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HILLSVILLE — The owner of Red Birch Energy sees farmers and truck stop owners as the new oil barons as people make the switch to biodiesel for their transportation needs.
Businessman Dean Price presents the idea for change as the ultimate “shop local” campaign, where American farmers supply the fuels and keep the economic benefits in the community, instead of sending that money to foreign oil suppliers.
That change is already underway in Hillsville, where Price's ideas have received a warm reception from the local governments and a point of sale at Race Inn.
"I think of all the places that I've been to preaching the gospel of biodiesel… in Hillsville, there's a seed here of entrepreneurialism that I haven't seen any other places," he said. "The vision and the initiative to think outside the box and to look and say, 'Why can't that be done?'"
Indeed, biodiesel already propels six Carroll school buses, a Hillsville garbage truck and heavy equipment for the county, and local leaders remain enthusiastic.
Biodiesel is made from crops like canola, or by collecting used cooking oil.
"Being able to use a product that is used so commonly and in such quantities as diesel that is — at least partially — made of a homegrown product has to be a positive all the way from the farmer who spends his dollars locally and from the businesses they shop with who will hopefully do the same and so on," Town Manager Larry South said in an e-mail. "We have exported so much of our manufacturing to other countries any possibility of using a home grown product or refinery will maybe begin to turn that tide a little."
County Administrator Gary Larrowe, who described himself as a long-time supporter of Red Birch's efforts, introduced Price to schools Superintendent Greg Smith at the USDA-Rural Development Celebration Day.
Canola may become a staple in farm fields in the county, next to other traditional staples, Larrowe said. This may take some growing trials to learn the best way to raise it, but there are great possibilities for a new revenue stream for farms.
"Interesting that Canola is a winter annual crop that is planted in the fall and harvested in early summer and grows in the same climate as cabbage," the county administrator said in an e-mail. "Carroll may be a great location to grow the crop."
The United States used to be the world's leading exporter of oil, but domestic production has been in decline since 1972, Price said. Now, companies have to drill 44 miles out from shore and three miles down into the ocean floor to reach the oil.
The need for an alternative fuel has already arrived.
"We have been the recipients of about 100 years of cheap plentiful oil and it's gotten us happy, fat and lazy," he said. ""Our industrial economy has been built on the fact of cheap energy and now those days are coming to an end. We've never been on the backside of cheap oil."
Hard-to-get-at petroleum reserves and increased demand from China and India means cheap oil will not return.
That's where the efforts in Hillsville come in.
Price has been making biodiesel in Bassett for three years now. Red Birch used to sell it at its own truck stop, but he sold that to concentrate on distribution efforts.
Making the biodiesel model work has been a struggle — at times, Price has felt like Noah building the ark miles from water without a drop of rain falling.
"It's going to start raining soon. I mean, here we see $89 for a barrel of oil in the middle of a recession," he said. "These are waters we've never crossed before."
But farm fields and deep fryers hold the key to fuel supply problems and this country's troubled economy, Price said. For example, instead of using $500,000 to buy foreign oil to run the school buses, that money could go to local farmers.
That would change the dynamic of the local economy, Price said. The way the system works now most of the money spend leaves the local community.
About 90 cents of every dollar spent on fuels will go to places like the oil producing countries in the Mideast, where they don't like the United States very much, he said. About 86 cents spent at big box stores also goes elsewhere.
If people, governments and businesses got biodiesel from farmers, the money would circulate through the community, multiplying the economic benefits at home.
The first thing farmers would do is go out and buy new equipment, Price said. The second thing would be putting up new buildings to house that equipment.
Both would result in more sales and property taxes going to local government.
"The best way to plug those leaks is to start producing and consuming your energy locally," Price said. "Give it to the farmers and let it trickle down from them."
Think about the economic multiplier effect this way, he said: "One person's spending is another person's income — that's what we're missing."
The United States has an advantage over places like Saudi Arabia, Price added. It's not desert here and this country can grow its own fuel long after their underground supply runs out.
There are side benefits — biodiesel burns cleaner and more efficiently and processing canola for biodiesel results in a quality protein supplement to feed to livestock.
Biodiesel has 93 percent as much energy as regular diesel and has more than gasoline, he added.
Red Birch now gets its feedstocks from about 2,500 acres of farmland and about 400 restaurants by collecting the cooking oils.
Success of biodiesel in Hillsville means other communities will catch on, too.
"Hillsville is a microcosm of the rest of the state of Virginia — if you can make it work in Hillsville you can make it work in Charlottesville... You can make it work anywhere," he said. "That's why this is so important as to what's going on here is because it's replicatable. I see Red Birch being the McDonald's of the biofuels business in five years."
Biodiesel will offer truckstop owners a competitive advantage, he expects. This is the first chance that the small business has a chance to complete with Big Oil.
"Anybody can get into it. All you need is a tractor, some seed, a planter a combine and you're in the biofuels business," Price said.
He also sees a day when the Carroll County Cannery makes a community crusher available, which will open up several options, he said. People could make food-grade canola oil, which sells for $12 a gallon, or make home heating fuel or biodiesel out of it.
Fresh off his successes in Hillsville, Price is seeking distribution points in Galax and Grayson County and usage by more local governments.
Having transportation fuels is not an option. Sooner or later, the rest of society will come around to Price's way of thinking, he expects.
"Time is on my side," he said. "Five dollar [a gallon] gas is right around the corner. We cannot keep doing the things we keep doing to this country and survive and have the type of lifestyles we've grown accustom to."
• More information about the biodiesel efforts is available at www.redbirchenergy.com.