Is Biodiesel Cheaper Than Petroleum Diesel?

With gas prices fluctuating and the Obama administration devoted to reducing America’s reliance on oil, Americans appear to be more interested in alternative fuels, such as those derived from farm crops and other renewable organic sources. Biodiesel and vegetable oil, both of which can be used to power a diesel engine, are among the most readily available.

Biodiesel, which is made from vegetable or animal fats, is chemically equivalent to petroleum diesel. Adherents claim it emits far less pollution than ordinary diesel.

Biodiesel is most typically supplied in mixes with regular diesel, such as B5, which contains 5% biodiesel and 95% petroleum fuel, and B20, which contains 20% biodiesel. According to the US Department of Energy, B20 costs around 20 cents per gallon more than petroleum diesel. B100 (pure biodiesel) costs about 85 cents per gallon more than conventional diesel.

Plain, edible cooking oil is a cousin of biodiesel. However, because cooking oil from grocery store shelves is not economically viable (a gallon costs approximately $8), some people are converting diesel engines to run on old deep-fryer oil that restaurants frequently discard. Discarded oil is sometimes given away for free, but more restaurants are beginning to charge for it.

We adapted a diesel-powered 2002 Volkswagen Jetta TDI to run on biodiesel (B5 and B100) and fryer grease to test how they compare to standard petroleum diesel fuel. We discovered that they all permitted the car to perform adequately, but that the price and convenience of each varies.

B5, a biodiesel mix with 5% biodiesel, gave us the greatest overall performance. It was the most efficient in terms of performance, emissions, fuel economy, and convenience. B5 may be used in any diesel engine without requiring any modifications to the vehicle, and it is injected into the tank exactly like regular gasoline. However, because it is made out of 95% petroleum diesel, it offers little to help drivers transition away from fossil fuels.

Our Jetta performed admirably on recycled cooking oil, but the hassle of locating fuel sources and preparing the oil for use in the engine limits its appeal and negates its low cost.

New diesel automobiles with up to 20% biodiesel blends are now being warrantied by automakers. Engineers say they detect too many contaminants and irregularities in the gasoline at concentrations higher than that, or on cooking oil, to be comfortable extending warranty coverage.

Why is biodiesel cheaper than diesel?

Last week’s meeting with OMCs, according to Sandeep Chaturvedi, head of the Biodiesel Association of India, which represents biodiesel manufacturers, yielded no results. “For the past ten years, there has been no excise charge on biodiesel, but now there is a 6% duty. Taxes and import duties on raw materials are also factored in. The price of biodiesel will rise by Rs9 per litre as a result of this. The cost may have to be borne by OMCs. They will be burdened by this “Added he.

“Tenders haven’t been closed yet. The blending was supposed to be implemented by April 1st. However, we are optimistic that we will be able to achieve it by May 1st, at the very least “Chaturvedi added.

Biodiesel is made from vegetable oils, animal fat, or algae as a feedstock. It can be combined with diesel and used in automobiles with diesel engines.

IOCL responded via email, saying, “The impact of excise duty is that the price differential between diesel and biodiesel widens, forcing the supplier and buyer to continue with such under-recovery. As a result, neither party can continue with the national program. If excise duty is eliminated, sellers will have greater opportunities to market biodiesel (B-100) in India.”

Biodiesel (B-100) is blended into diesel at a rate of 5% and sold as B-5. “For oil firms’ marketing purposes, there is no pricing difference between diesel and B-5. However, there is always a price difference of Rs(+)8 per litre when buying biodiesel against diesel “IOCL has been added.

Diesel prices are determined by crude oil prices, whereas biodiesel prices are determined by Malaysian Palm Oil Board Palm Stearin prices.

“While the current price of diesel in Mumbai is Rs62.57 per litre, Biodiesel (after blending) will cost roughly Rs52 per litre. Biodiesel, on the other hand, may become more expensive than diesel due to excise duty and taxes. This defies the aim of biodiesel’s introduction “Chaturvedi stated.

The usage of biodiesel reduces pollution and aids in the reduction of oil imports. To meet its demands, India imports 80 percent of its crude oil. By 2017, the National Policy on Biofuels suggested a blending ratio of 20% for both biodiesel and ethanol (mixed with gasoline).

