BIODIESEL: PROCESS ECONOMICS

A K Gupta Ex Scientist G Indian Institute of Petroleum, India Introduction

Biodiesel is the name of a clean burning alternative fuel, produced from domestic, renewable resources. Biodiesel contains no petroleum, but it can be blended at any level with petroleum diesel to create a biodiesel blend. It can be used in compression-ignition (diesel) engines with little or no modifications. Biodiesel is simple to use, biodegradable, nontoxic, and essentially free of sulfur and aromatics. Biodiesel is produced from any fat or vegetable oil. The process involves a reaction of the oil with an alcohol to remove the glycerin, which is a by-product of biodiesel production. Fuel-grade biodiesel must be produced to strict industry specifications. Biodiesel can be used as a pure fuel or blended with petroleum in any percentage. B20 (a blend of 20 percent by volume biodiesel with 80 percent by volume petroleum diesel) has demonstrated significant environmental benefits with a minimum increase in cost for fleet operations and other consumers. The use of biodiesel in a conventional diesel engine results in substantial reduction of unburned hydrocarbons, carbon monoxide, and particulate matter compared to emissions from diesel fuel. In addition, the exhaust emissions of

sulfur oxides and sulfates (major components of acid rain) from biodiesel are essentially eliminated compared to diesel. The use of biodiesel results in a substantial reduction of unburned hydrocarbons. Emissions of nitrogen oxides are either slightly reduced or slightly increased depending on the duty cycle of the engine and testing methods used. Biodiesel reduces net CO2 emissions by more than 70 percent compared to petroleum diesel. This is due to biodiesels closed carbon cycle. The CO2 released into the atmosphere when biodiesel is burned is recycled by growing plants, which are later processed into fuel. Is biodiesel safer than petroleum diesel? Scientific research confirms that biodiesel exhaust has a less harmful impact on human health than petroleum diesel fuel. In general, the standard storage and handling procedures used for petroleum diesel can be used for biodiesel. Biodiesel can be operated in any diesel engine with little or no modification to the engine or the fuel system. Biodiesel has a solvent effect that may release deposits accumulated on tank walls and pipes from previous diesel fuel storage. The release of deposits may clog filters initially and precautions should be taken. Ensure only fuel meeting the biodiesel specification is used.

ECONOMIC FACTORS
Depending upon the price of feed vegetable oil presently, Biodiesel is 1.5 2 times costlier than petro-diesel; cost of vegetable oil accounts for about 75% cost of production of biodiesel. Due to the higher cost biodiesel and biodiesel-diesel blends have not penetrated the market. To have a greater impact on the Indian Farm/ Rural sector biodiesel may have to compete with petro-diesel. Availability of non-edible vegetable oils, in large amounts, at reasonably lower price and improvements in conversion technology would reduce the cost of biodiesel.

Commercial Biodiesel Technologies

Currently used technologies for producing biodiesel can be classified into three categories: (i) (ii) (iii) Base catalyzed transesterification with refined oils Base catalyzed transesterification with low fatty acid greases and fats Acid esterification followed by transesterification of lower or high free fatty acid fats and oils. Other process under development include biocatalyzed transesterification, pyrolysis of vegetable oil/ seeds and transesterification in supercritical methanol. The goal of all technologies is to produce fuel grade esters meeting standard specifications (e.g. ASTM/ European/BIS). The key quality control issues involve complete (or nearly complete) removal of alcohol, catalyst, water, soaps, glycerine and unreacted or partially reacted triglycerides and free fatty acids (FFA). Failure to remove these contaminants causes the biodiesel to fail one or more fuel standards. The basic process involves transesterification of vegetable oil/fats in presence of a catalyst in batch or continuous mode. Continuous process may not be suitable, if the variation in quality of feedstocks are wide. There are numerous variations of basic technology: Different catalysts e.g. NaOH, KOH, MeONa, Non alkaline catalysts, acids, metal complexes and bio catalysts etc. can be used. Anhydrous ethanol, isopropanol or butanol can be substituted for methanol. Alcohols other than methanol may require additional process steps and quality control. 3

Basic transesterification is carried out at atmospheric pressure and temperature around 60-70C. Some technologies use higher temperatures and elevated pressure, typically in super critical range of methanol. For high FFA feedstocks acid catalysed esterification followed by base catalysed transesterification is used or FFA can be removed first and the purified oil is transesterified.

Majority of commercial processes use base catalysed reaction because it is most economic for several reasons: Low reaction temperature upto 100C and pressure up to 10 bar. High conversion (~98%) and minimal side reactions and reaction time. Direct conversion to methyl esters with no intermediates. Exotic material of construction are not necessary.

Problems of Biodiesel Production

Both base and acid catalyzed processes are associated with several inherent problems: Free fatty acids interfere with transesterification deactivate the basic catalysts loss of catalyst and biodiesel yield. Water deactivates both basic and acidic catalysts. Drying of oil may be required. Soaps formed with basic catalyst form emulsion and foam and difficult to remove. When processing feedstocks with high free fatty acids additional steps must be taken. After basic transesterification, the purification and adequate testing during processing is required to produce fuel grade esters. 4

Appropriate Technology
The selection of appropriate technology for production of biodiesel requires careful selection of processing steps, catalyst and downstream process integration. The quality of feed vegetable oil particularly FFA content plays and important role in identifying the suitable technology. The important factors to be considered include: Must be able to process variety of vegetable oils without or minimum modifications. Must be able to process high free fatty containing oils/ feedstocks. Most of the non-edible oils available in India contains high FFA (2-12%) For India non-edible oils obtained from plants which can be grown on waste/ semi arid lands are more suitable. Species can be selected based on the regional climatic conditions Must be able to process raw both expelled and refined oil. Process should be environment friendly almost zero effluents. Able to produce marketable by products glycerine, fatty acids, soap if any. Must be able to produce fuel grade esters; Biodiesel produced should meet the standard specifications. The process should be adaptable over a large range of production capacities.

IIP Processes for Biodiesel

India Institute of Petroleum has developed three processes for biodiesel from non-edible oils and under exploited oils including Jatropha curcas, Pongamia, Salvadora, Madhuca Indica and Mixed Oils.

Process I
5

This process is suitable for feed stocks having FFA content >1% to about 20%. The oil is pretreated before transesterification at moderate temperature (60-80C) in presence of a base catalyst. FFA are also converted to biodiesel resulting in higher yield of biodiesel. Pretreated oil is transesterified with methanol at Crude Biodiesel and glycerine are 60-70C in presence of a base catalyst. separated and purified by distillation.

