"Indiana’s soy biodiesel industry faces scrutiny
The small town of Claypool, Ind., is now home to the world’s largest soybean processing and biofuels plant.
The facility, owned by the Louis Dreyfus Corporation, can crush 50 million bushels of soybeans — worth $450 million — in a year. Those beans, 17 percent of the state’s total production, will then be converted into 250,000 gallons of biodiesel a day, totaling 88 million gallons a year.
Why so much soy fuel?
Supporters of soy claim that it is a clean, renewable energy source that may help lead to “energy independence” from foreign oil producers. This vision of soy has been irresistible to companies interested in turning beans into biodiesel, a feat that has been supplemented by generous government subsidies, with an estimated half-billion dollars for biodiesel in 2006, according to the International Institute for Sustainable Development.
At least eight more biodiesel projects are planned for the state, in addition to an existing handful. By the time they are all opened, somewhere between 30 and 40 percent of Indiana’s soybeans will be used for biodiesel.
Gov. Mitch Daniels enthusiastically greeted the Aug. 21 opening of the Claypool plant with a proclamation that “[t]he sky’s the limit for biofuels.” Soy biodiesel is a win-win for Indiana; it boosts the fortunes of its farmers, who find a steady market for their product, while at the same time doing something to reverse the decades-long industrial decline of the Rust Belt.
Beyond the friendly fields of Indiana, however, soy has its skeptics. David Pimentel, an environmental scientist at Cornell University, argues that “big money” is behind the burst of enthusiasm for both ethanol and biodiesel. He is the author of a much-discussed scientific paper that claims both corn and soy are poor substitutes for oil. Soy biodiesel, he says, actually costs more energy to produce than it creates. While Pimentel says soy is “much improved” over other crop-based fuels, he believes it is still a far from ideal fuel.
“Go ahead and use their data on the net energy to make it look better, then ask yourself how many hectares would it take to just support the trucks in this country?” he says. “You’d have to plant the whole United States, every square inch, with soybeans.”
Mark Walters, director of the biofuels program at the Indiana Soybean Alliance, disagrees. He claims soy biodiesel has a positive energy balance — that it contains more energy than it costs to produce.
“I don’t think anybody in the alternative fuels industry has ever said that these fuels — either ethanol or biodiesel — will replace petroleum. That’s a tall order,” Walters says. “I do think that we can mix enough of these fuels in with petroleum fuels to replace our dependency on foreign fuels. That is the goal.”
As the scientific debate rages on, the federal government has continued to squarely support the growth of biodiesel. The International Institute for Sustainable Development estimates that the average gallon of biodiesel has received between $1.69 and $2.15 in subsidies — staggering numbers that make clear just how dependent the industry is on the goodwill of government subsidizers. Biodiesel processors like Louis Dreyfus are, in a sense, gambling that those subsidies will continue for the foreseeable future.
Biodiesel round up
The combined yearly output of the three other Indiana biodiesel plants (soybean-processing) is less than a fourth of that produced by the new Louis Dreyfus facility: 20 million gallons against Dreyfus’ estimated 88 million.
Evergreen Renewables in Hammond, Ind., was first on the scene, beginning production on July 19, 2006, with an estimated output of 5 million gallons. Integrity Bio-Diesel in Morristown, Ind., followed close behind, opening Aug. 1, 2006, and also planning for 5 million gallons a year. E-Biofuels opened this June in Middletown, Ind., and it is estimated that it will produce 10 million gallons a year.
Three ethanol plants (corn-processing) are now open in Indiana, producing an estimated 192 million gallons a year. New Energy’s South Bend, Ind., plant opened in 1984 and produces 102 million gallons. Other plants are much newer to the market: Iriquois BioEnergy in Rensselaer, Ind., opened this January at an estimated 40 million, and Central Indiana Ethanol in Marion, Ind., opened this July at an estimated 50 million.
At least 16 ethanol plants are under construction or in the planning stages. POET Biorefining, the world’s largest producer of ethanol, will be hosting a grand opening for its Portland, Ind., facility on Sept. 18, with Richard Lugar as a guest speaker.