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DEVELOPMENT OF BIODIESELS: CURRENT SCENARIO

INTRODUCTION
Fuels are inevitable for industrial development and growth of any country. The life span of fossil
fuel resources has always been terrifying. Biodiesel, a renewable source of energy seems to be an
ideal solution for global energy demands including India as well. The current review is addressed
to various aspects of biodiesel production. Biodiesel, a derivative from plant oils or animal fats,
has gained widespread acceptance in recent years as a sustainable alternative fuel to petroleum
diesel due to its environmental benefits and renewability. Although there are several different
ways in which biodiesel can be used or formulated as a fuel such as direct blending,
microemulsions and thermal cracking, the most widespread remains the alkyl esters of fatty acids
obtained through transesterification of the oils or fats. In transesterification, triglycerides which
are the main chemical in oils or fats are converted into esters through reaction with simple
alcohols. The physical and chemical properties of the esters thus obtained are very similar to
those of the petroleum diesel.

In the context of shrinking crude oil reserves, rising demand and the resultant rise in prices of
petroleum, as well as the concerns about global climate change and energy security, bioenergy is
becoming increasingly relevant as a possible and potential alternative to fossil fuels. Bio-fuels
are liquid or gaseous fuels produced from biomass resources and used in place of, or in addition
to diesel, petrol or other fossil fuels for transport, stationary, portable and other applications.
Biofuels are derived from renewable bio-mass resources and, therefore, provide a strategic
advantage to promote sustainable development and to supplement conventional energy sources
in meeting the rapidly increasing requirements for transportation fuels associated with high
economic growth, as well as in meeting the energy needs of India‟s vast rural population.

For a developing nation like India, the current energy portfolio is dominated by fossil fuels such
as oil, coal, and petroleum products. Due to the rapid depletion and limited available resources,
the price of fossil fuel increases. Also, fossil fuel induces climate change, environmental
pollution, and rising global temperature. There is urgent need to shift from conventional energy
to renewable energy source for sustainable and economic growth and to enhance a country’s
energy security. Biofuel offers an attractive source of energy for the substitution of fossil fuels,
and looking at the huge demand for diesel in all sectors of the economy, the biodiesel is being
viewed as the best substitute for diesel. The other advantage for biofuel promotion in India is
climate change mitigation through reduced greenhouse gas (GHG) emission.

(i) First generation biofuels: First generation biofuels are made from biomass consisting
of sugars, starch, vegetable oils, animal starch or biodegradable output wastes from
agriculture, industry, forestry and households using conventional technologies. Bio-
diesel and bio-ethanol comes under first generation bio-fuels.
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(ii) Second generation biofuels: Second generation biofuel technologies are gaining
importance because first generation biofuels manufacture has got major limitations.
The primary one is that, they cannot be produced beyond a threshold level without
threatening food security. They are also not cost-competitive with existing fossil
fuels. The second generation fuels are more sustainable, affordable and have greater
environmental benefits. However,they have not become popular because the
technology for producing these is not yet standardized. Further;Lignocellulosic
materials can be converted to alcohol.Organic waste material converted into energy
forms which can be used as an automotive fuel: waste oil (e g, cooking oil) into
biodiesel; animal manure and organic household wastes into biogas; and special
strains of algae, agricultural and forestry-waste products into ethanol. It also helps to
diminish waste management problems.
(iii) Third and Fourth generation bio-fuels: The third generation biofuels include Algal
biodiesel, Algal hydrogen and conversion of biomass to hydrogen whereas the fourth
generation biofuels include biofuels from high solar efficiency cultivations.
However, these are still at a nascent stage. Biofuels offer a number of environmental,
social and economic advantages. The use of biofuels may lead to reduction in
vehicular pollution and greenhouse gas emissions as it is established that the
emission of sulphur dioxide (SO2), particulate matter and carbon monoxide (CO),
etc. are less from biofuels .The economic and social benefits arising out of the
development of biofuel sector through increased income and employment
opportunities for the rural communities is also highlighted. The greening of
wastelands and regeneration of degraded forest lands through cultivation of biofuel
crops is another added advantage

COMPARISION OF BIODIESELS TO OTHER FUELS:

Biodiesel has advantages over corn-starch ethanol because:

(1) it is an advanced biofuel and can play a role in helping to meet government-
mandated levels of advanced biofuels blending, and
(2) it does not have a precise blend wall, although there has been some talk by users
that 10% biodiesel and 90% conventional diesel fuel may be a realistic upper limit on
the market for now.
A disadvantage of biodiesel is that its production cost per gallon has been relatively
high when compared to conventional diesel fuel. To help make it competitive and
feasible to blend with diesel fuel, it has had a $1.00 per gallon tax credit.

