BIODIESEL

February 6, 2009 by admin  
Filed under Buy-Smart Guides

Biodiesel refers to a non-petroleum-based diesel fuel consisting of long chain alkyl (methyl, propyl or ethyl) esters, made by transesterification of vegetable oil or animal fat (tallow), which can be used (alone, or blended with conventional petrodiesel) in unmodified diesel-engine vehicles.

Blends of biodiesel and conventional hydrocarbon-based diesel are products most commonly distributed for use in the retail diesel fuel marketplace.

It is common in the USA to see B99.9 because a federal tax credit is awarded to the first entity which blends petroleum diesel with pure biodiesel .

In-line mixing, two components arrive at tanker truck simultaneously.

On August 31, 1937, G. Chavanne of the University of Brussels (Belgium) was granted a patent for a ‘Procedure for the transformation of vegetable oils for their uses as fuels’

Biodiesel can be used in pure form (B100) or may be blended with petroleum diesel at any concentration in most modern diesel engines.

Biodiesel has different solvent properties than petrodiesel, and will degrade natural rubber gaskets and hoses in vehicles (mostly vehicles manufactured before 1992), although these tend to wear out naturally and most likely will have already been replaced with FKM, which is nonreactive to biodiesel.

As a result, fuel filters may become clogged with particulates if a quick transition to pure biodiesel is made.

Since the passage of the Energy Policy Act of 2005 biodiesel use has been increasing in the United States.

Fueling stations make biodiesel readily available to consumers across Europe, and increasingly in the USA and Canada.

In 2005, Chrysler (then part of DaimlerChrysler) released the Jeep Liberty CRD diesels from the factory into the American market with 5% biodiesel blends, indicating at least partial acceptance of biodiesel as an acceptable diesel fuel additive.

In 2007, DaimlerChrysler indicated intention to increase warranty coverage to 20% biodiesel blends if biofuel quality in the United States can be standardized.

Similarly, a train in eastern Washington will be running on a 25% biodiesel 75% petrodiesel blend during summer, purchasing fuel from a biodiesel producer seated along the railroad tracks.

The train will be powered by biodiesel made in part from Washington-grown canola.

The world’s first biofuel-powered commercial aircraft took off from London’s Heathrow Airport on February 24, 2008 and touched down in Amsterdam on a demonstration flight hailed as a first step towards “cleaner” flying.

Biodiesel can also be used as a heating fuel in domestic and commercial boilers, sometimes known as bioheat. Older furnaces may contain rubber parts that would be affected by biodiesel’s solvent properties, but can otherwise burn biodiesel without any conversion required.

Transesterification of a vegetable oil was conducted as early as 1853 by scientists E. Duffy and J. Patrick, many years before the first diesel engine became functional.

Rudolf Diesel demonstrated a Diesel engine running on peanut oil (at the request of the French government) built by the French Otto Company at the World Fair in Paris, France in 1900, where it received the Grand Prix (highest prize).

This engine stood as an example of Diesel’s vision because it was powered by peanut oil — a biofuel, though not biodiesel, since it was not transesterified.

During the 1920s, diesel engine manufacturers altered their engines to utilize the lower viscosity of petrodiesel (a fossil fuel), rather than vegetable oil (a biomass fuel). The petroleum industries were able to make inroads in fuel markets because their fuel was much cheaper to produce than the biomass alternatives.

Despite the widespread use of fossil petroleum-derived diesel fuels, interest in vegetable oils as fuels in internal combustion engines is reported in several countries during the 1920s and 1930’s and later during World War II. Belgium, France, Italy, the United Kingdom, Portugal, Germany, Brazil, Argentina, Japan and China have been reported to have tested and used vegetable oils as diesel fuels during this time.

On August 31, 1937, G. Chavanne of the University of Brussels (Belgium) was granted a patent for a “Procedure for the transformation of vegetable oils for their uses as fuels” (fr.

More recently, in 1977, Brazilian scientist Expedito Parente produced biodiesel using transesterification with ethanol, and again filed a patent for the same process.

Currently, Parente’s company Tecbio is working with Boeing and NASA to certify bioquerosene (bio-kerosene), another product produced and patented by the Brazilian scientist.

