On November 2^nd California voters decided to uphold the state’s Global Warming Solutions Act (AB 32.) by rejecting Prop 23. Proposition 23 would have delayed the start of AB 32, which includes California’s Low Carbon Fuel Standard (LCFS), until the California unemployment rate dropped to 5.5 percent or less for a full year. 

Why is this so monumental you ask?  Californians, even in a tough economy, made it clear that they are in favor of clean energy technology.  Many argue that the addition of jobs in the clean energy fields will help to lower the unemployment rate. 

While AB 32 may only apply to California, it is sending the message all across the nation that we need to reduce harmful emissions by taking advantage of advancements in clean energy technology. 

California’s environmental regulations have often served as models for other states as well as the federal government. Oregon has approved its own LCFS and the 10 state RGGI (Regional Greenhouse Gas Initiative) and Pennsylvania intends to do the same. This demonstrates the intent of states and the people of the U.S. to step in and assure clean air, in addition to or in lieu of federal government action.

LCFS is a component of AB 32 that requires a 10% reduction in the carbon intensity of fuels sold in California by 2020.  As a way to reach this 10% reduction in carbon intensity, obligated parties will blend biofuels into standard fuels.

Regulations like LCFS will help alternative fuel companies grow and create more jobs in the coming years at the US builds its green economy.

Our experts at Blue Sun are always willing to discuss the benefits of biodiesel. Call us anytime – 866-BIO-FUEL.

The popularity of biodiesel is growing all over the country and large-volume buyers need to know where to start when deciding to work with a specific biodiesel company. Below are three things that we believe every company should look into before deciding purchase from a specific biodiesel supplier.

The first thing that you should research is the health of the company. Before deciding to lock into a long term deal with a company you should know how long the company has been in business as well as their track record in the industry. Failing to research this before signing a contract can be a risky move resulting in loss of money, product, and future sales. Blue Sun Biodiesel has been in business for 10 years and has consistently proven to sell a quality fuel thru a seamless process perfected over time. Blue Sun stands by their deals to deliver the right product, in spec and on time.

The second thing to look for in a reputable company is fuel quality. Fuel quality is impacted by both initial production quality (achieved from processing) and by maintaining that quality throughout the downstream supply chain.

To evaluate initial production quality of the fuel the quality of pure biodiesel (B100) is measured via ASTM or EN specifications. These specs are achieved by state-of-the-art biodiesel plants that employ, depending on feedstock, some or all of the following: feedstock drying, feedstock pretreatment, esterification, transesterfication, biodiesel/glycerin separation, biodiesel washing, biodiesel drying, methanol recovery, and biodiesel polishing.

Maintaining quality downstream is achieved via proper additization and quality control procedures. Additives, such as Blue Sun’s proprietary additive DTX, can remove water from biodiesel thus optimize performance of the engine. Only free water is limited in the ASTM spec. Biodiesel is more polar than diesel and therefore moisture is much more soluble in biodiesel. B100 can hold up to 1500 ppm of moisture before it is saturated, whereas diesel can only hold about 50-75ppm. If moisture in the B100 is not limited then it can become free water over time, in cold weather, and when blended with diesel. Free water can cause many problems from tank and equipment degradation with rust and corrosion, icing (plugging fuel filters with frozen water in the cold), and microbial incubation. Certain additives can also prolong the shelf life or oxidative stability of the fuel. Oxidative stability in a fuel allows the fuel to be stored longer. It is key in ensuring “fresh” quality fuel for user’s engines, especially if it has been held in storage tanks. Blue Sun engineered the oxidative stability component of DTX and the timing of its addition to the fuel to maximize the additive’s effectiveness.

The third thing a buyer should look at is the company’s Quality Assurance/Quality Control (QA/QC) process. A department that assures quality in the fuel you purchase is very important since biodiesel cannot be treated the same as regular diesel fuel. A company needs to have a comprehensive distribution program in place to ensure the fuel quality stays the same from production all the way thru to distribution and use. An example of this would be that Blue Sun always makes sure that any storage tank our fuel goes into, whether it is our tanks or downstream to one of our distributors, is tested and proven to be clean of any water or impurities.

Our experts at Blue Sun are always willing to discuss just how we get you the fuel you need, at the spec you need and at the quality you need for your downstream users. Call us anytime – 866-BIO-FUEL.

The lesson for fuel users can be seen in a likely parallel. The economics of electricity from coal are going to change. In order to meet regulations, coal plants will need to add hardware and processes to clean up their emissions. In a plausible, but near the margin scenario, coal could become so expensive that other technologies become superior from a financial perspective. Coal would be too dirty to use.

