September 12, 2006 4:00 AM PDT

Biodiesel to drive up the price of cooking oil

If you think the high price of gas has been irritating, wait until you see the cost of french fries.

The popularity of biodiesel--made from vegetable matter intead of fossil fuels--"will tighten the supply of vegetable oils," William Camp, executive vice president of Archer Daniels Midland, said during a presentation at the ThinkEquity Partners Growth Conference in San Francisco.

Because agricultural prices typically fluctuate with supply levels, the vegetable oil shortage could cause food prices to rise.

Martin Tobias, CEO of Seattle-based biodiesel start-up Imperium Renewables, agreed. Vegetable oil prices have declined in the past three weeks because projected demand for biodiesel has come down from the speculative levels achieved a few weeks ago. Nonetheless, lowered levels of projected demand still seem destined to make supply difficult.

"I do think there will be a crimp in vegetable oil supplies in three to five years," said Tobias, who once worked at Microsoft.

According to Camp, part of the problem is the amount of oil required. It takes 7.5 pounds of oil to make one gallon of biodiesel.

Next, add the expansion plans. Archer Daniels Midland has already installed capacity to produce 300 million gallons of biodiesel in Europe and 135 million gallons in the U.S. It plans to open a plant to turn soybeans into biodiesel in Missouri and one to turn canola oil into biodiesel in North Dakota. Oils currently exported for food will get consumed domestically as fuel, Camp predicted.

Imperium says it will be capable of producing 100 million gallons per year by the second quarter of next year and is in the midst of negotiating the purchase of large tracts of land for refining biodiesel in North and South America.

Biodiesel's growing share
Right now, biodiesel doesn't total so much as a rounding error in the overall diesel market, Tobias said. About 62 billion gallons of diesel are consumed annually in the U.S. and 85 billion gallons are consumed in Europe. The total worldwide biodiesel production is 75 million gallons.

Biodiesel, however, should grow to 2 billion gallons in the U.S and 2.5 billion gallons in Europe by 2010, he said. Regulations reducing greenhouse gases are driving demand in both markets. At the tailpipe, biodiesel puts out 43 percent less carbon monoxide and 55 percent fewer particulates.

Biodiesel, if made correctly, can also be less expensive than standard diesel, Tobias said. Most biodiesel manufacturers churn out the fuel for about $64 a barrel. A barrel of Imperium is equivalent to a barrel of crude at $54.5. Next year, Imperium will drop prices to $30 to $40 a barrel. The government currently pays a 99 cents-per-gallon subsidy to biodiesel manufacturers.

"We've been cheaper than diesel for the year," he said. "At $30 to $40 crude equivalent, we should be able to compete with crude all day long."

Imperium's prices are lower because they can use a variety of feedstocks. The company can make biodiesel out of palm, canola or soybean oil. Palm is the cheapest to buy, but the refining is a bit more complex.

Also, Imperium produces its biodiesel in a pressurized vat rather than an open vat, as some providers do. And by locating its plants near seaports, the company puts its biodiesel on tankers and ships it more cheaply. Refiners in the Midwest have to rely on trucks.

Biodiesel, Tobias further asserted, is a better alternative than ethanol. The capital expenditure is about 50 cents per gallon for biodiesel and $2 per gallon for ethanol. Biodiesel is also compatible with existing diesel trucks and buses. Gas-powered cars can handle only a small amount of ethanol and only a few high-ethanol cars are on the market.

Next year, European car manufacturers will bring to the U.S. more clean diesel cars, which produce fewer fumes than conventional diesel-engine cars. Clean diesels can also run on biodiesel, producing even fewer fumes.

"A clean diesel gets better mileage than a hybrid," he said.

See more CNET content tagged:
biodiesel, barrel, Europe, food, truck

132 comments

Join the conversation!
Add your comment
Does this mean we will be competing with our cars for food?
just a question- I like soya milk. Does this mean that soon we could be creating new masses of starving people so your SUV's can continue inching forward.
Also I was reading recently about various Palm oil plantations in Malaysia causing the deaths of indiginous people, burning the rainforests and helping to endanger the Sumatran tiger...
Does anyone else care to try BIKING to work or am I just a loony?
Posted by mattofasia (4 comments )
Reply Link Flag
Re: biking to work
As a former 60+ mile a week biker, it's my opinion that all the
health benefits of biking to work aren't worth the risk of becoming
road kill.

Bikers and commuters (who are putting on makeup, reading the
paper, talking on cellphones, etc.) don't mix well.
Posted by rcrusoe (1305 comments )
Link Flag
It means cheaper gas prices - but higher food costs!
We will start starving ourselves, and have to eat less because we can no longer afford it. But we will be able to drive anywhere because we can afford that.