Main Features of IIP Process I Flexibility for processing variety of vegetable oils separately or mixed without any modification. Tolerance of higher levels of free fatty acids Conversion of free fatty acids present in feed oils to biodiesel or alternatively free fatty acids can be recovered as byproduct or soap. Biodiesel produced meets the standard specification (ASTM, European or proposed BIS). Glycerine produced is ~ 99% pure. Process can be adapted to wide range of production capacities.

Vegetable oil

Oil Pretreatment

Methanol + catalyst

Transesterification

Crude glycerine Methanol recovery Glycerine refining

Crude Biodiesel

Refining

Biodiesel Glycerine

Figure 1: IIP Processes for Biodiesel Process I

Process II
This process is suitable for feedstocks having FFA<1%. Transesterification is carried out at ambient conditions in presence of a base catalyst. After separation of glycerine biodiesel is purified by distillation. Oil containing higher FFA can also be processed, if a pretreatment step is included. From technical point of view t his process is especially suitable for small scale operations. Any of these processes can be selected to produce biodiesel depending upon the characteristics of feed oil stock. Biodiesel produced meets standard specifications (ASTM / European / BIS proposed) (Table-1). In this process transesterification is carried out at ambient conditions in liquid phase with NaOH/ KOH as catalyst in presence of a solvent. The purpose of solvent is to make homogeneous single liquid phase, eliminating liquid-liquid mass transfer limitations. Vigorous mixing as in case of Process I is not required. After settling, the glycerin lower layer and biodiesel upper layer are separated. Biodiesel is purified by vacuum distillation. Unreacted material obtained as bottoms in distillation is recycled to transesterification reactor. FFA goes as sodium/ potassium salt in glycerin layer and is recovered as byproduct by neutralizing with an mineral acid (HCl, H3PO4, H2SO4) Experimental Studies 1. Solubility of oil and MeOH in solvent Requirement of solvent at various oil to MeOH ratio to make single phase 8 by all three processes

2. [A]

Transesterification runs Mode : batch without stirring ambient 10 25C Temperature :

After separation of glycerin layer, biodiesel recovered by distillation, bottoms recycled in next batch. Vegetable Oil Batch size Solvent MeOH Results Average of 7 consecutive runs Conversion of oil Yield of biodiesel (based on oil fed) [B] : : 99+ wt% 97 wt% : : : : Soya refined, Acid value ~ 1.0 mg KOH/g ~ 450 g (Fresh vegetable + recycle) Methyl ester of soya oil (10% of oil) Oil ratio : 4:1 (mole/mole)

Jatropha curcas oil (Acid value 11.6 mg KOH/g) Average of two runs Conversion of oil Yield of biodiesel (based on oil ) : : 92 % 84 wt%

By product Fatty acids Note: This process allows simultaneous production of biodiesel and FFA separation

IIP PROCESS II using solvent

Oil Feed

Removal of FFA (Optional) Solvent MeOH + Catalyst Transesterification

Glycerine separation

Glycerine

Biodiesel Solvent purification Recycle

Biodiesel

10

GENERAL COMMENTS ON PROCESS II The studies carried out established the following: Transesterification, at ambient conditions, is feasible using the solvent (Ester of fatty acids) Reaction proceeds well even at temperatures as low as 5-8C. reaction and settling time 6-8 h. (depends upon temperature) No stirring is required; The reactant form a single phase, thus mass transfer limitations are eliminated. Initial mixing of MeOH, oil, solvent and alkali is however necessary. Experiments with various oils like soya refined oil, Jatropha curcas and Mahua oil having upto acid no. 19.0 have been carried out. Vegetable oil containing FFA (acid no. upto about 12) could be processed without any difficulty. At higher FFA the reactant mixture becomes viscous and this hindered the separation of glycerin. NaOH/KOH suitable as catalyst. Product separation and purification possible by distillation/ water washing. Distillation preferred as it increased the yield of biodiesel, by converting recycled distillation bottoms to biodiesel. If water washing is used additional step of biodiesel drying needed. Product biodiesel met the specifications. FFA, if present in oil is recovered as by product with glycerin. Process tested with fresh oil as well as with recycle of distillation bottoms along with fresh oil in batch mode. 7 cycles of recycle have been tested. Total

Scale up issues

11

Batch scale reactors may be large L/D tanks with external For larger plants continuous process may be desirable. (Feasibility

circulating pump for initial mixing of reactants. for continuous operation needs to be established). Static mixers / CSTR followed by settlers. Down stream separation steps can be designed using standard available methods/ software packages.

12

Figure 2: IIP Processes for Biodiesel Process II

13

Figure 3: IIP Processes for Biodiesel Process II

14

Process III

IIP heterogeneous Biodiesel Process Indian Institute of Petroleum has developed a novel heterogenous catalyst and process to produce biodiesel under a research programme partially funded by The Department of Biotechnology. The process in ecofriendly and produces biodiesel meeting the current International and National specifications. This process is suited to feedstocks containing wide range of FFA or 100% FFA. In this process esterification of FFA and transesterification of triglycerides is carried out in a single step over a proprietary catalyst at moderate temperature and pressure. The catalyst is recycled and glycerine is obtained as by product. Biodiesel and glycerine are purified by distillation. The process is suitable for producing both methyl or ethyl ester.

Table -1Comparison of Biodiesel produced by IIP Process with National & International Specifications
Characteristics Density, 15C, g/cc Kinematic Viscosity @ 40C cSt Flash Point, C, closed cup, min Sulfated Ash content Max., wt %, max Water content, mg/kg, max Sulphur max. mg/kg, max Cu strip corrosion, 3 hr/50C, max ASTMD6751-02 1.9-6.0 130 0.02 500 50 3 BIS, India 0.86-0.90 3.5-5.0 120 0.02 500 50 1 Jatropha Curcas Methyl Ester 0.8887 4.55 135 0.008 250 <1 1 Karanja Oil Methyl Ester 0.98944 5.07 174 0.002 200 4.5 1 Mahua Oil Methyl Ester 0.8808 5.13 150 0.002 275 4.3 1

Acid Number, mgKOH/g, max Carbon residue, wt% max Cetane number, min Methanol, % mass, max Total glycerol%, by mass, max

0.8 0.05 -0.25

0.8 0.05 51 0.20 0.25

0.5 0.013 56.6 <0.1 0.1

0.6 0.025 -<0.1 0.1

0.58 0.014 -<0.1 0.1

Process Description The plant can be operated continuously in Fixed-bed reactor(s) or in batch mode in stirred reactors.

