Finally, a good reason not to eat your vegetables: put them in your diesel engine instead.

That’s what the Ontario government hopes people will do after it exempted biodiesel, a diesel fuel substitute typically made from soybeans, from its 14.3-cents-a-litre tax on fuel.

Ontario is the first province in Canada to make biodiesel tax-exempt, part of a government strategy to promote alternative, more environmentally friendly fuels.

Biodiesel can be burned in any standard, unmodified diesel engine in pure form (B100) or in a blend with petroleum diesel. B20-20 per cent biodiesel and 80 per cent petro-diesel-is the most common. Using B20, a diesel engine delivers similar torque, horsepower, and fuel economy as petroleum-powered diesels, yet cuts unburned hydrocarbon emissions, which cause greenhouses gases, by as much as 30 per cent. It does not reduce nitrous oxide (NOx) emissions, although biodiesel’s lack of sulphur allows the use of NOx controls that can’t be used with conventional diesel fuel.

The environmental benefits are “immense,” says Roger Smith, manager of fleet services for Toronto Hydro, the private utility which in May switched its 400-vehicle fleet to B20. Smith says the result was a 27-per-cent drop in emissions. “It’s also 10 times safer to handle than table salt,” he adds.

In June, the City of Brampton, Ont., became Canada’s first municipality to commit to the ongoing use of biodiesel after tests showed a 24-per-cent emissions reduction. During July, August, and September, the city will switch to B50 biodiesel, a half-and-half mix expected to reduce emissions by 60 to 70 per cent.

“Our drivers are wondering why we didn’t go to this years ago,” says Ken Dack, Brampton’s manager of fleet services. “They notice no reduction in power, and in some cases feel more power. The engine smoothed right out and is quieter thanks to better lubricity.”

The city has installed biodiesel tanks for fuelling at four locations in conjunction with its Toronto-based supplier, Big K Fuels.

With no drop in performance and no need to modify engines or fueling equipment, the big disadvantage of biodiesel is the price. Most biodiesel is made from soybean oil, a commodity whose price can swing wildly depending on the success of the soybean crop. Furthermore, most jurisdictions tax it like No. 2 diesel, which is why biodiesel suppliers have targeted mass transit authorities and other public fleets that are exempt from taxes imposed on retail diesel fuel.

Big K sales representative Brian MacDonald says even with the government’s tax reduction, biodiesel is still more expensive than diesel. “Until we produce it in Ontario and purchase it in Canadian dollars,” McDonald says, “it will be difficult to compete with the price of regular diesel fuel.”

He says domestic production would be a boon not only to biodiesel buyers but to Canadian farmers, especially in Ontario, one of the largest soybean producers in the world. One bushel of soybeans yields about 1.5 gallons of pure biodiesel.
Another hurdle is that most engine warranties don’t cover damages caused by alternate fuels.

World Energy, based in Chelsea, Mass., the largest producer of biodiesel in the United States, offers a $100,000 insurance policy to fleets that use the fuel. To date, not one claim has been filed.

That’s no surprise to Roger Smith. “A lot of people don’t know that Rudolf Diesel, when he introduced the diesel engine, was running it on peanut oil,” says Smith. “We’re just going full circle here.”