Conversion Technologies
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Transesterification (alcoholysis), most widely accepted and almost exclusively used technology
for the conversion of natural fats and oils to biodiesel, is the reaction of a fat or oil with an
alcohol to form esters and glycerol. Fat or oil will depend on what is available in the region of
the biodiesel production facility, their respective prices and the flexibility of processing facility
to handle multiple feedstocks. Alcohol is methanol because it is low cost, easily recyclable and
toxic. Because the reaction is reversible3, excess alcohol is used to shift the equilibrium to the
products side. Typical mole ratios of alcohol to triglycerides range from 5.25:1 to 6.1:1. A
catalyst is usually used to improve the rate of reaction and yield. The amount (0.1-0.5 % v/v) and
type (base vs acid) of catalyst used depends on the quality [free fatty acid (FFA) and moisture] of
triglycerides.

Even though conversion efficiencies are good with conventional transesterification and feedstock
costs represent 65 to 75 percent of the cost of producing biodiesel, there are significant research
interests in improving the process and thereby the economics of biodiesel production. These
interests include the development and evaluation of heterogeneous catalyst systems, the use of
ethanol, in situ transesterification, reducing NOx emissions, and adding value to the coproducts
(oilseed meals/presscakes and glycerol). Additionally, efforts in the area of standardization of
biodiesel will enhance its marketability. Heterogeneous catalyst systems have major advantages
over the homogeneous catalysts currently used in biodiesel production. The use of heterogeneous
catalysts will eliminate the need for a water wash to remove excess catalyst. This will reduce
both the capital cost of a plant and the operating cost. It also is perceived that FFAs present in
feedstocks, particularly in yellow and brown greases, could be converted concurrently to alcohol
esters rather than being separated out and used for some other, lower value purpose. Yet another
potential advantage is that a higher quality glycerol may be obtained.

BIODIESEL PROFITABILITY
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When compared with other motor fuels, biodiesel has a relatively short history dating back only
to the mid-2000s. Figure shows its estimated profitability in recent years, as well as total costs
and total revenue for typical plants using soybean oil as a feedstock. Soybean oil is the most
common feedstock for biodiesel although corn oil, animal fats, and small amounts of oil from
minor oilseeds also are used. Costs and profitability vary somewhat, depending on which
feedstocks are used in its production.

Feedstock costs are the largest expense of producing biodiesel, by a wide margin. Soybean oil
feedstock costs declined from a monthly average of $4.26 per gallon in April 2011 to $2.97 per
gallon in November 2012. The reduced cost resulted from a decline in the soybean oil price
from $0.56 per pound in April 2011 to $0.39 per pound in November 2013. From mid-November
to late January, soybean oil prices declined by an additional 5% to 6%, further reducing the cost
of biodiesel production. Soybean prices declined by a much smaller amount during the same
period because of increased demand for soybean meal. Strong protein meal demand allowed
soybean meal to carry a higher portion of the value of soybeans than in a number of previous
years.

U.S. Biodiesel Production Trend

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The decline in production in 2012 reflected a combination of the industry’s temporary loss of the
biodiesel blenders’ tax credit and high feedstock costs. Production increased sharply in 2013
with reinstatement of the blenders’ tax credit and a 28% increase in the Environmental Protection
Agency (EPA) mandated volume of biodiesel to be blended in the nation’s diesel fuel supply.
Production in July through October of 2013 continued to set record levels, with the industry
operating at approximately 72% of monthly capacity. We calculated an approximate monthly
capacity by dividing EIA’s estimated annual capacity by 12 months. In the USA, both vegetable
oils and animal fats are imported and exported. If biodiesel demand exceeds the estimated
demand benchmark of 450 to 900 thousand tons, domestic to foreign fat and oil spreads would
widen and exports would decrease, imports would increase or both. Some USA based
econometrics were used to predict price impacts from a demand shock.

BIODIESEL AND BIOETHANOL : INDIA‟S CURIOUS CASE

India’s biofuel production accounts for only 1% of the global production. This includes 380
million litres of fuel ethanol and 45 million litres of biodiesel. It is worth noticing that India is
the second largest producer of sugarcane in the world but accounts for only about 1% of global
ethanol production. This can be attributed to the fact that 70-80% of the cane produced in the
country is utilized for production of sugar and the remaining 20-30 % for alternate sweeteners
like jaggery and khandsari. Ethanol is produced from fermentation of molasses which is a by-
product in the manufacture of sugar from sugarcane. It is estimated that, out of one tonne of
sugarcane, 85-100 kg of sugar and 40 kg of molasses can be recovered. The processing industry
experience periodic market gluts of sugarcane, sugar and molasses due to cyclical nature of
sugarcane and sugar production in India. Out of the total alcohol produced, 25% is being used for
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industrial purposes, 30-35% is used for potable purposes and 3-4% for other uses. The surplus
available alcohol is being diverted for fuel.