Fresh Vegetable Oil Fresh Methanol Esterification & Transesterification

Recycle Methanol

Methanol Recovery

Phase Separation

Biodiesel Purification

BIODIESEL

Glycerin Phase

Glycerin Refining

Glycerin

Figure 3 : Process Flow Scheme for Biodiesel Production HETREGENEOUS CATALYST

Catalyst The IIP process uses a unique heterogeneous catalyst which catalyses transesterification and esterification simultaneously and provides improved selectivity and unit flexibility and suppresses corrosion and by product formation. No pretreatment of vegetable oil is necessary to remove FFA. The catalysts also convert FFA into biodiesel. Catalyst I Catalyst - II

Feedstocks Vegetable oils having FFA content upto 5%. Methanol purity is normally at least 99.85 wt%, however oils with higher FFA can be readily processed and lower purity methanol can be processed. Use of other alcohols e.g. Ethyl alcohol, Butyl alcohol in place of methyl alcohol have been tested and established. The catalyst also works with aqueous ethyl alcohol (azeotrope of EtOH-water) Product & by product yields Conversion of triglycerides and FFA is greater than 99%. Yields ester of over 98% based on Triglycerides and FFA present in the oil are obtained; unconverted MeOH is recycled. The process is suited to feed stocks containing wide range of FFA. The process can produce both methyl and ethyl esters. The reaction is performed at higher temperature and pressure than in homogenous-catalysed processes; excess alcohol is recovered by flash vaporization, glycerin is separated in a settler and biodiesel is purified by distillation under vacuum. Main Features of the process Flexibility for processing variety of vegetable oils separately or mixed.

Tolerance of higher levels of free fatty acids. Requires no pretreatment or removal of FFA. Conversion of free fatty acids present in feed oils to biodiesel Tolerance of water in alcohol (aqueous ethanol can be used) No emulsion or soap formation Catalyst is recycled when operated in batch mode and is not deactivated either with water or FFA. Biodiesel produced meets the standard specification (ASTM, European or proposed BIS). Glycerin produced is ~ 99% pure Process can be adapted to wide range of production capacities. The process is ecofriendly with almost zero effluents. Technological/ Economic Benefits Use of heterogeneous catalyst has direct impact on the economics of biodiesel production. Several neutralization and washing steps needed for processes using homogeneous catalysts such as NaOH, KOH, MeONa etc. are eliminated. Cost of alkali and associated waste streams are eliminated Typical Results (Bench Scale, Catalyst I)

Feed oil

Jatropha Curcas Oil Acid value : 11.6 mgKOH/g Moisture : 600-800 ppm * oil was filtered before use; No pretreatment Alcohol Operating Conditions Methanol (99.7%) Moisture : 0.2 wt%

Oil to alcohol ratio Catalyst Reactor Mode of operation

o o o o

: 1:10 mol/mol : 0.6 wt% of feed oil (fine powder, catalyst I ) : 600ml stirred reactor (SS316) : Batch

Unreacted methanol recovered by evaporation Glycerin separated in a settler Biodiesel recovered and purified by vac. Distillation Catalyst, recovered MeOH and unreacted/partially reacted vegetable oil recycled. Yields

o o

Average Biodiesel yield

: 98% based on fresh oil (Expelled oil)

Physico-chemical characteristics of Biodiesel conforms specifications

Typical Results (Bench scale, catalyst II) Feed oil JC Oil Acid value : 13.0 mgKOH/g Moisture : 600-800 ppm Oil was filtered before use, no pretreatment Alcohol Methanol (99.7%) Moisture (0.2 wt%) Operating Conditions Oil to MeOH ratio Catalyst Reactor : 1:10 mol/mol : : 1 wt% of feed oil (fine powder) 600 ml stirred reactor (SS 316)

 Yields

Mode of Operation :

Batch

Average biodiesel yield without recycle Continuous operation in Pilot Plant Reactor Catalyst Temperature Pressure Vegetable oil flow rate Catalyst MeOH flow rate Conversion (per pass) Typical results Temperature Pressure Oil flow rate (soya oil) Methanol/ oil ratio(mol) Conversion per pass : 175C : : : : : :

88.0 wt% on oil

Fixed-bed, Externally heated; Down flow mode. Material : SS-316 Catalyst II; extrudates; particle size (mesh 8 + 12) : : : : : : 170 200 15 25 kg/cm2g 60 135 g/h 741 g mole ratio 10:1 75 88%

Range of Operating Conditions

22 kg/cm2g 125 g/h 10:1 86.8 wt% (without recycle)

(based on oil) Aqueous Alcohol (Catalyst I) Use of other alcohols e.g. Ethyl alcohol, Butyl alcohol in place of methyl alcohol have been tested and established. The catalyst also works with aqueous ethyl alcohol (azeotrope of EtOH-water)

Typical Results Alcohol Oil Mode of Operation : : : Batch 70% based on oil EtOH (with 8 wt% water) JC oil

Yield of biodiesel without recycle :

Typical Results Catalyst Alcohol Alcohol to oil ratio Mode of operation Yield of biodiesel : : : : : Catalyst II, extrudates MeOH

2.7 wt% of oil

10:1 mol/mol Batch 88 % based on oil

without recycle

Continuous Operational Data (Pilot Plant)

o

Heterogenous catalyst Reactor fixed bed Flow : Down Flow Catalyst loading to reactor top.

: Catalyst II (extrudates : 8+12 mesh) : 1 diameter, SS-316 : 470 g

o o o o

Vegetable oil & methanol premixed and preheated to 150-170C and fed Same catalyst load used for 7 months Typical results :

o o

Effect of operating parameters : Temperature C 175 190 190 175 175 Pressure kg/m2g 23 23 23 23 23 Flow rate methanol g/hr 43 43 43 29 29 Flow rate veg. Conversion wt Oil g/hr %/ of veg oil 80 74.7 80 87.3 80 87.8 80 75.32 80 79.75

Note : Actual conversion of vegetable oil Per pass is more than given in the table above. The figures of conversion in the least column are actual yields of biodiesel

obtained after distillation without recycle of unreacted tiglycerides. For evaluation purposes, over all conversion may be taken as 99% with yield of biodiesel as 98% based on vegetable oil, as obtained in batch runs (data given above). Batch Distillation Data Liquid product obtained from the reactor bottom was separated into two layers. The upper layer containing biodiesel and unreacted oil was distilled under vacuum (2-3 mm Hg abs. Pressure) in a one plate distillation setup. Top product (170-200C) was collected as biodiesel. Bottom temperature was 220C max. Bottom recycled back to reactor.

