Portland is cautious with biodiesel

POSTED: Tuesday, March 2, 2010 at 02:41 PM PT
BY: Nathalie Weinstein
Tags: biodiesel, Portland Water Bureau, SeQuential

Jay Dykeman of Jay’s Garage in Southeast Portland fills up a car with a biodiesel blend. The city has decided to wait on a mandate that all diesel fuel sold in Portland have at least a 10 percent biodiesel blend by July 1. (Photo by Dan Carter/DJC)

Portland isn’t ready for B10 biodiesel. Or at least that’s the impression being given by the Portland Water Bureau, which has decided to delay implementation of a new Renewable Fuels Standard to meet goals for 2010.

The city’s policy requiring all diesel fuel sold within the city of Portland to have a blend of at least 5 percent biodiesel (B5) would have changed July 1 to require a blend of at least 10 percent.

But according to Anne Hill, program manager for Portland’s RFS, the city has decided to hold off on the policy adjustment due to industry concerns about quality standards and engine warranties. Also, a requirement for all diesel fuel sold in the state to have a minimum blend of 2 percent biodiesel went into effect this year, as did a qualifying feedstock rule that requires 50 percent of biodiesel to come from canola and other specific feedstock.

Hill said the Water Bureau, which last summer took over management of the RFS from the Bureau of Development Services, feels stakeholders such as oil companies, fuel distributors, station owners and trucking companies need time to catch up.

“There’s been a lot of change in Oregon and Portland around biodiesel this year already,” Hill said. “When you go over 5 percent, the fuel is no longer considered diesel and there are no ASTM standards. We’re waiting for the industry to catch up.”

ASTM International is a nonprofit that develops international standards for materials and products used in construction, manufacturing and transportation. Hill said fleet managers have expressed concern that running B10 in their vehicles could void engine warranties, since no standards have yet been identified for the biodiesel blend. And many car companies have not yet formally acknowledged that a higher biodiesel blend can run in their engines.

“Many car companies have been dealing with bigger things than a B6 to B20 standard,” Hill said. “And the majority of diesel is put into long-haul trucks. I can tell a guy from Texas pulling his rig in that B10 won’t affect his engine. But will he believe me? Or will he fuel up outside of Portland? We don’t want station owners to lose business.”

Oregon’s biodiesel industry has benefited greatly from Portland ’s Renewable Fuel Standard, according to Tyson Keever of SeQuential, a biodiesel supplier with offices in Portland and Eugene. (Photo by Dan Carter/DJC)

But at the same time, the RFS has been integral in growing the business of biofuels in Oregon, according to Tyson Keever of SeQuential, a biodiesel supplier with offices in Portland and Eugene. Keever said holding off on B10 for a year or two won’t kill Oregon’s growing biodiesel industry, but added that it will impact his business and those of suppliers.

“The technical differences between B5 and B10 are almost indistinguishable as far as performance,” Keever said. “Right now, there is a lot of misinformation and political land mines around biodiesel. But we have customers who have been using B99 for eight to 10 months with no issues.”

In fact, the Water Bureau’s own fleet for some time has used B20, B50 and B99 blends. Keever said the city’s use of biodiesel in its fleets has been a huge incentive for his company, which has expanded to producing approximately 1 million gallons of biodiesel per year. Other production facilities, including Beaver Biodiesel of Corvallis, GreenFuels of Klamath Falls, and Portland Biodiesel, also have come online recently due to Portland’s hunger for biodiesel.

“(The RFS) has driven growth and spurred development for farmers, production facilities and crush facilities,” Keever said. “Without this standard, our industry would not have grown. This has been a market mover. Portland is the envy of the (biodiesel) industry.”

Crush facilities process the organic materials used in biofuels into a form that can be used as fuel. Four new crush facilities have popped up in Oregon since the RFS was implemented in 2006, Keever said. An RFS also has been adopted in other states, and Washington’s state Legislature is considering implementation of a statewide B2-blend requirement.

“Other places are following Oregon’s lead because we’ve demonstrated that biofuels are working,” Keever said. “I have a sincere appreciation for (City) Commissioner (Randy) Leonard and the council for choosing to run biodiesel in our city fleet. By standing with the industry, they’re saying, ‘This is a real fuel today.’ ”

Hill was adamant that this year’s delay for B10 won’t turn into a reversal on the city’s biofuels mandate. She is monitoring ASTM’s progress in creating a standard for higher biodiesel blends, as well as car manufacturers’ progress in acknowledging that blends can run safely in their engines.

“Petroleum companies will hem and haw, but they will always comply because they don’t want the bad press,” Hill said. “But there are a lot of issues to work through. And we can afford the time to work through those.”

Portland City Council is expected to approve the suspension of the B10 standard at Wednesday’s meeting at 9:30 a.m.