I do bike to work.. have slacked off lately..the bus is easy too.
Posted by baswwe (299 comments )
Link Flag
RE: mattofasia
"Does this mean that soon we could be creating new masses of starving people so your SUV's can continue inching forward."
No. The next mass of starving people will be created by uncontrolled reproduction.
"am I just a loony?"
Possibly, not my call.
Posted by anchojoe (3 comments )
Link Flag
Does this mean we will be competing with our cars for food?
You do realize soy products tend to make you fat and depressed, right?

<a class="jive-link-external" href="http://www.soyonlineservice.co.nz/" target="_newWindow">http://www.soyonlineservice.co.nz/</a>

<a class="jive-link-external" href="http://www.mercola.com/article/soy/index.htm" target="_newWindow">http://www.mercola.com/article/soy/index.htm</a>

<a class="jive-link-external" href="http://www.westonaprice.org/soy/index.html" target="_newWindow">http://www.westonaprice.org/soy/index.html</a>
Posted by willdryden (271 comments )
Link Flag
You do realize soy products should not be eaten, right?
<a class="jive-link-external" href="http://www.westonaprice.org/soy/index.html" target="_newWindow">http://www.westonaprice.org/soy/index.html</a>

<a class="jive-link-external" href="http://www.mercola.com/article/soy/index.htm" target="_newWindow">http://www.mercola.com/article/soy/index.htm</a>

<a class="jive-link-external" href="http://www.soyonlineservice.co.nz/" target="_newWindow">http://www.soyonlineservice.co.nz/</a>
Posted by willdryden (271 comments )
Link Flag
Yes
Biofuels, when ramped up, will compete with food production. Fortunately, most food is consumed by animals, not humans. As long as we allow meat and animal products to become more expensive (reducing consumption) biofuels can make an significant impact.
Posted by Clouseau2 (329 comments )
Link Flag
Yes
Biofuels, when ramped up, will compete with food production. Fortunately, most food gown here is consumed by cattle, not humans. As long as we allow meat and animal products to become more expensive (reducing consumption) biofuels can make an significant impact.
Posted by Clouseau2 (329 comments )
Link Flag
Um...
Sure, you can bike to work, but what about people who have to drive vehicles to DO work. I have a company fan that hauls about 1200 lbs of equipment a day. Sorry, I'm not about to try that with a bike.
Posted by tanis143 (122 comments )
Link Flag
Your questions...
The soy milk that you drink is the PRODUCT of soybean
production. The soy oil is a by-product. Do a google search on
this and you will see that biodiesel is a good by-crop.

Also consider all of the other forms of biodiesel production:

Waste vegetable oil
Dead animal charcasses that are not allowed to be rendered
down to animal feed
Here is a great one: Algae (not only an excellent basis for
biodiesel, but an excellent way to absorb co2 from electricity
production).

Your conserns about Malasia's biodiesel production are valid.

Sincerely,

Mark Meachen
Posted by Mark Meachen (2 comments )
Link Flag
Your just LOONY
Sorry to inform you, but yes I like driving my SUV more than riding a bike. Thats why I sold my bike at a garage sale when I got my first car. As far as the Rain Forests go and the Sumatran Tiger, I could not care less. Where did you read that at anyhow? Probably a news paper or magazine or other "business" with a "profit motive". Its kind of like the whole oil in Alaska concept- its ours and its there and we need it, but lets not get it so a tree can live. I say cut down the trees and burn them for heat while we build mega highways through Alaska to get the oil out.
But thats just my American ways speaking. So do what you want, I have to go out back and cut up a tree to make a bigger drive (my SUV is too big for the little drive).
Steve Sand ithinkican11@hotmail.com
Posted by steve sand (10 comments )
Link Flag
See more comment replies
FAT Americans need to switch to a Mediterranean diet anyway
Come on FAT America, burn up the vegetable oil in your car and
burn up the calories by switching to a heathier Mediterranean diet
with olive oil..!! The change will do you good..
Posted by imacpwr (456 comments )
Reply Link Flag
FAT Americans need to switch to a Mediterranean diet..!!
Come on FAT America, burn up the vegetable oil in your car and
burn up the calories by switching to a heathier Mediterranean diet
with olive oil..!! The change will do you good..
Posted by imacpwr (456 comments )
Reply Link Flag
Not just Americans
There is a world-wide "epidemic" of obesity. It isn't just the USA.
Posted by dmm (336 comments )
Link Flag
Good to hear
I seriously doubt that biodiesel will drive up the price of cooking oil. Why? Because biodiesel can be made from new or used cooking oil (the latter needing to be filtered of particulate matter). Likewise, cooking oil can come from a variety of renewable sources. Instead of paying farmers NOT to plant particular crops, the free market can and should dictate what they plant. If there is a solid market for cooking oil, farmers will plant more and more of the crop.
Posted by Jerkmenistan (7 comments )
Reply Link Flag
But....
You are kind of missing the point... all the oil comes from the same place, whether it is used, or not. If every piece of farmland in America was growing corn and soybeans, and every ounce of crop was used to manufacture biodiesel, we still wouldn't have enough to run the country on biodiesel. Plus... we'd have no food.
Posted by David Arbogast (1709 comments )
Link Flag
7.5 POUNDS??? Oh wait
SEVEN AND A HALF POUNDS to make ONE GALLON?! Oh, wait. The article says vegetable oil weighs about 7.6 pounds per gallon. So...