BIODIESEL PROCESSES :Economic analysis

COST ESTIMATES Biodiesel Plant (Process I) (Alkali Process with Pretreatment) CASE I
Annual Capacity TPA (330 Days a Year)= Cost Index Type: CE Fixed Capital, CFC Direct Plant Cost Purchased Equipment, (E) Installation % E Instrumentation % E Electricals % E Piping % E Building % E Yard improvement % E Service Facilities %E Boiler/Hot water system Cooling tower system Tube well Generator Cost Index Value 20027000.0 7000000.0 1750000.0 700000.0 700000.0 1750000.0 1260000.0 700000.0 1540000.0 660

25 10 10 25 18 10 22 3 1.5 1 5

Miscellaneous Piping 25% of above Land %E Total Direct Plant Cost (DPC)= Indirect Plant Cost Eng. & Supervision %E Costruction Exp. % E Total DPC+above two =(B) Contractor fees %E Contingency % B Total Erected Cost (CFC) Working Capital 15% CFC or 70% E (Higher) Total Capital Investment, CTC, Rs.

1.5 3 6

420000.0 15820000.0 700000 1050000 17570000.0 700000 1757000 20027000.0 4900000 24927000.0

10 15 10 10

Manufacturing Expenses Direct Raw Materials & Cat & Chemicals Bio Oil tons per year 1683.7 Bio Oil cost Rs./ton 20000.0 Methanol tons per year 215.5 Methanol Cost Rs./ton 10000.0 Catalyst tons per year 8.42 Cat Cost Rs./ton 25000 By-products Credit Glycerine Glycerine produced, ton/yr 121.22 Glycerine Cost Rs./ton 54000 Operating Labour (3 shifts, 4 men per shift, 3000 p.m/men) Supervisory & Clerical, 25% labour Utilities Electricity Cooling water Maintenance & repair (3% of DPC/annum) Operating supplies (15% of maint. & repairs) Laboratory Charges (15% optg labour) Patents & Royalties (1% of total expenses) Total, ADME Indirect Overhead (payroll and plant packaging, storage, 60% of sum of optg lab, supervision & maint) (Assumed nil) Local Taxes (Nil) Insurance (0.5 % on DPC/ annum) Interest on Capital (70% fixed capital loaned) ^@7.5% per annum Total AIME

Rs./Yr

Rs./ ton

33673469.4 2155102.0 210459.2

20408.2 1306.1 127.6

-6546122.4 432000.0 108000.0 3300000.0

-3967.3 261.8 65.5 2000.0

822416.4 123362.5 64800.0 171940.0 34515427.0

498.4 74.8 39.3 104.2 20918.4

0.0 0.0 137069.4 2267740.3 2404809.7

0.0 0.0 83.1 1374.4 1457.5

Total Manufacturing expenses, AME Depreciation (10% of DPC), ABD General Expenses Administrative costs (15% sum of optg lab, supervision & maint) Total Expenses, AGE Manufacturing cost @Rs/kg Revenue from sales as @ Rs./kg Net Annual Profit, ANP Income Tax (Assumed zero) Net profit after tax, ANNP After tax rate of return, i=((ANNP+ABD)/CTC)*100 Payout period, years

36920236.7 2741387.9

22375.9 1661.4

204362.5 39865987.0 24.2 30.20 49832483.7 9966496.7 9966496.7 29.42 3.40

123.9 24161.2 30201.5

CASE II
Annual Capacity TPA (330 Days a Year)= Cost Index Type: CE Fixed Capital, CFC Direct Plant Cost Purchased Equipment, (E) Installation % E Instrumentation % E Electricals % E Piping % E Building % E Yard improvement % E Service Facilities %E Boiler/Hot water system Cooling tower system Tube well Generator Miscellaneous Piping 25% of above Land %E Total Direct Plant Cost (DPC)= Indirect Plant Cost Eng. & Supervision %E Cost Index Value 34704029.4 12130034.8 3032508.7 1213003.5 1213003.5 3032508.7 2183406.3 1213003.5 2668607.6 1650

25 10 10 25 18 10 22 5.20 2.60 1.73 8.66 2.60 5.20 6

727802.1 27413878.5 1213003.5

10

Costruction Exp. % E Total DPC+above two =(B) Contractor fees %E Contingency % B Total Erected Cost (CFC) Working Capital 15% CFC or 70% E (Higher) Total Capital Investment, CTC, Rs.

15 10 10

1819505.2 30446387.2 1213003.5 3044638.7 34704029.4 8491024.3 43195053.8 Rs./Yr Rs./ ton

Manufacturing Expenses Direct Raw Materials & Cat & Chemicals Bio Oil tons per year 1683.7 Bio Oil cost Rs./ton 20000.0 Methanol tons per year 215.5 Methanol Cost Rs./ton 10000.0 Catalyst tons per year 8.42 Cat Cost Rs./ton 25000 By-products Credit Glycerine Glycerine produced, ton/yr 121.22 Glycerine Cost Rs./ton 54000 Operating Labour (3 shifts, 4 men per shift, 3000 p.m/men) Supervisory & Clerical, 25% labour Utilities Electricity Cooling water Maintenance & repair (3% of DPC/annum) Operating supplies (15% of maint. & repairs) Laboratory Charges (15% optg labour) Patents & Royalties (1% of total expenses) Total, ADME Indirect Overhead (payroll and plant packaging, storage, 60% of sum of optg lab, supervision & maint) (Assumed nil) Local Taxes (Nil) Insurance (0.5 % on DPC/ annum) Interest on Capital (70% fixed capital loaned) ^@7.5% per annum Total AIME Total Manufacturing expenses, AME Depreciation (10% of DPC), ABD General Expenses Administrative costs (15% sum of optg lab, supervision & maint)

33673469.4 2155102.0 210459.2

20408.2 1306.1 127.6

-6546122.4 432000.0 108000.0 3300000.0

-3967.3 261.8 65.5 2000.0

822416.4 123362.5 64800.0 171940.0 34515427.0

498.4 74.8 39.3 104.2 20918.4

0.0 0.0 137069.4 2267740.3 2404809.7 36920236.7 2741387.9

0.0 0.0 83.1 1374.4 1457.5 22375.9 1661.4

204362.5

123.9

Total Expenses, AGE Manufacturing cost @Rs/kg Revenue from sales as @ Rs./kg Net Annual Profit, ANP Income Tax (Assumed zero) Net profit after tax, ANNP After tax rate of return, i=((ANNP+ABD)/CTC)*100 Payout period, years