To conclude the analogy, replace “coal” with “petrodiesel”. The solution for dirty, soon-to-be more expensive petroleum diesel fuels are Blue Sun’s fuels, including their alternative-diesel fuel, FUSION™.

California’s Air Resources Board and their Low Carbon Fuels Standard bring this hypothetical analogy solidly into reality. Dirty fuel’s cost will increase, leaving those who don’t promptly make a change in the dust, at a competitive disadvantage, and in highly competitive areas, quickly out of business.

Are questions starting to surface in your mind, like, will this really happen? (Yes). How soon? (As early as 2011 in California). When will it hit my state or be a national policy? (2012 is a realistic estimate). How can I change? Now that is the right question.

By beginning to make the change now, rather than after regulation is in force, public and private fleets can minimize the cost of compliance and maximize their advantage over competitors. By being further along the learning curve and by taking advantage of media attention by changing fuels now, fleets can put that critical gap between themselves and the competition.

You may have heard the phrase “RFS-2” in the news recently. You may know that this is the “Renewable Fuels Standard” which started July 1, 2010. For many, however, beyond this point the details get lost in the government lingo and the 549 page document that details the regulation.

Hence, here is Blue Sun’s 60-second RFS overview and what it means to your fuel.

The RFS-2 is managed by the EPA and is the program to enact the directives of the Energy Policy Act of 2005. The standard requires that a specified percentage of all transportation fuels be alternative fuels.

What it does:
•    Establishes required volumes of alternative fuels (11.1B gallons total in 2009).

•    Defines 4 sub-types of alternative fuel (renewable fuel, advanced biofuel, biomass-based diesel, cellulosic biofuel) and requires these fuels to reduce Greenhouse Gas (GHG) by specific levels to qualify (20%, 50%, 50% and 60% respectively for the four fuel types listed above. 2005 baseline.)
•    Expands regulation to cover diesel and off-road fuel (in addition to on-road gasoline) when calculating base for required renewable fuel volumes.
•    The rule applies to “obligated parties” which are refiners, blenders and importers of transportation fuel, and specifies the percentage of their fuel production which must be alternative fuel.

What it means for your fuel:
•    More alternative fuel options will begin to be available for vehicles. These options are likely to require no modification of a vehicle’s engine to use the fuel. Blue Sun will be a part of developing these fuels.
•    Biodiesel is likely to be added to most retail diesel fuels. Similar to the approach with ethanol, biodiesel will likely be added in low percentages to every gallon of diesel.
•    Blue Sun FUSION fuel will remain a major alternative fuel for diesel vehicles for a long time. Only the feedstock that is used to make the fuel may change.

Blue Sun FUSION can help you meet RFS-2 requirements. If you want to run a true “renewable fuel” Blue Sun FUSION is your best option. FUSION reduces emissions while maintaining the performance you expect from your vehicle.

Blue Sun’s biodiesel fuels help obligated parties meet the “Biomass-based diesel” portion of the regulation. The EPA estimates that 700 million gallons of biodiesel will be used in 2010 to meet the requirements of the RFS-2.

In this federal regulation biodiesel is credited with a 50% greenhouse gas (GHG) reduction, qualifying soy-based biodiesel as a “biomass-based diesel”, one of the higher-rated categories in the RFS-2.
In addition to biomass-based diesel with a 50% GHG reduction, the other levels are advanced biofuel (50% GHG reduction), cellulosic biofuel (60%) and renewable fuel (20%).

The RFS-2 requires obligated parties, primarily oil refiners and importers, to produce a certain percentage of their total fuel production as these alternative fuels. In 2010 the total requirement is 1.15 billion gallons for biomass-based diesel, 0.95B for advanced biofuel, 0.0065B for cellulosic biofuel and 12.95B gallons for the renewable fuel category.

This means the biodiesel industry can potentially provide the lion’s share of a 1.15 billion gallon market. To put that in perspective, US consumption of biodiesel peaked in 2007 with 358 million gallons consumed (EIA, Short-Term Energy Outlook Supplement – April 2009). Fuel producers, the alternative fuel industry and investors are all up to their elbows in the 1000-page regulation, working to understand the new opportunities for alternative fuels. Blue Sun Energy is one company prepared for considerable growth.

“Between our connections in the fuels market, our reputation for quality in production and the quality control of our fuel in the supply chain, Blue Sun is in a great spot to move forward given this news from the EPA,” says Steve Bond of Blue Sun Energy.