OH MY GOD! It takes a WHOLE GALLON of vegetable oil to make a mere GALLON of biodiesel!

Please. I detest this sort of "hype". Knock it off. No one thinks a gallon of biodiesel comes from thin air. The article here makes it sound horrible by comparing apples to oranges.
Posted by batzel (2 comments )
Reply Link Flag
USED cooking oil
The author of this report also fails to tell people that more than half of the oil used in biodiesel engines is USED oil! As in "already made fry with that" oil. The orginization that regulates the price or cost of cooking oil just wants to make a profit similar to the fossil oil companies. Greedy bastards.
Posted by SuPaFlyEMT (10 comments )
Link Flag
Not 1:1
Vegetable oil is not the only ingredient in biodiesel. 7.5 gallons of oil is not magically converted to 7.5 gallons of biodiesel with zero waste. Every gallon of oil requires 1/5 gallon of methanol, and 40 gallons (almost a barrel) of oil requires 1.5lbs of lye. (and that's for the cheap "home" method) By the way, methanol costs around 2.50 per gallon.
Posted by David Arbogast (1709 comments )
Link Flag
petrobras biodiesel on all gas stations
petrobras has just included it's biodiesel on all gas stations and can be used right away with buses and trucks. Next step will be to make a "out of the industry plant" solution for all of the alternatives around now.

The best way to make biodiesel is not with products that make part of cooking oil but instead alternatives which can be best used just for this purpose like Brazil's doing, in this case the mamona.

Best
Posted by ramonklown (17 comments )
Reply Link Flag
Biodiesel scam.
they currently churn out biodiesel for $64/barrel, with a .99 subsidy per gallon.

In other words, a barrel of biodiesel costs $105.58 while crude is still under $60/barrel.

Now... how about adding a little for profits?

The costs are hidden, but make no mistake... you are paying for it in taxes. And when the subsidies are canceled or dry up... get prepared to spend a lot more for biodiesel.

Its a neat fuel source, and one that we should make available. But it isn't got to be an economic boon, and we simply don't have the capacity to do everything with biodiesel. It will probably be a small part of the energy solution, but it isn't going to dominate... not while crude is still cheap.
Posted by David Arbogast (1709 comments )
Reply Link Flag
Amazing
Is there a corporate entity you don't suck up to?

The fact remains that right now biodiesel is cheper at the pump.
Posted by qwerty75 (1164 comments )
Link Flag
Oil is not under $60 a barrel!!!
Go to nymex.com and see for yourself. Its 64.29 as of wendesday.
Posted by alstatr (53 comments )
Link Flag
I have a Golf TDI that gets 36/46 miles to the gallon on B100 (100% biodiesel). How much do I pay at the pump in California? $3.30 compared to $3.40 Regular (89 octane). What's even better is that there are no hidden subsidies. B20 and B80 are then ones that are subsidized, not B100.

Math time!

42 gallons in a barrel:
42 x 3.30 = ~$135 / barrel (B100)
42 x 3.40 = ~$142 / barrel (89 Octane gasoline)
Posted by uglymittens (3 comments )
Link Flag
All the talk about how this costs more or is a scam
Look people, at least someone is doing something. Do you really think as the oil drys up it will stay at $64 a barrle? Supply and demand. The middle east has 30 years left. 30 years is our life time. Then what, texas, deep sea drilling, alask, wild life reserves? Maybe this will not "fix" the energey crisis that is coming. But look at it like this.