39865987.0 24.2 30.20 49832483.7 9966496.7 9966496.7 29.42 3.40

24161.2 30201.5

CASE III
Annual Capacity TPA (330 Days a Year)= Cost Index Type: CE Fixed Capital, CFC Direct Plant Cost Purchased Equipment, (E) Installation % E Instrumentation % E Electricals % E Piping % E Building % E Yard improvement % E Service Facilities %E Boiler/Hot water system Cooling tower system Tube well Generator Miscellaneous Piping 25% of above Land %E Total Direct Plant Cost (DPC)= Indirect Plant Cost Eng. & Supervision %E Costruction Exp. % E Total DPC+above two =(B) Contractor fees %E Contingency % B Total Erected Cost (CFC) Working Capital 15% CFC or 70% E (Higher) Total Capital Investment, CTC, Rs. Cost Index Value 52601472.3 18385694.6 4596423.7 1838569.5 1838569.5 4596423.7 3309425.0 1838569.5 4044852.8 3300

25 10 10 25 18 10 22 7.88 3.94 2.63 13.13 3.94 7.88 6

1103141.7 41551669.9 1838569.5 2757854.2 46148093.5 1838569.5 4614809.4 52601472.3 12869986 65471458.6

10 15 10 10

Manufacturing Expenses

Rs./Yr

Rs./ ton

Direct Raw Materials & Cat & Chemicals Bio Oil tons per year 3367.3 Bio Oil cost Rs./ton 20000.0 Methanol tons per year 431.0 Methanol Cost Rs./ton 10000.0 Catalyst tons per year 16.84 Cat Cost Rs./ton 25000 By-products Credit Glycerine Glycerine produced, ton/yr 242.45 Glycerine Cost Rs./ton 54000 Operating Labour (3 shifts, 4 men per shift, 3000 p.m/men) Supervisory & Clerical, 25% labour Utilities Electricity Cooling water Maintenance & repair (3% of DPC/annum) Operating supplies (15% of maint. & repairs) Laboratory Charges (15% optg labour) Patents & Royalties (1% of total expenses) Total, ADME Indirect Overhead (payroll and plant packaging, storage, 60% of sum of optg lab, supervision & maint) (Assumed nil) Local Taxes (Nil) Insurance (0.5 % on DPC/ annum) Interest on Capital (70% fixed capital loaned) ^@7.5% per annum Total AIME Total Manufacturing expenses, AME Depreciation (10% of DPC), ABD General Expenses Administrative costs (15% sum of optg lab, supervision & maint) Total Expenses, AGE Manufacturing cost @Rs/kg Revenue from sales as @ Rs./kg Net Annual Profit, ANP Income Tax (Assumed zero) Net profit after tax, ANNP After tax rate of return, i=((ANNP+ABD)/CTC)*100 Payout period, years

67346938.8 4310204.1 420918.4

20408.2 1306.1 127.6

-13092244.9 432000.0 108000.0 6600000.0

-3967.3 130.9 32.7 2000.0

1246550.1 186982.5 64800.0 171940.0 67796088.9

377.7 56.7 19.6 52.1 20544.3

0.0 0.0 207758.3 3437251.6 3645009.9 71441098.9 4155167.0

0.0 0.0 63.0 1041.6 1104.5 21648.8 1259.1

267982.5 75864248.4 23.0 28.74 94830310.5 18966062.1 18966062.1 35.31 2.83

81.2 22989.2 28736.5

OST ESTIMATES Biodiesel Plant (Process II) (Solvent Process) CASE I

Annual Capacity TPA (330 Days a Year)= Cost Index Type: CE Fixed Capital, CFC Direct Plant Cost Purchased Equipment, (E) Installation % E Instrumentation % E Electricals % E Piping % E Building % E Yard improvement % E Service Facilities %E Boiler/Hot water system Cooling tower system Tube well Generator Miscellaneous Piping 25% of above Land %E Total Direct Plant Cost (DPC)= Indirect Plant Cost Eng. & Supervision %E Costruction Exp. % E Total DPC+above two =(B) Contractor fees %E Contingency % B Total Erected Cost (CFC) Working Capital 15% CFC or 70% E (Higher) Total Capital Investment, CTC, Rs. Manufacturing Expenses Direct Raw Materials & Cat & Chemicals Bio Oil tons per year Bio Oil cost Rs./ton Methanol tons per year Methanol Cost Rs./ton Catalyst tons per year Cat Cost Rs./ton By-products Credit Glycerin Rs./Yr Cost Index Value 15039900.0 5100000.0 1275000.0 510000.0 510000.0 1275000.0 918000.0 510000.0 1530000.0 660

25 10 10 25 18 10 30 3.00 1.50 1.00 5.00 1.50 3.00 6

306000.0 11934000.0 510000.0 765000.0 13209000.0 510000.0 1320900.0 15039900.0 3570000 18609900.0 Rs./ ton

10 15 10 10

673.5 20000.0 86.2 10000.0 3.37 25000

13469387.8 862040.8 84183.7

20408.2 1306.1 127.6

Glycerin produced, ton/yr 48.49 Glycerin Cost Rs./ton 54000 Operating Labour (3 shifts, 4 men per shift, 3000 p.m/men) Supervisory & Clerical, 25% labour Utilities Electricity Cooling water Maintenance & repair (3% of DPC/annum) Operating supplies (15% of maint. & repairs) Laboratory Charges (15% optg labour) Patents & Royalties (1% of total expenses) Total, ADME Indirect Overhead (payroll and plant packaging, storage, 60% of sum of optg lab, supervision & maint) (Assumed nil) Local Taxes (Nil) Insurance (0.5 % on DPC/ annum) Interest on Capital (70% fixed capital loaned) ^@7.5% per annum Total AIME Total Manufacturing expenses, AME Depreciation (10% of DPC), ABD General Expenses Administrative costs (15% sum of optg lab, supervision & maint) Total Expenses, AGE Manufacturing cost @Rs/kg Revenue from sales as @ Rs./kg Net Annual Profit, ANP Income Tax (Assumed zero) Net profit after tax, ANNP After tax rate of return, i=((ANNP+ABD)/CTC)*100 Payout period, years

