Monday, November 08, 2010
Tyson & Syntroleum Build Plant to Convert Grease to Diesel
Buyers include oil companies mandated by federal law to mix renewable fuel into their conventional diesel. The U.S. Air Force has contracted to buy about 40,000 gallons for testing the fuel for potential use in planes.
The fuel will not be economically viable unless Congress restores a $1-a-gallon federal tax credit that used to go to companies that mixed alternative fuels into petroleum-based diesel. That break expired at the end of 2009, when the $170 million Louisiana plant was under construction. Syntroleum probably would not have built the plant if they had known that Congress would let the break lapse.
Some believe that if the tax break isn't extended, the whole green-fuels industry in the U.S. is going to go own. Similarly, a 45-cent-a-gallon tax break for companies that blend ethanol into gasoline is due to expire at the end of this year. Makers of the corn-based fuel are lobbying Congress to extend it.
Tyson and Syntroleum aren't making biodiesel. They use heat to change the molecular structure of fats and oils and then refine them into fuel. It behaves more like conventional diesel and jet fuel than biodiesel does—meaning it could be used in large quantities in existing pipelines, gas stations, cars, trucks and planes.Their fuel is registered with the Environmental Protection Agency for use in cars and trucks. It hasn't been certified for use in planes. (WSJ, 11/8/2010)