Jan 30, 2008

The ever fluctuating price of fuel

Drive by almost any gas station and you'll see one common link - they advertise the price of their fuel in big numbers right out front.

With no other product are people as price sensitive. Back before I knew I had a choice, I would fill my car with the cheapest gas I could find, or would choose a station that was a penny less than its neighbor. I doubt I ever saved more than a dollar on any one transaction, but that was important to me.

Nowadays, because the fuel I buy is cleaner burning, the price is much less important. To me, just being able to use cleaner burning makes paying more worth it.
I drive a diesel Jetta TDI and use biodiesel (B20 BLEND for the winter, B99 BIODIESEL in the summer). (In case you are wondering, I pay the retail price for my fuel - the SeQuential employee discount is only valid at the Eugene biofuel station and I live in Portland).

Recently the price of biodiesel has been increasing and has prompted many email questions. For those of you who are wondering, here is a breakdown of the price increases from the SQ Newsletter January 2008:
Biodiesel Price Increases

As many of you are aware the price for biodiesel at the pump has been increasing. We have been working diligently to keep costs down, however certain areas are out of our control. As a small local company that was built by our loyal customers, one of our goals is to be as transparent and open as possible. In an effort to keep everyone informed of the industry trends we would like to address some of the causes of this price increase.

1 – METHANOL: The cost of methanol has gone up over 300% since September 2007. Methanol is a key ingredient in biodiesel production and this increase affects not just the SeQuential-Pacific Biodiesel plant in Salem but also biodiesel producers throughout the country. Two of the world’s largest methanol plants experienced unplanned outages due to mechanical and technical production problems which caused this spike in prices. Global supply forecasts are expecting for prices to begin falling by early spring

2 – SOYBEANS - The most common feedstock for biodiesel in the United States is soybean oil and soybean oil prices have increased over $0.90 since September. The SeQuential-Pacific Biodiesel plant in Salem has a capacity of one million gallons per year and primarily uses used cooking oil or Oregon-grown canola. The demand for biodiesel well exceeds capacity and we are importing soy based biodiesel, which is affecting the price at the pump. The SeQuential-Pacific facility is currently under expansion to five million gallons per year.

We appreciate your commitment to locally sourced, cleaner-burning biofuels. We are doing everything we can to keep prices down and to continue offering you a choice in your fueling needs.
It is important to note that SeQuential only owns one station, the solar-powered biofuel station in Eugene; SeQuential can not set prices at any other locations or with distributors. (See all locations and distributors).

If you find the price of biodiesel is too high for you, you can mitigate this is by using biodiesel / petroleum diesel blends. Just fill up partly with petroleum diesel and then top off with biodiesel - the fuels will mix in your tank and it can save you some money. Also, driving less cuts down on fuel costs - try to combine errands into one trip, carpool and when able, take public transportation or ride your bike!

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