I own and operate a grease trap pumping company that services 80% of all the restaurants in my Target Market Area with a population of 170,000 and growing fast! I've been kicking around the idea of getting into Waste Oil Collection and biodiesel production. I already have plenty of customers to provide the oil, many of which are tired of the company that currently collects it. I was reading about IRS Notice 2007-37 and was wandering what the impact on smaller collection companies has been so far and what you think the future will look like for small scale WVO biodiesel producers? Will I find my self in a year having to pay for the WVO? Thanks,

Personally I think WVO is a commodity, and as such folks are beginning realize this. For example McDonalds press releases. So it makes since to sell it to the highest bidder in the market.

Check your PM inbox.

Dear ,

I want to start a WVO from c-store. Is it profitable to collect and sale it ?

 

 My main source of oil has just informed me that  he has been offered money for his waste oil. I didn't ask how much he was offered. A year ago  when I started collecting it from him he was paying a $100,  a month to get it hauled away. SInce I patronize his resturant regularly, he still gives it to me at no cost. I don't know what the future holds for the little guy. (homebrewer) Paying for waste oil is closer then you think.

In a word ..............................nope!

    Don't know bout your neck of the woods, but here in east Tn. WVO is now a commodity with prices increasing on a near weekly basis. Currently, depending on the quality, quantity,  location,  (and some few other factors) you can expect to pay around $.50 from a little greasy spoon out in the boony's, to as much as $1.75 for the good clean stuff from the high volume Chinese buffet in the mall. And even at that it's only beginning, it's just a matter of time before it's out of the range of the average do-it-yourselfer.  One of the larger biodiesel processors in the area says he is prepared to pay within $.95 of the going rate of pump diesel and can still make a profit of $.23 - $.29, which because of his capacity will make his plant very profitable, and will pretty much discourage the small timers (like me) from setting up or staying in operation.

   The two 300sd Mercedes I converted are going on ebay as soon as I use up the 400 or so gallons I already have made up and while the prices on them are still inflated, and I'm going to a gas hybrid. The days of the old 30 mpg diesels are definitely numbered when the free waste oil is history. 

   And here's another caveat concerning home made fuel, (better read this one carefully) Both state AND federal law enforcement people are being notified that because of the increasing use of "untaxed" motor fuel, any diesel powered vehicle stopped for any reason can soon be routinely checked for illegal fuel if the exhaust smell warrants it, and the fines can be staggering!  One local farmer has already found that out at $12,000 for the first offense!  Think I'm kidding, can't tell you his name because it would be an invasion of his privacy, but the police dept down in Newport Tn will gladly verify it. (That's not an isolated incident by the way) Also, we now have to sign name and address in order to buy kerosene in ANY  amount because backyarders were mixing it with used motor oil as a diesel fuel. The Gov. is deadly serious about stopping the homebrewers, BUT, you'll not hear much about it right now because of the political ramifications during an election year. I've been making diesel fuel for over twenty five years, and in the beginning I even had a couple of articles about it in the local paper, long before the old Hippies began making an industry of it, that's all changed now, and depending on who the next president is it could become hazardous to your finances, concievably your freedom. Ms Clinton has already remarked about "assesing the backyard diesel plants", Obama laughed off the subject, McCain said we could learn something from it?  I'm not political, I don't care who gets in, but the point is, it's now on the Govt radar and if you're not already involved, it may be better if you keep it that way.       

    I started by just going around and dipping out a few gallons once in a while into a couple of plastic jugs in my trunk, and processing it all by hand in a few buckets in the back of my shop, and as interest grew, wound up making more and more over the years, sometimes giving it away to friends as just something of a novelty, and by the middle of last summer had grown to a vacuum pumper truck and 18 five hundred gallon propane tanks for storage, a semi automated continual run heater/reactor/centrifuge/filtration/metered line that could process 400 gallons/day. THEN................ I began noticing that the barrels where I had picked up for years were turning up empty more and more often, and that more and more old Mercedes Benz were running around the county smelling like deepfryers!  Now just in the past few months the free oil has completely gone away, and in the past several weeks I actually found a couple guys sitting out back of one of the places waiting for the next pan of oil to come out. And they, not knowing I've been doing it for years look at me as if I were some kind of "oil monger" trying to muscle in on their stake, so I'm getting out of it.

  My story is probably not unique, and if I were younger I might try making a business of it, but I can see where the competition for a limited resource is going to create some problems, and I just don't want the hassle.
   Hope this helps someone.

 Yeah that seems to be the issue. I go around and have a few places that will give me their oil, but the big companies or medium size guys are starting to pay for it. 

They are not even taking it for free. I guess business is business. But it is hard for the people that just want to use it to get by on cheaper fuel and have fun while doing it.

 I mean how cool is it to sit in your garage with some buddies and make fuel! It is fun..

Anyway it is to bad that the big money will win in the end but such is business... need to find the thing that will be another 25 years down the road before they get there hands in it.

And make some money from that. I am sure you can always find enough to make for yourself. It is also getting harder to even pick it up under the radar..

 

Ron 

 

I'm gonna make a prediction. I think these "big" companies are digging them selfs a "big" hole. The only reason there is profit in WVO is because of the price of Crude. Within 10 years we will see the price of oil come back down. The main reason the price of crude is up, is because OPEC has us by the &@!!$, and both sides of the political spectrum in this Country like it, because it suits one of there many agendas. The "BIG OIL" companies, and Pres. Buss like it because it increases pressure on our government to allow domestic drilling. The left wing environmentalists like it because it put pressure on people to find alternative. Admit it, if crude was still cheep, there would be no market (other than for Homebrewers) for WVO. So, as more and more people start driving hybrids, natural gas, electric, hydrogen, flex fuel cars, the demand will drop and so will the value and so will the price. I don't think there's much room for negative inflation in the WVO biodiesel market. It will become a "Waste" again and all these companies that are ramping up business trying to take over the countries WVO supplies will be jumping into the hole the dug. Why would you build such a big business around a product that every electrical/mechanical/chemical/////engineer is trying to eliminate the need for? The need for diesel will probably be around for many more years but it's demand is going to drop like crazy over the next 5 to 10 years. Good luck big boys!!! I predict the small guys when in the end of this showdown!