French poet and writer Hilaire Belloc's famous quote "Let's never doubt what nobody is sure about", may yet prove to be an apt response to the ubiquitous, incessant claims for and questions about perceived pros and cons of biodiesel that appear daily on the Internet, the media and numerous trade and industry magazines. The ongoing debate has provided FleetWatch correspondent Max Braun with a compelling and challenging opportunity to weigh up the views and opinions of bio fuel producers, vehicle and engine manufacturers, oil companies, fuel experts and the all important transporters and fleet managers who soon will be willing to, or be persuaded to introduce biodiesel as an extender to conventional diesel. These views and inputs are carried over the next few pages so as to provide our readers with what is arguably one of the most comprehensive articles on this vitally important subject.

At this time, local fuel-tech experts and laymen alike are scurrying around to gather meaningful information and reliable feedback on safe steps to take that will result in achieving a worthwhile reduction in carbon emissions without incurring onerous, additional costs to their transport operating costs. Biodiesel is one of the areas many are looking to.

What is Biodiesel?
Biodiesel is an alternative energy source produced from a variety of renewable resources such as palm, soybean, rapeseed, canola and vegetable oils. Biodiesel is generally regarded as a clean burning fuel that contains no petroleum. It is biodegradable, non-toxic and generally without sulphur and other aromatics.

Biodiesel is suitable for use as a blend to extend conventional diesel and should not be seen as an alternative fuel. This is especially so when the desired blend is greater than 5%, or when it involves the more sophisticated electronically managed common rail diesel engines. The comments made by vehicle and engine manufacturers as well as fuel experts further on in this article, elaborate and expound on this point.

The production of biodiesel flows from a chemical process that separates methyl esters (the technical name for biodiesel) and glycerine, a versatile product used in a variety of products. A more comprehensive description of the biodiesel product is "fatty acid methyl esters" derived from vegetable and animal fats, also known by the acronym FAME. Hydrogenation under high pressure is another way of producing biodiesel. The production process results in fuels with different characteristics.

Who makes biodiesel?
Biodiesel has been available, albeit in relatively small quantities, since at least the early 1990s. Producers around the world include organised agriculture, individual farmers, industrialists and both small and medium-sized entrepreneurs with knowledge of or connections to the energy business.

Ongoing pressure to reduce greenhouse emissions has accelerated the growth in demand for biodiesel and thus the growth in the number of producers and would be producers globally. Several biodiesel and ethanol producers already established in South Africa are working closely with a variety of entities allied to the energy industry. Regardless of where in the world, producers are looking to their respective governments for favourable treatment usually by way of tax incentives or subsidies. Similar sentiments are being echoed in South Africa.

There are endless claims from a variety of sources proclaiming the merits of biodiesel as a blend and as an alternative fuel. Equally there are apprehensions and considerable trepidations about the claimed merits of biodiesel and the spectre of latent engine damage with expensive consequences. To avoid adding to the uncertainty surrounding this contentious matter, a comprehensive range of opinion and comment was researched and canvassed. This is what is being published and said:

The Merits
Most of the claims for biodiesel and indeed biofuels generally tend to be around climate control and a lowering of greenhouse emissions. The synopsis that follows is by no means complete. It does, however, indicate widely held views and claims:

• Dependent to a large degree on the method of production, choice of feedstock and consistent quality control, it improves the environment.

• It reduces CO₂ emissions.

• It has lubricity. Combines well with conventional diesel, especially coal to liquid 

• (CTL) such as the diesel fuel produced by Sasol.

• It can be used close to where it is produced thus it cuts down on transport costs.

• Good for school buses and other scheduled services or inhouse transport needs.

• It renders South Africa less dependent on imported crude oil and refined fuel.

• It has the potential to create jobs mainly in rural areas.

• The US Department of Energy says biodiesel emits 78.45% less carbon dioxide from well to wheel than conventional diesel. The presence of oxygen in biodiesel improves combustion thus reducing carbon monoxide and particulate emissions.
   

Good for school buses? Golden Arrow buses report a 22% worsening of fuel consumption

The Concerns
Not everyone agrees - or is convinced - that the green claims for biodiesel can be achieved. There is also widespread trepidation and uneasy feelings around a number of technical and operating issues. Here is a selection of concerns from local and international sources:

• Fuel consumption suffers - the degree depends on the feedstock, quality and additives. Known lower thermal efficiency of suitable feedstocks is seen as a key factor.

• The presence of oxygen increases nitrogen oxide emissions and reduces kilometres per litre. Researchers are looking for additives to correct this.

