Research Project Information

Research Project Summary Information

Development of Biodiesel Manufacturing in New York(ST7683-1)

C.J. Schneider Engineering


This project will help develop a biodiesel manufacturing plant in New York. With the current cost of biodiesel higher than conventional diesel fuel, larger plants will be required to take advantage of economies of scale. It is anticipated that the plant will manufacture at least 10 to 12 million gallons of biodiesel annually (10 MGPY). In addition, lower-cost feedstock will be required. A 10 MGPY plant requires approximately 6,700,000 bushels of soybeans. Since New York produced only 5,200,000 bushels in 2001, a plant this size would need to either import soybean oil or identify large supplies of other types of feedstock, such as waste animal fats or recycled vegetable oils. The United States diesel market is approximately 60 billion gallons per year, and New York consumes on average about 770,000,000 gallons of diesel per year. Biodiesel is typically sold as a B20 blend or 20% biodiesel. Therefore, full penetration of the B20 market in New York State equates to 150,000,000 gallons per year.

Map Error

Project Description

The goal of this project was to help commercialize biodiesel manufacturing in New York. Results may be used to decide whether to proceed to business plan refinement, presentation to equity markets, and ultimately design, construction, and startup of a facility.


A 10 million gallon per year (MGPY) plant would cost 10 to 15 million dollars and result in approximately $25,000,000 in direct product sales. A plant of this type typically produces five (5) times the economic impact to the local community ($125,000,000) through creation of jobs for construction, plant operations, transportation of products, and creation of new markets for recycled oils and fats. If the entire output was used in New York State as B20, it could reduce air emissions 12-20% over conventional diesel.

Project Results

Work included: 1) screening and selection of up to three potential biodiesel manufacturing sites; 2) site-specific assessment of local/regional feedstock sources (including soybean oil, other vegetable oil, recycled oils, animal fats, etc.) and their quality, supplies, and costs at the potential sites; 3) identification of the current and potential local market size, selling price, and market demand for biodiesel and co-products; 4) site-specific preliminary process design and economics (capital and operating costs) for a full-scale manufacturing facility that can accommodate various feedstocks; and, 5) assessment of overall project risk at selected sites via a financial analysis model. The study identified an estimated 20% internal rate of return to build a 15 million gallon per year biodiesel plant in New York. Equity investors typically expect a 25% to 30% rate of return. The report recommended the State implement legislation to provide incentives, develop an infrastructure to distribute the biodiesel product, and mandate usage of biodiesel to create a market. The biodiesel industry is changing rapidly. Currently, many parties are interested in building a manufacturing facility in New York State. Since the report was written, the price of oil has risen to more than $45 per barrel, which may be enough to stimulate New York investment. On the other hand, the price of soy oil has dropped, so New York’s advantage of abundant yellow grease supplies may be less relevant.


C.J. Schneider Engineering
5634 South 85th Circle
Omaha, NY 68127

Principle Investigator

George Hefley

Universities Involved


Project Type:

Indigenous/Renewable Energy Resources

Technologies Types:

NYSERDA Contact Information

Judy Jarnefeld


R&D - Environment & Energy Res

Contract Details

Start Date: 1/11/2010
Project Status: Active
Contract Number: ST7683-1

Last Updated: 12/1/2010