SSPC Initiates California Distribution of Biodiesel Fuel
20 July 1999
SSPC Initiates California Distribution of Biodiesel Fuel Through 4 Million Gallon Per Year Biodiesel Production Agreement with NOPEC Corporation
SHREVEPORT, La., July 20 -- Southern States Power Company
(OTC Bulletin Board: SSPC) (http://www.sspowerco.com) has reached a production
agreement with NOPEC Corporation (http://www.nopec.com) that will make available
immediately up to 4 million gallons of biodiesel fuel for distribution in
California through a custom processing arrangement. An option agreement also
exists to expand this capacity to 8 million gallons. SSPC has established a
fuel distribution facility with biodiesel storage tanks in San Bernardino,
California and is currently discussing purchase orders with numerous buyers
including trucking companies, fleets affected by alternative fuel fleet
vehicle requirements and heavy equipment operators. Recent emission testing
seems to indicate that SSPC's biodiesel fuel, OXyG B-60, has achieved
substantial improvements in emission reductions versus other biodiesel fuels.
NOPEC Corporation has established a state of the art 10 million gallon per
year biodiesel plant that has been producing biodiesel fuel since 1996. The
facility uses a fully computerized production process that allows for the use
of a variety of feed stocks that leads to lower production costs and very
competitive biodiesel fuel costs. This will allow SSPC to distribute
biodiesel fuel at a substantial discount from current suppliers in California
and other Western States. More information about the NOPEC facility can be
obtained at the NOPEC Corporation web site at http://www.nopec.com.
California is the third highest consumer of diesel fuel in the world, with
12 million gallons a day consumed. Its economy is closely tied to industries
(trucking, mass-transit, railroad, shipping, farming and manufacturing, etc.)
that use diesel fuel. Although only two percent (2%) of all vehicles run on
diesel, diesel-fuel vehicles produce half of all of the particulate matter
produced from vehicles. On-road trucks and buses running on diesel fuel
contribute almost 65% of the PM10 (particles less than 10 microns in diameter)
air pollution.
In August of 1998, the California Air Resources Board (CARB) took the
dramatic step of listing particulates, tiny pieces of liquid and solid
particles in soot, as "Toxic." These microscopic pieces of carbon from a
diesel engine's exhaust can lodge deep in lungs, increasing the risk of
premature death from heart attacks, lung ailments, cancer and other diseases.
Particulate matter can also increase the instance and severity of asthma
attacks, aggravate bronchitis and cause other lung ailments. The USEPA has
recently listed particulates as an air quality health hazard and has
promulgated new regulations requiring reduction of particulates by diesel
engines.
Several regulations are now being implemented in California and at a
Federal level that will affect demand low emission fuel alternatives to
diesel:
-- In South Coast Air Basin in LA, trucks not meeting air quality
standards for smoke (particulates) can be fined up to $5000 if it is a
second violation. Trucks are being tested at weigh stations and
border crossings.
-- Heavy equipment operators can gain bid preferences & operate equipment
without idle or shut-off restrictions in highway projects. Funds are
available to subsidize costs of biodiesel & other alternative fuels.
-- Fleets affected by the alternative fuel fleet requirements in the
Energy Policy Act of 1992 can meet requirements by using a 20% mixture
of biodiesel. This blend with diesel is then very cost-effective.
SSPC's contract with NOPEC Corporation enables it to sell a clean high
performance fuel that requires no modification of diesel engines to meet
alternative fuel or air quality requirements. Biodiesel requires no increased
insurance and storage costs due to combustibility, unlike other alternative
fuels. In fact, capital costs for refueling facilities are only a fraction of
the cost of competing alternative fuels such as natural gas. Because
OXyG B-60 can be readily blended with petroleum diesel, it operates as a
diesel fuel and eliminates the need for separate maintenance and operations
facilities. SSPC's OXyG B-60 biodiesel has better performance, higher cetane
(how fast diesel ignites), greater lubricity, and more cleaning action than
petroleum diesel. Higher cetane means less engine knock and vibration.
Greater lubricity produces longer injector pump life. Improved cleaning
action helps keep internal engine parts free of power robbing carbon
emissions. The significantly higher lubricity of OXyG B-60 biodiesel can be
used to compensate for lack of lubrication with new low sulfur or California
reformulated diesel fuels. Therefore, SSPC's OXyG B-60 biodiesel is not only
safer for the environment, it is better for diesel engines.
Biodiesel fuels are recognized alternative fuels by the United States
Department of Energy (USDOE). Consequently, SSPC's OXyG B-60 biodiesel
powered vehicles qualify for Alternative Fueled Vehicle Credits (AFVs) under
the Energy Policy Act (EPACT).
Extensive testing and certification of the fuel is now underway at an
independent emission testing laboratory, Emission Testing Services, Inc.
(http://www.etsusa.net). Multiple 4 mode tests on off-road diesel fuel (red diesel)
have been completed. The results indicate that SSPC's OXyG B-60 biodiesel
fuel has reduced emissions of particulates by 22%, carbon monoxide by 16%,
hydrocarbons by 23% and opacity by 60%. This compares very favorably with
other biodiesel fuel tests such as the Colorado Institute for Fuels and High
Altitude Engine research where tests showed a reduction of particulates of
only 14%, hydrocarbons of 13% and carbon monoxide of 7.1%. Red diesel fuel
was targeted for the first set of tests because it is an important market for
initial biodiesel fuel sales. A complete set of 13 mode diesel engine tests
will now be completed by Emission Testing Services using California Air
Resources Board certified diesel fuel to certify emission reductions for
on-road highway use. Results are expected over the next several weeks. Data
from these tests will be used to market biodiesel fuel to trucking companies
and other on-road users affected by state and federal emission and alternative
fuel requirements.
This press release contains forward-looking statements that should not be
used to make an investment decision. Please refer to the SSPC web site
(http://www.sspowerco.com) and other sources for detailed information, or call
Michael Sealey at 318-221-5703 or sspowerco@usa.net.