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Minnesota Poised to Play a Role in Next-Generation Heating Oil

Biodiesel Magazine

August 21, 2015

By the Minnesota Soybean Research and Promotion Council

While the leaves on the trees have yet to turn color, and the cold blast of winter remains a distant memory to some, the change of seasons could yield new economic opportunities for Minnesota’s biodiesel industry.

At a forum sponsored by the Minnesota Soybean Research and Promotion Council, attendees listened as a diverse group of energy influencers described Bioheat, a blend of biodiesel and heating oil, as a 21st century heating oil that promises to increase the diversity of the U.S. energy supply. In the soybean fields of Minnesota, farmers are growing that diversity.

“Biodiesel has earned its stripes as a transportation fuel,” said Tom Slunecka, CEO of the Minnesota Soybean Research and Promotion Council. “The heating oil market represents an exciting opportunity for Minnesota to continue its role as a leader in renewable energy.”

New markets and uses for biodiesel offer significant potential for U.S. soybean farmers and the entire biodiesel industry. Within the biodiesel market, soybean oil has a 50 percent share. Heating oil is well established in many of the New England states such as Maine, Vermont and New Hampshire as heating oil has traditionally provided an economical way to meet the heating needs of homes, multifamily dwellings, and small businesses. A homeowner can use 1,000 gallons over the season. Bioheat has positive environmental attributes. According to a report released by the National Oilheat Research Alliance, biodiesel blends at 20 percent (B20) with ultra-low sulfur heating oil are lower in greenhouse gas emissions (GHG) than natural gas when evaluated over 100 years, while blends of 2 percent (B2) or more are lower in GHG than natural gas when evaluated over 20 years.  

The report also found that biodiesel blended at 5 percent would require approximately 300 MMgy. Assuming the biodiesel industry average of 50 MMgy per plant, Bioheat would be responsible for six plants built and continuously operated. Thus, nearly 270 full time jobs can be directly attributed to Bioheat.

“Biodiesel blending into home heating oil has proven to be a winner,” said Paul Nazzaro, CEO of the Nazzaro Group and advisor to the National Biodiesel Board. “With a decade of technical and market positioning on the record, continued support from biodiesel stakeholders like Minnesota Soybean will be imperative to keep this momentum intact to ensure biodiesel producers have a healthy and growing market to move their production allocations long term.”

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