• The impact of oxidation stability, clouding, filters, injectors, hygroscopic, precipitation, limited shelf life, cold weather performance and hard starting, shorter service intervals and frequent filter replacement are frequently asked questions from transporters and fleet managers most of whom are keen to receive some detailed and tested information on usable biodiesel and blending procedures.

• Anticipated problems often relate to blend percentage. 

• Negative impact on fuel consumption. At the time of writing there were not many easily contactable operators that have taken the plunge. Golden Arrow Bus Company reports a 22% worsening in fuel usage over a test period of 12 months. Other comments referring to this issue confirm this is to be expected given the nature of biodiesel feedstocks.

• There is a perceived danger in acquiring fuel from small producers who are not able to keep up the standards or quality control - a fundamental requirement from OEMs.

• A discussion paper released by the OECD (Organisation for Economic Cooperation & Development) says few biodiesel producers can sustain the reduction in greenhouse emissions. Compared with petroleum petrol and diesel, when taking crop fertiliser into account emission reduction is only 40% when a 2% blend is used. It also lacks government support in most countries. The OECD paper goes on to say the overall environmental impact of ethanol and biodiesel exceeds those of petrol and diesel when acidification, fertiliser use, biodiversity loss and toxicity of agricultural pesticides are taken into account.

• A leading renewables company in the US commenting on fuel made from vegetable oils or meat fat, say it costs more to make biodiesel than it does to make conventional diesel even when the US government gives refiners a $1 a gallon subsidy.

• Sustainability of Transportation Biofuels, a global study by London-based consulting firm Arthur D Little, suggests that biofuel markets thrive in countries that offer attractive incentives and access to cheap feedstocks. However, long-term survival of various biofuels is far from clear since they are dependent on high oil prices and ongoing government support and are only competitive when oil prices are high, says the report. There is also the question of assured long term government support when competition between fuel crop and food crop arises. In the long term, who will drive the market - private equity companies or energy majors?

• Green lobbies against biodiesel say crops used put too much pressure on food prices. 

• There is also concern about the absence of controlled, practical test results in respect of feedstock claims, actual specification, blends and blending procedures.

Food Prices
How does the growing demand for biofuels affect food prices? Herman van Schalkwyk, dean of agriculture at Free State University, says there are several reasons for the increases we are seeing in food prices. The demand for biofuels, drought around the world and the steep growth of South Africa's middle class are three of them.

In November 2007, Stats SA said the year-on-year maize price was up 21% and sugar was up10,4%. About 20% of the world's maize crop is now used to make ethanol. The US promotes this by legislating that 2% of fuel must contain ethanol. Human consumption, animal feed and the huge amount for biofuel has serious implications for food prices. Farmers will grow more to cash in on high prices, but that means less land for other crops.

Over production of biodiesel due to insufficient demand has created a global problem of escalating food prices and feedstock prices. Nigeria, as an example, forecasts a need to accelerate growth of food supplies by nearly 80% by 2015. Structural changes in agriculture specifically for biodiesel will keep food prices high for a decade - high income for large producers and higher costs for smaller farmers to feed animals.

Excluding maize from ethanol production has serious negative consequences for the government's land reform policy and maize producers says Monsanto - it believes South Africa can produce 12 million tons a year. With a suggested seven million tons to feed the nation, two million tons for export and one million tons as stand-by supplies, this would leave two million tons for biofuel production

The OECD and UN Food & Agriculture Organisation make the point - high food and energy prices impact on inflation. The growing use of cereals, sugar, soy, oil and vegetable seed to produce fossil fuel substitutes is under-pinning crop prices and indirectly, through animal feed costs, also the price of livestock products. Demand for feedstock helps farmers get a better price - that's good for investment and jobs and may reduce the surplus subsidised stocks of grain. The barley price is up by 48% in a year because more farmers grow maize. Not good for beer drinkers.

Social Implications
With regular reports of hotter weather, lower rainfall and other adverse weather conditions, the threat of drought must have an impact on what government calls food security. What about the potential for a catastrophe such as could happen if - or is it when - Zimbabwe implodes? Can South Africa afford to risk facing the future without caution?

Ethanol South Africa, an organisation facing a dilemma now that the Government's biofuels strategy excludes maize, says that the production of every 3,8 billion litres of ethanol a year would create 8 000 jobs of which 1 500 would be permanent. There is no doubt that the production of ethanol and biodiesel on a viable scale would create jobs mainly in rural areas where they are sorely needed. Deciding on this is part of the daunting challenge facing the South African government and the energy industries.
 

Ethanol making process The production of every 3,8 billion litres of ethanol a year would create 8000 jobs, of which 1500 would be permanent and in rural areas where sorely needed.

