MACROECONOMIC EFFECTS OF A COMMUNITY-BASED BIODIESEL PRODUCTION SYSTEM

Oilseeds can be processed into biodiesel, a diesel fuel substitute tha t can be utilized in unmodified diesel engines. A previous study indic ated that under very specific conditions biodiesel can be processed an d can compete with standard diesel fuel when produced in community-bas ed plants. Investment in such plants would generate positive macroecon omic effects in communities where they are located. This preliminary a nalysis suggests that positive regional impacts are partially offset b y a decrease in retail businesses, such as bulk fuel supply firms and local feed dealers within that community. Net permanent job creation i n rural communities was found to be slight with the operation of a sin gle 500 000 gallon community-based biodiesel plant; however temporary jobs were increased due to plant construction. Overall, community-base d biodiesel plants were beneficial to the local economies in terms of increased wages, increased tax base and the value added to soybeans. M ore rigorous analyses will be essential to identify the true impacts o f biodiesel production, both inside and outside the region in which pl ants are located. (C) 1996 Elsevier Science Ltd.