Low Carbon Fuels Standard

Another potential boost to the biodiesel industry is the upcoming Low Carbon Fuel Standard (LCFS.) California’s late-April ‘09 adoption of the LCFS solidified new ways of looking at transportation fuels regulation. This is important because the LCFS is seen as a forerunner to U.S. policy and will soon affect every driver’s use of fuel, including you. Additionally, several other states have pledged to follow the LCFS in some way. The LCFS becomes active in 2011. Blue Sun will be there to help you meet LCFS standards.

Carbon Intensity Values
The LCFS requires a 0.25% reduction in 2011 climbing to a 10% reduction in carbon intensity by 2020 (2010 baseline). To help obligated parties (producers, blenders, importers) meet these goals a carbon intensity look up table has been created. Major fuel types and their carbon intensities are detailed in this lookup table within the LCFS regulation.

Ethanol from corn was hit particularly hard by these changes and is now comparable or even greater in carbon intensity (from 77 to 104gCO2e/MJ) than that of gasoline (~96gCO2e/MJ). California may have the power to hold the line on this determination. Nationally, however, the corn lobby and senators from corn-producing states are strong enough to potentially defeat ILUC (Indirect Land Use Change) provisions in the national policy. Blue Sun FUSION is in a much better place, with very much lower carbon intensity at 26.9 gCO2e/MJ.

What this means is that Blue Sun FUSION continues to be a major alternative fuel to help you meet coming mandates. Whether you’re directly regulated or an end user of fuel, Blue Sun’s fuels will be a solution for low-emissions transportation fuel.

Will using biodiesel harm my engine?  There are plenty of myths about biodiesel going around and we would like to help clear them up.  Many consumers remain skeptical about running biodiesel in their diesel engine for fear that it will have negative effects. Rest assured biodiesel is safe for your engine.   Below are 5 common misconceptions about biodiesel and the truth behind these myths.

Myth # 1: Biodiesel is not good for your engine and will cause filters to plug.

Fact:  Biodiesel can actually extend the life of your engine.  Blue Sun biodiesel fuel adds significant lubricity which will reduce the wear of engine parts.  As far as fuel filters go, pure biodiesel (B100) is a good solvent, which may release deposits accumulated on tank walls and pipes from previous diesel fuel use.  When using high blends of biodiesel, the release of deposits may clog filters initially and precautions should be taken to replace fuel filters until the build-up is eliminated. Blue Sun goes a step further with the Blue Sun Guarantee.

Myth #2: Biodiesel does not perform well in cold weather.

Fact:  Biodiesel will gel in very cold temperatures, just as No. 2 diesel does. Although pure biodiesel (B100) is recommended to be used in temperatures above 40˚F, Blue Sun Fusion™ B20 with Winter DTX™ helps engines function down to -20˚F below zero, and more (not all biodiesel brands can do that).

Myth #3: Biodiesel and Straight Vegetable Oil are the same thing.

Fact:  Biodiesel is created through a chemical process called transesterfication.  This process is a reaction of the oil with an alcohol to remove the glycerin and converts oils and fats into fatty acid methyl esters (FAME). Running vegetable oil in your engine without conversion to biodiesel will lead to soot accumulation and deposits that may lead to power loss and engine failure.

Myth #4: You must convert your vehicle to run biodiesel.

Fact:  No conversion is required to run biodiesel in a diesel engine. It is a common misconception among diesel drivers. The misconception is often generated when people equate Straight Vegetable Oil (SVO) with pure biodiesel (B100.) Another source of misperception could have to do with natural rubber seals and hoses. High biodiesel blends can degrade natural rubber. However, all diesels after 1993 use a synthetic hosing (ex. Viton™, http://en.wikipedia.org/wiki/Viton), so no changes are required.

Myth #5:  Biodiesel has no minimum standards, you could be buying anything.

Fact:  The biodiesel industry has been active in setting standards for biodiesel since 1994 when the first biodiesel taskforce was formed within the American Society for Testing and Materials (ASTM).  Biodiesel has its own fuel standard, ASTM 6751 http://www.astm.org/SNEWS/ND_2008/D02E0_nd08.html  The National Biodiesel Board also set up the BQ-9000 quality certification program to create a nationally-recognized list of approved distributors.

Can the biodiesel industry survive without government regulation?  Arguments can be made for both sides. While some think that the industry needs to learn to survive on its own without regulation and tax incentives others would say that regulation is important to help get the US to energy independence and reduce the environmental impact of fuels.   Right now there are a few potential regulations that can and most likely will increase the demand for biodiesel.

The highly anticipated $1-a-gallon biodiesel federal tax credit was renewed just as of today, May 28. (EDIT: The bill is now in the Senate for debate – the next vote may occur September 14, 2010. Upon passing, the bill would need to return to the House for final approval).