Someone is doing something besides complaining. We have a cleaner fule source and it is renewable. Now maybe with further advances in automotive technology cars can travel longer/further with less. Maybe the process is refined, maybe another energy source comes to light. In the mean time, this is one of the better solutions and people stand to make mucho money for it. You could try to think of ways to solve its flaws. Patent them and make money. Or you can sit on c|net and complain.
Posted by Central_office_tech (49 comments )
Reply Link Flag
Funny.
Look how the entire country gets upset when the price of gas goes up $0.50 or so...

I agree that biodiesel is pretty cool... but at a cost of $100+ per barrel, there is NO WAY people will accept it as a replacement for fossil fuels. Yes, the cost may come down, but the supply will never be great enough to meet the demand. Therefore, the more popular it gets, the higher the price will be.

Yes... the cost of oil will likely continue to rise over time as well, but until the cost DOUBLES, it will still be generally cheaper than running our cars on soybeans. The supply is also very plentiful despite what some people say.

So... biodiesel is a fuel that will dramatically increase the consumer's cost at the pump, and will never dominate as a primary fuel source. It is a great substitue for the "greens" among us, but other than the rich elite "greens," most people won't spend the money on it.

Some people are spending time and energy on biodiesel as you suggest - and good for them. Others are looking at the situation and realize that biodiesel, for as large as the market may become, will supply only a small percentage of the fuel we need. And those people are looking at much-needed alternatives. Everything from more efficient gasoline powered cars, to electric or hydrogen solutions, to ethanol mixtures... etc.

When people suggest that Biodiesel is cheaper and more plentiful, they are pitching a solution that is indeed a SCAM, because it is neither. And we will need far more than biodiesel to keep us going in the future...
Posted by David Arbogast (1709 comments )
Link Flag
Ode To Frank Herbert
Those who control the Spice, er, oil, er, fat, control the _____!

I said this when the biodiesel promoters were quoted, "My friend works as a manager at n-named restaurant chain and let's me take away the waste fat for free. My only cost is initial startup, chemical for processing (lye...) and labor..."

And I said, no, it won't be free for long as the franchises and oil distributors (ADM...) will regulate the waste product. No more free ride once they realize they can profit from waste.

if you don't control the product, you might as well be buying it.

Think and protect. Get regulations to prevent control and monopolies on sources (solar, batteries, ...) else you will be a victim...of ignorance and greed.
Posted by Below Meigh (249 comments )
Reply Link Flag
Frank, indeed...
Your comment made me laugh; I've quoted his book(s) across the 'net many times of late also.

Its a darned shame the most prescient authors turned out to be Frank Herbert, Aldous Huxley, and George Orwell; I was really hoping they'd be Lewis Carroll or A.A. Milne...lolllll...
Posted by missingamerica (6147 comments )
Link Flag
Cooking Oil Minus Glycerine = Biodiesel.
Glycerine is a very Costly Ingredient in Skin Care Products.

Diesel engines can also be tuned to burn raw oils. A further economy of local repurposing of Solar Produced Oils, savings in transportation costs.

In the cotton growing areas of the country, cottonseed oil is a byproduct of fiber production, pure food grade cottonseed oil sold for 26 cents a pound delivered in the 2005 crop cycle. That's about $2 a gallon.

I am particularly fond of another oil, PALM oil, due to its very high productivity, as well as the palm tree's ability to grow in salty water, making energy culture possible in areas where nothing else will grow.

Both palm oil and cottonseed oil are pretty unhealthy from a cholesterol standpoint, so removing them from the food chain by price competition has a side health benefit.

There is still plenty of work to be done in the area of oil producing aquatic plants (which would clean wastewaters while making oils.)

Farming IS solar energy collection, after all.
Posted by disco-legend-zeke (448 comments )
Reply Link Flag
Cooking Oil = Useless
Ever let a container of cooking oil sit in the hot sun for a few days? Its disgusting. Ever see what happens to it when it sits in the cold winter weather for 20 minutes or so? Cooking oil, as we currently use it in our kitchens, is useless as an automobile fuel. It MUST be "refined," which adds to the cost.
Posted by David Arbogast (1709 comments )
Link Flag
undercutting alt energy
Cheap crude is the achilies heel of any alternative energy source. Oil is expensive when we have no alternative, but dirt cheap if you are not paying for scarcity. Oil companies and producers could make profits down to below $20 a barrel- so it can always undercut alt energy, but only to the extent there is a threat to its dominance.
We as a country need to decide to phase out oil- its dirty and represents an economic subsidy to people who hate us. We have to just suck up this short term hit to our economy because we will be much better off in the long term.
Posted by td001 (11 comments )
Reply Link Flag
A much better idea
td001. You are obviously someone who "gets it". Petroleum was great for this country for many years. Now it is just a subsidy to many countries that bear nothing but vitriol and hate for us. I am unable to see the sense in continuing this arrangement any longer than necessary. Petroleum companies are doing nothing but making millionaires even richer and making us reliant on countries and peoples we shouldn't be relying on.
Posted by JackStraw246 (12 comments )
Link Flag
Time to dust off the friendly atom
Very rarely do the French get it right. In getting some 70-odd percent of their electric power from atomic energy, they have got it right.

