Corporates shun low-carbon biodiesel in Oman
Published: 02:10 PM,Oct 16,2023 | EDITED : 06:10 PM,Oct 16,2023
MUSCAT: Omani startup Wakud, which operates the country’s first commercial-scale biodiesel plant using waste cooking oil as feedstock, has bemoaned the appallingly low uptake of its low-carbon biodiesel by energy companies and other large corporates operating in the Sultanate of Oman.
Wakud CEO and Co-Founder Maher Mohammed al Habsi revealed that despite strenuous efforts by the company to find commercial buyers for its indigenously produced biodiesel, few if any organisations have stepped forward to patronize its sustainable fuel.
“No one is using our biodiesel today; I don't know why companies or the private sector are not supporting us,” Al Habsi, a pioneer among Oman’s waste recycling entrepreneurs, lamented during a presentation at the ‘Forum on Sustainable Aviation Fuels’, organised by the Civil Aviation Authority (CAA) last week.
In particular, Al Habsi faulted the government subsidy on motor fuels for the lacklustre uptake of his biodiesel commodity despite the environmental benefits associated with biodiesel usage. Biodiesel produced from used cooking oil (UCO) results in CO2 emissions of around 0.1 kg/per litre, compared with 3.2 kg per litre of normal diesel. With a 93 per cent lower CO2 emission rate, biodiesel offers the “fastest and cheapest solution” to the decarbonisation of the automotive sector, he noted.
With diesel currently being sold at the pump at a subsidized rate of 258 baizas per litre, there are inevitably few takers among large corporates for Wakud’s biodiesel that currently sells for around 600 baizas a litre, according to Maher.
The comparatively high cost of biodiesel, he explained, is driven by two main factors: first, very little of the edible oil imported into the country is currently captured before it ends up either in drainage systems or in landfills – a practice deemed environmentally unsafe. Second, biodiesel refineries like Wakud find themselves at the mercy of a small number of well-entrenched UCO collectors who charge as much as 400 bz/litre for the commodity. These collectors are also known to ship their volumes to neighbouring countries where a better price awaits them.
“So I’m forced to buy the used cooking oil for 400 baizas, plus I add another 200 bz/litre towards the running costs of the factory. Thus, while on the one hand, I cannot survive for anything less than 600 bz/litre on my biodiesel, on the other, no one will buy my biodiesel at that price,” Al Habsi protested.
One solution out of this dilemma, according to the entrepreneur, is for the government to consider either subsidizing biodiesel distribution or mandating sales as a blend with conventional diesel – a practice that is adopted widely in many countries around the world. Depending upon customer requirements, biodiesel can be blended as, for example, B1, B5, B10 and so on, up to B100. B5, for example, is made up of 5 per cent biodiesel mixed with 95 per cent diesel.
Despite the dismal local uptake of biodiesel, the entrepreneur has vowed to remain in operation and even expand its footprint with an eye of foreign export markets for his climate-friendly fuel. He also plans to diversify his feedstock base to include fish waste and oil-rich agri-crops, among other waste resources.
Caption:
Maher al Habsi, CEO – Wakud, speaking the CAA Forum on Sustainable Aviation Fuels
Wakud CEO and Co-Founder Maher Mohammed al Habsi revealed that despite strenuous efforts by the company to find commercial buyers for its indigenously produced biodiesel, few if any organisations have stepped forward to patronize its sustainable fuel.
“No one is using our biodiesel today; I don't know why companies or the private sector are not supporting us,” Al Habsi, a pioneer among Oman’s waste recycling entrepreneurs, lamented during a presentation at the ‘Forum on Sustainable Aviation Fuels’, organised by the Civil Aviation Authority (CAA) last week.
In particular, Al Habsi faulted the government subsidy on motor fuels for the lacklustre uptake of his biodiesel commodity despite the environmental benefits associated with biodiesel usage. Biodiesel produced from used cooking oil (UCO) results in CO2 emissions of around 0.1 kg/per litre, compared with 3.2 kg per litre of normal diesel. With a 93 per cent lower CO2 emission rate, biodiesel offers the “fastest and cheapest solution” to the decarbonisation of the automotive sector, he noted.
With diesel currently being sold at the pump at a subsidized rate of 258 baizas per litre, there are inevitably few takers among large corporates for Wakud’s biodiesel that currently sells for around 600 baizas a litre, according to Maher.
The comparatively high cost of biodiesel, he explained, is driven by two main factors: first, very little of the edible oil imported into the country is currently captured before it ends up either in drainage systems or in landfills – a practice deemed environmentally unsafe. Second, biodiesel refineries like Wakud find themselves at the mercy of a small number of well-entrenched UCO collectors who charge as much as 400 bz/litre for the commodity. These collectors are also known to ship their volumes to neighbouring countries where a better price awaits them.
“So I’m forced to buy the used cooking oil for 400 baizas, plus I add another 200 bz/litre towards the running costs of the factory. Thus, while on the one hand, I cannot survive for anything less than 600 bz/litre on my biodiesel, on the other, no one will buy my biodiesel at that price,” Al Habsi protested.
One solution out of this dilemma, according to the entrepreneur, is for the government to consider either subsidizing biodiesel distribution or mandating sales as a blend with conventional diesel – a practice that is adopted widely in many countries around the world. Depending upon customer requirements, biodiesel can be blended as, for example, B1, B5, B10 and so on, up to B100. B5, for example, is made up of 5 per cent biodiesel mixed with 95 per cent diesel.
Despite the dismal local uptake of biodiesel, the entrepreneur has vowed to remain in operation and even expand its footprint with an eye of foreign export markets for his climate-friendly fuel. He also plans to diversify his feedstock base to include fish waste and oil-rich agri-crops, among other waste resources.
Caption:
Maher al Habsi, CEO – Wakud, speaking the CAA Forum on Sustainable Aviation Fuels