Full Disclosure Finance

By Andrew

Happy Turkey Day yesterday to everyone in the US. I had the pleasure of watching my Packers beat up on the Lions. I can’t wait for the game against the Cowboys next week…Go Pack Go!!

Recently on Spike TV’s show Trucks I saw a very interesting segment on biodiesel fuel. They went through step-by-step how to actually make you own fuel. I’ve done some research online and decided it would be a good topic to write about on the site. Coincidentally Justin and I did a 4th year class engineering project on biodiesel. So why would I want talk about biodiesel on a personal finance and investing website? Well with oil approaching $100 a barrel and the national average gas price hovering around $3.10 per gallon ($1.07 per liter in Canada) every trip to the pump seems to get more painful. If you have, or are thinking of purchasing a diesel fueled car or truck, producing your own biodiesel might actually be a viable alternative to save you some serious coin. Plus as a bonus you will save the environment, stop global warming, terminate our dependence on foreign oil, and defeat terrorism. Well maybe not just you, but every bit helps.

Biodiesel is a renewable fuel made from vegetable or animal sources. It is renewable in that the production sources can be grown or produced year after year, unlike fossil fuels which of course are non-renewable. Biodiesel can be used in almost all conventional diesel fueled engines with little or no modifications. It can be used straight (typically called B100) or blended in any proportion with regular diesel fuel. Performance specifications are comparable to regular diesel fuel in terms of fuel efficiency, power output, and engine torque and running on biodiesel can actually extend your engine life because it is more lubricating than petroleum based diesel. Biodiesel is biodegradable and non-toxic, has the highest energy balance of any alternative fuel, and greatly reduces emissions compared to regular diesel (greenhouse gasses by 75-100%, sulfur by 100%, particulate matter by 40%). OK, so biodiesel is great right…but how can it save you money?

The coolest thing about biodiesel is that it can be made from USED vegetable oil. So you can actual run your car on the same oil that cooked the chicken wings and french fries you ate last night. Although you can purchase biodiesel from many gas stations around the country, it will cost you more than regular diesel fuel. If you want the big savings you’ve got to produce it yourself. Fortunately, with the right equipment, its quite easy and almost anyone can do it. The system that was used on Trucks was the FuelMeister II from Cascade Biodiesel. For just under $3000 you get everything you need to make your own high quality, washed biodiesel including detailed “how-to” instructions. The system can make 80 gallons per day with only 1/2 hour of hands-on time per 40 gallon batch. Anyone who saw the segment on Trucks can attest that the entire process seemed quite simple.

The only ingredients you need to manufacture biodiesel are used vegetable oil, household lye, and methanol. The used vegetable oil can be obtained from your local greasy restaurant. In most cases they will be happy to give you their used oil, since it saves them from having to dispose of it. The household lye can be found at any hardware store in the plumbing supplies section. Just make sure that its 100% pure, undiluted lye. The methanol has to 100% pure racing quality which can be found at many automotive racing supply stores. The total cost of the ingredients will run you about $0.70 per gallon. With the US national average for regular diesel at $3.41 per gallon, making your own homebrew translates into savings of $2.71 per gallon. You still need to shell out the initial $3000 for the equipment, but assuming you burn one 15 gallon tank of fuel per week, at the current prices you will completely recoup your investment in less than 1.5 years. If you typically burn more than 15 gallons per week or if you split the cost of the system with a diesel burning buddy, you’ll be in the black much quicker. Remember biodiesel can be used in any diesel burning engine so your homebrew isn’t limited to your car or truck only. Biodiesel can be used in generators, oil-fired home heating furnaces, tractors, motor homes (mom and dad) and anything else that runs on diesel.

If you combine the environmental and geopolitical benefits with the potential cost savings, I think that producing your own homebrew biodiesel can be a viable and rewarding option for anyone who currently relies heavily on petroleum diesel for their fueling needs. I would love to hear from anyone who has explored this option further or is currently making their own fuel. I’m sure that Justin will want to add his two cents to this post because I know that he is considering biodiesel as an option when he gets rid of the beauty that he’s driving right now.

If you want more information on biodiesel there are a lot of great resources on the net. Here are some of the links I came across while researching this post.

Freedom Fuel America is a great source of general information on biodiesel.

Grassolean.com is another good source of general information. Apparently Daryl Hannah (the chick from Kill Bill II who gets her eye plucked out by Uma Thurman in that wicked trailer fight scene) is a huge supporter of biodiesel and is affiliated with Grassolean.

The official site of the National Biodiesel Board is a great in-depth resource.

The Collaborative Biodiesel Tutorial is a great site geared towards helping the general public learn how to make biodiesel.