Why Biodiesel May Not Be the Miracle Fuel You Think

With more retailers being incented to offer biodiesel, and regular diesel becoming nearly extinct for owners of diesel-fueled cars, it is important to ask whether biodiesel actually helps or harms diesel-fueled vehicles. And are the environment benefits as great as we’re led to believe?

Aug 12, 2014 at 9:58AM

This article was written by Oilprice.com -- the leading provider of energy news in the world. 

Nine years ago, U.S. President George W. Bush passed the Renewable Fuel Standard (RFS) with the goal of lessening America's dependence on foreign oil supplies and reducing greenhouse gas emissions.

The RFS mandated that a certain percentage of transportation fuel sold in the U.S. contain ethanol, which is mostly produced from corn. Two years later, the standard was expanded to include biodiesel, derived from vegetable oils such as rapeseed or palm oils.

With more retailers being incented to offer biodiesel, and regular diesel becoming nearly extinct for owners of diesel-fueled cars, it is important to ask whether biodiesel actually helps or harms diesel-fueled vehicles. And are the environment benefits as great as we're led to believe?

The U.S. and Europe have both implemented government programs to mandate the increased use of biofuels. In Europe, the Renewable Energy Directive requires that 10 percent of transportation fuels come from renewable sources by 2020. In the States, the Environmental Protection Agency (EPA) sets a biofuel mandate each year that mandates the proportion of biofuel that must be blended with regular gasoline.

Several U.S. states have implemented laws to encourage the use of biodiesel. Illinois has one of the most generous incentive programs, exempting biodiesel blends of B10 or higher from the 6.25 percent state excise tax. President Barack Obama's home state is the leading producer and consumer of biodiesel, with B20 biodiesel now the standard diesel fuel sold at pumps.

However, an article published by The Diesel Driver notes that, despite EPA mandates to create more biodiesel, and state incentives to sell it, the inconsistency of biodiesel and the varying strength of its blends are causing problems.

The article notes that most U.S. modern diesel cars are designed to use B5 biodiesel, and as a result, "using blends with as much as 20 percent biodiesel have caused problems ranging from check engine warnings to reduced fuel economy and outright engine failure."

Using high-percentage biodiesel in your diesel vehicle could, in fact, invalidate the warranty. Mercedes-Benz, one of five manufacturers of diesel-vehicles sold in the U.S., tells potential owners, "Any damages caused by the use of such non-approved fuels will not be covered by the Mercedes-Benz Limited Warranty."

Further, while engines that run on biodiesel do cause less air pollution than those fueled by regular diesel, their performance is actually worse, according to a fact sheet published by Penn State's College of Agricultural Sciences, which says biodiesel has lower fuel economy than regular diesel, and reduces engine power and torque. Biodiesel can also leave deposits and cause clogging, especially in cold weather.

As for their environmental footprint, advocates for plant-based fuels argue that they are carbon neutral because they only release existing carbon dioxide, compared to fossil fuels, which add greenhouse gases.

But biodiesel loses ground when the total environmental costs of producing the fuel are taken into account. Nitrogen fertilizers applied to soils that grow crops to make biodiesel and ethanol emit nitrous oxide, a potent and long-lasting greenhouse gas. Carbon dioxide is released from soil when land is plowed for planting crops. There is also evidence that links biodiesel to higher tailpipe emissions of nitrous and nitrogen oxides.

Then, of course, there is the argument that land grown for plant-based fuels uses valuable farmland and water supplies that could be used for food production -- possibly causing crop shortages and driving up food prices. The European Parliament has recognized this potential downside and last year voted for a cap on "traditional biofuels" (those that could be used to produce food). EU legislators called instead for a switchover to making biofuels from alternative sources like seaweed and organic waste.

In sum, while using biodiesel and ethanol is definitely better than relying on hydrocarbon-based fuels, the environmental benefits may in fact be smaller than anticipated, or even negligible, when entire lifecycle emissions are taken into account.

Combine that with the constraints forced upon diesel car owners in states where the only fuel available is biodiesel, along with the potentially harmful impacts on engines, and there are valid reasons to question whether the promise of these 'cleaner' fuels measures up to the reality.

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By Andrew Topf of Oilprice.com

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4 in 5 Americans Are Ignoring Buffett's Warning

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Jun 12, 2015 at 5:01PM

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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