Brown Grease: Smells Like Money

While there is tremendous opportunity for grease trappers, they must meet the same federal traceability requirements as UCO collectors.

It’s no secret that the used cooking oil (UCO) market can be volatile. The market for trap-derived brown grease is no different. In the 2000s, many collectors considered trap brown grease just another byproduct to dispose of or to be sold overseas in less-regulated markets at barely enough money to cover the shipping. During the “biodiesel boom” of the 2010s, however, renderers, traders and producers grew interested in its potential as biofuel feedstock, and the market for brown grease saw a substantial rally to over 10 cents FOB the U.S. domestic origin point.

Unfortunately, the brown-to-biofuel boom didn’t last long. In the coming years, feedstock prices declined, and most industry participants decided that the effort and cost associated with processing brown grease into an acceptable fuel wasn’t worth the investment. As a result, many of Reiter Scientific’s trap-grease pumping clients who had begun to render the grease out of their collections abandoned the effort due to dwindling margins.

Were those early adopters of the concept of harvesting— rather than disposing of—recoverable grease from grease traps wrong, or just before their time?

For the most part, they were likely simply ahead of their time. The value of trap brown grease is stabilizing at a price that justifies the cost of recovering the material for those companies, given they collect a sufficient volume. But in order to be able to sell recovered trap brown grease to a biofuel producer, the trapper must meet all the same U.S. EPA requirements for documenting the origins of the grease as they would for UCO, an industry requirement known as “traceability.”

Is Recovering Trap Grease Profitable?

Historically, commercial kitchens have paid trappers to pump (collect and dispose of) the contents of their grease trap or interceptor. The pumper has to find a disposal site that will accept the grease. That site might charge around 25 cents to $1 per gallon to dispose of the grease after the trapper has already incurred the cost to pump and transport the waste. If the grease-trap material contains high amounts of fats, oils and grease (FOG) or high chemical oxygen demand (COD), it can cost even more.

Usually about 2 percent to 4 percent of the total volume pumped is recoverable grease. If the trapper can remove that FOG, not only can it be sold into various industries, but disposal of the remaining wastewater will often cost less as well.

So, the value proposition in recovering brown grease from grease-trap sources is twofold: savings in water disposal, and revenue from trap brown grease sales.

Processing trap brown grease into biodiesel or renewable diesel is more expensive than processing UCO. This is primarily due to the necessary removal of impurities that, in the case of renewable diesel, spoil fuel-production catalysts. For biodiesel, these impurities cause unacceptably high sulfur levels in undistilled product. While there is an upfront investment, if the company can produce sufficient volumes of grease to sell to biodiesel producers, that investment can be rewarding.

As more companies recognize the value of trap-derived brown grease and invest in the processes necessary to remove metals and sulfur from the feedstock, demand from the fuels sector has grown steadily. (Visit ReiterScientific.com for more information on trap grease recovery technology.)

Why is Trap Grease Traceability Important?

The Renewable Fuel Standard, a federal program that sets minimum requirements for the amount of renewable fuels used in transportation, offers subsidies for those renewable fuels. To receive the subsidies, however, biofuel producers must be able to account for the sustainable origin of each and every gallon of feedstock they purchase—or they could face penalties during a failed audit. That means buyers of multisource brown grease need their suppliers to adopt the technology necessary for tracking and managing their grease-recovery efforts.

While EPA has technically required traceability for UCO for nearly a decade, the agency has increased enforcement and audit activities on the industry substantially over the past two years in an effort to bring UCO traceability up to regulatory standards. It is reasonable to predict that EPA will follow a similar path with respect to yellow and brown grease, increasing audits and accountability.

Initially, many producers and collectors believed that accounting for the origin of each gallon meant that they would only need to state the general area from which the oil was collected, such as a city or region. But in the latest RFS update, the agency clarified that tracking required the specific addresses or coordinates at which every gallon of grease was retrieved—not just a general area. The ability to record, store and access the detailed records necessary for compliance, and the ability to do so in a scalable and efficient way, is no longer a request from major buyers but a requirement.

“Under the RFS program, trap grease should be treated like UCO and has all the same traceability requirements,” says Sandra Dunphy of Weaver’s Energy Compliance Services advisory group. “A lot of buyers believe that mixed feedstocks such as yellow and brown grease have no traceability requirements but that is 100 percent incorrect, with each blended component of the yellow or brown grease mixture having traceability requirements.”

Dunphy also emphasizes that Weaver is available to answer additional questions pertaining to feedstock requirements under the federal RFS and California Low Carbon Fuel Standard.

How to Digitally Track Trap Brown Grease for Maximum Revenue

Route Simplified is a leading platform used by many of the country’s most successful UCO collectors to plan their routes and manage drivers to maximize efficiency and revenue, all while maintaining EPA RFS traceability compliance. The software helps with scheduling, route optimization, accounting and traceability, allowing UCO collectors to scale in an organized and compliant manner.

And starting in March, the software isn’t just for UCO collectors. Route Simplified is excited to announce that its Grease Trap Beta release is scheduled for Feb. 17 at the Water & Wastewater Equipment, Treatment & Transport Show at the Indiana Convention Center in Indianapolis, Indiana.

Every feature of Route Simplified has been designed with the help of our users, and we’re looking for early adopters to test our grease-trap features and provide the critical feedback needed to further improve the platform. Beta testers receive an extended free trial of the software in exchange for their feedback. Give Route Simplified a call at 888-428-5617 to sign up to be one of the first companies onboarded. Grease Trap Beta tester space is limited.

Route Simplified is the software of choice for the country’s most successful UCO collectors, and with the feedback of a strong beta-testing team, we’ll change the game for grease trappers as well.

Call today to apply for six months of free software as a beta tester.