Research into the use of transesterified sunflower oil, and refining it to diesel fuel standards, was initiated in South Africa in 1979.

An Austrian company, Gaskoks, obtained the technology from the South African Agricultural Engineers; the company erected the first biodiesel pilot plant in November 1987, and the first industrial-scale plant in April 1989 (with a capacity of 30,000 tons of rapeseed per annum).

Throughout the 1990s, plants were opened in many European countries, including the Czech Republic, Germany and Sweden. France launched local production of biodiesel fuel (referred to as diester) from rapeseed oil, which is mixed into regular diesel fuel at a level of 5%, and into the diesel fuel used by some captive fleets (e.g.

In September 2005 Minnesota became the first U.S. state to mandate that all diesel fuel sold in the state contain part biodiesel, requiring a content of at least 2% biodiesel.

The calorific value of biodiesel is about 37.27 MJ/L.

This is 9% lower than regular Number 2 petrodiesel.

It has been claimed biodiesel gives better lubricity and more complete combustion thus increasing the engine energy output and partially compensating for the higher energy density of petrodiesel.

Biodiesel is a liquid which varies in color — between golden and dark brown — depending on the production feedstock.

Biodiesel has a density of ~ 0.88 g/cm3, less than that of water.

Biodiesel has a viscosity similar to petrodiesel, the current industry term for diesel produced from petroleum.

The cloud point, or temperature at which pure (B100) biodiesel starts to gel, varies significantly and depends upon the mix of esters and therefore the feedstock oil used to produce the biodiesel. For example, biodiesel produced from low erucic acid varieties of canola seed (RME) starts to gel at approximately ?10 °C (14 °F).

To permit the use of biodiesel without mixing and without the possibility of gelling at low temperatures, some people modify their vehicles with a second fuel tank for biodiesel in addition to the standard fuel tank. Alternately, a vehicle with two tanks is chosen.

Biodiesel may contain small but problematic quantities of water.

These molecules can act as an emulsifier, allowing water to mix with the biodiesel.

In addition, there may be water that is residual to processing or resulting from storage tank condensation.

Water reduces the heat of combustion of the bulk fuel.

Water causes corrosion of vital fuel system components: fuel pumps, injector pumps, fuel lines, etc.

Water & microbes cause the paper element filters in the system to fail (rot), which in turn results in premature failure of the fuel pump due to ingestion of large particles.

Water freezes to form ice crystals near 0 oC (32 oF).

Water accelerates the growth of microbe colonies, which can plug up a fuel system.

Additionally, water can cause pitting in the pistons on a diesel engine.

Previously, the amount of water contaminating biodiesel has been difficult to measure by taking samples, since water and oil separate.

Water contamination is also a potential problem when using certain chemical catalysts involved in the production process, substantially reducing catalytic efficiency of base (high pH) catalysts such as KOH.

Global biodiesel production reached 3.8 million tons in 2005.

In the United States, average retail (at the pump) prices, including Federal and state fuel taxes, of B2/B5 are lower than petroleum diesel by about 12 cents, and B20 blends are the same as petrodiesel.

B99 and B100 generally cost more than petrodiesel except where local governments provide a subsidy.

Biodiesel is commonly produced by the transesterification of the vegetable oil or animal fat feedstock.

Chemically, transesterified biodiesel comprises a mix of mono-alkyl esters of long chain fatty acids. The most common form uses methanol (converted to sodium methoxide) to produce methyl esters as it is the cheapest alcohol available, though ethanol can be used to produce an ethyl ester biodiesel and higher alcohols such as isopropanol and butanol have also been used.

A by-product of the transesterification process is the production of glycerol. For every 1 tonne of biodiesel that is manufactured, 100 kg of glycerol are produced.

Usually this crude glycerol has to be purified, typically by performing vacuum distillation.

Dow also plans to build a plant in China to make epichlorhydrin from glycerol.

Epichlorhydrin is a raw material for epoxy resins.

Biodiesel production capacity is growing rapidly, with an average annual growth rate from 2002-2006 of over 40%.

