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Published byJonah McKenzie Modified over 8 years ago
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Biofuels: Boom or Bust for Montana Producers November 9, 2007
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Biodiesel Market Byproducts Market Feedstock Size Process Production/Operation Costs Construction Costs Return on Investment Risks
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Source: CARD, Iowa State University
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One Million Gallon Plant (an example) Oils from restaurants and food processing Tallow from beef packing Oilseed crops ▪ Canola ▪ Safflower ▪ Sunflower ▪ Rapeseed ▪ Mustard ▪ Soybean ▪ Camelina
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Product Revenue Biodiesel$x.xx / gallon Glycerin (fuel oil).00 / lb. ▪ 0.75 lbs. per gallon Meal $120.00/ ton ▪.067 tons per gallon
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Subsidy Revenue Tax credit for small producers 0.10/gal. Tax credit – State (MT) 0.10/gal.
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Processing (assumptions) Feedstock, canola (+ handling & cleaning) ▪ $0.151/pound Crushing and filtering ▪ $50 /ton Methanol ▪ $0.14/gallon of biodiesel Catalyst ▪ $0.08/gallon of biodiesel
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Processing (assumptions) Neutralizer ▪ $0.01/gallon of biodiesel Natural gas/electricity ▪ $0.02/gallon of biodiesel Cost of plant operation (labor, maintenance, administration ▪ $0.15/gallon of biodiesel
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Assumptions Annual Production (million gallons) Capital Cost/Gallon 0.5$2.00 1.0 2.00 5.0 1.25 20.0 1.00
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Important Fixed Costs Depreciation (economic) and interest ▪ 10 years / 6 percent ------ $0.15 per gallon of biodiesel
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What’s missing... Land Buildings Registration, licenses and certification Permits Utility installation Wastewater treatment Rail spur development
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Revenue (1 million gallon/year plant) Biodiesel$ 3,060,000 Glycerin 0 Meal 804,000 Total 3,864,000 Total with subsidies 4,064,000
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Processing Costs Total processing3,910,638 Capital costs Interest and depreciation 150,000 Total Costs 4,060,638 4.06/g Net income (EBIT) 3,362
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Oil supply Crude oil prices Blending B100 Demand for biodiesel and byproducts Distribution Longevity of the Federal Excise Tax Credit
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