By L. Davis Clements

The history of U.S. biodiesel begins almost 30 years ago as university researchers built upon developmental Austrian work. Years later, when biodiesel gained entry into the 1990 Farm Bill, an industry was born.

The Oil Embargo of 1973 changed the dynamic between oil exporting and importing countries forever. Historically, the oil importing countries including the U.S. and Europe controlled exploration, development of existing and new production and transportation and refining of final products for a majority of the petroleum used in the world. On Oct. 17, 1973, the Organization of Petroleum Exporting Countries, following a resource allocation model developed by the Texas Railroad Commission, stopped the flow of petroleum to much of the western world. Soon, our tanks were nearly empty and we were coping with a new set of rules in the energy industry. In particular, the cost of petroleum-based energy within the refinery, and in the fuels and chemicals markets, would never be as before.

The increased prices and diminished availability of diesel fuel impacted the economic viability of mechanized agriculture in the U.S. and Europe. After a number of unsuccessful experiments using vegetable oil as a replacement for diesel fuel in farm tractors, a young organic chemist, Martin Mittelbach, from the Technical University of Graz in Austria, reviewed the problems encountered in using whole oils in the tractor engines. In 1981, Mittelbach and colleagues began a structured laboratory research program to determine the cause of the engine failures and how to eliminate them. Their first publication of the use of fatty acid esters as a diesel fuel appeared in 1982.

In 1979, Charles Peterson, an agricultural engineer at the University of Idaho, began working with vegetable oil as a diesel fuel for farm tractors. Peterson’s group faced the same challenges as the Graz group did with fuel coking. At Idaho, the researchers also explored the idea of using blends of diesel and vegetable oil as a fuel. The results from the Idaho effort were confirmation of the failures in Austria, until Peterson’s group tried a 50/50 mixture of diesel fuel and transesterified rapeseed oil. The engine performed reliably in long-term testing. The majority of the subsequent development work at Idaho used ethyl esters, not methyl esters as used in Austria. The rape esters also demonstrated the fact that the esters are powerful paint removers.


The important contribution from Austria is the use of transesterification as a means of producing fatty acid esters and the separation of the coproduct, glycerol. The glycerol is the component in the vegetable oil that creates the coking upon combustion in the diesel engine because of its low decomposition temperature (290 degrees Celsius). Coking is why the engines were failing after a relatively small operating time. By using transesterification, glycerol is easily removed from the fatty acid esters. Peterson’s work clearly showed that fatty acid esters blended easily with conventional diesel fuel and produced a fuel product, B100, a complete replacement for petroleum diesel.

By 1983, the strategy of transesterification was a demonstrated success. Additional work on fuel quality and emissions at Graz resulted in a seminal paper published in The Journal of the American Oil Chemists’ Society (JAOCS) in 1988 that opened the door to the current biodiesel industry.

Establishing Biodiesel

The JAOCS paper quickly came to the attention of Earl Gavett, USDA Economic Research Service, who assembled a fact-finding team that went to Austria to find out about this new “biodiesel” innovation. The team recognized that biodiesel offered a potential market for excess soybean oil, and a renewable source of diesel fuel. I received a call from Don van Dyne, University of Missouri-Columbia, and a colleague in a large USDA oilseed project. “Dave, we’ve learned about an exciting opportunity for a renewable diesel fuel,” he said. “We have a briefing for the House Ag Committee in two weeks. Could you provide us with a process description and a cost estimate for a 100 MMgy production plant to make biodiesel?” I replied, “Well maybe. I have seen the work at Idaho with oil-diesel blends, but what is biodiesel?” Van Dyne replied, “The fatty acid methyl esters made from vegetable oil.” I said, “O.K., I can do that,” and I did using the data from Mittelbach and Peterson.

The rush was on. The American Soybean Association began funding several projects to evaluate the biodiesel opportunity, and the USDA Agricultural Research Service instituted additional research in support of the development of biodiesel. There were a number of early adopters in private industry—designers with and without expertise, and the beginnings of the “home brewers” movement. Several universities became involved, beginning with the University of Idaho, then University of Nebraska, Iowa State University, University of Missouri-Columbia, and the University of Georgia. The USDA biodiesel program was centered at the ARS Lab in Peoria, Ill. The U.S. DOE biodiesel program was headquartered at the National Renewable Energy Laboratory in Golden, Colo.

Another phone call came two years later from a senior staffer of the House Ag Committee, who needed a legal definition of biodiesel to get it into the Farm Bill—and it was needed in two hours. My reply: “Biodiesel is defined as the mono-alkyl esters of long chain fatty acids derived from vegetable oils or animal fats, for use in compression-ignition (diesel) engines.” The new title in the Farm Bill passed. Shortly thereafter, there was an increase in funding and attention for biodiesel in USDA and DOE. The National Center for Advanced transportation Technology (NCATT) at the University of Idaho was established in 1991 by Congress as a key participant in the biodiesel development program.

Building the Industry

The 1990 Farm Bill opened the door for government support and involvement in developing biodiesel as a new industry. At the time there was a very large demand for soybean meal for animal feed, but the available soybean oil supply outstripped the market demand. The soybean farmers were awash in oil.

The American Soybean Association embraced the opportunity offered by the emerging biodiesel industry as a way to provide a profitable absorption of the excess oil. There were ASA committees actively pursuing market development, legislative support, fuel demonstration projects, public awareness, as well as critical research and development programs.

A major effort went into the creation of a preliminary quality standard for the fuel, finished in 1991. The standard was the first step in providing the quality and performance requirements for the biodiesel industry. The standards tell engine manufacturers the properties they can expect from the fuel and enabled the manufacturers to develop appropriate technologies to support performance warranties.

As a program director of the USDA Cooperative State Research Service Office of Agricultural Materials on loan from the University of Nebraska-Lincoln, I cohosted a meeting at USDA Secretary Edward Madigan’s office in early 1992 to discuss coordinating the efforts on behalf of the ASA, USDA, DOE, and advocacy groups such as the New Uses Council to further the biodiesel cause. The outcome of the meeting was the formation of the National SoyDiesel Development Board.

The early discussions of the SoyDiesel Board addressed the strategy to be adopted in pursuing the acceptance and, hopefully, cooperation of the petroleum industry and the vehicle/engine manufacturers. There were already a number of demonstration projects underway, but there was only a provisional specification for the fuel. The decision was to rigorously develop performance specifications for the fuel and its use utilizing the ASTM structure and approval system as the acceptance strategy.

A key collaboration in the pursuit of acceptance by the engine manufacturers and the diesel fuel providers was the result of a memorandum of understanding between the USDA and the U.S. Department of Defense to develop technologies to produce products using agricultural raw materials. The products had to be of use to the U.S. military, the world’s largest single consumer, and the civilian market—a “dual use strategy.”

Initial biodiesel trials by the military took place at Yuma Proving Ground, Arizona. When the test vehicles failed within a few hours to a few days, things looked bad. Steve Howell, a chemical engineer with Mark IV, was sent by the SoyDiesel Board to YPG to investigate the situation. Howell proved to the Army that biodiesel is a super solvent that cleans fuel tanks, with the dissolved goo plugging fuel filters. The Army was satisfied, but this issue persists today.

Extensive additional performance and property testing was conducted by the Army Tank-Automotive Command in Warren, Michigan, and the Fuels and Lubricants Laboratory in Ft. Belvoir, Va. (Editor’s Note: Read part two of the story in the January issue of Biodiesel Magazine.)

L. Davis Clements is CEO of Biomass Renewable Technologies Inc. Reach him at