| AgroFire’s use of second-generation technology
yields a premium biodiesel fuel known as renewable diesel. This
technology and renewable diesel offer several key advantages over
traditional biodiesel production. |
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| Wider Choice of Feedstocks |
| Second-generation technology allows a wider
variety of feedstocks to be use while maintaining a consistent
product quality, compared to standard biodiesel. This gives
AgroFire the ability to utilize both standard feedstocks,
like soy, and less costly feedstocks, such as animal fats,
to improve margins. Texas’ location makes it well situated
to import feedstocks, such as palm oil, from around the globe
in an effort to further ensure lower cost supply. Overall,
AgroFire will be more resilient to market swings in feedstock
pricing and supply that could render the standard biodiesel
production model unviable. |
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| Petro-Diesel Compatibility |
| Unlike standard biodiesel, renewable diesel meets
both the ASTM 6751 specification for biodiesel and the ASTM
975 specification for petroleum diesel. The ASTM 975 compatibility
is a significant factor in the potential for AgroFire to use
existing fuel pipelines for distribution where standard biodiesel
is not currently allowed. |
| |
| Premium Blending Stock |
| Compared to pump-grade petroleum diesel at
about 45 and standard biodiesel at about 50, renewable diesel
has a greatly increased cetane number at nearly 100. This
dramatically high cetane number combined with negligible sulfur
levels suggests that renewable diesel can be used as a premium
blending stock to upgrade low-grade petroleum diesel to marketable
pump-grade diesel. Due to these factors, renewable diesel has
received praise from fuel traders, who believe AgroFire’s
renewable diesel will demand a pricing premium. |
| |
| Reduced Environmental Impact |
| Recently, the biodiesel market has been plagued
by concerns of increased NOx emissions compared to petroleum
diesel. While industry leaders are working to alleviate these
concerns, renewable diesel provides a solution today as testing
shows NOx emissions comparable to petroleum diesel. |
| |
| Cold Climate Performance |
| While superior to petroleum diesel in many
ways, standard biodiesel tends to cloud and thicken in colder
climates and during the winter months. Fuel blenders commonly
reduce blending percentages and utilize additives to combat
this issue. However, renewable diesel has clouding and pour point
performance comparable to that of petroleum diesel, thus giving
AgroFire’s product similar performance in low temperatures. |
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| Co-Product Contriburtion |
| The standard biodiesel process loses about
10% of its production to the generation of glycerin. Unfortunately,
the market for glycerin is saturated, resulting in a negligible
(<1%) contribution from glycerin. Second-generation technology,
however, does not produce glycerin. In contrast, this technology
produces carbon-chain fuels such as propane, which can be
sold for significant contribution to AgroFire’s operation.
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