The above figure represents the amount of ethanol production by countries in 2008.
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India is not self-sufficient in edible oil production and depends upon large quantities of import of
palm oil and other vegetable oils to meet the domestic demand. So India does not use vegetable
oils derived from rapeseed, mustard or palm oil for production of biodiesel. Biodiesel in India is
mostly produced from oils extracted from non-edible seeds ofshrubs like jatropha and pongamia.
But the cultivation practices are not backed by adequate research. Cultivation of jatropha and
pongamia needs intercropping standard spacing of 2 x 2 m irrespective of soil conditions. They
also require proper irrigation for better fruiting and seeding. High production cost and
overemphasis on one feed-stock also contributes to low production of biodiesel in India. Getting
adequate quantity of wastelands is difficult because of its impact on forest conservation.

DEVELOPMENTS UNDER THE BIOFUEL POLICY

The Government of India approved the “National Policy of Biofuels” on December 24, 2009.
Since then, considerable advancements have taken place in the direction of cultivation,
production and use of biofuels. The policy and the developments following it have strengthened
India’s energy security by encouraging the use of renewable energy resources to supplement
transport fuels. It has stimulated rural development and has also created employment
opportunities. It has addressed the global concern about containment of carbon emission through
use of environmentally friendly biofuels. Biofuels is derived from non-feed stock that is being
raised on degraded land or wasteland that are not suited to agriculture. This has avoided a
possible conflict of fuel verses food security. The policy has also facilitated and brought about
the development and utilization of indigenous feedstock for production of biofuels. Minimum
Support Price (MSP) has ensured a fair price for biodiesel oil-seed growers.

Oil marketing companies purchase bioethanol at Minimum Purchase Price (MPP) based on
actual cost of production and import price of bioethanol. In the case of biodiesel, MPP is linked
to prevailing retail diesel price. National Biofuel Fund provides financial incentives, including
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subsidies and grants, for new and second generation feed stocks, advanced technologies and
conversion processes and production units.Except for concessional excise duty of 16 percent on
bioethanol, no other central taxes and duties are levied /imposed on biodiesel and bioethanol.

Biodiesel technologies and projects are allowed 100 percent foreign equity through automatic
approval routes to attract Foreign Direct Investments (FDI), provided biofuels is for domestic use
only, and not for export. The Prime Minister is the head of the National Biofuels Coordination
Committee (NBCC).Some development works have been carried out with regards to the
production of trans esterified non-edible oil and its use in biodiesel by units such as Indian
Institute of Science, Bengaluru and Tamil Nadu. Generally a blend of 5% to 20% of biodiesel
(B5 to B2) is used in India. Indian Oil Corporation (IOC) has taken up research and development
work to establish the parameters of the production of trans-esterified Jatropha vegetable oil &
use of biodiesel in its research and development center at Faridabad.

The Indian Railways has started to use the oil (blended with diesel fuel in various ratios) from
the Jatropha plant to power its diesel engines with great success. Currently the diesel
locomotives that run from Thanjavur to Nagore section and Tiruchirapalli to Lalgudi, Dindigul
and Karur sections run on a blend of Jatropha and diesel oil. In one of the biggest initiatives for
bio-fuel production in the country, Indian Railways is poised to set up four bio-diesel plants
costing about Rs. 120 crore. While two bio-diesel esterification plants are going to be
commissioned at Raipur and Chennai during the next two years, the other two units will be set up
subsequently. Each plant, estimated to cost around Rs 30 crore, will produce 30 tons bio-diesel
per day, which means more than 9,000 tons a year.

Future Prospects
Future raw material availability for biodiesel production, worldwide, is significant. Additional
sources include expanded oilseed production, higher oil content varieties, and substitution of
higher oil content crops. In the USA, it is estimated that roughly expanding oilseed production
by releasing productive land currently in government set aside programs 4 million ha and
switching from lower value small export grains, 8 million ha could produce additional vegetable
oil feedstocks of 2.1 million and 4.2 million tons. If the average oil yield from soybeans would
improve to 20 percent versus the current 18 percent, which has been proven with several
improved varieties, an additional 800 thousand tons of vegetable oil would be available, or if
future improvements could increase oil yields to an average of 22 percent oil, 1.60 million tons
would be available. If oil demand outpaces protein demand, soybean production could be
replaced with higher yielding oil crops such as sunflower and canola, which produce approx 100
l/ha more oil than soybeans. Assuming soybean production at 29 million ha12 and a 20 percent
conversion to higher yielding oil crops an additional 2.6 million tons would be available.
Overall, conversion of all existing and potential feedstocks in the USA will not generate more
than 12 percent of the diesel demand. Therefore, biodiesel will be consumed primarily in niche
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markets: 20% biodiesel blends for emission benefits and 5% or less blends as a fuel additive for
lubricity benefits in ultra low sulfur diesel fuel.

It is anticipated that biodiesel will drive the industrial applications for vegetable oils and animal
fats but will not displace food applications which will continue to lead vegetable oil price for
most desirable oils, while lower grade oils will become industrial feedstock. Conversion
technologies will continue to improve and will allow biodiesel production to remain competitive
as government incentives are phased out.