For the year 2006, the latest for which actual production figures could be obtained, total world biodiesel production was about 5-6 million tonnes, with 4.9 million tonnes processed in Europe (of which 2.7 million tonnes was from Germany) and most of the rest from the USA.

In 2007 production in Europe alone had risen to 5.7 million tonnes.

The capacity for 2008 in Europe totalled 16 million tonnes.

Total world production of vegetable oil for all purposes in 2005/06 was about 110 million tonnes, with about 34 million tonnes each of palm oil and soybean oil.

A variety of oils can be used to produce biodiesel.

Virgin oil feedstock; rapeseed and soybean oils are most commonly used, soybean oil alone accounting for about ninety percent of all fuel stocks in the US.

Many advocates suggest that waste vegetable oil is the best source of oil to produce biodiesel, but since the available supply is drastically less than the amount of petroleum-based fuel that is burned for transportation and home heating in the world, this local solution does not scale well.

Animal fats are a by-product of meat production. Although it would not be efficient to raise animals (or catch fish) simply for their fat, use of the by-product adds value to the livestock industry (hogs, cattle, poultry).

Similarly, some small-scale biodiesel factories use waste fish oil as feedstock.

Worldwide production of vegetable oil and animal fat is not sufficient to replace liquid fossil fuel use.

In the United States, estimated production of vegetable oil for all uses is about 11 million tonnes (24 billion pounds) and estimated production of animal fat is 5.3 million tonnes (12 billion pounds).

If the entire arable land area of the USA (470 million acres, or 1.9 million square kilometers) were devoted to biodiesel production from soy, this would just about provide the 160 million tonnes required (assuming an optimistic 98 GPa of biodiesel).

Given a more realistic yield of 36 tonnes/hectare (3834 GPa) the area required is about 152,000 square kilometers, or roughly equal to that of the state of Georgia or England and Wales.

Algae fuel yields have not yet been accurately determined, but DOE is reported as saying that algae yield 30 times more energy per acre than land crops such as soybeans.

Yields of 36 tonnes/hectare are considered practical by Ami Ben-Amotz of the Institute of Oceanography in Haifa, who has been farming Algae commercially for over 20 years.

The Jatropha plant has been cited as a high-yield source of biodiesel but yields are highly dependent on climatic and soil conditions.

It is grown in the Philippines, Mali and India, is drought-resistant, and can share space with other cash crops such as coffee, sugar, fruits and vegetables.

It is well-suited to semi-arid lands and can contribute to slow down desertification, according to its advocates.

According to a study written by Drs. Van Dyne and Raymer for the Tennessee Valley Authority, the average US farm consumes fuel at the rate of 82 litres per hectare (8.75 US gallons per acre) of land to produce one crop.

While this may compare unfavorably to solar cells combined with an electric drive train, biodiesel is less costly to deploy (solar cells cost approximately US$1,000 per square meter) and transport (electric vehicles require batteries which currently have a much lower energy density than liquid fuels).

However, these statistics by themselves are not enough to show whether such a change makes economic sense.

The debate over the energy balance of biodiesel is ongoing.

If using only traditional food plants, most such nations do not have sufficient arable land to produce biofuel for the nation’s vehicles.

In tropical regions, such as Malaysia and Indonesia, oil palm is being planted at a rapid pace to supply growing biodiesel demand in Europe and other markets.

The direct source of the energy content of biodiesel is solar energy captured by plants during photosynthesis.

When straw was left in the field, biodiesel production was strongly energy positive, yielding 1 GJ biodiesel for every 0.561 GJ of energy input (a yield/cost ratio of 1.78).

When straw was burned as fuel and oilseed rapemeal was used as a fertilizer, the yield/cost ratio for biodiesel production was even better (3.71).

Biodiesel is becoming of interest to companies interested in commercial scale production as well as the more usual home brew biodiesel user and the user of straight vegetable oil or waste vegetable oil in diesel engines.

One of the main drivers for adoption of biodiesel is energy security. This means that a nation’s dependence on oil is reduced, and substituted with use of locally available sources, such as coal, gas, or renewable sources.

