By Nate Smith, Washington Times-Herald Staff Writer
MONTGOMERY - Biodiesel, a new type of fuel being used in trucks and buses, might find a $25 million home in Daviess County.
During a biodiesel mini-course Wednesday, plans and future developments for a plant in Daviess County were revealed. The seminar was hosted by the Daviess County Purdue Extension office and Daviess County Biodiesel Development, LLC.
The company, set up by area farmers and businesses, wants to build a $25 million biodiesel production facility. To produce 10 million gallons of biodiesel a year, the facility will house a $10 million crushing plant and a $15 million biodiesel facility.
"One of the really satisfying things of working on this project has been the absolute cooperation of everyone we talk to," said John Decker, head of Daviess County Biodiesel. "This is not the effort of any one small person or a small group."
What Daviess County Biodiesel is waiting on is money for a feasibility study to see if the market is there and if supplies are plentiful to make 10 million gallons of biodiesel a year. Helping find the grant money has been the Purdue Extension Office. As of Friday, the group is waiting to hear if they received a $53,000 grant from the USDA to help pay for the study. Application for the grant was done by the extension office and endorsed by U.S. Sen. Richard Lugar, R-Indiana.
"We should know Monday or Tuesday," said Chad Pfitzer, agriculture extension educator. "The target date was (Aug.) 31st, and we are waiting to hear word."
Biodiesel is a mixture of vegetable oil and diesel fuel that burns cleaner than regular diesel. It is competitively priced with regular diesel.
Biodiesel is derived from vegetables or animals. Largely, the natural fuel comes from plants such as soybeans or canola seeds, but the fuel can also be made from rendered animal fats or processed ethanol.
The local plant will start with soybeans but wants to switch to canola in the future because the canola seed yields twice the amount of usable fuel as soybeans, Decker said.
The advantages of using biodiesel are less emissions and increased gas mileage. In studies, engines using biodiesel release up to 12 percent less greenhouse gasses than regular diesel engines.
Locally, buses for Washington Community Schools use biodiesel. Barr-Reeve and North Daviess schools do not because of the older bid specifications for their contracts.
During Wednesday's seminar, Iowa State Extension educator Rudy Pruszko explained that biodiesel can work in any diesel engine without making expensive modifications as one would have to make with ethanol.
"If we took all the feed oils and animal fats and made biodisel, we would only replace 14 percent of the diesel used in the U.S.," Pruszko said. "It's not rocket science, but there are a few oddities that you have to deal with."
One of those oddities is cost. Pruszko added that biodiesel costs on average $1 more to make than regular diesel, so blending companies such as the proposed Daviess County facility will receive $1 per gallon in tax credit.
Nationally, there are 58 biodiesel plants making 714 million gallons of the fuel. In Indiana, there are three proposed plants, but the Daviess County plant would be the only biodiesel plant in southern Indiana.
Recently, plans were announced for two ethanol plants in Posey County. On Tuesday, Gov. Mitch Daniels said in his opening remarks to the Richard G. Lugar-Purdue University Summit on Energy Security that 12 new ethanol plants throughout the state will bring the state's ethanol production to 1.3 billion gallons.
"Now that we've come from behind to leadership in first generation biofuels, we want to be second to none in the next generation," Daniels said.
After the feasibility study, Daviess County Biodiesel hopes to be raising funds for the plant in 2007. The proposed facility would employ up to 10 people.