The lapse of the credit as of December 31^st of last year had forced many biodiesel producers to scale back production due to a decrease in demand for biodiesel that cannot be competitively priced against ULSD.  The biodiesel tax incentive has helped achieve its goal of increasing the production and use of biodiesel in the U.S.  In 2004, when the incentive was initially enacted, the U.S. produced 25 million gallons.  In 2009, that number increased to 545 million gallons.  The bill calls for the tax credit to be retroactive to January 1, 2010 and will expire December 31, 2010. Many retail sites have discontinued the sale of biodiesel due to the decrease in production and increase in price. The passing of this tax credit will make it easier for retail sites to offer biodiesel at a competitive price again.

Many argue that the Renewable Fuels Standard, RFS-2, which is administered by the EPA is enough regulation to drive the adoption of alternative fuels. The RFS-2 requires obligated parties (primarily refiners) to sell alternative fuels as a certain percentage of their overall fuel sales. Obligated parties prove compliance with this regulation via credits known as “RINs” that they either generate by selling qualifying alternative fuels (like biodiesel), or by purchasing them on the RIN market. Biodiesel producers can generate income and/or reduce the price of biodiesel through the value they get in generating and selling these valuable RINs. The argument is that these RINs would increase in value without the $1 tax credit, making that credit redundant.

Another proposed bill that could have an effect on the biodiesel industry would be the Clean Energy Jobs & American Power Act.  An updated version of this Act or “Climate Bill” as it is more commonly known was introduced in May 2010.  The bill is an effort to limit climate-altering emissions, reduce oil imports and create millions of new energy-related jobs.  Introduced by Democrat Senator John Kerry and independent Senator Joe Lieberman the bill is having trouble gaining support from Republicans due in large part to the fact that jobs in the fossil fuel industry will be lost.  It is predicted, however, that these job losses would be offset by the new positions created for the biofuel and renewable energy fields.

To read the bill in its entirety you can visit: http://kerry.senate.gov/cleanenergyjobsandamericanpower/pdf/bill.pdf

The Low Carbon Fuel Standard (LCFS) in California has been gaining attention from the biodiesel industry since it was established in January 2007.  The LCFS was created to reduce vehicle greenhouse gas emissions, reduce our oil dependency and establish a market for cleaner fuels.  The LCFS will require fuel providers in California to ensure that the mix of fuel they sell into the California market meet, on average, a declining standard for GHG emissions.  By 2020, the LCFS will produce a 10 percent reduction in the carbon content of all passenger vehicle fuels sold in California, replace 20 percent of on-road fuel consumption with low-carbon fuels, reducing consumption and expand the size of the current renewable fuels market in California (already the largest in the nation) by 3 to 5 times. While this standard will only be regulated in California it may serve as a model for state, federal and international standards in the future.  LCFS currently remains on target to start in 2011.

The argument for regulation is to create home-grown alternative fuels to increase energy security and reduce environmental impacts, since the private market will not do so on its own. The argument against is to let the “free market” do it on its own, yet free market arguments have been somewhat hamstrung by the collapse of the housing bubble created by the free, unregulated market in the form of lightly regulated complex mortgage derivatives.

Either way, government regulation appears here to stay. Stay tuned to see what happens. 2010 should be a very interesting year…more on that later.

-Stefanie, for Blue Sun

In this federal regulation biodiesel is credited with a 50% greenhouse gas (GHG) reduction, qualifying soy-based biodiesel as a “biomass-based diesel”, one of the higher-rated categories in the RFS-2.
In addition to biomass-based diesel with a 50% GHG reduction, the other levels are advanced biofuel (50% GHG reduction), cellulosic biofuel (60%) and renewable fuel (20%).

The RFS-2 requires obligated parties, primarily oil refiners and importers, to produce a certain percentage of their total fuel production as these alternative fuels. In 2010 the total requirement is 1.15 billion gallons for biomass-based diesel, 0.95B for advanced biofuel, 0.0065B for cellulosic biofuel and 12.95B gallons for the renewable fuel category.
This means the biodiesel industry can potentially provide the lion’s share of a 1.15 billion gallon market. To put that in perspective, US consumption of biodiesel peaked in 2007 with 358 million gallons consumed (EIA, Short-Term Energy Outlook Supplement – April 2009).
Fuel producers, the alternative fuel industry and investors are all up to their elbows in the 1000-page regulation, working to understand the new opportunities for alternative fuels. Blue Sun Energy is one company prepared for considerable growth.

