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BIODIESEL – THE STORY OF A COMPANY'S DETERMINATION TO SUCCEED IN AN EMERGING YET DIFFICULT MARKET
My grandchildren challenged me with a question "Grandad, you've taken a lot from this world, isn't it time you made a difference and put something back?"
This was the driving force behind my decision to start up Global Commodities UK Ltd as I firmly believe that global warming is not a legacy that we want our children and grandchildren to inherit!
We have the only purpose built factory in the UK dedicated to the manufacture of bio diesel with a current capacity to produce up to 30 million litres a year from our site in Dereham, Norfolk. We are currently engaged in building a new factory, which will have the capacity to manufacture 180 million litres of bio diesel per year.
We currently employ two scientists at our site in Dereham, who are responsible for laboratory tests on quality assurance and the ongoing innovation of our product. driveECO has undergone external analysis and testing to ensure it conforms to the European Standard for bio diesel EN 14214.
In the early years in developing both the product and the company, life was made very difficult by our Government not giving sufficient incentives in the form of reduced excise duty on bio diesel.
Whilst the Government was happy to give incentives for the use of automotive LPG it took a long time before the duty on bio diesel was reduced to make it economically viable to manufacture and attractive to be purchased. Additionally there were no grants available for us to develop the product and to date we have been self-funded and received no help or support from our Government.
We launched driveECO to the market in February 2002 and although the demand was great, the current economic situation meant we were unable to match the price of conventional diesel. It was not until July of that year that the Government announced that there was to be a reduction of 20 pence per litre on bio diesel - I will never forget that day as long as I live!
Additionally at this time we were having battles with Customs and Excise over fuel duty, and in particular where we sold the product for off-road use. These problems were resolved after some time, but caused us great stress in the meantime.
The July announcement helped our business considerably and we were able to pass through a critical phase in the company's finances. As part of our survival we sold a number of shares in the company.
Our commitment to manufacture bio diesel stems from our belief that we cannot continue to produce pollutants in the atmosphere, which contributes towards the greenhouse effect. Emissions from transport have more than doubled since 1970 and from freight transport alone have increased by more than 60%.
We are members of CRED, a carbon reduction initiative launched by the University of East Anglia. CRED has ambitions to cut carbon emissions by 60% by 2025, which is way ahead of the Government's target. This initiative engages in educating local businesses, individuals and schools on how we all are able to play our part in the reduction of emissions, thereby protecting our environment. We are particularly aware in East Anglia that the melting of the polar icecaps and glaciers will increase sea levels to which we are extremely vulnerable.
Fossil fuels are rapidly depleting as we continue to 'rape mother earth' and the inevitability is that prices of these will continue to rise as the product becomes short. It is estimated by the University of Ohio that by 2020 the extraction of "reasonable cost" petroleum fuels will be seriously depleted. As an indication of the increasing production of oil the following is interesting. From the tapping of the first oil well in 1858 in Pennsylvania to 1930 some 17 billion barrels of oil had been extracted worldwide. By 1970 we were extracting 17 billion barrels per year, and today the figure is 24 billion barrels per year. This cannot continue to be sustained at this pace of growth.
On the one hand as countries develop to achieve increased standards of living and transport, the demand for fuel will increase and on the other hand we cannot keep on increasing the production of greenhouse gases that will affect the Earth's climate.
Our belief is that we must seek other ways in which to fuel our life style, and we believe that the use of bio fuels is the way forward to ensure that these objectives are met.
The European Union has issued a directive that all automotive fuels must have an organic origin of 2% by 2005, rising to 5.75% by 2010. Diesel sales in the UK are in excess of 17 billion litres per annum. Therefore by 2005, sales of bio diesel should be 340 million litres rising to over 970 million litres by 2010. We cannot see these figures being achieved in the current climate.
The depletion of fossil fuels is of paramount importance and every effort must be made to sustain our lifestyle using alternative forms of energy. Current market conditions of large price rises in energy, coupled with the volatile prices of energy are cause for concern brought about by supply and demand criteria amongst other influencing factors.
The use of bio fuels addresses both of these concerns, and in addition has a number of other benefits. These benefits particularly apply to the environment.
- The production of bio diesel through the agricultural industry can provide a stable source of fuel and ensure that we fuel our local economy by empowering our farmers to grow rape on land currently set aside.
- Bio diesel does not contribute to skin problems, dermatitis, and asthma.
- Particulate emissions are reduced when bio diesel is used even in a 5% mix with conventional diesel.
- Bio diesel is bio degradable and bio degrades within 28 days.
There are some economic benefits when using bio diesel:
- It is possible to gain carbon credits when this product is used in commercial heating systems.
- Bio diesel mixes in all proportions with conventional diesel and recovers the lubricity, thereby enhancing the life of your engine.
- There are no engine modifications required to use bio diesel.
We have engaged ourselves in a number of educational programmes with schools and colleges around the country. I am passionate about educating the youth of today on the benefits of protecting our environment. I firmly believe that in the future it will be our children who will be educating us on the benefits of sourcing environmentally friendly product alternatives.
As part of our passion in promoting the use of bio fuels we have had the opportunity to meet with many Members of Parliament, both at Westminster and within Europe. This has resulted in many of them visiting our site at Dereham and receiving their ongoing support for our cause of 'fuelling a better world'. We continue at the forefront of lobbying the UK Government for a further reduction of excise duty on bio fuels and feel that they need be more proactive in their support for the bio fuels industry.
The future…...
We are excited about our future and have plans in place to build a new factory producing bio diesel from virgin rapeseed crops grown by local farmers. This presents an opportunity to support British Agriculture and at the same time increase the production of bio diesel, helping to improve the environment.
At the moment there are some 681,000 hectares of land set aside by agriculture, on which farmers could grow rapeseed. Growing an industrial crop such as rape attracts a further grant of 45 euros. The use of this land would enable us to grow our own fuel and achieve my vision of making East Anglia "the oilfields of the future."
The production of rapeseed locally also provides farmers with an opportunity to produce a high protein cattle feed from the resultant rapeseed cake, which gives them further added value to the process.
We believe therefore that our vision of "fuelling a better world" is a reality that the UK needs to wake up to!
- Locally produced bio fuels from local farmers thereby supporting and increasing the local economy.
- Government targets on the use of bio fuels met.
- Reduction in the carbon emitted into the atmosphere from fossil fuels and thereby protecting our world!
For further information, visit us at www.globeco.co.uk.
West Midlands and Mid Wales branch, Worcester Rugby Club – 10th June 2004.
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