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U.S Biodiesel Market Projections are compiled from market estimates based in part on independent consulting firms, the U.S. Department of Energy (DOE) and other sources which are in part dependent on favorable legislation. View chart

America's energy sources are changing. Gone are the days of endless petroleum importing and gas-guzzling. Today, our government is more committed than ever to increasing the use of renewable fuels-including biodiesel-in place of costly, imported fossil fuels.

National Renewable Energy Laboratories Estimates
The National Renewable Energy Laboratory, which studies the technology and market potential of alternative fuels, estimates the total market potential of biodiesel -- using current technology and agricultural capacity -- to be 1.5 billion gallons. A biodiesel market at this level could replace 10% of current on-road U.S. diesel consumption.Currently we are consuming an estimated 20 million gallons of biodiesel per year. NREL researchers believe they can get the total biodiesel market up to four billion gallons, with the advent of new technologies and biodiesel-based products.

Federal Legislation

During the past few years Congress has passed several pieces of legislation favorable to biodiesel incluing the Energy Policy Act of 1992 (EPAct) and the new Farm Bill. The EPAct mandates that all companies, with 50+ vehicles, 8,500 pounds or heavier, convert 30% of their fleets to alternative fuel vehicles (AFV) by 2010. The Farm Bill, signed into law in early 2002, helps the biodiesel industry by extending the USDA's bio-energy program. The USDA¹s bio-energy program offers financial credits to producers, stimulating increased production of biodiesel nationwide. Biodiesel gained substantially more ground in 1998 when Congress amended EPAct to include using B20 (20% biodiesel, 80% petroleum diesel) in a diesel engine as an AFV. Biodiesel is also the first alternative fuel in the U.S. to successfully complete the EPA¹s strict Tier I and Tier II Health Effects testing under the Clean Air Act. What¹s more: converting to B20 is 60-90% less expensive than converting to other AFVs. With such enormous savings, it¹s no wonder biodiesel is one of the fastest growing alternative fuels in America.

Additionally, the EPA calls for petroleum refiners to reduce sulfur (a lubricant) in diesel fuel by 97% by 2006. This means refiners will need a lubricating ingredient to replace the sulfur in diesel fuel. Fortunately, biodiesel offers a natural, cost-effective solution. In fact, blending just 1% of biodiesel with diesel fuel increases lubricity by up to 65%.

And the legislative action does not stop at the federal level. In more than 15 states lawmakers have recognized the importance of renewable fuels to America¹s economic health, national security and environmental sustainability. Additional legislation is pending in many more states across the country.

European biodiesel growth
European sales of biodiesel will grow 25% per year, to $2.4 billion by 2007, according to a report by Frost & Sullivan (London). The growth is driven by EU directives allowing member states to introduce tax advantages for biodiesel use.

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