If reactors can be built (and the Japanese have some interesting designs) without having to inspect them to death just to get them fired up, energy independance could be our within 5 years.
Posted by Too Old For IT (351 comments )
Link Flag
Oh well
Oh well, it may have some positive benefits, for by selling farmgate produce into alternate market streams, it may go a long way into eliminate the current one buyer lowest price paid control(in many cases trans national corporations actually so dominate and control the wholesale market side with monopolies that force payments below actual local farm real growing costs)!

Two examples of this, are the United Fruit Packing Coy's deceitful operations in South America(even got the legendary Gipper to make a fake B grade propaganda movie at one time for them!, and has been known to use the CIA, to overthrow legitmately elected democratic governments that seek to end their market control as happened in Panama!), and also Nestle's sheer size costs Coffee growers so much money that in certain countries it is far easier to make a peso from illicit drug crops than legitimate farm produce, that is purchased by foreign corporations knowingly underpaying farm growing costs!

Brazil, has shown that by extensive utilization of Sugar Cane to produce ethanol for car use, that has broken the back of the World Bank's very deliberate drive to make very cheap overproduction food crops and bought below real cost in third world countries the wholesale price for sugar, which is very heavilly utilised in all processed foods sold in Western supermarkets(upto 50% by weight in certain foods, and we wonder why both obesity and Diabetes type 2 are in such epidemic proportions in the western developed countries)

The modern trans national food corporations have become so large and dominate the market for food in such a manner, that here in the west we pay trillions in extra taxes, just to merely subsidise the farmer , whilst these companies use their operations in such a manner to avoid paying all legitimate local taxes, using very dodgy accounting supported by trans national accounting firms! So sadly the ordinary man in the street is also forced to pay for their missing taxes as well!

Only time will tell, will all farm subsidies and consequent food mountains and the waste support excessive taxes be terminated with prejudice!

What price a choice?
Posted by heystoopid (691 comments )
Reply Link Flag
What about the cost or the non cost
Biodiesel can also can be recovered from used cooking oils, here in Australia it is a high cost to get Waste Oil removal from the Fast Food and Food Processing Factories. All the Biodiesel suppliers offer this service free to these users and manufacturers.Spin off is this is cheaper and does not present problems with contamination at landfill sites. Biodiesel is the answer, don't let
the Oil Companies "Spin Doctors" do the diagnostics. Diesel Valhalla !
Posted by sloanerg (1 comment )
Reply Link Flag
7.5 lbs < 1 Gal Is this author dumb?
Is this just media sensationalism?

7.5 lbs = 7.5 pints
8 pints = 1 gallon

So it takes LESS vegetable oil to make the equivalent amount of biodiesal.
Posted by kyt1080 (1 comment )
Reply Link Flag
The simple math of it
For every 5 gallons of vegetable oil used, there is a gallon of methanol used. 5 gallons of vege oil will yield very close to 5 gallons of BioDiesel because the gallon of methanol also has to be figured into the equation. After the reaction is complete, you'll net somwhere between 4.5-5 gallons of usable fuel and 1-1.5 gallon(s) of glycerin. So there you have it.
Posted by JackStraw246 (12 comments )
Link Flag
7.5 lbs < 1 Gal Is this author dumb?
Oil being lighter than water will weigh less than water. 7.5 fluid lb = 7.5 pints. I will give you $700 per fluid once of gold that you buy for under $600 per regular once.
Posted by galeso (283 comments )
Link Flag
3,785 mL of cooking oil to make 1 mere gallon
What a waste. I can't believe anyone would support biodiesel after knowing those figures. At least I hope you don't so I can wait a little longer before I dump my 300 million dollar oil investment.
Posted by The Wiethoff (32 comments )
Link Flag
Oil is lighter than water
1 pint = 1 pound is approximately true, but oil floats on water.
Posted by wboquist (1 comment )
Link Flag
Stupid response - oil less dense than H2O
Idiot. Water is more dense than H20, like the way your head is more dense than wood. Therefore an equivalent VOLUME of oil will weigh LESS than the equivalent VOLUME of water. Pounds is a unit of WEIGHT, gallons is a unit of VOLUME. You should be banned form all tech sites for spouting off like you did. Your probably a lawyer.
Posted by philcreeklab (1 comment )
Link Flag
Biodiesel good but not the solution
As I've said many times on these forums, the only REAL, LONG-TERM solution to our energy problems is greatly reduced consumption of energy. That doesn't mean we have to go back to the Stone Age, but it does mean we need to do things like 1) live close to work, or at least carpool; 2) videoconference rather than travel far to meet in person; 3) drive vehicles that are not built like souped-up tanks; 4) live in smaller houses; 5) control suburban sprawl; 6) patronize local stores; 7) mandate sidewalks and bike lanes; 8) force new housing developments to include areas for sidewalk-accessible food shopping, schools, libraries, recreation centers, worship facilities, and residential-friendly businesses; 9) link everything with good public transport; and 10) make existing cities (which often already have many fuel-friendly attributes) more enticing by reducing crime and improving their schools and other infrastructure.

