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The National Biodiesel Board says the U.S. is not making near what it could be when it comes to biodiesel.

This story on Wisconsin Ag Connection says high soybean oil prices are keeping America from producing an NBB-projected amount of 1.85 billion gallons a year… but that could soon change:

Soybean oil prices in the mid- to high 40-cent range is one of the biggest contributors to tight margins and biodiesel production cutbacks. Recent passage of the Energy Independence and Security Act of 2007, however, expands the Renewable Fuels Standard (RFS), which will require 500 million gallons of biodiesel to be used or blended in 2009.

In 2007, the United States produced 400 million gallons of biodiesel, or about 22 percent of production capacity. The year before, the industry had a production capacity of 580 million gallons and sold 250 million gallons, or 43 percent of capacity.

NBB officials do point out that many biodiesel plants project a much-higher capacity than what they are currently producing in order to make it easier to expand later on.

Some farmers in Canada are having trouble getting biodiesel to run their farm equipment, so they’re trying to make their own.

According to this story in the Owen Sound (Canada) Sun Times, a group of farmers got a $10,000 grant and they were able to make do-it-yourself biodiesel refineries for about $600 each, which they recently demonstrated in their home county of Bruce County in Ontario.

“Biodiesel is still hard to get at the farm level. This allows us to use our own home oil seed crops to make it . . . (and) still have livestock feed left over,” said project leader John Gillespie, a beef farmer from the Ripley area who heads up Bruce Biodiesel.

Bruce Biodiesel draws its members from the Christian Farmers Union, the National Farmers’ Union and the Bruce County Federation of Agriculture.

The system, which can be put together for about $600, uses four discarded hot water heaters, some piping and a few pumps to produce diesel fuel from oil extracted from soybeans or canola. Some commercially produced chemicals, such as methanol and sodium hydroxide or potassium hydroxide, are needed to remove the glycerine from the oil.

In addition to getting the fuel, the farmers are able to take the leftover meal and feed it to their livestock.

While it’s good to have the big refineries making the biodiesel available to a wide audience, it’s also nice to see folks able to take part in biodiesel on their own.

Oakland, California-based Blue Sky Bio-Fuels, Inc. has sent out its first shipment of biodiesel.

This story from the East Bay Business Times says the biodiesel is going to fuel school buses in the area:

Blue Sky, an 18-month-old Oakland company that manufactures biofuel from waste restaurant kitchen grease, formed a partnership with the city of San Francisco’s Greasecycle program to collect used kitchen oil and convert it into a fuel that burns more cleanly than traditional diesel fuel. Greasecycle was launched in November by San Francisco Mayor Gavin Newsom. Greasecycle is the first citywide program to collect fats, oil and grease, or FOG, and convert them into biofuel for municipal vehicles. The first restaurants that had their FOG picked up gratis by the city were Puccini and Pinetti in Union Square.

Recycled FOG from San Francisco restaurants in the Greasecycle program is estimated to generate 1.5 million gallons of biofuel each year. Fifty-nine restaurants had signed up for the program before its launch.

Blue Sky got its first shipment of waste oil about a month ago. You can read more about the company on its web site, BlueSkyBio-Fuels.com.

In a bit of a surprise over the weekend (sorry, just now catching up from the Christmas holiday), Martin Tobias is out as chairman and CEO of Imperium Renewables… replaced by company co-founder John Plaza as CEO and Nancy Floyd as chairman.

This story on C|Net News Green Tech Blog says tight times for the biodiesel industry might have prompted the change:

Tobias has been the spokesman and public figure for Imperium since its founding. The company has raised more than $200 million dollars and earlier this year christened a 100-million gallon refinery in Washington state. It has plans to build similar sized facilities in Hawaii, Argentina and elsewhere.

Biodiesel, however, is a tough business. The fuel, made from vegetable or meat oils, actually costs more than regular diesel. The federal government gives refiners a $1 to 50 cent per gallon subsidy. Imperium had filed preliminary papers for an IPO, but recent rumors make it sound like the company had to postpone the proposed date for the IPO. No confirmation on that.

The article goes on to point out that some other companies have had to swap out management lately as green fuel companies try to find the right mix of someone from the energy sector who is media-tech savvy. What makes this transition so puzzling is that Tobias seemed to have both.