This is an excerpt from EERE Network News, a weekly electronic newsletter.

April 03, 2002

New Minnesota Law Mandates 2-Percent Biodiesel Blend

All diesel fuel sold in Minnesota may one day consist of at least 2 percent biodiesel, thanks to a new law that was passed by the state legislature last month. The 2-percent biodiesel mandate will kick in when the state's production capacity for biodiesel reaches 8 million gallons and when 18 months have passed since a federal action (such as a tax credit) creates a two-cent drop in the price of such a biodiesel blend. If there is no federal cost break for the biodiesel blend, the mandate will kick in on July 1, 2005, as long as the production capacity is at 8 million gallons. And should the mandate be repealed, the law allows some compensation to distributors who have upgraded their equipment to meet the mandate. See the Minnesota legislature Web site.

Minnesota Governor Jesse Ventura allowed the bill to become law without his signature, noting that he approves of the outcome but disagrees with the idea of government mandates. See the Governor's press release.

Biodiesel also continues to advance in California, where Southern States Power Company is developing a new facility to produce 30 million gallons per year of the fuel. The company signed an agreement to purchase land for the facility in mid-March, and announced yesterday that it had signed a preliminary engineering contract with Lurgi PSI Inc. for the design and construction of the facility. See the Southern States Power press releases.