Since we are a capitalist, supply-and-demand country, the easiest way to achieve this is to impose a very high federal tax on all fuels (like $1/gallon for gasoline). This would be made revenue-neutral by increasing the personal exemption amount for income tax. The justification for the high fuel tax is that a large part of our military's job is protecting the supply of Middle East oil, and so fuel users should primarily pay for it. As fuel use came down, we could safely reduce the military budget, and use that money for other things (preferably research into energy conservation and alternative energy sources, but I wouldn't rule out education and Social Security).

Hard to believe that came from a right-wing Republican, huh?
Posted by dmm (336 comments )
Reply Link Flag
Real and Long Term Solution
True, and the only REAL, LONG-TERM way to reduce energy consumption is real, long-term reductions in population. We definitely do not have to live in the Stone Age but that is exactly where we are heading if we continue to breed like flies.
Posted by anchojoe (3 comments )
Link Flag
dmm, you are not dmm
I agree with you 100% except for what the taxes pay for. They should not fund military action but subsidize renewable energy programs like home based power generation.
Posted by The Wiethoff (32 comments )
Link Flag
People do not realize that gas does not, suddenly run out, in a free market
Gas does not suddenly, in a free market run out. Prices today reflect expectations of the available supply and demand for goods and services today and tomorrow. If, for instance, the expectation is that oil supply will decrease or will be less than demand in ten years time, it will influence oil prices today. Prices today will go up. People will have the incentive to conserve (demand will decrease) and to develop new alternatives. Actually, we are probably conserving too much, because of OPEC and Governments taxations are keeping prices higher than they otherwise would be. That oil soon runs out is a political slogan that keeps coming up to keep politicians busy. This political slogan sounds true and will, therefore, in the political market sell. Only true markets can handle this sort of complex things. Compared to markets, Governments are too simple minded and primitive, because of the fact; they lack the essential tools that are needed to solve these kind of problems. They primitively, for example, regulate car manufacturers (and in the end consumers) to produce cars which improve gas mileage and impose upon people speed limits, without knowing if these actions are good or bad. Only markets can tell if conservations are good or bad, because market prices gives people the necessary signals of supply and demand, and people can therefore compare these prices to their own values if they are profitable or not to realize. The essential tools that are needed (which Governments are always lacking) are, as mentioned, market forces and the market price mechanism. Without these mechanisms nothing can be done. For example, a scientist will not reach the truth in trying to calculate physical available quantities and compare that to what he expects physical demand will be. It is silly, it is static and mechanistic. Every individual and every business around the whole world, with all different knowledges, all the time, and in all possible situations, and which are directly influenced of higher prices, will conserve and try out alternatives. Even people and businesses that are not directly influenced of higher oil prices, also, have incentives to find out alternatives. These things happen all the time with all goods, services, capital and raw materials, and it run smoothly without us even noticing it. If Governments were going to replace the markets, we would probably end up with no available goods and services at all! In a sense, this would solve the conservation problem (joke). To make an example of this lack of knowledge and the belief that you can ignore markets, look at the so called Club of Rome, a group that made fools of themselves in the 70s with their book
Limits to growth (<a class="jive-link-external" href="http://www.answers.com/the+club+of+rome?gwp=11&#38;ver=2.0.0.453&#38;method=3" target="_newWindow">http://www.answers.com/the+club+of+rome?gwp=11&#38;ver=2.0.0.453&#38;method=3</a>). If they were right, we would probably barely, even, live today!

