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Robert
2nd May 2006, 12:46 AM
OK, here goes a long post.

I suspect that most of the biodiesel industry will not participate in here as many of them see the home producer as a threat and they see a forum that includes a “making biodiesel” section as something to be avoided. This is indeed a shame, as while many of you do make your own biodiesel, there are more in here that would prefer to simply be able to buy it and the industry is remiss for not making it more available. If it were more available, they would not have as many home producers to worry about.

Either way, open discussion about biodiesel will not hurt anyone and I'm sure that members of the industry could in fact aid their standing and reputations by contributing in here to show their consumers that they care (as some of them already do).
I believe that we forum users are quite a powerful consumer lobby and eventually, the industry might start to open up and treat biodiesel in Australia as less of a secret.

This post is to preface the next I will make in this thread, as I feel many of you will need to understand the background of this industry to understand why it behaves the way it does (particularly to the home producer, who many industry members see as their natural enemy).

The Biodiesel Association of Australia, or BAA (www.biodiesel.org.au) has been the body that has claimed to represent biodiesel in Australia for many years now. Many people in the Biodiesel game (home producers, industry members and many biodiesel wannabe consumers – such as myself) have had bad experiences with them in the past. There are many in this forum who will have many bad things to say about them (that is their right, it is an open, public forum and as long as it does not get personal or defamatory, I’ll allow it). I also turned to the BAA for help a couple of years back and was annoyed that I had to pay a membership in order to get what I felt should be made publicly available. In fact, to make matters worse, when I did try to pay membership, my card was never debited and all my attempts to contact the BAA were completely ignored (in hindsight, probably a good thing). This was what spurred me on to create the Sydney Biodiesel Users Group (http://www.sydneybiodiesel.com/) and also this site, as I felt that there was a strong need for this information to be made free and public and for like minded people to be able to find each other. I'm glad that you all have since proved me right, as these sites are now attracting loads of traffic. I’ll continue to keep them running and I will not charge anyone for it.

Anyway, prior to 2003, the BAA used to be active. There were many acrimonious splits within the organisation, which we won’t go into here. However, there was a time when the BAA did represent Biodiesel in Australia in some form. Since 2003 the scene changed a little. Tax regulations were introduced, which effectively outlawed any small scale production of biodiesel, while commercial scale production would still be possible. There were also elements of the organisation which became commercial, many saying that this was a conflict of interest for an organisation.
The home producers buried themselves deep underground, as could be expected and no one really knew whether the BAA represented commercial industry, the home producer, or the consumer. In fact since 2003, they took no new memberships and as far as it looked to me “slept”. There were complaints from some members who saw nothing happening for their membership fees.

However, last year, new life seemed to be happening. I’m not sure whether I just started to notice it purely because I was now running these sites, or because things really were happening. After years of frustration with being ignored and not being able to get any real information, I was suddenly being invited to attend biodiesel functions. I had to be very careful to distance myself from much of the bad blood that seemed to exist with the BAA and I was careful not to tarnish myself by association. I had some discussions with the BAA about how I could objectively offer people stuff for free that they were charging memberships for and not be a natural enemy to them. They did not seem too concerned and it became clear to me that they were not really seeking memberships from people like myself anyway and we would not conflict. Next was my belief that they were not really doing anything, which was a belief shared by many. It seems that actually things have been happening, just not transparently or publicly, which I have a problem with, but there is a solution, as you will discover.

It became clear to me that the BAA had become an industry body and left the home producer far behind. This is not an amazing revelation and there are many of you out there who feel very betrayed that the BAA did not fight as you wanted on the exemption of excise for the home producer. This is fully understandable and I shared your ire. However, moving forward, there is now a rapidly growing industry of commercial biodiesel production that will be able to bring biodiesel to a wider audience. There are those that argue that the home production cannot co-exist with the commercial production and this is a debate that I fully understand both sides of, but I can remain outside of, as I am neither a home producer, or a commercial producer. I am simply a consumer who would love to use biodiesel and seen it promoted for all the benefits it can offer.

So, as it now stands, the BAA, despite past “bad blood” is still operating and has recently hosted a couple of events that have demonstrated a desire to keep going. Additionally, they are still the only body that other international biodiesel organisations look to for Australia. The recent advent of biodiesel on the Australian commercial marketplace has demonstrated that there are still some very big hurdles that need to be overcome, such as acceptance of both the vehicle manufacturers and the general public. I am never going to achieve this sort of thing on my own (my letters just get ignored). It is quite clear that there needs to be an industry body to represent the interests of the biodiesel industry here (note, I am mentioning industry, not home producers here, as it is quite obvious that vehicle manufacturers all think that biodiesel may mean home-brew, which they are all scared of). Is this the BAA? This has been a hotly debated question for a while now. Personally, I have always seen the BAA as an industry body, not representative of the home producers, or biodiesel consumers.

