Monday, November 29, 2004

Biodiesel America

The Veggie Van has a new look and new attitude. The introduction letter in their blog is most excellent.

The biodiesel tax incentive....

what does it mean? Who benefits? How and when will price reductions be felt at the pump? At $.01 per % biodiesel blend excise tax reduction, this incentive is significant. Given a constant set of competitive pressures for suppliers, we should see price drops of $1.00/gallon for b100 by early February. Will this indeed be the case?

Also of note, the full credit applies only to virgin oil biodiesel, WVO based biodiesel is only eligible for 1/2 the credit amount. The farm lobby did the work on this bill, and they'll receive the benefit. This should be a good thing, as cheaper WVO has been responsible for several loads of spoiled biodiesel in the Seattle area. With feedstock costs between WVO/virgin oil more even, large distributors (that's YOU World Energy!) should prioritize virgin fuels meeting ASTM standards. A consistent, high quality fuel supply is a biodiesel industry hurdle. Not only have early-adopting fleet owners been burned from bad fuel, this issue is the primary roadblock preventing auto maker endorsement.

The incentive looks well crafted with perfect timing.

Information links:

NBB Tax News

RFA Bill Highlights

Biodiesel in Industry

Earthwise Excavation of Maltby featured in Snohomish County Biz Journal article.