A growing fuel alternative

In early May, John Plaza produced the first gallons of biodiesel commercially refined in the Northwest, an event that could mark a turning point for alternative fuels in the region.

Plaza’s fuel refinery, located in Seattle’s industrial area, is the culmination of years of work – a project the retired commercial airline pilot believed in so strongly that he has emptied his life savings and mortgaged his home to get it running.

The refinery is not large, but it embodies promise; perhaps it will be part of the answer to stubborn problems of toxic vehicle exhaust and foreign oil dependence.

The Northwest has lagged in the national biodiesel movement, despite the myriad efforts of government and business.

But skyrocketing gas and diesel prices, tax incentives for alternative fuel and pressure for renewable fuel standards may finally be a catalyst for change.

Consider this: Americans spend about $200,000 a minute on foreign oil. Of the 20 million barrels of oil used each day, half is imported. And the dependence is poised to grow, according to the U.S. Department of Energy.

In two decades, U.S. demand for oil is expected to grow to 27.9 million barrels a day, of which more than 68 percent will be imported, according to the DOE.

While disheartening to many, the numbers represent urgency and opportunity, said Plaza, whose Seattle Biodiesel LLC refinery has plans to produce 5 million gallons a year.

That amount could be easily guzzled in Washington alone.

Five years ago, there was little if any biodiesel used in the state. This year, more than 5 million gallons will be used.

In the Seattle area, many city and school buses run on biodiesel. It’s used on state ferries and by Naval Station Everett.

In Spokane, biodiesel powers Central Valley School District buses as part of a pollution-abatement program.

Though biodiesel emissions contain more smog-producing nitrogen oxide than petroleum diesel, the levels are negligible when compared with the overall pollution each fuel produces.

Ron Edgar, chief of technical services for the Spokane County Air Pollution Control Authority, said the agency is more concerned about toxic emissions in diesel exhaust.

“We look at biodiesel as much cleaner and we support their efforts,” he said.

Motorists in the Spokane area can pump a blend of 20 percent biodiesel and 80 percent petroleum diesel at the Pacific Pride card-lock station at the corner of Appleway Avenue and Barker Road in Spokane Valley.

Last week the biodiesel blend, called B-20, was selling for $2.61 a gallon, while petroleum diesel sold for $2.59 a gallon.

The 2-cent price difference, said Pacific Pride manager Chris Herron, was as close as the two fuels have ever been.

It all adds up to an opportunity for Eastern Washington, said Terry Morgan. As a farmer near Rosalia, south of Spokane, he’s active in efforts to find ways to bring biodiesel to Eastern Washington.

The potential for farmers is grand — for evidence, one need to look no further than the success of Midwest soybeans, now used in everything from fuel and ink to food and solvents.

Grain farmers in Eastern Washington could conceivably include oilseed plants such as canola, mustard or rapeseed, in their crop rotations, Morgan said. These yellow-flowering crops would then be harvested and hauled a short distance to small crushing operations.

Oil extracted from the crushers could be sent to refineries such as that belonging to Plaza, or others that could be built in Eastern Washington. The mash left over from the crushing could be sold as cattle and hog feed. And some of the oil could be turned into other, higher-value products such as lubricants.

It’s all a big what-if, Morgan said, acknowledging there are many obstacles, some logistical and others political.

“There are some involved who want to lead, and the others, well, they don’t necessarily want to be led,” Morgan said. “Overall, farmers around here may not be as interested in all of this as the (Spokane County Conservation District.)”

The SCCD has been at the forefront of public relations efforts pushing biodiesel. Employees can be seen zipping about town in the bright green “Bio-Bug,” a diesel-powered Volkswagen Beetle that extols the virtues of biodiesel.

But farmers, already battered by low wheat prices and soaring costs for fuel and fertilizer, aren’t about to risk their operations by planting oilseed crops until they can pencil out a profit, Morgan said. The federal Farm Service Agency reported that last year Washington farmers planted fewer than 10,000 acres of oilseed crops — far from the hundreds of thousands of acres envisioned to support a biodiesel industry.

Oilseed crops are expensive to grow and there are few markets for them locally.

Soybeans are out because they don’t grow well in the Northwest.

“Call it the chaos of a fledgling industry,” said Tim Stearns, senior energy policy specialist with the Washington Department of Community, Trade and Economic Development.

“The good news here is that we have opportunity and interest,” he said. “But realistically, there’s a lot of chicken and egg going on.”

He said farmers won’t grow the oilseed crops until markets and a profitable business model are established. Crushers, in turn, won’t be built until markets and a steady supply of crops are established. And refineries won’t be interested unless they can be guaranteed of a steady supply of oil.

Plaza said he would like to buy oil from Eastern Washington farmers for his Seattle refinery, but the price would have to be competitive with soybean oil from the Midwest. Right now, canola would cost the refinery 10 cents to 12 cents more per pound to buy than soy. By the time canola is turned into biodiesel, it will cost 70 to 80 cents more per gallon to produce than biodiesel made from soybeans.

The biodiesel equation all comes down to “making it work moneywise,” Stearns said.

The key, say Stearns, Morgan and many others interviewed, is the development of markets for the byproducts of making biodiesel.

The main residual material is glycerin.

“If we don’t figure out high-value uses for glycerin, all of our efforts may be for naught,” he said.

Glycerin can be used to make soap, cosmetics, plastics, rubber products, shoe polish and household cleaners.

Furthermore, canola mash left over from the crushing operation might be turned into cattle and hog feed.

If mustard is grown, residual material could be used to make fumigants for gardeners and landscapers.

Research into such products is being conducted by scientists at Washington State University and the University of Idaho.

Stearns said he’s confident that a new state industry around oilseed crops is possible and predicts it may be five to 10 years out.

Plaza, meanwhile, is busy as the state’s only biodiesel refinery, making the fuel in old tanks from the defunct Rainier Brewery.

He’s speaking with farmers and people interested in setting up crushing operations, including Steve Stetner of Ephrata.

Stetner, who runs a potato seed-cutting business in the Columbia Basin, said he has purchased old crushers and might be six months away from starting an operation in the town of Quincy.

Similar efforts that have been proposed in the region, however, have not borne out.

“It’s a tough nut to crack,” Plaza said of Eastern Washington’s efforts. “We think the ability and an interest is there, but there’s so much hesitation. I think a lot of farmers around here have been sold a bill of goods in the past and they’re not about to let it happen again.”

Added Morgan: “There’s so much being talked about right now. Who knows?”