Portland plant is cooking now, turning old grease into biofuel
The owner is planning to add restaurants to his supply chain and line up more customers.
By TUX TURKEL, Staff Writer
September 8, 2009
Jarmin Kaltsas got started on Maine Bio-Fuel Inc.’s $2 million plant by taking out a bank loan and using his home as collateral. It’s believed to be only the second commercial-grade refinery for cooking grease in Maine.
Jack Milton/Staff Photographer
PORTLAND — Jarmin Kaltsas became fascinated with turning restaurant grease into heating oil and motor fuel while working four years ago at a farm greenhouse in Knox County. The biodiesel he began producing there in small volumes gave him bigger ideas.
It might have been fate: His grandfather owned oil wells in Texas and Pennsylvania.
"I guess maybe it was in my blood a little bit," he said last week. "But I wanted to do clean energy."
After more than two years of raising money and scraping together equipment, Kaltsas has opened Maine Bio-Fuel Inc. The company is believed to be only the second commercial-grade refinery in Maine that recycles cooking grease into biodiesel. The $2 million plant is located in an industrial park on the outskirts of Portland.
Kaltsas is slowly ramping up business now, collecting cooking grease from roughly 40 restaurants in Greater Portland. His long-range plan is to capture grease from up to 500 eateries within 100 miles of the city, trucking it from as far as northern Massachusetts. With that quantity, he could produce up to 1 million gallons a year of pure biodiesel, much of it to be sold wholesale.
Biodiesel is part of an evolving industry in the United States, as new government regulations aimed at cutting petroleum use and reducing emissions linked to air pollution and climate change take hold. And there's a new element. Debate is growing over the use of first-generation biofuels, such as those made from corn, soybeans and other food crops.
Case in point: In Massachusetts, all diesel fuel sold after 2011 must be blended with 2 percent biofuel. But a new provision requires the fuel to deliver a net 50-percent reduction in greenhouse gases, when compared with petroleum. Biofuels derived from cooking grease automatically meet the Massachusetts standard.
That's lucky for Kaltsas. He may be opening his plant at a prime time, making a product that's in high demand.
That said, he'll also face competition for the feedstock he needs. Grease is a valuable commodity these days, listed on the Chicago Board of Trade.
Kaltsas seems confident, though, that he can line up distributors and oil dealers that want to blend and market his locally produced biofuel.
"Given a choice," he said, "people want to use fuel made from recycled product."
Biodiesel is made from a chemical process that separates glycerin from vegetable oil and animal fat. Diesel vehicles can run on this product or – in cold weather – a blend of petroleum diesel. And fuel-grade biodiesel, like what's being made at Maine Bio-Fuel, must meet strict industry standards.
Inside, Kaltsas has assembled a production line that begins with a 1,000-gallon container of cooking grease and ends with a 15,000-gallon storage tank of pure biodiesel. Along the way, equipment settles and filters food waste, then removes the glycerin byproduct so it can be used for soap-making or composted. Methanol, used in the process, is recycled in a closed-loop system. Final fuel cleaning is achieved with an innovative wash system that saves water and money.
Outside, Maine Bio-Fuel recently opened a retail pump so diesel cars and trucks can fill up on weekdays. It was selling this week for $2.80 a gallon, on par with petroleum diesel. That's what Kaltsas puts in his 1985 Mercedes-Benz diesel sedan. The license plate gives a clue: Greasy 1.
Maine Bio-Fuel has two trucks that pick up grease from restaurants, free of charge. Marketing and sales are picking up speed, spearheaded by Dean Sgouros, the company's vice president. A Web site will be launched soon: www.mainebio-fuel.com
Getting this far took a while. Kaltsas, who is 34, started the plant by taking out a bank loan and using his home as collateral. He saved money by doing much of the work himself. He has since attracted private investors.
Maine Bio-Fuel's progress is being watched closely by Alfred Padula, an environmental activist in the city who has been heavily involved in biodiesel. He helped finance an experimental biodiesel production facility back in the 1990s that's used by the Chewonki Foundation in Wiscasset, a plant that has since been upgraded. And he drives a diesel-powered Volkswagen Jetta, which he filled recently at the Maine Bio-Fuel pump.
"It's really quite amazing that they've been able to do this," Padula said. "It's real recycling, in the sense that they use 100 percent of the original product."
Kaltsas also has caught the attention of Joel Glatz, co-owner of Frontier Energy Inc. in China.
Glatz's company has been offering biodiesel since 2001. He sells more than 200,000 gallons a year of pure biodiesel, derived from virgin feedstock such as soybeans. These domestically grown crops displace imported oil, but critics say it takes as much petroleum to grow and harvest the plants as is saved by using the biofuel.
"That's being disputed by the soybean industry," Glatz said, "but it could create a market for the recycled product, so that you could sell as much as you make."
Other companies see the promise. Bean's Commercial Grease has had a similar grease-to-biofuel operation for the past five years in Vassalboro. It also has a retail pump. The nation's largest grease collector, Baker Commodities, has an outlet on the same road.
Kaltsas said he's not too concerned about these competitors. He chose Portland because it has more restaurants – and more grease – than anywhere in Maine. He has a strategic location near the Maine Turnpike, good equipment and a supportive community with a heightened environmental awareness.
"I knew how much oil there was in the state," he said. "And I knew it would be a lot of work to get all the restaurants on board. But I'm taking the challenge."
Staff Writer Tux Turkel can be contacted at 791-6462 or at: tturkel@pressherald.com
