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How the county’s biodiesel-making effort in Cathcart flopped

CATHCART — Snohomish County’s gamble on turning canola into biodiesel has turned belly-up, but at least the Spokane Indian Tribe may reap a jackpot this week when the County Council votes on surplussing its remaining biofuel equipment, a grain crusher purchased in 2008 under a biofuels initiative, to the tribe.
Under a 2005 biofuels initiative, the county had been awarded $344,000
from the U.S. Department of Energy and $500,000 from
the state government agency now known as the Depart-ment of Commerce to
invest in diesel production from canola and other crops. Another $523,000 came from the county’s solid-waste budget.
The money went into installing the grain crusher and a grain dryer at the county’s Cathcart
public works site in 2008 and promoting the planting of canola to local agriculture.
Some of the money, $143,000, was returned when Bellingham-based Whole Energy Fuels, contracted to develop the grain-crushing system, ran into technical difficulties and failed to deliver all the goods as scheduled.
According to a media report at the time, Whole Energy CEO Atul Deshmane had described the installation as “the only project of its kind in the country,” but had also said “I wouldn’t call it a failure,
but it’s not a success.”
The county had proffered the possibility of the purchased equipment making 240,000 gallons of biodiesel by 2014 to power its diesel vehicles,
but by June 2016, only 1,700 gallons had been made, according to county solid waste director Matt Zybas.
What sank the county’s biofuels gamble over the last nine years was a combination of flip-flopping prices in the fossil fuels and grain markets and evolving developments in alternative sources such as poplar trees and algae to make fuel. Oil was selling for $140 a barrel in 2008, making diesel production from
canola attractive. That is no longer the case with oil selling for just $44 a barrel recently, making it significantly less expensive than the cost of converting canola into a biofuel. And while canola prices were on the rise several years ago, it is still a commercially low-return crop for Western Washington farmers, who also say it is suited more for Eastern Washington’s sunnier and drier climate.
The county had initially envisioned running the equipment in  partnership with farmers and research institutions, but that failed to materialize. By 2011, the project was suspended with no plans to continue it, though there was slight positive news in 2012 when the
Bartelheimer family, owners of Sno-Valley Farms, agreed to lease the dryer for one year and cover maintenance costs. Sno-Valley Farms paid the county $1 per year to rent the dryer, equipment fees of 50 cents per ton of grain dried, and $10 per ton of grain crushed once the total exceeded 50 tons.
“We leased the dryer for grain handling,” said Peter Bartelheimer, who ran the dryer’s operations. “We have over 2,000 acres in Snoho-mish and used it for canola, wheat and barley. It was good equipment.”
Their business did not involve using the grain crusher, which was run by county employees, he said.
The Bartelheimers did not renew the lease, but did end up buying the dryer and related components at a tidy
discount, $42,500, in September 2015 when the county off-loaded it for sale. The county had paid $67,000 for the dryer.
Because of grant restrict-ions, the county has not been able to do the same with the grain crusher until the Spokane Tribe of Indians, which has commenced its own biodiesel project, expressed interest. The tribe qualifies to receive the grain crusher under Snohomish County Code, which allows the
county to dispose of surplus property by “negotiated sale, lease, or
trade to a governmental agency.”
If the county approves surplussing the grain crusher this week, a request initiated from the solid waste department, the tribe will arrange and fund the cost of transferring it to their property, where it will be utilized for its original purpose as a public benefit. The estimated fair market value of the equipment is approximately $60,000. 

 

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