The Reconciliation of Food and Fuel

As both the alternative fuel and food industries evolve, a once rocky relationship could improve.

The relationship between the food industry and the biodiesel industry has had its rough spots. While the biodiesel industry is promising to be a piece of the U.S. energy independence puzzle, as well as a way of reducing greenhouse gas emissions, parts of the food industry are still dubious.

This past April, the Grocery Manufacturers Association (GMA), which represents more than 200 companies that manufacture and market food and consumer packaged goods, referred to biofuels as an "unlikely foe," calling attention to the numerous social, economical and environmental consequences of our farmers' rush to take advantage of high commodity prices.

While the ongoing debate over the causes of rising food prices rages on, food-to-fuel policies are at the top of the list. More specifically, the argument is that as the government subsidizes the conversion of food products to fuels and the biofuel industry flourishes, the food industry finds itself competing for crops such as corn and soy. Facing consequently higher raw material and feed prices, food manufacturers then have no choice but to pass the price increases onto its consumers.

Whether or not you agree with the aforementioned argument, the tension between the food industry and the biofuels industry is undeniable. However, as the biodiesel industry explores new, non-food feedstocks and numerous food manufacturers explore the business benefits of biodiesel, the two industries are finding a more symbiotic relationship than previously realized.

Feedstock evolution
Because of its prevalence in the U.S., soybean oil quickly became the predominant feedstock for biodiesel production. As soybeans already had innumerable industrial, food and feed uses, the addition of biodiesel demand caused debate as to whether or not biodiesel was to blame for rising commodity prices, as well as competition for crop land.

Like the food industry, the biodiesel industry is not immune to the stress caused by raw material price increases. However, the flexibility of biodiesel allows producers to shift feedstocks according to market prices, which has led to the exploration of new, non-food based feedstocks.

"The biodiesel industry is in a fortunate position in that we are not working with a set recipe," says John Fox, CEO of Innovation Fuels, a rapidly emerging, New York-based biodiesel company. "We constantly keep our finger on the pulse of what's going on with feedstocks. Our main goals are to lower our costs and not compete with the food supply."

This fall, Innovation Fuels launched a pilot program across New York State to plant the non-edible, oilseed crop pennycress with the intent of producing biodiesel. Fox estimates that one planted acre of pennycress can yield Innovation up to 120 gallons of biodiesel.

Biodiesel can also be produced from waste oils, such as beef tallow, pork fat and poultry fat – all of which are byproducts of the meat industry. In addition, many biodiesel processors are exploring the benefits of other, non-edible oil-seed bearing plants, such as jatropha and cuphea.

Perhaps the most promising next-generation feedstock is algae. Algae has been researched as a potential green energy source for years for many reasons. To begin with, algae can be produced in massive amounts. It also contains a large amount of oil. As an added environmental benefit, processing algae into biodiesel actually pulls carbon dioxide from the air, and replaces it with oxygen. Once the oils are harvested from algae, the remaining byproducts can be used as a source of protein in animal feed or in fertilizer, which should also serve to strengthen algae's appeal to the food industry.

Don't fight them, join them
Biodiesel is designed as a clean-burning alternative to petroleum diesel fuel. As such, food manufacturers, especially those particularly interested in promoting environmental stewardship, are actively using biodiesel fuels in their delivery trucks. FreshDirect (New York, NY), Kettle Chips (Salem, OR), New Belgium Brewing (Fort Collins, CO), Café Mam Coffee (Eugene, OR), Essential Baking (Seattle, WA), and Whole Foods (Midwest) are a few food companies leading the way with biodiesel usage.

Food Lion supermarket chain (NC) is using biodiesel generators to ease utility demands during peak operations, such as on hot days when air conditioners are running on high.

Of course, cost is always an important part of the equation. According to the U.S. Department of Energy, while petroleum diesel has typically been less expensive than biodiesel, the price gap has narrowed significantly between 2007-2008. Biodiesel blends (B2, B5, B20) however, have been consistently less expensive than petroleum diesel fuel in the past two years. As biodiesel feedstock prices go down (or as cheaper feedstocks are used), the price of biodiesel fuel should go down accordingly.

New links
More and more companies are capitalizing on the untapped links between the food industry and biodiesel industries. New research is revealing that both industries can potentially profit from each other's byproducts.

This past summer, chemical engineers at Rice University (Houston, TX) published research on a new fermentation process that allows E. coli to convert glycerin – a byproduct of the biodiesel production process – into profitable chemicals. One such chemical is succinate, which can be used as a food additive in a wide variety of products, from dried vegetables to beer.

On the other end, Renewable BioSystems (Fairfield, NJ) is now marketing an oil extraction technology in the U.S. that promises to convert waste to energy. The technology processes organic waste (such as food processing wastes, offal from meat processing, fish residuals, etc.) and converts varying percentages of this waste into oil that can the be further processed into biodiesel.

The size and ease of use of this equipment makes it possible for food manufacturers to process their byproducts on-site and then sell oils directly to biodiesel producers.

"Our company recognizes that appropriate goals for biodiesel production include feedstock solutions that are not only sufficient enough to meet the government's RFS mandates, but also compete with food as little as possible. We are supplying our technologies to food manufacturers in ways that enable them to work economically with biodiesel producers to both lessen food waste streams and create green energy," states Peter Behrle, CEO of Renewable BioSystems.

Closing the gap
As both the food and biodiesel industries evolve to meet changing economic, social and environmental needs, and both industries are realizing the possibilities of a mutually beneficial relationship, the food versus fuel debate should be quelling.

"Food versus fuel is quickly becoming a moot point," says John Fox.

The biodiesel and food industries are both pushing for a more sustainable system, and perhaps part of the answer comes in closing the gap between the two industries.