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Panel: Indiana’s biofuel industry is still growing
By DEB McKEE
The Terre Haute Tribune-Star

TERRE HAUTE, Ind. — Biofuels are here to stay, said Kellie Walsh, the executive director of Central Indiana Clean Cities Alliance, Inc. When asked if ethanol and soy-based alternatives to gasoline could be just the latest “ostrich farm” – a flash-in-the-pan, popular trend in agricultural investment – Walsh said no way.

Farmers gathered with some of the state’s leading experts Thursday during the Farm World Expo at the Wabash Valley Fairgrounds to discuss the feasibility of biofuels to replace or complement traditional petroleum-based gasoline.

Terry Hayhurst, manager of Hayhurst Farms in Terre Haute, said the reason for pursuing biofuel alternatives is simple: the price of oil demands it.

In May 2005, the Jiffy Mini-Mart at 501 S. Third St. in Terre Haute was the first retail shop in Indiana to sell E85, a blend of 85 percent ethanol and 15 percent gasoline. Since then, dozens more retailers have begun to offer the flex-fuel.

Walsh said the 40th E85 station in the state opened recently, fulfilling a goal that had been set for the end of the year.

However, the increase in the price of E85 since last August has some consumers skeptical.

“When the Terre Haute Jiffy Mini-Mart started offering E85,” Walsh said, “the price spread was 40-50 cents cheaper (than regular unleaded gasoline). A lot of things affected the price, (Hurricanes) Katrina and Rita. And then the natural gas price increased, and that is a big component of the production of ethanol.”

Although prices have fluctuated, Karen Riley, vice president of Terre Haute-based Jiffy Mini-Marts Inc., said she will continue to support ethanol blends.

“It’s been up and down,” Riley said. “We were selling 14,000-17,000 gallons a month, then the price went up. Now we’ve seen the price drop back down.”

Automobiles compatible with E85 are known as flexible-fuel vehicles. It is possible to be driving a flex-fuel vehicle and not know it, Walsh said. Drivers can check their car or truck’s owner’s manual or the sticker inside the gas door. General Motors’ models have a yellow gas cap to indicate E85 compatibility, she said.

About 70,000 flex-fuel vehicles are licensed in Indiana, up from 61,000 in July 2005, Walsh said. An estimated 850 are in Terre Haute, up from 750 last year.

Another type of biofuel gaining proponents is soy biodiesel, a diesel-equivalent, processed fuel derived from soybean oil.

Chris Novak, executive director for the Indiana Soybean Board, said as many as 75 percent of farmers are burning B2 (a blend of 2 percent soybean oil/98 percent conventional diesel) in their farm equipment, but in surveys, only about 50 percent of farmers acknowledge it.

Novak thinks many are unaware they are using the alternative fuel. Novak said his goal is to continue to reach out to farmers and the general public to educate them about soy biodiesel. He hopes with the grand openings of two new biodiesel operations in the state, it may become easier. Eleven additional biodiesel plants have broken ground in Indiana, he said, and 21 have been announced.

Aaron, a 22-year-old farmer from Illinois, who declined the use of his last name for this story, said he has been using biodiesel on his 1,000-acre farm since February. That was when his family began looking for an alternative to decrease the cost of running heavy farm equipment.

“We blend biodiesel with the fuel for the tractors,” he said. “You can run them on 100 percent but I don’t have quite the volume (of oil) to do that.”

Aaron said the drawback of using biodiesel is a lack of used cooking oil.

“It’s kind of hard to get it,” he said. “You can go around to restaurants, but everybody’s doing it now, so it’s kind of rare.”

The cost, 80-90 cents per gallon, “if you can get your cooking oil free,” he said, makes it worth it.

“It works, I know that,” he said. “It’s a little better for the engine and it’s a lot better for the environment.”

Some of the environmental perks of using either ethanol or soy biodiesel to replace conventional fuels include a decrease in carbon dioxide, hydrocarbon and benzene emissions.

This farm news was published in the August 9, 2006 issue of Farm World, serving Indiana, Ohio, Illinois, Kentucky, Michigan and Tennessee.

8/9/2006