Another Fuel From The Farm
Biodiesel gets a long-needed boost from a tax exemption, improved
technologies and the ever-rising cost of petroleum. Source: Toronto Star [Aug
13, 2002] Walking through his 31-acre soybean field near Woodstock, Liam
McCreery broke off a sample pod from this year's crop. By early October, the
broad-leaf plants will yield white pea-size beans by the tonne. But like
Rudolf Diesel, inventor of the diesel engine, McCreery, head of the Ontario
Soybean Growers, also has a shrewd eye on the longer-term. "We harvest solar
energy," the 38-year-old farmer says, drawing attention to the fact that
plant sources such as canola or soybean combine sunlight with carbon dioxide
and soil nutrients to grow. It's long been known that vegetable oil, and oil
made from waste animal fats, can be used in diesel engines. When German
inventor Rudolf Diesel himself proposed it, he was hoping to make a local
source of inexpensive fuel available to communities and also noted that
burning vegetable oil cut pollution from the workhorse engine he invented.
Biodiesel emits no sulphur, reduces black, lung-clogging particle matter by
80 per cent, and produces 60 per cent less carbon monoxide than petroleum
diesel. Importantly, the carbon dioxide produced from the combustion of
soybean oil as biodiesel is claimed back from the atmosphere by the next
crop. Biodiesel can directly replace petroleum diesel fuel or be blended in
any ratio. And it is compatible with any standard diesel engine. In fact, the
slippery quality of biodiesel fuel has been found to lubricate engines,
prolonging life and boosting performance. Those virtues aside, high
production costs and poor supply infrastructure have kept the fuel out of the
mainstream for decades. But now, a new tax break on biodiesel, rising
fossil-fuel prices, and breakthroughs in production and distribution may give
the technology a boost. With a big push on towards greener hydro, the truck
fleets of Toronto Hydro are powering along this summer on biodiesel imported
from the United States. So far, the biodiesel being tested shows a
significant reduction in harmful exhaust emissions, Hydro reports. Even a B20
blend (20 per cent vegetable oil and 80 per cent diesel mixture), notably
cuts down on pollutants. Also this summer, more than 100 Montreal city buses
are running on a diesel mixture of waste animal fat and old restaurant
grease. Unbeknownst to many, Janet Ecker's debut as the new Ontario finance
minister created a stir across the biodiesel community. In the June budget, a
tax exemption of 14.3 cents per litre provincial fuel tax on biodiesel was
introduced. Ethanol has enjoyed a tax break for years. Striving for a cleaner
environment, a provincial committee has also recommended that all diesel sold
in Ontario must either be biodiesel, contain ethanol, or be a combination
thereof by July 1, 2006. When Tim Haig, president and chief executive officer
of Biox Corp., heard about the tax exemption, he reportedly offered to give
Ecker, "a big, sloppy kiss." Biox Corp. is a pilot biodiesel project in
Oakville which stands to benefit from the policy. The small processing
facility is producing one million litres of biodiesel from oil derived from
soybeans and waste animal fat. Biox expects to open its doors commercially
early next year, with a full-scale 60-million litre capacity. The Biox
process, for which a patent is pending, is based on a discovery by David
Boocock, a professor at the University of Toronto. About eight years ago,
Boocock, now 60 and former chair of the chemical engineering and applied
chemistry department, discovered a process that eliminates one of the
chemical steps traditionally needed to create biodiesel. "We believe that,
given the choice, everyone would choose green if the cost was the same" Tim
Haig President and chief executive officer Biox Corp. The Biox process is
expected to cut costs considerably. At the high-tech pilot plant, located at
an old trucking depot, compact equipment consisting of coils and chemical
reactors convert raw vegetable seed oil or waste animal fat into litres of
golden-colour biodiesel. From start to finish, the process takes about 40
minutes. A competitor in Europe takes a litre of oil extracted from vegetable
seed and turns it into a litre of biodiesel for about 25 cents. The Biox
process is designed for producing the same litre of biodiesel for about 7
cents a litre (Canadian dollars). One business plan is for the company to set
up franchises around the world which would lease the equipment to a range
organizations, from oil companies to rendering plants or anyone else who
wants to produce biodiesel and sell it. The equipment is designed to be
user-friendly; other than for maintenance of the machines, no specialized
technicians are required. It means that, typically transport trucks can dock
at the plant and pipe in the raw material, and truck it away when it is
processed. The University of Toronto's innovation foundation (UTIF), that
links professors with investors and entrepreneurs, turned out to be a key
ingredient for Dr. Boocock's process, helping transform the idea into a
business venture. Tim Haig, a personable, energetic entrepreneur was brought
on board to create the company. Haig, 40, a professional engineer with over a
decade of experience in environmental projects, lobbying and fund-raising,
was a natural fit for the academic professor. In less than two years, Haig,
along with angel investors, and in a joint venture with UTIF, bought the
rights to Boocock's process and created Biox Corp. Haig is president and
chief executive officer of the company. Practicing what he preaches, Haig
drives a diesel Volkswagen Jetta, one of the few diesel consumer cars
available in Canada. According to Haig, a well-cared for diesel car can last
up to 1.2 million kilometres, compared to 500,000 kilometres with a
gasoline-powered car. "We believe that, given the choice, everyone would
choose green if the cost was the same," says Haig. Several contributing
factors could also help open the flow of biodiesel. Obviously, Ontario's
23,000 soybean farmers, who on average have experienced a 50 per cent drop in
gross revenue in recent years, are keen to open up a new market for their
products. That's partly because there is a glut of vegetable oil on the
market and because U.S. farm subsidies have created artificially low prices
for soybean growers. "Is this the be-all-and-end all for soybean producers?
No," says McCreery. "But we see a lot of other benefits as well — more
processing jobs in Ontario, cleaner fuel, and the opportunity to take sulphur
out of diesel fuel and put something in that helps our environment and our
markets. It's a win-win situation." Meanwhile, waste animal renderers are
crying out for a new market. When mad cow disease reared its head, the demand
for cattle meal from waste animal by-products disappeared, but dead animals
didn't. In the United Kingdom, for example, there are stockpiles of frozen
carcasses seeking a new product outlet. Oil converted from waste animal fats
to biodiesel doesn't pose a threat.
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