1	Costs Associated With the Production of Biodiesel Fuel
2	Most Common Sources of Oil for Biodiesel Engines in U.S. Yellow Grease Yellow grease is used frying oils from deep fryers and restaurants' grease traps. Used oil can be recycled and used to make biodiesel fuel. Soybean Oil Soybean oil is a commercially manufactured oil which is used in the production of cooking oils and vegetable shortening. Corn Oil Corn oil is a commercially manufactured cooking oil as well. Algae Algae has not been proven yet but in the future scientists predict that farming algae can produce mass quantities of vegetable oils which can in return be made into biodiesel.
3	Production Costs Associated with Converting Oil to Fuel Costs of raw materials (Oil, methanol and Sodium Hydroxide) Facilities to manufacture biodiesel fuel Electricity and natural gas
4	Cost of Materials Yellow Grease As of 2004, the fair market cost of yellow grease was around $1.05 per gallon. These prices are expected to rise in the future, as the popularity of bio-diesel fuel rises. This cost can be offset if used oil is obtained and recycled from the food industry. Soybean Oil As of 2004, the market price for soybean oil was around $1.91 per gallon. www.usda.gov
5	Cost of Materials (continued) Methanol The current price of methanol is approximately $0.32 per gallon. Sodium Hydroxide (Lye) Average price of sodium hydroxide is around $3.00 per pound. 40 grams (0.08 lbs.) of sodium hydroxide is needed to make 1 gallon of fuel. This breaks down to about $0.30 per gallon.
6	Cost of Bio Diesel Diesel costs between $2.00 to $2.50 20% Bio Diesel costs 15 to 20 cents more than Diesel Yellow Grease is the Cheapest form of refined Bio Diesel 100% Bio Diesel is $.89-$.91 more than Diesel
7	Facilities to Manufacture Bio-diesel Fuel Commercial As of this time there are 87 active plants in the United States, including two in NW Ohio (Defiance and Hicksville). Bio-diesel fuel stations are limited mostly to the midwest. The nearest source for bio-diesel fuel in our area is in Findlay, OH (Blanchard Valley Farmers). www.biodiesel.org Personal Biodiesel can be made non-commercially by purchasing a “reactor” or mixing tank. A reactor that makes around 40-160 gallons of bio-diesel per hour would cost around $2,000.00. www.homebiodieselkits.com
8	Biodiesel Plants in the United States
9	Factories 3 Biodiesel plants in the State of Ohio Leipsic will be the closest plant to Bluffton Minimum amount of Bio diesel in the State of Ohio Transportation Costs
10	Electricity and Natural Gas Biodiesel production processes use for each gallon of fuel, 0.083 kilowatt hours of electricity and 38,300 BTU (British Thermal Units) of natural gas. Production costs for each gallon of fuel is approximately $0.16 per gallon. www.eia.doe.gov
11	Projected Production Costs Energy Information Administration Year Soybean Oil Yellow Grease Petroleum 2004/05 2.54 1.41 0.67 2005/06 2.49 1.39 0.78 2006/07 2.47 1.38 0.78 2007/08 2.44 1.37 0.78 2008/09 2.52 1.40 0.78 2009/10 2.57 1.42 0.75 2010/11 2.67 1.47 0.76 2011/12 2.73 1.51 0.76 2012/13 2.80 1.55 0.75 Figures represent dollars per gallon. Projection costs based on 2002 statistics. www.eia.doe.gov
12	Other Factors to Consider Incentives for bio-diesel production At this time the USDA offers grants for bio-diesel producers through the Commodity Credit Corporation. These grants effectively lower the cost of bio-diesel, making it a cost effective alternative to petroleum.
