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September 2007

McDonald’s turns used cooking oil into fuel
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McDonald’s Corp. is boosting its green credentials with plans to run its entire delivery fleet in the United Kingdom on biodiesel made from used cooking oil.

Oil from around 900 McDonald’s restaurants across Great Britain will be combined with pure rapeseed oil to make high-quality biodiesel, said Matthew Howe, senior vice president and chief support officer of McDonald’s United Kingdom.

The switch to 100 percent biodiesel follows an extensive trial by the Oak Brook, Illinois-headquartered fast-food restaurant chain. Howe said initial testing in the United Kingdom started last year. During the trial 150,000 liter of used cooking oil was collected and added to the conversion process to produce high-quality biodiesel.

Eventually, every vehicle in McDonald’s 155-strong delivery fleet in the United Kingdom will be converted to run on the fuel, Howe said. In July, the division started with half of its 45-vehicle fleet that operates from a distribution center in Basingstoke.

“There are additional costs involved in using 100 percent biodiesel in the delivery fleet, such as modifications and extra servicing for vehicles. However, this cost is being absorbed by the company and is not being passed on to customers,” Howe said.

“There is a small difference between the price of biodiesel and regular diesel, so in the longer term we may see a small saving resulting from using this fuel.”

Howe said the trial enabled the company to pinpoint any difficulties. “The main issues were that small modifications needed to be carried out to fuel pipes in the vehicles as biodiesel is slightly more acidic than regular diesel,” Howe said. He said that the delivery vehicles also now require more frequent servicing due to the switch.

Initially, the biodiesel used will be made from 85 percent used cooking oil, collected from McDonald’s restaurants in the United Kingdom, and 15 percent from pure rapeseed oil. Howe said that McDonald’s would continue to work with its suppliers in order to minimize the need for pure rapeseed oil in the fuel manufacturing process.

McDonald’s estimates the carbon saving will be 1,675 tons annually once the national rollout is completed – the equivalent of removing 2,424 cars from the road.

“We have been sending our used cooking oil for recycling for some time, but we are delighted to now have a practical, efficient use for it within our own business,” Howe said. He did not say whether the company plans to expand the process to other countries.

“We think this is a great example of how businesses can work together to help the environment, and is a natural complement to the work we are doing to our delivery schedules to cut food miles and fuel consumption,” Howe said. “Our approach to the environment is reduce, reuse, recycle, and we try to do this in everything that we do.”

Matt Drinkwater, an analyst in London with New Energy Finance – a specialist provider of renewable energy information and research – said the scale initially at McDonalds is rather small and it seems to be geared more for public relations purposes.

Drinkwater said he is not aware of any other Western company converting used-cooking oil into fuel like McDonald’s in the United Kingdom. “You have to have a very particular set-up to be able to collect waste cooking oil cost-effectively, and if the waste oil is very heterogeneous, that will push the price of processing up,” Drinkwater said.

“I think McDonald’s is in a good position to do this because it has the collection infrastructure already in place, and the quality of the waste oil is going to be relatively predictable.” He said the technology is similar to producing biodiesel from straight vegetable oil. But he said refiners need to spend more time cleaning the used oil.

Drinkwater said that converting waste cooking oil into biodiesel is not very common on a commercial scale. He said some small operators in China are trying it along with a company called Petrotech Biodiesel in Germany. “There are a lot of small-scale backyard or farmer-operated projects that are way below our radar,” Drinkwater said.

“When you’re making it yourself, your tolerance for problems is greater – commercial operators have to produce biodiesel that will run without any problems or they’ll lose contracts. The heterogeneity problem is more acute for them.”

Drinkwater said that he does not expect many other restaurants to follow McDonald’s lead. “Maybe similar fast food chains with a significant output of relatively homogenous waste oil might be able to pull it off, but I think the renewable diesel route is more likely as you have much greater tolerance for heterogeneous feedstocks,” he said.

Drinkwater said the biggest hurdle is finding a way to collect the used oil economically. Plus, finding a partner who is willing to process it is also is a challenge. A certain expertise is needed to blend it so the oil has the desired physical properties – particularly the gel point. He said used oil tends to gel at a higher temperature than straight rapeseed oil. Therefore the rapeseed is blended to lower the gel point.

But the benefits of converting the oil waste into biodiesel may eventually outweigh the drawbacks, Drinkwater said. “You can’t feed it to livestock any more, so it’s basically a waste product. Monetizing waste is good for the bottom line,” he said.