Southeast Texas To Become Biodiesel Mecca - Three New Area Projects Could Produce More Than 70 Million Gallons Annually

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Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). What do Texas Governor Rick Perry, Willie Nelson, and Dow Chemical have in common? All chemical jokes aside, they all are singing the praises of an increase in the use of biodiesel in Texas. Recent developments in the biodiesel industry have turned the attention of producing the greasy fuel to the greater Houston area, normally known for its petrochemical plants and refineries. Four announcements over the past month could turn the energy capital of the United States into the biodiesel capital of the world.

Earlier this year, one of the leading marketers and sellers of biodiesel in the country, World Energy Alternatives LLC (Chelsea, Massachusetts), entered into an agreement with Dow Haltermann Custom Processing (Houston, Texas), a subsidiary of Dow Chemical Company (NYSE:DOW) (Midland, Michigan), to produce an unspecified amount of biodiesel at Dow Haltermann's organic chemical distillation plant at Jacintoport on the Houston Ship Channel that will give the company another production resource to draw from.

Start-up producer, Texas Biodiesel Corporation (Houston, Texas) is also planning to enter the market and will soon kick off construction on a new $33 million, 30-million-gallon-per-year plant in Hillje, Texas. The plant will be the first of three new biodiesel projects planned by the company in Texas.

And just last week another new player, Natural Fuel and Energy (Boston, Massachusetts), announced plans to build a $60 million, 36-million-gallon-per-year plant on the Houston Ship Channel that will be the granddaddy of them all.

Even Willie Nelson has formed a marketing company called Willie Nelson's Biodiesel and plans to make "bioWillie" biodiesel available at every truck stop from Beaumont to Luckenbach, Texas.

All of these new developing and existing projects could grow the industry in Texas to over 70 million gallons annually by the middle of 2006. Currently, the twenty biodiesel plants in the country have the capability of producing over 100 million gallons of the fuel annually. Another 20 or so plants in the development stage have the potential to more than double the industry's capacity, over the next few years.

The industry will need help from the government to get the cleaner burning fuel into big rig fuel tanks and construction equipment across the country. Texas Governor, Rick Perry has instructed the Texas Department of Transportation to begin using the fuel in fleets, where available, and especially in areas of the state where air quality needs improvement, such as high level non-attainment zones, such as the Houston/Galveston area (See related June 23, 2004 news article - Houston/Galveston, Texas is the Front and Center Genesis in Highly Reactive Volatile Organic Compound (HRVOC) Emissions Reduction Spending)

The use of biodiesel fuel has also recently caught the eye of farm equipment manufacturer John Deere, which will begin using a B2 blend (2% biodiesel) of fuel in equipment coming off the factory production lines to promote the use of biodiesel. Biodiesel is the first alternative fuel to have fully completed the health effects testing requirements of the Clean Air Act. The use of biodiesel in a conventional diesel engine results in substantial reduction of unburned hydrocarbons, carbon monoxide, and particulate matter. Biodiesel or methyl esters can be manufactured through a simple transesterification process utilizing virgin soybean oil or yellow grease found in most fast food restaurants across the country, solving both air emissions problems and waste grease disposal issues.

For more information on this emerging industry and access to a biodiesel database of existing and developing plants, please contact Industrialinfo.com's Member Center at 1-800-762-3361.

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