“Between our connections in the fuels market, our reputation for quality in production and the quality control of our fuel in the supply chain, Blue Sun is in a great spot to move forward given this news from the EPA,” says Steve Bond of Blue Sun Energy.

The EPA Administrator signed the rule on February 3rd and the EPA has submitted the rule for publication in the Federal Register.

School buses running conventional diesel are a source of harmful emissions like hydrocarbons, carbon monoxide and particulate matter. In fact, the air inside school buses has been shown to be worse than the air behind the bus.

180 days is the average number of school days in the U.S. That’s 360 trips per year. Each trip averages 38 minutes — that makes for over an hour of exposure to high pollutant levels per day. In a year that’s over 200 hours of exposure to harmful air!

School bus fleet administrators, bus drivers, parents, students, and anyone else exposed to diesel emissions may like to know just how easy it is to solve this problem and make going to school healthier for our children.

Fuels like Blue Sun FUSION 20 fuel can be run in any vehicle, any bus – starting tomorrow even!

Blue Sun’s FUSION lowers emissions of many harmful pollutants including carbon monoxide (-24% reduction), hydrocarbons (-29%), Particulates (-18%) and Nitrogen Oxides (-4%). (Source: National Renewable Energy Lab)

USA Today’s full report is available at:

http://content.usatoday.com/news/nation/environment/smokestack/index

The RFS-2 is the “Renewable Fuels Standard” and is managed by the EPA. It is the program to enact the directives of the Energy Policy Act of 2005. The standard requires that a specified percentage of all transportation fuels be alternative fuels. We are currently operating under RFS-1, with the RFS-2 waiting in its mandated comment period before its final approval.

What RFS-2 does:
• Establishes required volumes of alternative fuels (11.1B gallons total in 2009).
• Defines 4 sub-types of alternative fuel (renewable fuel, advanced biofuel, biomass-based diesel, cellulosic biofuel).
o Requires these fuels to reduce Greenhouse Gas (GHG) by specific levels to qualify (20%, 50%, 50% and 60% respectively for the four fuel types listed above. 2005 baseline.)
o Uses life-cycle emissions analysis to calculate GHG emission levels for each fuel.
o Includes Indirect Land Use Change (ILUC) effects in life-cycle calculation.
• Expands regulation to cover diesel and off-road fuel (in addition to on-road gasoline) when calculating base for required renewable fuel volumes.
• The rule applies to “obligated parties” which are refiners, blenders and importers of transportation fuel, and specifies the percentage of their fuel production which must be alternative fuel.

What it means for your fuel:
• More alternative fuel options will begin to be available for vehicles. These options are likely to require no modification of a vehicle’s engine to use the fuel. Blue Sun will be a part of developing these fuels.
• Blue Sun FUSION fuel will remain a major alternative fuel for diesel vehicles for a long time. Only the feedstock that is used to make the fuel may change.
• End users are in no way federally-mandated to use a specific fuel (though we highly recommend using Blue Sun Fusion).

The RFS-2 is not final yet – it is still in the public comment period that the EPA will use to craft the final version. Until that time the RFS-1 standard will apply.

Blue Sun FUSION can help you meet RFS-1 and RFS-2 requirements. If you want to run a true “renewable fuel” Blue Sun FUSION is your best option. FUSION reduces emissions while maintaining the performance you expect from your vehicle.

We hoped this helped your understanding of the Renewable Fuels Standard. If you want more detail now, download the EPA’s overview from http://www.epa.gov/OMS/renewablefuels/420f09023.pdf

Keep an eye out for our 60-second update on California’s Low Carbon Fuels Standard. The LCFS is the engine running the alternative fuels train right now.

For more about Blue Sun visit http://www.gobluesun.com

We’re excited about this grant because it is awarded through DARPA, the Defense Advanced Research Projects Agency. They do some really cool things, so being a part of a DARPA project is, well, cool.

Additionally, the lead group on this project is General Atomics. It’s great to work with them on an alternative energy project. This really shows the changes the world can achieve when motivated.

Our part is to develop new methods to harvest and extract the oil from the algae. This has been one of the economic barriers to making fuel from algae a reality. Blue Sun will also be helping commercialize and bring to market this new technology.

Why are algae such an interesting feedstock for biofuel? Algae yield 15 to 30 times more energy than standard crops, do not require the use of fresh water resources and can grow in marginal areas, including deserts. Algae absorb CO2 as part of their life cycle, making algae a carbon-neutral solution. Furthermore, algae represent a domestic energy source that increases energy security for the U.S.

The study will begin this spring and result in a commercially viable process to produce JP-8 from algae oil. The project is expected to be completed by June 2010.