So, to get to my point, the BAA invited me to their most recent event, where they also invited the biodiesel industry to discuss the future of biodiesel in Australia. Initially, they thought I represented the home producer, but I had to point out that I did not represent anyone but myself (I’ve never yet made a litre of my own), and a users group who wanted to see biodiesel at the bowser.

The following post that I will make, I am not making as a BAA member (which I am not), I am simply trying to make public all the stuff that is going on, that the industry seems to keep secret, as I’m convinced that we need to hear it. I guess I was invited there to listen to what happened on the inside and try to report it to all those of you who would like to know that there is something going on with the biodiesel industry in Australia.

Robert
2nd May 2006, 12:49 AM
Biodiesel Association of Australia - Biodiesel Strategy Meeting


The BAA arranged a Biodiesel Strategy meeting on 20/4/06 so that the Australian Biodiesel Industry members could get together and discuss their future here. There were about 80 members present. The following are the notes that I took while at the meeting. They are only my interpretation of what happened and based only on the notes that I found relevant to take at the time. I am making them available here for the benefit of those not in the biodiesel industry, but who still have an interest on what might be happening with it. I was invited, not as an industry member, but to contribute on behalf of the Sydney Biodiesel Users Group. Any notes following are not the opinion of the BAA, or any other member present.




Morning session speakers

The first speaker was Brendan George from the NSW Department of Primary Industries. He gave us his department’s perspective on Biodiesel in Australia.

· Looking at managing environmental impact (especially of Short Rotation Crops).
· Seeking to ascertain sustainability of biofuels.
· Premier’s announcement of 2005 was for all NSW Government fleets to use biofuels wherever available.
· NSW as a state is keen to compete with others on green issues.

Next to speak was Adrian Lake, from the BAA, who had just returned from a Biodiesel Conference in San Diego. He gave us an overview of the sessions that the National Biodiesel Board had run over there.

· The main focus of their discussion was on issues of biodiesel quality.
· The US biodiesel industry had seen approximately 10 times production growth in the last 4 years. Largely due to favourable conditions, such as grants and subsidies.
· Many US celebrities (Darryl Hannah, Willie Nelson, Woody Harrelson, Jack Johnson) are strongly getting behind biodiesel and helping to promote the image.
· Much of the US focus for biodiesel is patriotic, it is seen as a great “home grown” alternative to fuel sourced from the Middle East. This also has a good home security aspect as well.

Stuart Roberts from Intertek gave us a short presentation of his company’s biodiesel testing commitment and capabilities. Stuart spoke to us of the issues relating to the correct testing of biodiesel to meet specifications.

· Testing is currently very expensive. Costs of lab equipment alone are over $1m capital investment.
· There are 22 different parameters in the current ASTM specification, some of these requiring expensive specialised equipment not used for any other tests.
· Intertek currently offer full analysis in Sydney and Melbourne (with some exceptions, such as cetane testing).
· Intertek are planning on also offering testing facilities in Brisbane to properly cover the biodiesel production in QLD.

Mark Mackenzie was asked to speak to us on the government perception of biodiesel. He has been consulting with the government on behalf of other alternate fuels such as LPG and CNG. He spoke to us of biodiesel advocacy, which seems to be the current popular speak for what we used to call lobbying. He offered some honest and blunt observations of the current Australian Biodiesel Industry in terms of their ability to influence as a group.

· His current perspective of the biodiesel lobby: fractured.
· In order to be more effective, they would need to:
1. Have a voice;
2. Be backed with industry and consumer groups;
3. Offer economic benefits;
4. Have consistency in the message that they offered;
5. Be relevant;
6. Meet the requirements of the transport industry.

Robert
2nd May 2006, 12:51 AM
Afternoon Workshop Sessions


The participants discussed the topics that we would need to “workshop” for the afternoon session. The following topics were identified:

·Quality (including testing, assurance, etc).
·Consumer Education/Market Awareness/Media Management.
·OEM Support (or current lack thereof).
·Housekeeping of storage/distribution management – product stewardship.
·Mission Statement – a need to get one.
·Government relations (tax/excise issues as well).
·Market segments –needing to identify and target them properly.
·Understanding customer requirements.
·Related Industry Association relationships. (How do we deal with others?)
·Identify vulnerabilities.
·Information Sharing.
·Environmental issues.

The above subjects were then broken up into 7 different focus groups, with at least 1 producer present in each. Participants then allocated themselves into a group where a few hours were spent for the group to come up with ideas to be presented back to the rest of the other groups at the end. The groups were divided as follows:

1.Quality
2.Mission Statement
3.Feedstocks
4.Market Awareness
5.OEM
6.Government
7.Vulnerabilities

Following is a basic summary of each group’s presentation. It should be noted that there was much “cross pollination” between the groups as many of the points raised interrelated with other groups, for example, many quality issues are a big part of the Market Awareness and OEM groups etc.

