Biodiesel Production in the US
According to the National Biodiesel Board, as of June 2009, there were 173 biodiesel production facilities in operation in the U.S. While it may appear that overcapacity exists in the marketplace, a condition that could be exacerbated by new plants that may come online, we believe that the market potential for biodiesel remains significantly higher than current and projected production levels. The Energy Information Administration also predicts that the market will continue to absorb biodiesel supply for the foreseeable future.
In accordance with the EISA, RFS2 requires the domestic use of 800 million gallons of biodiesel in 2011. RFS2 provides specific volume requirements for advanced biofuels due in large part to research demonstrating that biodiesel produced from recycled oils, animal fats and agri-based oils can reduce greenhouse gas emissions by as much as 86% compared to petroleum diesel.
While the European automobile industry already uses diesel engines in approximately 50% of all cars manufactured and sold, the United States is beginning to follow suit as evidenced by OEM warranty statements that now support biodiesel blends of up to 20% without voiding any parts of workmanship warranties.