Government's Role
How South Africa ultimately benefits from implementing biofuels as extenders to petroleum based fuels will depend on the success of the government's strategy. The national strategy was announced in early December 2007 mandating that two percent of all diesel fuel must be a biofuel extender by 2013.

In announcing the strategy, the energy and minerals minister, Buyelwa Sonjica, revealed that the biodiesel will receive a 50% fuel levy exemption while 100% of the levy is exempted for Ethanol. The blending target for South Africa is ethanol - 8%; biodiesel - 2%.

In announcing that maize be excluded on grounds of food security, much to the chagrin of Grain South Africa, the Government also gave the thumbs down to sugar on the grounds that it is too thirsty and to wheat in that it is an import. While Government is not keen to control food prices, it will have to think carefully about how it trades off food security, food prices and job creation. Pressure from maize interests is prompting government to reconsider a role for maize.

According to SAPIA (SA Petroleum Industry Association) demand for petroleum products increased by 15% in the past five years representing 3 billion litres a year. Building capacity and developing skills remain a challenge for the industry. With the governments of Zimbabwe and Mozambique announcing they are to launch biofuel projects, South Africa needs to be mindful of setting up regional guidelines especially in respect of developing a biodiesel specification compatible with southern African conditions and in terms of viable feedstock for the vehicle parc. Finding a workable and sustainable balance among these major issues will have a significant impact on the success of biofuels in South Africa for years to come.

Next Steps
Once you have read all the side-block articles to this feature, I'm sure you will agree that it is too early to attempt to quantify benefits, if any, that South Africa can expect from its emerging biofuels industry. An ongoing review of progress and problems encountered in First World and emerging countries will, however, provide a number of stepping stones that the country could follow in a determined effort to resolve some of the challenges that lie ahead in establishing a viable and sustainable biofuels strategy and policy.

Early successes and failures, mainly in the US, UK and EU, can in many respects signal approaches that work and provide timely warnings of those that just don't fly. Without claiming the suggestions that follow to be definitive or in any order of priority, they are nonetheless worth careful consideration, regular review and assessment to ensure the national strategy succeeds and will be refined in the light of ongoing experience.

• Ensure production capacity and feedstock availability is sufficient and sustainable to meet a growing demand for biofuels.

• Consider the merit of long term tax incentives to attract required investment and ensure the survival of the industry.

• Undertake the research to ensure the development and implementation of a viable biodiesel specification that assures long term performance and durability permitting measurable reductions in emissions.

• Continue testing to ascertain the severity of potential performance and durability problems and develop solutions.

• Find solutions to the problems of product quality control and distribution channels before introducing higher blends.

• Engage with industry groups and organised national biofuels associations to advance the reputation of biodiesel standards, product quality and distribution.

• Work with authorities to craft and refine renewable energy policies.

Conclusion 
When setting out to write this article I did not appreciate just how complex the issues around biodiesel really are. There are a multitude of claims and counter-claims being made globally about feedstock suitability and availability as well as anything from marginal to miraculous qualities that reduce a range of emissions, improve fuel consumption and vehicle performance. Unfortunately so much of what is claimed is still undependable. The scarcity of practical tests and the reluctance of fleet owners to take the plunge provides scant reassurance that it is a safe step to take.

There is no doubt in my mind that biodiesel is here to stay. It is a question of would be producers - if they are serious - getting their ducks in line. However, for investors to take irretrievable first steps they need a host of assurances that will give them a fighting chance to secure sufficient renewable feedstock under all conditions at an affordable price. They also need assurance that the government will mandate sufficient demand to justify production capacity and access to a reasonable selling price.

The oil companies are ready to engage with producers. However, they will do so in terms of the mission they have always upheld - being mindful of their economic, social and environmental responsibilities. This means they can only associate themselves with quality controlled products compliant with SANS codes. How else can they protect their customers?

Government has the difficult task of trying to find a balance between ensuring food security under expected economic growth forecasts plus a margin to cover catastrophe versus job creation, mainly in rural areas where it is urgently needed. The national strategy inherently encourages small producers to benefit from this industry.

There is also the question of incentives, a problem facing governments around the world. The only thing that is clear is that a biofuels industry cannot survive without commitment of long term government support.

The industry cannot succeed if users are not reassured that biofuels are totally and consistently reliable and will not result in premature component failure or increased operating costs they have little chance of recovering. The success or failure of biofuels in South Africa will depend on the political will to make it work efficiently, a daunting task for the stakeholders and role players.

Taking all these things into account I can ask: "Will it all work out as we all would want it to?" In answering this question I am reminded of the famous movie mogul, Samuel Goldwyn's response to a similar question, he replied: "I give you a definite maybe!"