The oil marketing businesses are hoping for a 5% availability across all locations for blending in diesel. OMCs will require 400 crore litres of biodiesel per year at current rate.

Due to limited supply, IOCL currently blends at ten locations in West Bengal, Odisha, Andhra Pradesh, Telangana, Tamil Nadu, and Gujarat, according to the company.

Last August, oil minister Dharmendra Pradhan stated that the country aims to increase its biofuels market by more than sevenfold over the next six years.

Pradhan said that blending 5% biodiesel with regular diesel and 10% ethanol with petrol could boost the market to Rs50,000 crore by 2022, up from about Rs6,500 crore now, and that India would need 6.75 billion litres of biodiesel and 4.5 billion litres of ethanol to expand its biofuels market in six years.

Why is biodiesel better than petroleum diesel?

Biodiesel has a higher oxygen content than petroleum diesel (typically 10 to 12 percent). As a result, pollutant emissions should be reduced. As a result, some compounds that are generally regarded acceptable for diesel fuel may be more aggressive. Biodiesel is a significantly safer alternative to petroleum diesel.

Is biofuel cheaper than petroleum?

The expense of biofuels in comparison to petroleum-based fuels is a key barrier to their adoption. Biofuels are more expensive to produce heat because of their lower energy density and higher raw material costs. The lower the energy density and consequently the energy efficiency of the fuel, the higher the biofuel content (see Fig. 1). The energy return on investment (EROI), or how much net energy gain exists in the finished product compared to the total energy spent in its creation, is a critical topic when considering alternatives to petroleum. The process of producing, distributing, and consuming an energy source is measured by EROI. It also has a direct impact on the cost, adoption rate, rate of economic development, and environmental benefits of the society that consumes it. Petroleum has an EROI of 16, whereas soybean biodiesel, which accounts for around 60% of U.S. biodiesel output, has an EROI of only 5.5. In actuality, biofuels are incompatible with state and national goals/mandates to employ energy efficiency as a “priority resource” to reduce both energy consumption and greenhouse gas emissions. The White House’s 40-page Energy Strategy for America, released in May 2014, for example, references “efficiency” 44 times!

Because biofuels are caustic and cause steel to fracture, trucks and rail, rather than our huge and less expensive pipeline system, dominate the business. Trucks can increase transportation costs by a factor of five, whereas rail can increase expenses by a factor of three or four. For Northeast states like New York and Massachusetts who wish to use more biofuels, this can quickly mount up: In the far Midwest, 95 percent of ethanol is produced and 60 percent of biodiesel is produced. According to one estimate, motorists in the United States paid an extra $10 billion in fuel expenditures between 2007 and 2014 to blend 93 billion gallons of ethanol into gasoline. Conventional heating oil with 2% biodiesel (currently under discussion as a New York mandate) costs about 3-5 cents per gallon extra, with the cost rising by 1-2 cents for every percent of biodiesel contained. Used cooking oil from deep fryers (also known as “yellow grease”) is recognized as one of the most sustainable sources of biodiesel, and demand is increasing. When restaurant owners had to pay to have it carted away just a few years ago, the unprocessed, raw material was referred to as “liquid gold.” It currently sells for over $3 per gallon in New York City. Theft and “black market” sale have followed the rise in value: barely 30% of waste grease in New York City is collected by licensed collectors. Biofuels’ additional costs are frequently overlooked. The inconsistency of biofuels and the varying strength of blends create significant problems, particularly from a fuel efficiency standpoint, according to a study released in January by the World Resources Institute, which found that biofuel mandates fail to consider their opportunity costs, a common mistake made by those pushing renewables over conventional forms of energy like oil. Due to higher pricing, equipment damage (ethanol can destroy engines), costly repairs, and supply shortages, the EPA has postponed its RFS blending amounts for 2014, 2015, and 2016.

Is biodiesel cheaper than oil?