13	Statistics Soybean Oil Biodiesel Production Costs 2004-06 - Production levels equal to prior year Costs/Subsidies 2004 2005 2006 Variable Cost 2.55 2.54 2.49 CCC Payment -0.43 -0.22 -0.00 Variable Cost (Net) 2.12 2.32 2.49 - Production levels above those of prior year Variable Cost 2.55 2.54 2.49 CCC Additional -1.45 -1.46 -1.47 Variable Cost (Net) 1.10 1.08 1.12 www.eia.doe.gov
14	Statistics (continued) Yellow Grease Biodiesel Production Costs 2004-06 - Production levels equal to prior year Costs and Subsidies 2004 2005 2006 Variable Cost 1.42 1.41 1.39 CCC Payment -0.27 -0.14 -0.00 Variable Cost (Net) 1.15 1.27 1.39 - Production levels above prior year Variable Cost 1.42 1.41 1.39 CCC Payment -0.89 -0.90 -0.91 Variable Cost (Net) 0.53 0.51 0.48 www.eia.doe.gov
15	Summary As the demand for biodiesel fuel rises in the future, the costs associated with the materials used will likely increase as well. At this time, biodiesel is cheaper to purchase than traditional petroleum products due to the subsidies provided by the Commodity Credit Corporation industries producing biodiesel fuel.
16	Crude Oil Crude oil is the term for "unprocessed" oil. It is also known as petroleum. Crude oils are useful starting points for many different substances because they contain hydrocarbons. Hydrocarbons are molecules that contain hydrogen and carbon and come in various lengths and structures, from straight chains to branching chains to rings. The problem with crude oil is that it contains all different types of hydrocarbons that are mixed You have to separate the different types of hydrocarbons to have anything useful and this can be done through oil refining.
17	Oil Refining Different hydrocarbon chain lengths all have progressively higher boiling points, and can all be separated by distillation. This is what happens in an oil refinery - in one part of the process, crude oil is heated and the different chains are pulled out by their vaporization temperatures. Each different chain length has a different property that makes it useful in a different way.
18	Oil Refining Fractional Distillation and some Chemical Processing http://science.howstuffworks.com/oil-refining4.htm only 40% of distilled crude oil is gasoline but gasoline is one of the major products made by oil companies. Rather than continually distilling large quantities of crude oil, oil companies chemically process some other fractions from the distillation column to make gasoline; this processing increases the yield of gasoline from each barrel of crude oil.
19	Fuel Efficiency Gasoline, Diesel, and Ethanol
20	Combustion Reaction Burning fuel is a chemical reaction that produces excess energy which is what drives our vehicles. Burning a fossil fuel produces a reaction similar to this CH4[g] + 2 O2[g] -> CO2[g] + 2 H2O[g] + energy
21	Energy The energy coming from a fuel explosion within an engine is what is used to move the pistons, therefore providing the acceleration and power needed to keep vehicles running. Energy can be measured by a unit called BTU’s, gasoline has 124,000 BTU’s per gallon.
22	Ethanol Ethanol fuels have been under a lot of study recently due to the increase in gasoline prices. Ethanol is made out of farm products such as corn in a process that produces carbon dioxide for soda pop, animal feed, water, and ethanol. In the process nothing is wasted, everything is useful for other tasks.
23	"Ethanol fuels have varying degrees..." Ethanol fuels have varying degrees of ethanol in them for different efficiencies. Gasoline by itself produces more energy than ethanol, but is more expensive, so a happy medium is attempted to be found with varying mixtures of both fuels. Ethanol fuels in use today: E20 E30 E85
24	Energy in Ethanol Ethanol is reported to have 220,000 BTU’s per bushel of corn. This number is dramatically higher than other fuels. A downside to ethanol is that it takes energy to make this energy. Thereby expending other fuels to make another useful fuel. Another interesting fact is that if you burned shucked corn instead of converting it into ethanol you would gain even more energy, 153,000 BTU’s more.
25	Diesel Diesel is one of the most efficient forms of fuel available right now. Diesel returns 20%-40% more miles per gallon than comparable gasoline engines. If Diesel engines made up 30% of all vehicle engines, by 2020, it would reduce U.S. oil consumption by 350,000 barrels a day.
26	Energy in Diesel Diesel has 139,000 BTU’s per gallon, which is quite a bit larger than the gasoline, this makes for much more energy produced per combustion reaction.