"Everything but the oink!" is a common marketing expression in the hog world, invoked to highlight both the bountifulness of the pig and the clean efficiency of an animal industry that's found a market for not only prime chops but snouts, nails, and all the blood and gristle in between. About one third of all fats and oils in the United States are rendered products -- essentially slow-cooked, inedible animal parts -- and are used in things like pet food, livestock feed, and soap. Now Tyson Foods, the world's largest "protein provider," has identified yet another use for the hog, chicken, and cow parts that don't make the cut for human consumption: fuel.
Late last month, Tyson and oil giant ConocoPhillips announced a partnership in which Conoco will purchase 58 percent of Tyson's yearly output of 300 million gallons of rendered animal carcass, and convert it into what they're calling "renewable diesel." The project is expected to produce 175 million gallons of biofuel per year -- domestically, about 0.1 percent of the current diesel market.
The partnership comes at a time when there is a growing, across-the-aisle political emphasis on renewable energy. Nearly every current Democratic presidential candidate has called for 60-65 billion gallons of alternative fuels to be in yearly production by 2025, and while Republicans have been less specific, even President Bush has been talking about switching 15 percent of fuel consumption to renewable sources over the next 10 years. It came as a surprise, then, that the National Biodiesel Board and a number of Congressional Democrats, lead by Texas Representative Lloyd Doggett, have been raising a stink about the Tyson-Conoco project.
At the root of the issue, as you might imagine, is pork. When Tyson and Conoco announced they'd be working towards a greener future, they had their eyes on an obscure piece of tax code that grants a $1-per-gallon credit to fuel producers making use of "thermal depolymerization" technology to produce "renewable fuel." House Republican Whip Roy Blunt inserted the provision into the 2005 Energy Bill, hoping to benefit a floundering company in his home district that produces boiler fuel from turkey offal, which did not qualify chemically as "biodiesel" -- and therefore didn't qualify for the 50 cent-per-gallon biodiesel credit. (The company, incidentally, has already received a reported $12 million in federal aid, has yet to produce an affordable fuel, and has reportedly become a smelly nuisance to its neighbors.) Conoco and Tyson caught wind of the tax break and lobbied the Treasury Department to extend the definition of "thermal depolymerization" to apply to their method of integrating animal fat and diesel fuel.
Today, Congressman Doggett is introducing legislation "to prevent some corporations from taking advantage of renewable diesel tax incentives by merely processing animal fat in conventional refineries." Word on the Hill is that the Tyson-Conoco process essentially amounts to pouring fat into diesel tanks during the refining process -- and that should disqualify them from the subsidy.
Some of the hoopla centers around the the overwhelming competition small biodiesel refineries would face and the fairness of giving tax breaks to a large, profitable company . The rest is a real question of what renewable fuel should accomplish -- is energy independence enough of a goal, or should an alternative fuel have a demonstrable impact on greenhouse gas emissions?
"Not one single new product or technology will come out of this," Greg Hopkins, a turkey biodiesel producer in Georgia, told me. "The diesel fuel will come out as diesel -- it's not going to have an emissions impact." This is likely why environmental groups, such as the Natural Resources Defense Council and the Sierra Club, are supporting Doggett's bill, which accuses Tyson and Conoco of exploiting a credit that was meant for "clean-burning, biodegradable diesel fuel that is fully independent of petroleum products."
Joe Jobe, CEO of the NBB, testifying before the House Small Business Committee on May 3, alluded to the same concern, adding that Conoco and Tyson's claims to enhancing energy security are also limited. He charged that the companies had failed to provide any significant data about emissions, biodegradability, toxicity, lifecycle energy benefits, health effects, operability, performance, durability, or compatibility with infrastructure or vehicles. "They were completely given a pass on all regulatory requirements simply by exploiting an ambiguity in the tax code," Jobe testified. "The renewable diesel ruling will result in large payments for some activity that does not significantly expand our refinery capacity and therefore will not add to our fuel supply."
Tyson would not return calls, but the company's website refers to renewable diesel as a "cleaner burning fuel." However, there is no mention of greenhouse gases or global warming, and no data on what "cleaner burning" might mean. When asked about the animal-fat biodiesel program, ConocoPhillips spokesman Bill Graham noted that their product was tested for emissions by an independent laboratory and claimed that four categories of greenhouse gas emissions were lower in their diesel blend. But the companies claim the biofuel is "chemically equivalent" to diesel, so it's difficult to say what the actual emissions impact might be. Conoco has not publicly released the results of the emissions test.
There's also the environmental impact of the meat industry to contend with. Each 42-gallon barrel of Conoco biofuel would require two steers, 16 hogs, or 1,300 chickens to produce. A report released in November 2006 by the United Nations Food and Agriculture Organization found that the livestock industry is one of the world's top contributors to global warming, producing 18 percent of greenhouse gas emissions. It's also one of the highest consumers of fossil fuels. When you consider that the Union of Concerned Scientists has identified driving, followed by eating meat as the most polluting of an average person's activities, well, the irony is not so subtle.
Just as the evidence for an emissions impact remains elusive, there's not a lot of information on what the efficiency of Conoco's 20-percent-animal-mass fuel might be. While ethanol and biodiesel have endured numerous studies evaluating their energy return ratios, rendered-fat fuel has thus remained obscure, and as a mere "byproduct," innocuous enough to evade scrutiny.
To get a general idea of the amount of energy that goes into this "byproduct," I called up a family friend who's a livestock veterinarian and a turkey farmer. According to him, the average chicken is grown to 6 pounds, 20 percent of which ends up heading to the rendering plant. Combine that information with a United Nations estimate that each kilogram of chicken carcass takes 35 megajoules of energy to rear (which doesn't even include the energy expended in transport, processing, storage, conversion of carcass to fat, or energy used in transporting and processing the conventional diesel component), and you've got a gallon of "renewable" fuel that has taken over 4.3 times the energy to produce as it yields. Chicken, Tyson's number 1 product, would be the most commonly used fat, though it's not necessarily the most energy-efficient animal: Hog and cow fuel would require at least 4.9 and 1.9 times the energy they produce, respectively. Taxpayers and fuel users need to decide if this is something they want to subsidize.
For Doggett, cost is the biggest issue. The tax break was initially claimed only by the Missouri company, Changing World Technologies, and the Finnish national company, Neste Oil (which has a renewable biofuel refinery in California), which made the cost of this pork seem manageable. With Conoco claiming the tax credit, the added cost would start at $175 million and could skyrocket, depending on how much fuel Tyson and Conoco choose to produce and whether other companies who are openly investigating biofuel possibilities, like Smithfield Farms, might jump in with their own deals.
Doggett legislation would limit the tax break -- which is up for renewal in 2008 -- to only companies producing 100 percent biofuel, and automatically revoke the credit for Conoco, which must add 80 percent regular diesel to the animal fat for it to work with their existing refinery equipment. Meanwhile, Conoco, which is poised to pour $100 million into the project, says if they don't get the credit, the deal's off. End of story? Probably not. Even if Doggett's measure is passed in the House, Tyson has promised to forge ahead. The company's renewable fuel fact sheet pledges that they're hard at work on "ways to generate energy from poultry litter."
