias says oil-producing algae might be the path to truly homegrown fuel.

Web extras:

Imperium Renewables

Oregon State University study on biofuel potential

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