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The Soap & Detergent Association sponsors an annual $3,000 prize for research into new applications for glycerin. Thanks to a new U.S. law that threatens to create an oversupply of this oleochemical, companies that make it are praying for a really good winner this year. The American Jobs Creation Act of 2004, signed into law by President George W. Bush on Jan. 1, would not seem to be of much concern to the oleochemical industry. But part of the massive bill is a new tax incentive for using the alternative fuel known as biodiesel. Biodiesel is a diesel fuel produced by combining vegetable oils or animal fats with methanol in a transesterification reaction that yields a fatty acid methyl ester, known as biodiesel, and glycerin. About three-quarters of a pound of glycerin is produced for every gallon of biodiesel made. Last year, according to the National Biodiesel Board (NBB), the industry's trade association, the U.S. produced about 30 million gal of biodiesel, primarily for customers like universities and the U.S. military that operate large diesel vehicle fleets. A blend of 80% diesel and 20% biodiesel can be used in conventional diesel engines without modification, proponents say. The incentive included in the jobs bill is a two-year federal excise tax credit that will trim 20 cents off the price of a gallon of the blend, bringing it close in cost to straight diesel. NBB and its lobbying partner, the American Soybean Association, cite a Department of Agriculture prediction that the incentive will help boost biodiesel demand to at least 125 million gal in the next few years. |
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