Biodiesel in its purest form is rarely utilized. It’s usually combined with diesel and labeled according to how much diesel it contains. According to Edmunds, biodiesel may be found in practically all “normal” fuel sold at petrol stations in the United States, with blends as high as B5. While many drivers of diesel trucks and cars are unaware that the fuel they put in their vehicles contains 5% biodiesel, fleet operators actively seek nonpetroleum fuel. In fact, B20, a blend of 20% biodiesel and 80% gasoline, is used in many fleet and commercial vehicles.

The cost of manufacturing biodiesel is comparable to the cost of producing petroleum. Federal initiatives that give incentives have helped to keep market prices competitive. Biodiesel has also benefited from federal low-sulfur diesel fuel requirements.

Is biodiesel OK for Duramax?

The next-generation Duramax diesel V-8 from General Motors will not only burn cleaner to fulfill strict new emissions rules for 2010, but it will also burn greener – in terms of gasoline. In GM’s 2011 model year 2500 and 3500 Silverado and Sierra pickups, the so-called LML Duramax will be certified to run on biodiesel mixes of up to B20, which is 80 percent ultra-low-sulfur diesel and 20 percent biodiesel.

The move ultimately equals the B20 capability of the current Cummins 6.7-liter inline-six powering the Dodge Ram HD series, which runs from 2007 to 2009. In our previous Heavy Duty Shootout, the 2007 Dodge Ram 3500 was the only pickup that could burn B20. Although B20 biodiesel is readily accessible at many truck stops today, the latest LMM Duramax and Ford’s 6.4-liter Power Stroke V-8 engines are only authorized for B5 biodiesel.

Vegetable oil worked wonderfully in the Jetta. However, you must switch to diesel before shutting down the engine to remove contaminants from the fuel system, which is inconvenient. If you neglect to turn off the light after you’ve turned it off, the cooking oil tank will fill with diesel fuel.

B100 is a completely renewable fuel that has comparable fuel economy and performance to petroleum diesel, however it comes at a significant price premium. There is no financial incentive to use B100 right now. Furthermore, manufacturers are unlikely to warranty B100 in their engines, while most will cover up to B20.

If you have access to biodiesel, a moderate biodiesel blend in your diesel engine could deliver somewhat better fuel economy and acceleration while costing roughly the same as conventional diesel.

Another entirely renewable fuel is used cooking oil, but it’s only a viable option for people who are willing to take on the challenge. Operating a grease car necessitates sacrificing trunk room for an auxiliary tank, establishing your own fuel sources, collecting up, filtering, and storing the fuel, recharging the fuel system with standard diesel after each drive, and cleaning the system before shutting it down.

Is biodiesel less efficient than diesel?

B20 is a popular blend because it offers an excellent balance of price, emissions, cold-weather performance, materials compatibility, and solvent capabilities. The majority of biodiesel users buy B20 or lesser blends from their regular gasoline distributors or biodiesel marketers. Under the Energy Policy Act of 1992, regulated fleets that utilize biodiesel blends of 20% or greater are eligible for biodiesel fuel consumption credits.

In general, B20 and lower-level mixes can be used without modification in modern engines. In fact, many diesel engine original equipment manufacturers (OEMs) support the usage of B20 (for a list of OEMs that support biodiesel blends, see Clean Fuels Alliance America’s OEM Information). Before using biodiesel, users should first check their vehicle and engine warranty statements. See the Biodiesel Handling and Use Guide for additional information on OEM-approved biodiesel use in cars.

Engines that run on B20 consume the same amount of fuel, produce the same amount of horsepower, and produce the same amount of torque as engines that run on petroleum diesel. Although B20 with 20% biodiesel content has 1% to 2% less energy per gallon than petroleum diesel, many B20 users say there is no discernible difference in performance or fuel economy. Biodiesel has some pollution advantages, particularly for engines built before 2010. The benefits of engines using selective catalytic reduction (SCR) systems are the same whether they run on biodiesel or petroleum diesel.

Biodiesel, on the other hand, emits fewer greenhouse gases than traditional diesel fuel. The emissions reduction advantage is roughly proportional to the blend level; for example, B20 has 20% of the emissions reduction benefit of B100.

How much does biodiesel cost?

Biodiesel often costs more than 0.5 U.S. dollars (USD) per liter L1. Depending on the feedstock oils, it costs about 1.5 times as much as petroleum-based diesel.