A coalition of alternative-fuel advocates that last year proposed constructing a biodiesel-fuel manufacturing complex here now is envisioning a larger facility and is launching an effort to find ways to make the development feasible.


The coalition, which includes a mix of public agencies and private companies, is hopeful that construction of the complex will get under way next year, says Jim Armstrong, spokesman for the Spokane County Conservation District, which is a member of the coalition. Meantime, Banner Furnace & Fuel Inc., of Spokane, plans next spring to introduce to the Spokane market a biodiesel-blend fuel produced in the Midwest that would be similar to the fuel that would be made here.


Biodiesel fuels are an alternative to diesel fuel made from vegetable oils. Theyre manufactured by removing the triglyceride molecule from vegetable oil through a chemical process. The remaining molecules are similar to those found in diesel fuel.


The proposed Spokane-area complex would include both an oil-seed crushing plant and a biodiesel processing plant. It would include two, 40,000-square-foot buildings to house facilities that would produce up to 5 million gallons of biodiesel fuel annually. The coalition hasnt estimated the construction costs of the project, but Armstrong says similar-sized projects elsewhere have cost between $5 million and $10 million.


A site for the project hasnt been selected yet.


The proposed complex would be larger than originally envisioned. Late last year, the coalition disclosed hopes to build a facility that would produce between 1 million and 3 million gallons of biodiesel annually. Its members had discussed development of an oil-seed crushing plant as part of the complex, but were leery about whether producing oil, as opposed to buying it from other sources, would be viable.


After further study, Armstrong says, the group found that it would be best to produce and process its own oil.


The coalition, he says, believes there will be a future market for such fuels. Much of the reason for that, Armstrong adds, is that burning biodiesel generates fewer emissions and is more environmentally sound than burning diesel thats refined from petroleum.


Its a perfect answer to the (U.S. Environmental Protection Agencys) mandate to produce low-sulfur diesel, he says.


To make such a project more feasible, advocates are working with state and federal legislators to draft tax-incentive legislation.


At the state level, the coalition is seeking a business-and-occupation tax exemption for biodiesel complexes and related operations, such as farms that supply oil seeds to such facilities.


At the federal level, it is lobbying for an excise-tax reduction for diesel fuel thats blended with biodiesel so that the alternative fuel is cheaper at the pump. The group proposes a one-cent reduction in tax for every percentage point of biodiesel included in mixes with diesel fuel derived from petroleum. For example, if a blended fuel contains 20 percent biodiesel, the tax would be reduced by 20 cents a gallon.


Such a measure would make blended fuel less expensive than straight diesel, Armstrong says. The feedback from legislators has been positive, Armstrong says. Their staffers are drafting legislation right now.


Without such an exemption, blended fuel is more expensive than diesel, and thus wont be as palatable in the marketplace, he says.


While working to make biodiesel more viable, proponents are talking with Eastern Washington farmers about forming a cooperative that would supply oil seedscanola or mustard seedsto the complex and also would have an ownership interest in the facility. The plant would need to be fed by the equivalent of 20,000 to 30,000 acres of oil-seed production annually, and farmers in the cooperative would be assured of a fixed price for their production.


In addition to the efforts of the cooperative, a mix of public grants and funds and private investments likely would finance development of the complex.


Public agencies involved in the effort include the conservation district, the EPA, Spokane Transit Authority, and the Spokane County Air Pollution Control Authority. Participating private companies include Avista Corp. and Banner Furnace & Fuel, both of Spokane.


The proponents are formalizing as the Columbia Plateau Clean Cities Coalition, which will advocate use of all forms of alternative energy. Armstrong says forming such a coalition makes the group eligible for federal grants that it couldnt receive otherwise.


Biodiesel in Spokane


As plans for the proposed facility here move forward, Banner Furnace & Fuel is working to bring in a blended fuel consisting of 20 percent biodiesel that would replace straight diesel.


Sue LaRue, Banners fuel manager, says the company currently is talking with a producer of such fuel in Iowa and likely will make the blended fuel available here by next spring. To her knowledge, no fuel-station operators are offering biodiesel blends here currently.


Initially, Banner plans to offer the blended fuel at one of its five card-lock fueling stations. She says the company hasnt decided at which station it will sell the alternative fuel.


Before deciding to offer biodiesel here, Banner first used the alternative fuel in some of its own vehicles for several months. LaRue says the vehicles ran as well as they do on straight diesel and didnt encounter any problems.