GreenGold shows the jatropha way

A little-known company GreenGold Ray Energies, Inc. (Other OTC:GRYE) issued a press release yesterday that its biodiesel refinery in Nasipit, Agusan del Norte should be opening within 90 days. The GRYE Processing and Refinery Plant which is capable of producing 680 million liters (180 million gallons) of biodiesel a year is designed to use jatropha oil as its feedstock.

To support its plant, GreenGold has been acquiring lands and growing jatropha plants in plantations in Mindanao and Marinduque and has forged supply agreements with local jatropha planters. It has also established a research and development center for jatropha in Cagayan de Oro City.

A model of GreenGold's biodiesel refinery

The investment is seen as a response to Republic Act 9367 or the Biofuels Act of 2006, which requires the use of biofuel blends of up to 10% on vehicle engines within four years. The Philippines is projected to need 150 million liters of biodiesel a year for the next few years to meet the Biofuels Act mandate.

While there are several biofuel plants in various stages of development in the country, the only other large-scale biofuel plant in operation is that of Chemrez Technologies Inc. (PSE: COAT) which uses coconut oil as feedstock. It has a capacity of only a third of GreenGold’s refinery.

Jatropha (Jatropha curcas) has been touted as a viable biodiesel plant since it grows almost anywhere, even on marginal lands. Proponents have endorsed it since the oil is inedible, and should be exempt from the food for fuel controversy.

However, agronomists from the UP Los Baños have shown a few years back that jatropha that grows on marginal lands cannot yield commercially-viable biodiesel, and the only way to increase the yield is to grow it as if it were like any other agricultural crop: fertile land, irrigation and use of fertilizers.

The government, through the PNOC Alternative Fuels Corporation has an ongoing jatropha initiative although it has not yet entered into the commercial phase.

Jatropha as biodiesel

Among the advantages of jatropha crude oil over fossil diesel cited by GreenGold engineers are: (1) it is biodegradable; (2) has higher flash point than petrodiesel ; (3) emits less carbon dioxide;  and (4) can be used alone or mixed with other fuels for vehicle use.

The disadvantages cited are: (1) it is more expensive than petrodiesel; (2) less suitable in cold weather because it may form a gel; and (3) tends to reduce fuel economy on vehicles running using pure biodiesel.

The potential of jatropha as a viable fule was recently demonstrated when Air New Zealand used a 50/50 mix of jatropha oil and jet fuel is a successful test flight. Last month, Houston-based Continental Airlines tested jatropha fuel on one of its jetliners.

If anything, GreenGold is trying to show that the jatropha plant can be made viable as a source biodiesel if grown scientifically and provided with proper requirements just like any other agricultural crop—and not just letting it grow on marginal lands as the government planners originally proposed.

DOE proposes to raise the biodiesel blend to 3%

Over the weekend, Department of Energy (DOE) director Mario Marasigan announced that his agency may propose to increase the minimum required biodiesel blend to 3% by February 2009 to spur investors to pour in more money to the sector.

 He revealed that there are now 13 accredited biodiesel manufacturers capable of producing up to 326 million liters which is more than what the 2% blend requires.

 “The DOE is studying that with this capacity in place, is it appropriate, rather than two percent mandated blend on February 2009, why don’t we increase it to three percent?,” he said.

 Why not? If the blend is indeed that friendly to the environment and it can compete with the usual diesel, why not make it to 5%. Studies suggest that a blend of 6 to 10% works very well with light cars and vehicles, and other countries are mulling to use up to 20% blend (B20) for large buses. In fact many countries start with a mandated 5% blend (B5) and gradually increasing it to B20. A 2% blend is just too dilute to effectively feel a difference in performance, and its avowed benefit may be hardly felt.

But what we, users, must guard against is substandard fuel introduced into the market by unscrupulous individuals or firms out to make a quick buck. True, the DOE has released its adopted biodiesel standards which is, on paper, quite stringent and appears to have been patterned after the European standards. What is uncertain though is whether the DOE has the know-how or the capability to scientifically monitor the blend already on the market.

We mean the technical capability to verify whether these biodiesel blends passed the technical requirements such as fatty acid content, cetane rating, sulfur limits, heavy metals content and the like. Corollary to this is the question whether there are laboratories which can independently check the quality.

These are not routine inquiries, for what is at stake is the integrity of one’s vehicles, not mentioning the projected impact to the environment.

 There is also a need for more public discussions on the DOE standards. The consumers need to be clarified whether the standards apply to the diluted blend or to the pure biodiesel (B100) which is the starting material for blending.

 As far as I could tell, we are the first and possibly only country to have specified a coco-methyl ester (CME) standard rather than the usual fatty acid methyl ester (FAME) or fatty acid alkyl ester (FAAE) standards. Its formulation smacks of political undertones or lobbying from CME manufacturers in attempts to exclude other biodiesel sources.

 There is nothing wrong with protecting our own native coconut industry. The Malaysians have done it with their palm oil and the Americans with their soya oil. What is objectionable though is a protectionist policy that stretches beyond the boundaries of technology to favor certain interests to the ultimate detriment to the consumers whose choice becomes limited.

 This outlook apparently crept into the formulation of the cetane rating in which the DOE standard pegs it at 55. The cetane rating measures the relative amounts of easily burnt component in a fuel; in this case the molecular weights of fatty esters. The higher the cetane rating, the better the fuel.

 Scientifically, though, the standard vehicle engines work very well with cetane ratings for 46 to 55. This is the reason why the U.S. ASTM standards pegs the cetane rating to only 47—which the soya oil, a major U.S. crop product for biodiesel,  passes easily—while some European countries put the minimum at 51. Incidentally, DOE claims that CME has a higher cetane rating than soya or palm oil.

 The danger is, such exclusive provisions can be twisted to suit one’s selfish interests and mislead the public. For example, a leading CME manufacturer listed at the Philippine Stock Exchange made it appear that only biodiesel conforming to the CME standards are allowed in the market citing the DOE's revised circular that “only CME conforming to PNS/DOE QS 002:2007 shall be manufactured, sold, offered for sale, dispensed or introduced into commerce as biodiesel in the Philippines.” Apparently the manufacturer’s announcement was in reaction to reports that some firms are importing biodiesel which is not CME-based from Korea and other places, and is trying to protect its turf.

 The mandate to use the biodiesel blend in accordance with Republic Act 9367, otherwise known as the Biofuels Act, starts in February 2009. There is still time to conduct public discussions in media to educate the consumers on the pros and cons of biodiesel, and on how they could be protected from unscrupulous dealers.