Pacific Biodiesel's fuel sales flow

Pacific Biodiesel's fuel sales flow

By Alexandre Da Silva
The Associated Press
Published: Sunday, September 25, 2005

Tom Jones got a few odd stares from fellow motorists the other day in Honolulu while test-driving a Volkswagen beetle with the slogan "100 Percent Recycled Vegetable Oil" stamped all over it.

By the time the 50-year-old restaurant owner ended his spin in the avocado-green bug, he had made up his mind.

"I want to sell my car and buy a biodiesel vehicle," said Jones, who can't wait to replace his gas-guzzling Highlander SUV with a car powered by the same oil he uses to deep fry fish.

Jones would be using an often-ridiculed thick yellow fuel that has suddenly become so popular that there isn't enough to go around. With only one biodiesel pump on the island, all city ambulances and fire trucks in Honolulu now run on 20 percent biodiesel, and fleets of airport shuttles on Maui and the Big Island use the fuel.

Pacific Biodiesel, which has been collecting used cooking oil from restaurants for a decade to produce the fuel, has joined with partners to expand operations to Virginia, Oregon and Japan.

Country singer Willie Nelson, who owns a house on Maui and drives a 2005 Mercedes using biodiesel, is in a partnership with Pacific Biodiesel that will open a plant in Carl's Corner, Texas, in February. Plants also are planned in Nevada and Pennsylvania.

To produce the environmentally friendly fuel, private haulers pick up the oil from restaurants and dump their loads into Pacific Biodiesel's containers.

The oil is heated and filtered through a process that separates vegetable fuel from the waste product, glycerin.

In 1996, Bob King, a former diesel mechanic on Maui, and his wife Kelly gambled their combined life savings on the then-risky venture.

At first, Pacific Biodiesel was stuck in low gear, with a fuel rejected by people who second-guessed the idea of running their cars on cooking waste and a pump price too expensive for most motorists.

Now, as Hawaii gas prices top $4 a gallon in some areas, the Kings haven't increased their price more than 10 cents a gallon in five years. The price on their Oahu pump is stuck at $2.64 and they don't see it going up much at all because biodiesel is not tied to oil markets.

"We've kept prices tied to our costs of production and doing business," said Mrs. King, the company's marketing and communications director. "We started this business because we wanted to prove that we could make a viable alternative ... that eventually could be cheaper."

For years, the unpopular vegetable-based fuel trickled slowly into rusty tanks of a handful of Earth-loving motorists, who made infrequent visits to the pump.

"We were struggling, trying to decide if we should stick with this business or not," Mrs. King remembers thinking in 1996.

This month, the Kings started registering regular customers so it could control sales.

"It's been nuts the last few weeks," said Mrs. King, who restricted sales on Maui on Sept. 1 to drivers registered with the company and expected a similar restriction on Oahu soon. "We were overselling. We are not taking any new ones."

Production capacity at the two Hawaii plants is 1.2 million gallons of biodiesel a year.

The city/county of Honolulu injects some 12,000 gallons of biodiesel into its fleet every month, making it the company's largest consumer.

Another good chunk of the production powers the 11 new Mercedes Sprinters bought by SpeediShuttle's airport fleet on Maui and the Big Island.

The shuttle company already has replaced 75 percent of its fleet with the biodiesel vans, said Everett Peacock, the company's vice president of operations and development.

Peacock had been tracking the renewable fuel market since November and opted for biodiesel when its prices became cheaper.

"Diesel has an added advantage of better fuel mileage right off the top. ... We have a huge economic advantage now," Peacock said. "It's working out great on both the being green and being smart with our money."

As its sales continue to boom, Pacific Biodiesel is keeping an eye on research being done by other companies to prevent the fuel from gelling in more extreme temperatures - one of its key shortcomings.

But in yearlong sunny Hawaii, it's business as usual for Bob King.

"We get real busy in here," said King, 47, as he leaned against a fuel tank at the Oahu plant after business hours, the sun dipping behind him. "There's so many ways to make energy, this is just one. It's great to see it taking off."