Michigan Plant Rebirth Keeps Biodiesel Flowing
by Karen Potratz (Michigan Advanced Biofuels Coalition/Biobased Diesel Daily) Biodiesel producer W2Fuel joined the newly formed Michigan Advanced Biofuels Coalition to help advocate for blending incentives and encourage in-state use of its clean-burning fuel.
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Previous owners built the Adrian facility in 2007, during an era Strom (Roy Strom, the company’s president and CEO) calls the “Wild West” of biodiesel production. At that time, the industry specifications and standards were not as stringent as they are today to ensure biodiesel quality and consistent performance.
“Back then, biodiesel got a bad reputation due to the lack of quality controls,” Strom says. “There were reports of biodiesel clogging fuel filters and causing trucks to shut down.” An economic downturn didn’t help. The Adrian plant operated for only a year before closing in 2008.
With improved economics and higher quality standards, the biodiesel industry rebounded in 2011, stimulating new investment. A private-equity investor with interest in alternative fuels saw opportunity in the Adrian plant.
The investor breathed new life into the facility, purchasing the distressed assets and retooling operations to meet industry standards. W2Fuel is now BQ-9000-certified for biodiesel-quality assurance.
“We replaced old equipment to prevent breakdowns and reduce downtime, installed better separation and filtration systems for product consistency and made process improvements for faster and more efficient production needed for us to remain competitive,” Strom says.
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Despite the owner’s investments and Strom’s business acumen, W2Fuel was forced to shut down for nine months in 2019, due to uncertain federal policies related to renewable fuels.
“We had no biodiesel tax credits for two years,” Strom says. “On top of that, a record number of small-refinery exemptions were handed out under the Renewable Fuel Standard. The combination killed biodiesel demand and we couldn’t run profitability with those disruptions. After Congress renewed the biodiesel tax credit, the market became more viable again.”
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Today the W2Fuel plant in Adrian runs at 100 percent capacity, producing biodiesel primarily for customers just across the state line in Toledo, Ohio. The company’s Crawfordsville plant serves customers in Iowa, Illinois and Minnesota. “There is a lot of demand for biodiesel in Minnesota because there is a B20 mandate there in the summer,” Strom notes. “Many states offer incentives to use biodiesel, but Michigan currently has no incentives for fuel suppliers to blend biodiesel. So, even though we are producing biodiesel in Michigan, there is not much used here.”
Biodiesel Benefits for Michigan
Strom would like to change that dynamic, which is why W2Fuel joined the Michigan Advanced Biofuels Coalition (MiABC). The organization, established in 2022, aims to promote biodiesel use through education, networking and technical expertise.
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Decarbonization is another benefit. “Biodiesel can reduce carbon emissions now, while we are waiting for electric vehicles to become viable alternatives to petroleum diesel,” Strom says. “There are lots of soybeans grown in Michigan. Let’s use a fuel product manufactured here versus using oil from other parts of the world.” READ MORE