Björn Lundahl
Göteborg Sweden
Posted by Björn Lundahl (253 comments )
Reply Link Flag
I love the free market too, but..
the free market has limitations. For example, we used to have lead (Pb) in all sorts of things: gasoline, paint, pipes, etc. Then we found out it was making our children retarded. Did the free market make it stop? No. (At least, not fast enough to avert catastrophe.) Governments had to step in and force people to do the right thing. Ditto for quack medicines, DDT, PCBs, CFCs, warning labels on cigarettes, deforestation, wetland drainage, endangered species, racial discrimination, etc. The list could go on and on.

The free market is bad at solving problems that either a) only the top 50% can understand; or b) are not noticeable by most people until it is too late to do anything; or c) require altruism; or d) have only a few consumers or a few suppliers. Why? Because, as you point out, the free market depends upon large numbers of informed people acting rationally in their own self-interest.

Incidentally, I was pleasantly surprised to read such a vigorous defense of the free market by a Swede. I thought you were all socialists. ;-)
Posted by dmm (336 comments )
Link Flag
Why do we even bother?
Biodiesel is made from used cooking oil and I've even seen regular diesel engines running on just regular cooking oil, without modifications. Now, here's my question: Why is it that all of the sudden we have a "cooking oil shortage" and the price of cooking oil is going to go up because of it? Are they kidding?

The moment we find something that's simple and can save people money at the pump by making it themselves and they just had to find some way of making it too expensive to use!

It's like they don't want us to ever stop using gas. We'll be slaves to oil from overseas forever, or until the supply of oil runs out.
Posted by thedreaming (573 comments )
Reply Link Flag
That's exactly the point...
that David Arbogast keeps trying to make, and people keep shooting him down. (Disclaimer: I have no idea who David Arbogast is.) His point is that you can't say "used frying oil is the answer to our energy problems (after all, it's free)." Because, first, it is only free to a few early adopters. Natural gas used to be considered a nuisance, by people who only wanted crude oil. They would just burn it off at the oil well. If you wanted it, you could have it, free, as long as you didn't get in their way. Then someone figured out you could liquify it and distribute it through pipelines. Now it's such a resource that companies purposely drill for it. And it ain't free!

Second, there is not really much used frying oil being produced by restaurants, not compared to the number of cars in their service area. It seems abundant only because so few people are using it to run their cars.

In summary: Don't blame Shell, BP, and Exxon for this one. They've got bigger fish to fry. :-D
Posted by dmm (336 comments )
Link Flag
agricultural subsidies
Well, that means that the gov't can stop with agricultural subsidies and all those being paid not to farm can go back to it.

Too much of this money is already going to big farms as it is, not the family types that it should be going to.
Posted by schubb (202 comments )
Reply Link Flag
Deregulate Energy!
The trick is in the balance, isn't it?

Decentralize energy! Bio-diesel lends itself perfectly to this because it is not an all or nothing solution. Many governmental fleets are now running on B-20. They report excellent results with improved lubricity.
An added benefit of the diesel engine is that it's 30% more efficient than a gas engine. This has to be worth some consideration. The diesel engine invented by Rudolph Diesel was originally designed to run on non petroleum products. Products found on the farm.

I would like to see a diesel - electric, plug in type. this would give you the first 40 miles from your ordinary house charge. We have had diesel electric in subs since WW 1. I'm sure we have come a long way in the technology since then.

There are so many things that can be done, a simple light bulb can save millions of barrels. We are in the information age many jobs today don't require a 5 day physical presents. Think of all the fuel that can be saved by telecommuting and filling out reports from your computer. This would also take a tremendous strain off the current infrastructure.
Posted by Sedan2 (3 comments )
Reply Link Flag
Let's look for domestic sources of oil
Then let's go for domestic sources of oil. The so-called alternative fuels will have adverse impacts on food security. I like the work being done by the Consumer Alliance for Energy Security, <a class="jive-link-external" href="http://www.secureourenergy.com," target="_newWindow">http://www.secureourenergy.com,</a> in lobbying Congress to enact laws to allow the drilling of oil and gas from the Gulf Coast of the United States.
James
Posted by nwachai (2 comments )
Reply Link Flag
Drill all you want
It won't make any difference. Oil production peaked in 1970 in the United States and has been going down inexorably, as we have used up most of our reserves. We have more oil wells (500,000) than the rest of the world COMBINED, so drilling more won't solve the problem. Drill in Alaska, drill off the coasts of Florida and California, it won't reduce our increasing reliance on imports.

