PA Biodiesel Producers Barely Hanging On

John Davis

pastatecapitol.jpgBiodiesel producers in Pennsylvania are in a tough spot these days, and unless the state steps in to help them, their industry could go bust by the end of the month.

This story in the Central Penn Business Journal says lawmakers are still sparring over subsidies that could help make the industry competitive again:

There are two proposals that would help the industry. One would increase subsidies and the other would mandate the blending of biodiesel into petroleum-based diesel. Both are part of Gov. Ed Rendell’s energy strategy to reduce the state’s dependence on foreign oil.

The Republican-controlled state Senate passed a subsidy bill in December. Special Session Senate Bill 22 would give biodiesel producers 75 cents per gallon. The Democrat-controlled House wanted a bill that raised subsidies to $1 per gallon. All biofuels producers, including ethanol producers, are eligible for a 5-cent-per-gallon subsidy.

Biodiesel producers last year asked for $1 per gallon so Pennsylvania producers could be competitive with Midwest producers that already receive subsidies ranging from $1 to $1.50 per gallon, said John Cole, founding partner of United Biofuels in Manchester Township, York County.

Meanwhile, biodiesel producers say they’re down to running on fumes and loans.

Biodiesel, Government, Legislation