The EU commission president, Jose Manuel Barroso, speaking at a recent EU biofuels conference, stressed that properly managed biofuels have the potential to reinforce the EU’s security of supply through diversification of energy sources.

Food quality vegetable oil has become so expensive there is no longer viability to use for fuel.

In some poor countries the rising price of vegetable oil is causing problems.

Others argue that the problem is more fundamental.

The law of supply and demand predicts that if fewer farmers are producing food the price of food will rise.

Biodiesel from sea algae would not necessarily displace terrestrial land currently used for food production and new algaculture jobs could be created.

There is ongoing research into finding more suitable crops and improving oil yield.

Specially bred mustard varieties can produce reasonably high oil yields and are very useful in crop rotation with cereals, and have the added benefit that the meal leftover after the oil has been pressed out can act as an effective and biodegradable pesticide.

The NFESC, with Santa Barbara-based Biodiesel Industries, Inc, is working to develop biodiesel technologies for the US navy and military, one of the largest diesel fuel users in the world.

A group of Spanish developers working for a company called Ecofasa just announced a new biofuel made up from trash.

From 1978 to 1996, the U.S. National Renewable Energy Laboratory experimented with using algae as a biodiesel source in the “Aquatic Species Program”.

A self-published article by Michael Briggs, at the UNH Biodiesel Group, offers estimates for the realistic replacement of all vehicular fuel with biodiesel by utilizing algae that have a natural oil content greater than 50%, which Briggs suggests can be grown on algae ponds at wastewater treatment plants.

This oil-rich algae can then be extracted from the system and processed into biodiesel, with the dried remainder further reprocessed to create ethanol.

The production of algae to harvest oil for biodiesel has not yet been undertaken on a commercial scale, but feasibility studies have been conducted to arrive at the above yield estimate.

A group at the Russian academy of Sciences in Moscow published a paper in September 2008, stating that they had could isolate large amounts of lipids from single-celled fungi and turn them into biodiesel in an economically efficient manner.

The recent discovery of a variant of the fungus Gliocladium roseum points toward the production of so-called myco-diesel from cellulose.

Researchers at the University of Nevada, Reno, have successfully produced biodiesel from oil derived from used coffee grounds. Their analysis of the used grounds showed a 10% to 15% oil content (by weight).

Virgin Trains launched in 2007 the first biodiesel train in the world. Richard Branson was at the unveiling for the first biodiesel train.

Small Cap Stocks - Should They Now Be Avoided?

February 5, 2009 by admin  
Filed under Buy-Smart Guides

The world’s stock markets have taken a hammering in 2008 with pretty much every single listed company seeing huge falls in their share price. Both large and small companies have been affected but smaller companies have been hit particularly hard and are looking really weak, so is it now worth buying shares in these companies or not?

Well my own personal view is that these smaller cap companies should be avoided, at least for now. There are very few buyers out there generally, and the investors that are buying are predominantly buying shares in solid profitable companies that are most likely to survive the impending recession and be in a strong position when the economy recovers.

While there are a few smaller companies that are doing well and likely to survive the credit crunch, they are definitely in the minority. Furthermore even the ones that are profitable are still largely out of favour with investors because at the moment people are looking for safe shares to invest in, and this generally means the largest and most established listed companies.

There are also real fundamental problems with these smaller companies that are a direct result of the credit crunch. The vast majority of these companies rely on credit to grow their businesses in a healthy economy, but in this weak economy when people have less money to spend, a lot of these businesses need credit just to survive. However as has been mentioned in the news on numerous occasions, the banks just aren’t lending money at the moment, which is a crippling blow for small businesses.

The secret to successful investing is to buy profitable companies at low prices and hold on to them for several years when you should hopefully see substantial gains. However at the moment you cannot be confident about any small cap companies because quite simply you do not know if they will still be in business in a few years time.

These are really tough times and smaller companies are finding it particularly difficult, so my own investing strategy is currently to ignore all small cap stocks and focus on the larger companies that have a long record of income growth and dividend growth. These companies are the ones best equipped to deal with the forthcoming recession.

Click here to learn about useful stock market tools and resources including Marketclub, the trading signals service, and ADVFN, one of the world’s leading financial websites.

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