“More renewable diesel is used in California than biodiesel, and that affects the ag economy in North Dakota,” said Dave Ripplinger, NDSU bio energy bioproduct specialist, at the February ag economics webinar.

Biomass-based diesel is two different products – biodiesel and renewable or green diesel.

“Biodiesel is a product that we’ve been making across the Midwest for quite some time,” he said.

Soybean or canola oil is most often used as vegetable oil to make biodiesel fuel, and biodiesel and renewable diesel have their own specifications.

“Renewable diesel is really where the action has been in the last few years and where there is a tremendous amount of growth currently underway,” Ripplinger said.

Renewable diesel is made by hydrotreating vegetable oils. It is a drop-in fuel and meets the diesel specifications.

“Because it is chemically equivalent to diesel, you can put it in the same pipe, tank, or engine,” he added.

Ripplinger explained that the California Air Resources Board is overseeing the California Low Carbon Fuel Standard. California currently uses more renewable diesel than biodiesel to meet that standard.

“Many states are looking at meeting a lower carbon footprint, but California is 10 percent of the transportation market in the U.S. and the state requires refiners to shrink their carbon footprint every year,” he said. “It is becoming difficult in California to go to a gas station and find any petroleum-based diesel at all.”

Renewable diesel and biodiesel have a lower carbon footprint than ethanol, which has a lower carbon footprint than gasoline.

Renewable or green diesel is a drop-in fuel that is chemically equivalent to diesel, and it can be put in the same tank and engine. It operates the same as diesel and it gives a lot of advantages (to agriculture).

“Those advantages and some activities by petroleum marketers in California are driving my main point here today,” Ripplinger said. “There are growing markets for soybean oil, canola oil, and other vegetable oils to feed the growing market opportunities for biomass-based diesel.”

Ripplinger’s friend sent him a photo of a Chevron pump in Orange County, Calif.

The photo shows a diesel pump and a gas pump on the one drive-up pump. The diesel pump is labeled as renewable biodiesel B20. Chevron has its own specific product in California that is 80 percent renewable diesel, 20 percent biodiesel, and 100 percent biomass-based diesel.

The relative spread between renewable biodiesel B20 and regular gasoline products is not necessarily extremely large, with the renewable biodiesel B20 about 60 cents more than gasoline (at the time the snapshot of the pump was taken.)

“This is really interesting and presents unique opportunities and challenges for agriculture because there’s a tremendous amount of vegetable, oil, fat or grease that we need to make these products,” Ripplinger added.

There are several new renewable diesel facilities that are coming online to serve California’s low carbon footprint policy.

“It’s entirely possible that most, if not all, of the petroleum-based diesel will be displaced in California,” he said. “If you look at the math of how much vegetable oil we will need to do that – it’s really quite astonishing.”

Renewable diesel facilities would need about a billion bushels of soybeans to produce 1.6 billion gallons per year.

Last year, North Dakota produced 198 million bushels.

“You’d need all the bushels from five North Dakotas to meet that current production, and the expectation is it’s going to end up pushing out that diesel, so we need that much more, soon,” he said.

Ripplinger said other states, such as Oregon and Washington, as well as other countries, are also going for a low carbon footprint and will need renewable diesel, as well.