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Green diesel harnesses Swedish forests

Peter Vinthagen Simpson · 20 Feb 2011, 11:24

Published: 20 Feb 2011 11:24 GMT+01:00

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Describing the development of the product, which hits the market in April, as "unique", the firm claims that Preem Evolution diesel reduces carbon dioxide emissions by 16 percent due to the fact that a fifth of the raw material is tall oil.

"New thinking on green solutions lies behind the development of the Evolution diesel. The tall oil has hitherto been regarded as waste by the forest industry. Through innovative thinking and co-operation it has been developed into a renewable resource," the firm said in a statement.

The product is developed from processing a residue extracted from black liquor in pulp mills and is the result of six years of research and costing the firm more than 300 million kronor ($47 million).

The diesel is identical to fossil diesel molecularly, but is made up of 20 percent renewables, thus qualifying it for tax free status in Sweden and thus comparable in price to regular diesel.

This content also contributes to environmental benefits, the firm stated.

Story continues below…

"It represents a larger reduction in CO2 from vehicles and transports than biogas and ethanol together," the firm said, arguing that CO2 savings will equate to the emissions from 120,000 cars in 2011 alone.

Preem will launch the new product in April and plans to introduce 100,000 tonnes of Evolution diesel on the Swedish market during 2011.

Peter Vinthagen Simpson (news@thelocal.se)

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Your comments about this article

12:21 February 20, 2011 by rybo1
Sounds good, but will it screw up my engine?
12:30 February 20, 2011 by Keith #5083

But hey, Rybo, I don't think you need worry about getting bark beetle in your cylinder block :)
14:22 February 20, 2011 by Nemesis

This will mean less imports of fossil fuels, which in turn will improve the overall balance of payments in the country.
14:56 February 20, 2011 by Great Scott
thus qualifying it for tax free status in Sweden.

I dont think so, wait until Swedens loony conservative government see what it can make from it. People currently using diesel will switch that ='s loss of revenue in taxes.

I also think that in real terms this is no different than rape seed.
15:24 February 20, 2011 by Rick Methven
"The diesel is identical to fossil diesel molecularly, but is made up of 20 percent renewables, thus qualifying it for tax free status in Sweden and thus comparable in price to regular diesel."

Reading between the lines, what they are saying is:

It is expensive to make and we need to claw back our 300 million kronor R&D quick. So the only way we can sell it for the same price as ordinary diesel is if we do not pay fuel tax ( or at least the extra 0.26kr/lt that the government has just put on diesel)
18:56 February 20, 2011 by eppie
@great scott '''I also think that in real terms this is no different than rape seed.'''''

Indeed but with major difference that here they use forest waste instead of crops that have to be grown on purpose for making fuel.
21:59 February 20, 2011 by Swedesmith
Sounds like a great idea on the surface.
06:08 February 21, 2011 by för30årseden
This sounds like a real tax boondoggle. A variation on the U.S. Black liquor tax boondoggle (see below). It will not save any carbon emissions since it uses waste products that would have been burned to supply energy to the pulp mill. So the pulp mill will use more fossil fuels, But the new product will burn up more tax breaks!

April 17 (Bloomberg) -- Paper companies may claim about $6.6 billion from a U.S. tax break meant to discourage use of fossil fuels, and they'll burn more diesel to get it.

The tax credit is an incentive to mix an alternative energy source with carbon-based fuel. Papermakers already generate electricity by burning a wood byproduct from pulp-making called "black liquor." To qualify for the windfall they are adding diesel fuel to the black liquor, following the letter of the law while violating its spirit, said Verle Sutton, editor of the Reel Time Report, a unit of Los Angeles-based Forestweb Inc., a provider of data on the paper industry.

"It's an absolute government boondoggle," Sutton said. "These companies were not using fossil fuels. They only started because they needed it for the tax credit to work. So there's a negative to the environment, not a positive."
18:32 February 21, 2011 by mkvgtired

"Sounds good, but will it screw up my engine?"

I looked into using biodiesel in my sister's Jetta. What I found was most diesels manufactured in the mid to late 2000's are biodiesel ready. Older diesels may need to have certain seals replaced to run straight biodiesel. Because this is only a 20% blend I'm not sure if you would have to treat it as bio. Maybe email your manufacturer.

@för30årseden, Yes, government is not always the best entity for detecting arbitrage opportunities. I am sure they will rewrite the law or get a court injunction (which in the common law system would get codified into law).

Hopefully this does not end up like the US situation you mentioned above. If it does not encourage waste somewhere else, look at the bright side, it is not imported from Libya.
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