-2618449.0 432000.0 108000.0 990000.0

-3967.3 654.5 163.6 1500.0

358020.0 53703.0 64800.0 171940.0 13975626.3

542.5 81.4 98.2 260.5 21175.2

0.0 0.0 59670.0 977019.8 1036689.8 15012316.0 1193400.0

0.0 0.0 90.4 1480.3 1570.7 22745.9 1808.2

134703.0 16340419.0 24.8 30.95 20425523.8 4085104.8 4085104.8 28.36 3.53

204.1 24758.2 30947.8

CASE - II
Annual Capacity TPA (330 Days a Year)= Effective Date to which estimate applies Cost Index Type: CE Fixed Capital, CFC Direct Plant Cost Purchased Equipment, (E) Installation % E Instrumentation % E Electricals % E Piping % E Building % E Yard improvement % E Service Facilities %E Boiler/Hot water system Cooling tower system Tube well Generator Miscellaneous Piping 25% of above Land %E Total Direct Plant Cost (DPC)= Indirect Plant Cost Eng. & Supervision %E Costruction Exp. % E Total DPC+above two =(B) Contractor fees %E Contingency % B Total Erected Cost (CFC) Working Capital 15% CFC or 70% E (Higher) Total Capital Investment, CTC, Rs. Manufacturing Expenses Direct Raw Materials & Cat & Chemicals Bio Oil tons per year Bio Oil cost Rs./ton Methanol tons per year Methanol Cost Rs./ton Catalyst tons per year Cat Cost Rs./ton By-products Credit Glycerine Glycerine produced, ton/yr Glycerine Cost Rs./ton Cost Index Value 26062072.8 8837596.8 2209399.2 883759.7 883759.7 2209399.2 1590767.4 883759.7 2651279.0 1650 Jun-04

25 10 10 25 18 10 30 5.20 2.60 1.73 8.66 2.60 5.20 6

530255.8 20679976.4 883759.7 1325639.5 22889375.6 883759.7 2288937.6 26062072.8 6186317.7 32248390.5 Rs./ ton

10 15 10 10

Rs./Yr

1683.7 20000.0 215.5 10000.0 8.42 25000 121.22 54000

33673469.4 2155102.0 210459.2

20408.2 1306.1 127.6

-6546122.4

-3967.3

Operating Labour (3 shifts, 4 men per shift, 3000 p.m/men) Supervisory & Clerical, 25% labour Utilities Electricity Cooling water Maintenance & repair (3% of DPC/annum) Operating supplies (15% of maint. & repairs) Laboratory Charges (15% optg labour) Patents & Royalties (1% of total expenses) Total, ADME Indirect Overhead (payroll and plant packaging, storage, 60% of sum of optg lab, supervision & maint) (Assumed nil) Local Taxes (Nil) Insurance (0.5 % on DPC/ annum) Interest on Capital (70% fixed capital loaned) ^@7.5% per annum Total AIME Total Manufacturing expenses, AME Depreciation (10% of DPC), ABD General Expenses Administrative costs (15% sum of optg lab, supervision & maint) Total Expenses, AGE Manufacturing cost @Rs/kg Revenue from sales as @ Rs./kg Net Annual Profit, ANP Income Tax (Assumed zero) Net profit after tax, ANNP After tax rate of return, i=((ANNP+ABD)/CTC)*100 Payout period, years

432000.0 108000.0 2475000.0

261.8 65.5 1500.0

620399.3 93059.9 64800.0 171940.0 33458107.3

376.0 56.4 39.3 104.2 20277.6

0.0 0.0 103399.9 1693040.5 1796440.4 35254547.7 2067997.6

0.0 0.0 62.7 1026.1 1088.8 21366.4 1253.3

174059.9 37496605.3 22.7 28.41 46870756.6 9374151.3 9374151.3 35.48 2.82

105.5 22725.2 28406.5

CASE III
Annual Capacity TPA (330 Days a Year)= Effective Date to which estimate applies Cost Index Type: CE Fixed Capital, CFC Direct Plant Cost Purchased Equipment, (E) Installation % E Instrumentation % E Electricals % E Piping % E Building % E Yard improvement % E Service Facilities %E Boiler/Hot water system Cooling tower system Tube well Generator Miscellaneous Piping 25% of above Land %E Total Direct Plant Cost (DPC)= Indirect Plant Cost Eng. & Supervision %E Costruction Exp. % E Total DPC+above two =(B) Contractor fees %E Contingency % B Total Erected Cost (CFC) Working Capital 15% CFC or 70% E (Higher) Total Capital Investment, CTC, Rs. Cost Index Value 39502715.5 13395291.8 3348823.0 1339529.2 1339529.2 3348823.0 2411152.5 1339529.2 4018587.5 3300 Jun-04

25 10 10 25 18 10 30 7.88 3.94 2.63 13.13 3.94 7.88 6

803717.5 31344982.8 1339529.2 2009293.8 34693805.8 1339529.2 3469380.6 39502715.5 9376704.3 48879419.8

10 15 10 10

Manufacturing Expenses Direct Raw Materials & Cat & Chemicals Bio Oil tons per year Bio Oil cost Rs./ton Methanol tons per year Methanol Cost Rs./ton Catalyst tons per year Cat Cost Rs./ton By-products Credit Glycerine

Rs./Yr

Rs./ ton

3367.3 20000.0 431.0 10000.0 16.84 25000

67346938.8 4310204.1 420918.4

20408.2 1306.1 127.6

Glycerine produced, ton/yr 242.45 Glycerine Cost Rs./ton 54000 Operating Labour (3 shifts, 4 men per shift, 3000 p.m/men) Supervisory & Clerical, 25% labour Utilities Electricity Cooling water Maintenance & repair (3% of DPC/annum) Operating supplies (15% of maint. & repairs) Laboratory Charges (15% optg labour) Patents & Royalties (1% of total expenses) Total, ADME Indirect Overhead (payroll and plant packaging, storage, 60% of sum of optg lab, supervision & maint) (Assumed nil) Local Taxes (Nil) Insurance (0.5 % on DPC/ annum) Interest on Capital (70% fixed capital loaned) ^@7.5% per annum Total AIME Total Manufacturing expenses, AME Depreciation (10% of DPC), ABD General Expenses Administrative costs (15% sum of optg lab, supervision & maint) Total Expenses, AGE Manufacturing cost @Rs/kg Revenue from sales as @ Rs./kg Net Annual Profit, ANP Income Tax (Assumed zero) Net profit after tax, ANNP After tax rate of return, i=((ANNP+ABD)/CTC)*100 Payout period, years

