BioDieselNow - Renewable biodiesel fuel

Hi,

My question above, "Why isn't Biodiesel cheaper than petroleum diesel?", isn't a simple little question to be answered w/a sentencel. Basically, it used to be a little less than $2.00/gal US at the fuel docks in San Pedro, California in the early to mid-90's.

 Now I see that it is apparently about 12 cents less on average, according to some websites - that means a little over $3.00/gal.

 So, if the price of vegetable oil or Lye hasn't gone up, and considering that in the last decade the process of producing biodiesel has decreased, with kits, etc., then why is biodiesel so much now?

 I can't imagine that very much petroleum diesel could sell if Biodiesel was still available at a dollar less per gallon.

 So...

 The question really is, "How come biodiesel isn't still the price it was 10yrs ago, or even cheaper?

tallship:

   My question above, "Why isn't Biodiesel cheaper than petroleum diesel?", isn't a simple little question to be answered w/a sentence.   

Your paying for freshness. <---- one sentence.

tallship:

 The question really is, "How come biodiesel isn't still the price it was 10yrs ago, or even cheaper?

If I can use a runon sentence as 1...

Its because biod is very energy intensive because farming is very energy intensive and as we all know that energy cost has more than 2x in the last few years, its amazing that we dont have higher prices and a testiment to the growing power of the american farmer and industry once it wants to start to do something plus the fact that the gov gives roughly $1 per gallon offers you the ability to competitively buy biod with petrol which many think is better use of tax $ than dying in Iraq.

Welcome aboard the poopdeck tallship! 

Well forgive me for being sarcastic, but this is a da-to-DUH response.

The simple answer is vegetable oil is a lot more expensive than petroleum. Take away the government subsidy, and there would be no BD period because no one in their right mind would pay for it...

For the more detailed answer:

The major disadvantage of biodiesel is high production costs. Biodiesel is currently about one and a half times more expensive than petroleum diesel fuel. These costs come from a variety of sources. First, soybeans, the predominant source of vegetable oil for biodiesel, are only 20 percent oil. Utilizing recycled cooking oils produces a more cost efficient yield, but there isn’t nearly enough recycled cooking oil available to meet the anticipated demand for biodiesel. Second, it takes a lot of energy to manufacture the fertilizers for the vegetable oil crops, and to support the planting, cultivating, fertilizing, harvesting, transporting, and processing of the crops for the energy return from the biodiesel fuel. All of the above is also very labor intensive, as compared to refining petroleum diesel or producing synthetic diesel. And lastly, although not technically a cost of production, pure biodiesel delivers only 90 percent of the fuel economy of petroleum diesel.

 another thing to consider, petroleum is used in making bio-diesel, it is used the farming equipment to grow and harvest the basestock, and petroleum is used in transporting the raw and finished product.

 Hey thanks for the answers everyone 

I'm just not willing to accept that there isn't evidence of intentional gouging - from the Saudi overloards to big oil companys. It's not conscienable that such a leap in petroleum prices has been allowed to go unchecked. Yes, we pay less than other western nations, and more than some places - like Argentina.

 What makes no sense at all is the fact that diesel was much less (spelled MUCH LESS - in all caps) than gasoline right up until the time that people started switching over to diesel trucks (and a lot of diesel cars were mfgd too following the gas shortages/crunches during the Ford and Carter administrations). It just seems to apparent that when people began to retool their fuel, then the conspiracy was on and heading to cut off those who benefited by changing the kind of fuel their cars and trucks used.

 As far as the price of vegetable oil prices going up as much as one of the respondants said - I still don't see that. It actually HAS NOT gone up 400% (or even 200%) since gas was a buckten a gallon. If the subsidy that was referred to in that response had to do with a subsidy provided to biodiesel producers, then I would like to sign up, since, by my calculations, I should be able to produce, by my calculations, biodiesel for about a buck a gallon or less (at this time), w/o going to the several sources (for free) to get used cooking oil (about 150 gallons a week from only 5 sources). 

 Not only that, but there would be enough glycerin left over to start a new, hip and fragrant brand of soap to sell in the hippie style stores for a buck a bar!

Any thoughts? 

tallship:

What makes no sense at all is the fact that diesel was much less (spelled MUCH LESS - in all caps) than gasoline right up until the time that people started switching over to diesel trucks (and a lot of diesel cars were mfgd too following the gas shortages/crunches during the Ford and Carter administrations). It just seems to apparent that when people began to retool their fuel, then the conspiracy was on and heading to cut off those who benefited by changing the kind of fuel their cars and trucks used.

That is simple supply and demand. Once the demand for diesel fuel increased so didn't the cost. It is more complicated than that but, what your saying definitely relates to the laws of supply and demand.

Don't forget the fact that most likely when you buy BD you are buying it from a distributor. It has changed hands 2 or 3 times from production, to storage and transport and then to the station who sells it. Even if it cost 1.50 to produce, they sell it for 1.3 to 1.5 above cost (cost being a relative term,,, fixed vs. variable)=  2.25/gallon. Then the middle man transports it and distributes it to the retail seller at 1.5 above there costs = 3.37/gallon. Then they sell it for 1.5 above there cost to the public= 5.06. Granted this number is a little high even in todays standards but if you do the same math at 1.4 you get 4.11 final product. What i'm getting at is if you don't make it yourself there is very little savings because of the economics of the producer to retail markup.

p.s. I am strictly talking about B-100. Unfortunately, I'm not too far off from current prices. Here is a current price list for Newport Biodiesel in RI.

http://www.newportbiodiesel.com/cms/index.php?option=com_content&task=view&id=32&Itemid=44

The simplist answer is that biodiesel is a fuel commodity and will be priced (and valued) to diesel fuel since it can be used in place of it. Several years ago there was a perfect example: One station was selling biodiesel slightly below the price of diesel fuel and supporting the renewable fuel users in their area  ... when truckers heard the could fill for 20 cents less than the Interstate diesel stations, they 'convoyed' over to the station and drained the tank. The same thing happens to our limited national supply of biodiesel (or the ingredients to produce). If biodiesel is sold much less than petroleum diesel, it will be gobbled up by distributors or users. The only way biodiesel prices will come down will be either reducing demand or increasing supply of whatever we use for fuel. (well if our dollar was stronger that would help too)

Biodiesel is over $5 a gallon where I live.     It always has been a little more than petro diesel.

Big business biodiesel will sell to the highest bidders and that is the way it is.  Even in a time of war they will send biodiesel to Europe to get the best price !

They are cashing in big right now.  I am afraid they are using their profits to buy more and bigger trucks and suckers so they can take even more of the WVO that homebrewers need to make biodiesel.

They have tried many times to take my source of oil.  I know the owner of the place and he tells me what they say to him !

They tried to scare him away from me having the oil so they could have it ! ! ! ! ! ! ! !

Not only do I use that oil to make biodiesel to get around but I also use it to do tests and help others learn how to homebrew.

I would love to give a shout out to the people that said no to big business biodiesel and said yes to homebrew but I don't want them to have problems.

There are people in this world that are like that and won't sell out something as great as homebrew biodiesel ! ! !  

 Im no a expert, but

Maybe the answer for the cuestion WHY? could be the MARKET

If I have petro-Diesel  around 3.5 and grow. AN d yo make Biodiesel for like a half.  You offer the Biodiesel

to the higger price in the Market, The law of price in the market.

This is just one factor, but if you look the strategie for some companies to improve the profit, take the advantajes in the 

market options.  The Market is not going to ack -- cheaper and efficiently at same Time, This schema is nos good bussines.

R yepez.