Quality

·BQ9000 (US) or AQGM (??? Whatever the equivalent European Standard is). There needs to be an Australian biodiesel quality standard accreditation program that encompasses the whole supply chain, right from the field to the bowser, including labelling on the bowser. There needs to be an Australian version adopted and followed.
·Issues with repeatability of testing. Some tests can be difficult to get the same results for twice.
·CFPP (Cold Filter Plug Point) needs to be shown to the consumer. This is one of the more practical and relevant requirements for biodiesel as the consumer should be aware of its implications.
·Although the current legislation allows for B5 to be sold as “diesel” with no labelling to the consumer, currently B5 is “off spec” on colour and specific gravity. Industry groups need to change this spec with the Government so it is more realistic. Caltex (who were represented at the meeting) already agree with this.
·The National Biodiesel Board in the US have already offered to help BAA here with the implementation of a quality certification standard program based on their own, but customised for our purposes.

OEM

·There are currently no Australian made Diesel engines.
·Local support stems from OS sources, which often have incorrect information.
·There needs to be an audit of the Engine Manufacturers Association.
·Need to identify and foster friends in this field.
·OEMs need to be hassled to justify their stance on biodiesel (i.e. commitment on blends etc.)
·Component manufacturers (supply the parts to manufacturers) & service industry (need education) should also be addressed.
·Website listing of vehicles, engine manufacturers etc would be a good tool for end users.
·What about government tenders that specify biofuel compatibility? This also applies to private tenders. OEMs need to get their act together about biodiesel to avoid missing out on business in this manner.


Government Relations

What can the Biodiesel Industry offer to Government?
(A clear target % by a certain year would be a good start)
Economic
Balance of Payments, energy security, job creation (especially rural), regional growth, export potential, potential income…
Environmental
Air pollution (toxins, particulates etc), Greenhouse life cycle analysis, water quality (no spillage issues), soil quality.
Social
International communities, regional, health benefits, regional job creation, intergenerational equities (also more commonly called “kid’s future”).
What do we want from the Government?
Stability and certainty relating to tax and excise.
Long-term goals clearly identified.
Regulation of standards.
Ongoing consistency with policy.
How should we engage Government?
At Local, State and Federal levels.
Both with Ministers and with Bureaucrats.
Take a cohesive story.
Have an industry mouthpiece.
Work with the media – be proactive.
From a body to champion industry interests.

Robert
2nd May 2006, 12:53 AM
Vulnerabilities

· Feedstock (availability is limited, also market can be volatile).
· Alternative technologies (such as that announced recently by BP).
· Roll of Majors (BP, Shell, Caltex etc) – need to work with them.
· Bad publicity (such as poor quality or backyarders).
· Compliance to government standards.
· Industry disunity.
· Changing engine technologies.
· Price of crude oil and vegetable oil.
· Waste by-product issues.

Market Awareness

· Three market segments clearly exist in the mainstream:

Consumer / Retail – The general public who fill their vehicles individually at a service station bowser. (Where most of the media focus is)
Commercial – The larger fleets who purchase their fuel in bulk.
Government · There needs to be a recognised Quality Assurance Program in place that covers “field to wheel” and is easily identified/branded, perhaps with an easily recognised logo or stamp (like the Heart Foundation approval tick).
· Biodiesel fact sheets need to be current, market specific and also contain a unified message (many of the current fact sheets from various producers are out of date or conflicting in some ways).
· Product Stewardship. There need to be systems in place to ensure that the reputation of biodiesel stays high.
· Possibly a spokesperson needs to be found to represent biodiesel. This has had much success with celebrities and biodiesel in the US.
· An organisation that properly represents the biodiesel industry needs to be transparent, honest and public about what it is doing.





Summaries & Extras

After the workshop presentations, a few more items were mentioned and there was some more discussion amongst the room:

BP’s latest announcement and how the Biodiesel Industry should approach this.

There should be an approach made to Government to demonstrate that the Australian Biodiesel Industry can triple the target set by the Fed Government’s 2005 Biofuels taskforce and in a valid manner. The BP technology to make a fuel using under 5% bio derived ingredients has not had to jump any of the same hurdles that the biodiesel industry has had to. BP should be asked to retract their statement.

Labelling and the B20 blend standard

There is a DEH discussion paper, soon to be distributed to the industry, to possibly determine the B20 spec. This could effectively mean that all biodiesel sales in Australia would be limited to B5, B20 and B100 only and all other blends would not be legal. The Industry does not like this idea.

Moving Forward

After the day’s discussions, it was clear that a new focus must be sought and a new direction set.

Current projects planned at the moment “in the room” added up to 750-800ML. It is abundantly clear that the industry needs to work together. Local feedstock would be an issue in the future, possibly with 200ML of palm oil being needed in the future to satisfy production.

A working group/steering group was clearly needed to get things moving forward, to show a unified national representation of biodiesel in Australia. Before 2003, home producers were the only option, but now that there is a real industry, the time has come to start working together cohesively.

A steering committee was represented to this end, comprising of 8 people, representing areas within the industry of producer, feedstock, testing and distribution.