Every President since Nixon has been saying "we need to rely less on foreign sources of oil" and it has gotten worse with each administration.
Posted by Clouseau2 (329 comments )
Link Flag
Soy tastes like wax
Dude, why would anyone want to eat mass amounts of some white flavorless wax? I'd polish the floors with it, shine my shoes, etc. If it doesn't look like food, doesn't taste like food, why eat it? You can keep the white glop.

BTW, did you know soy (along with corn) is heavily subsidized by the US government? Does that mean theres an incentive to push it on consumers?

I really dont know, but I have to say, Ive come to belief (tragically) that theres almost nothing we can take for granted anymore in our country. Is anyone to be trusted? To be taken at face value? Politicians? The media? Certainly not the Internet?

What the hell ever happened to integrity? Shame on us. Shame on all of us.
Posted by gmycyk191 (32 comments )
Reply Link Flag
Selfish
Do we really need to save a dime on fuel costs to hurt the starving people in the "3rd World"??
Posted by georose (50 comments )
Reply Link Flag
Not Taxed
The only reason vegetable oil is a cheap fuel is because it isn't taxed yet. I thought we might pollute oursevles out of existence first but maybe will starve ourselves first as was originally predicted. Save those fetuses so we can overpopulate the world with hungry humans.
Posted by georose (50 comments )
Reply Link Flag
Biodiesel as sole fuel is stupid...
Biodiesel as a sole fuel source would be horrible to the food production for the world. To my understanding, it also does not have the high octane ability like gasoline, so you need to burn more biodiesel in order to go the same distance as gasoline can.

If biodiesel is offered as one of the alternatives, then great. We can recycle wasted cooking oils and food into biodiesel. But to grow and process food strictly for biodiesel is stupid. Hunger is still a major problem in the world, and it can only get worse if biodiesel replaces gasoline. --GIF
Posted by treet007 (123 comments )
Reply Link Flag
Biodiesel as sole fuel is stupid...
Biodiesel as a sole fuel source would be horrible to the food production for the world. To my understanding, it also does not have the high octane ability like gasoline, so you need to burn more biodiesel in order to go the same distance as gasoline can.

If biodiesel is offered as one of the alternatives, then great. We can recycle wasted cooking oils and food into biodiesel. But to grow and process food strictly for biodiesel is stupid. Hunger is still a major problem in the world, and it can only get worse if biodiesel replaces gasoline for the masses. --GIF
Posted by treet007 (123 comments )
Reply Link Flag
Biodiesel not so stupid
First, Diesel is not measured with an 'octane' rating, it's typically
measured with a 'cetane' rating. And although it depends on the
raw matieral used, refining method, etc, in general vegetable
oil-based Biodiesel has a higher cetane rating than petroleum
diesel, not lower.

Also, most Biodiesel has a higher lubrosity rating than petro-
based diesel. Lubrosity (one of my favorite words of all time) is
roughly a measure of how well a substance provides lubricating
effects (ie, to the machinery within which it runs).

If you're interested, you can google for the school district that
did a several month trial run of Biodiesel in place of the petro-
based diesel they were running in their school buses. I think it
may have been a Milwaukee district - or at least, somewhere
around thte Great Lakes - and tested the use of B20 (that is, a
mix of 20% biodiesel and 80% petro diesel).

As is typical in a fleet environment, they chemically measure the
state of their fuel oil on a regular basis, and change it when
necessary (not '3 months or 3000 miles' like most consumers do
their cars). What they found - and I'm only going off of memory
here, but I should be pretty close to actual - was that their
overall fuel economy increased by a significant percentage
(something like 10+%), they were able to go significantly longer
in between necessary oil changes, and anacdotally seemed to
have fewer engine breakdowns or other difficulties. This
collectively lead them to determine that the use of Biodiesel on
average provided them a ~20% increase in overall economy -
that is, if the price per gallon were equivalent, and factoring in
total cost of ownership per mile per year, they'd save almost 20%
over the use of petro diesel alone.

Incidentally, the reason they didn't use B100 (100% biodiesel)
points to one substantial problem of biodiesel: without other
stabilizers, it has a tendancy to solidify in northern climates or
at lower temperatures. So unless you have a tank heater in your
rig, or you live down on the South Coast like me, you can't use
100% biodiesel in the north during the winter.
Posted by dmouton (1 comment )
Link Flag
 

Join the conversation

Add your comment

The posting of advertisements, profanity, or personal attacks is prohibited. Click here to review our Terms of Use.

What's Hot

Discussions

Shared

RSS Feeds

Add headlines from CNET News to your homepage or feedreader.