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Grease Rustlers Unite!

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Fri, Apr 4, 2008 at 3:54 pm

    This wacky tale of grease rustling at a Northern California Burger King spins off a lot of threads. The police report said the wild-haired suspect
    was siphoning his 300-gallon haul of used fryer grease into a tank on
    the back of his truck. He was headed for a biorefinery in Atasacadero,
    where this "yellow grease" would net $1.35 a gallon, as opposed to only
    80 cents in his employer’s territory, Nevada. Immediate
    question: Why the price difference? Does Las Vegas have the world’s
    highest concentration of deep fryers?

    Bigger question: Even if
    fry oil goes for $1.35, why does biodiesel sell for over $4.00 a
    gallon (if you can find it, but that’s another story), same as
    regular diesel?

    That turns out to be an easy answer:  Most
    biodiesel is made from virgin soybean oil–which, like all commodities
    including petroleum, is through the roof on futures market trading. Brand-new biodiesel refineries are sitting idle because of the price.

    Naturally,
    the big biodiesel plants were built to run on soybean oil because it’s
    a known, industrially available, hedged and traded commodity. It’s not
    far from the petroleum model, except for the lack of pipelines.  Yellow grease, as
    the used cooking oils are known, takes a much different business model (even though most restaurants are still
    happy to give it away). 

    Yellow grease, which is also used in livestock feed, is a business of local haulers like this septic pumper
    who’s using the same technology for grease gathering (though we hope
    not the same trucks) up to medium-sized regional companies. The
    business depends on contracts with individual restaurants.

    So
    much paperwork, thinks the refiner. So many wacky characters to deal
    with. And what if the grease guy doesn’t show up, or deep-fried taco
    bites go out of favor? But some biodiesel refiners are catching on,
    like this Earth Biofuels plant in Oklahoma that’s buying from a professional fleet that combs the restaurants of Dallas-Fort Worth and beyond.

    Grease rustling pre-dates biofuels,
    although it’s more lucrative these days. Yet millions of gallons of
    rancid, refinable grease are still dumped into landfills, or illegally
    into sewers.

    Final question: Couldn’t the right kind of
    regulation employ the rustlers and run those shuttered refineries? It
    seems partly a matter of getting more of the new-age refiners to stop
    thinking like old Texas oilmen. To kick-start it, I propose a fat fee on
    landfill fry-oil oil disposal, spent to reward restaurants that
    contract with waste-oil recyclers. That bottom-up nudge would have
    fast-food chains lobbying for a more efficient pickup system, locking
    up the disposal bin and hiring their own wild-haired guys with pumper
    trucks.

    Until, that is, Exxon, Chevron and friends get wind of the idea and mount a jillion-dollar media campaign on behalf of the "overregulated restaurant owner." 

      

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