Biodiesel production to nearly double in U.S. this year

Biodiesel manufacturer Imperium Renewables will open up a plant that can produce 100 million gallons of biodiesel a year, said Martin Tobias, CEO of Imperium in a meeting at the Clean Tech Investor Summit, which took place this week in Palm Desert, Calif.

That's going to nearly double the U.S. output of biodiesel, he said. Only about 150 million gallons got produced in the U.S. last year. Imperium itself only has the capacity right now to make 5 million gallons.

Overall, it's a drop in the bucket of the diesel market, he admitted. 62 billion gallons of diesel get consumed a year in the states, but it's a promising sign. There is more demand out there for biodiesel than can be met by current supply, and it's becoming very popular in Europe.

Biodiesel, he asserted, also doesn't come with all of the problems that ethanol does. Ethanol manufacturers can use one vegetable feedstock. If it's a corn ethanol plant, they have to use corn. By contrast, Imperium can switch from soy oil to palm to other oils. The demand for biodiesel will likely cause the price of cooking oil to rise in the future, but the different feedstocks help ameliorate that situation, and so will new plants.

"In three to five years, you will have crops that are produced specifically for food, not fuel," he said.

The infrastructure for diesel exists too. This stuff can go into a regular diesel car or get sold out of a diesel pump in a gas station.

Tobias, who formerly worked at Microsoft, is also sort of the clown prince of the alt fuel set. He likes to speak his mind and get a reaction out of people. One trend he expects to see is upscale gas stations.

"Going to the gas station sucks. It's smelly and dirty," he said. "Someone is going to make it better. It's the same way Starbucks charges $3 for a cup of Maxwell House."

Ethanol makers, he asserted, are also getting cornered by agribusiness giants because they both own croplands and refineries.

"You have Cargill on bottom of you and Cargill on top. I can see how some people would consider that pleasurable," he said.