-13092244.9 432000.0 108000.0 4950000.0

-3967.3 130.9 32.7 1500.0

940349.5 141052.4 64800.0 171940.0 65793958.2

285.0 42.7 19.6 52.1 19937.6

0.0 0.0 156724.9 2566169.5 2722894.5 68516852.7 3134498.3

0.0 0.0 47.5 777.6 825.1 20762.7 949.8

222052.4 71873403.4 21.8 27.22 89841754.2 17968350.8 17968350.8 43.17 2.32

67.3 21779.8 27224.8

COST ESTIMATES Biodiesel Plant (Process III) (Heterogeneous Catalyst) CASE I

Annual Capacity TPA (330 Days a Year)= Cost Index Type: CE Fixed Capital, CFC Direct Plant Cost Purchased Equipment, (E) Installation % E Instrumentation % E Electricals % E Piping % E Building % E Yard improvement % E Service Facilities %E Boiler/Hot water system Cooling tower system Tube well Generator Miscellaneous Piping 25% of above Land %E Total Direct Plant Cost (DPC)= Indirect Plant Cost Eng. & Supervision %E Costruction Exp. % E Total DPC+above two =(B) Contractor fees %E Contingency % B Total Erected Cost (CFC) Working Capital 15% CFC or 70% E (Higher) Total Capital Investment, CTC, Rs. Manufacturing Expenses Direct Raw Materials & Cat & Chemicals Bio Oil tons per year Bio Oil cost Rs./ton Methanol tons per year Rs./Yr Cost Index Value 17284750.0 5950000.0 1487500.0 595000.0 595000.0 1487500.0 1071000.0 595000.0 1547000.0 660

25 10 10 25 18 10 26 3 1.5 1 5 1.5 3 6

357000.0 13685000.0 595000 892500 15172500.0 595000 1517250 17284750.0 4165000 21449750.0 Rs./ ton

10 15 10 10

673.5 20000.0 86.2

13469387.8

20408.2

Methanol Cost Rs./ton 10000.0 Catalyst tons per year 0.040 Cat Cost Rs./ton 500000 By-products Credit Glycerine Glycerine produced, ton/yr 48.49 Glycerine Cost Rs./ton 54000 Operating Labour (3 shifts, 4 men per shift, 3000 p.m/men) Supervisory & Clerical, 25% labour Utilities Electricity Cooling water Maintenance & repair (3% of DPC/annum) Operating supplies (15% of maint. & repairs) Laboratory Charges (15% optg labour) Patents & Royalties (1% of total expenses) Total, ADME Indirect Overhead (payroll and plant packaging, storage, 60% of sum of optg lab, supervision & maint) (Assumed nil) Local Taxes (Nil) Insurance (0.5 % on DPC/ annum) Interest on Capital (70% fixed capital loaned) ^@7.5% per annum Total AIME Total Manufacturing expenses, AME Depreciation (10% of DPC), ABD General Expenses Administrative costs (15% sum of optg lab, supervision & maint) Total Expenses, AGE Manufacturing cost @Rs/kg Revenue from sales as @ Rs./kg Net Annual Profit, ANP Income Tax (Assumed zero) Net profit after tax, ANNP After tax rate of return, i=((ANNP+ABD)/CTC)*100 Payout period, years

862040.8 20204.1

1306.1 30.6

-2618449.0 432000.0 108000.0 1122000.0

-3967.3 654.5 163.6 1700.0

410550 61582.5 64800 171940 14104056.2

622.0 93.3 98.2 260.5 21369.8

0.0 68425 1126111.875 1194536.9 15298593.0 1368500.0

0.0 103.7 1706.2 1809.9 23179.7 2073.5

142582.5 16809675.5 25.47 31.84 21012094.4 4202418.9 4202418.9 25.97 3.85

216.0 25469.2 31836.507

CASE II
Annual Capacity TPA (330 Days a Year)= Effective Date to which estimate applies Cost Index Type: CE Fixed Capital, CFC Direct Plant Cost Purchased Equipment, (E) Installation % E Instrumentation % E Electricals % E Piping % E Building % E Yard improvement % E Service Facilities %E Boiler/Hot water system Cooling tower system Tube well Generator Miscellaneous Piping 25% of above Land %E Total Direct Plant Cost (DPC)= Indirect Plant Cost Eng. & Supervision %E Costruction Exp. % E Total DPC+above two =(B) Contractor fees %E Contingency % B Total Erected Cost (CFC) Working Capital 15% CFC or 70% E (Higher) Total Capital Investment, CTC, Rs. Manufacturing Expenses Direct Raw Materials & Cat & Chemicals Bio Oil tons per year Bio Oil cost Rs./ton Methanol tons per year Methanol Cost Rs./ton Catalyst tons per year Cat Cost Rs./ton By-products Credit Glycerine Glycerine produced, ton/yr Rs./Yr Cost Index Value 29952088.3 10310529.5 2577632.4 1031053.0 1031053.0 2577632.4 1855895.3 1031053.0 2680737.7 1650 Jun-04

25 10 10 25 18 10 26 5.20 2.60 1.73 8.66 2.60 5.20 6

618631.8 23714217.9 1031053.0 1546579.4 26291850.3 1031053.0 2629185.0 29952088.3 7217370.7 37169459.0 Rs./ ton

10 15 10 10

1683.7 20000.0 215.5 10000.0 0.10 500000 121.22

33673469.4 2155102.0 50510.2

20408.2 1306.1 30.6

Glycerine Cost Rs./ton 54000 Operating Labour (3 shifts, 4 men per shift, 3000 p.m/men) Supervisory & Clerical, 25% labour Utilities Electricity Cooling water Maintenance & repair (3% of DPC/annum) Operating supplies (15% of maint. & repairs) Laboratory Charges (15% optg labour) Patents & Royalties (1% of total expenses) Total, ADME Indirect Overhead (payroll and plant packaging, storage, 60% of sum of optg lab, supervision & maint) (Assumed nil) Local Taxes (Nil) Insurance (0.5 % on DPC/ annum) Interest on Capital (70% fixed capital loaned) ^@7.5% per annum Total AIME Total Manufacturing expenses, AME Depreciation (10% of DPC), ABD General Expenses Administrative costs (15% sum of optg lab, supervision & maint) Total Expenses, AGE Manufacturing cost @Rs/kg Revenue from sales as @ Rs./kg Net Annual Profit, ANP Income Tax (Assumed zero) Net profit after tax, ANNP After tax rate of return, i=((ANNP+ABD)/CTC)*100 Payout period, years

-6546122.4 432000.0 108000.0 2805000.0

-3967.3 261.8 65.5 1700.0

711426.5 106714.0 64800.0 171940.0 33732839.7

431.2 64.7 39.3 104.2 20444.1

0.0 0.0 118571.1 1951396.6 2069967.7 35802807.4 2371421.8

0.0 0.0 71.9 1182.7 1254.5 21698.7 1437.2

187714.0 38361943.2 23.2 29.06 47952429.0 9590485.8 9590485.8 32.18 3.11

113.8 23249.7 29062.1

CASE III
Annual Capacity TPA (330 Days a Year)= Effective Date to which estimate applies Cost Index Type: CE Fixed Capital, CFC Direct Plant Cost Purchased Equipment, (E) Installation % E Instrumentation % E Electricals % E Piping % E Building % E Yard improvement % E Service Facilities %E Boiler/Hot water system Cooling tower system Tube well Generator Miscellaneous Piping 25% of above Land %E Total Direct Plant Cost (DPC)= Indirect Plant Cost Eng. & Supervision %E Costruction Exp. % E Total DPC+above two =(B) Contractor fees %E Contingency % B Total Erected Cost (CFC) Working Capital 15% CFC or 70% E (Higher) Total Capital Investment, CTC, Rs. Manufacturing Expenses Direct Raw Materials & Cat & Chemicals Bio Oil tons per year Bio Oil cost Rs./ton Methanol tons per year Methanol Cost Rs./ton Catalyst tons per year Cat Cost Rs./ton By-products Credit Glycerine Glycerine produced, ton/yr Glycerine Cost Rs./ton Rs./Yr Cost Index Value 44711251.5 15627840.4 3906960.1 1562784.0 1562784.0 3906960.1 2813011.3 1562784.0 3438124.9 3300 Jun-04

25 10 10 25 18 10 22 7.88 3.94 2.63 13.13 3.94 7.88 6

937670.4 35318919.4 1562784.0 2344176.1 39225879.5 1562784.0 3922587.9 44711251.5 10939488 55650739.8 Rs./ ton

10 15 10 10

3367.3 20000.0 431.0 10000.0 0.20 500000 242.45 54000

67346938.8 4310204.1 101020.4

20408.2 1306.1 30.6

-13092244.9

-3967.3

Operating Labour (3 shifts, 4 men per shift, 3000 p.m/men) Supervisory & Clerical, 25% labour Utilities Electricity Cooling water Maintenance & repair (3% of DPC/annum) Operating supplies (15% of maint. & repairs) Laboratory Charges (15% optg labour) Patents & Royalties (1% of total expenses) Total, ADME Indirect Overhead (payroll and plant packaging, storage, 60% of sum of optg lab, supervision & maint) (Assumed nil) Local Taxes (Nil) Insurance (0.5 % on DPC/ annum) Interest on Capital (70% fixed capital loaned) ^@7.5% per annum Total AIME Total Manufacturing expenses, AME Depreciation (10% of DPC), ABD General Expenses Administrative costs (15% sum of optg lab, supervision & maint) Total Expenses, AGE Manufacturing cost @Rs/kg Revenue from sales as @ Rs./kg Net Annual Profit, ANP Income Tax (Assumed zero) Net profit after tax, ANNP After tax rate of return, i=((ANNP+ABD)/CTC)*100 Payout period, years

432000.0 108000.0 6600000.0

130.9 32.7 2000.0

1059567.6 158935.1 64800.0 171940.0 67261161.1

321.1 48.2 19.6 52.1 20382.2

0.0 0.0 176594.6 2921663.8 3098258.4 70359419.5 3531891.9

0.0 0.0 53.5 885.4 938.9 21321.0 1070.3

239935.1 74131246.6 22.5 28.08 92664058.2 18532811.6 18532811.6 39.65 2.52

72.7 22464.0 28080.0

TABLE 2 : Economics of Biodiesel

Capacity : 2.0 TPD Item Capital Investment (Rs. Crore) Processing cost (Rs. / kg biodiesel) Payout Period (years) Process - I 2.49 6.60 4.17 Process II 2.14 5.57 3.84 Process - III 1.86 4.76 3.53

TABLE 3A :

13

Effect of Capacity on Economics IIP Process - I

Capacity, TPD Item Capital Investment (Rs. Crore) - Plant & Machinery (Rs. Crore) - Working Capital (Rs. Crore) Processing cost (Rs./kg biodiesel) Payout Period (years) at 25% Profit 2.0 2.49 2.00 0.49 6.61 4.17 5.0 4.32 3.47 0.85 4.2 3.4 10.0 6.55 5.26 1.29 3.0 2.83

TABLE 3B :

Effect of Capacity on Economics IIP Process - II

Capacity of Plant, TPD Item Capital Investment (Rs. Crore) - Plant & Machinery (Rs. Crore) - Working Capital (Rs. Crore) Processing cost (Rs./kg biodiesel) Payout Period (years) at 25% Profit 2.0 2.15 1.73 0.42 5.47 3.85 5.0 3.72 3.00 0.72 3.20 3.11 10.0 5.56 4.47 1.09 2.50 2.52

TABLE 3C :

Effect of Capacity on Economics IIP Process - III

Capacity of Plant, TPD Item Capital Investment (Rs. Crore) - Plant & Machinery (Rs. Crore) - Working Capital (Rs. Crore) Processing cost (Rs./kg biodiesel) Payout Period (years) at 25% Profit Economics Based on IIP processes, for a 2 TPD biodiesel plant the capital investment and production cost were estimated and summarized in Table-2. The cost analysis indicates that cost of oil is major component (about 75-90%) of total cost of biodiesel. Use of lower cost feedstocks would have tremendous impact on the biodiesel economics. II and III. The capacity of production affected the processing cost (Table 3a, 3b, 3c). At 10 TPD capacity for process II and III the processing cost reduce to Rs. 2.50 and Rs. 1.80 per kg biodiesel respectively. Another approach which leads to reduction in operating cost is 14 improvement in technology; this is clearly indicated for the improved IIPs Processes 2.0 1.86 1.50 0.36 4.76 3.53 5.0 3.22 2.61 0.61 2.70 2.82 10.0 4.89 3.95 0.94 1.80 2.32