Can Your Kitchen Grease Become Biofuel and Earn Extra Money for Your Restaurant?

Fats, oils, and grease (sometimes referred to as FOG) can be a hassle for restaurant owners and others who run commercial kitchens.

Municipalities are increasingly regulating the disposal of used grease and mandating industrial grease traps due to the costs associated with unclogging sewer lines. In 2007, for instance, San Francisco implemented a new law to help it counteract an annual cost to taxpayers of $3.5 million spent unclogging sewers. Business owners and managers can either view this as a threat … or they can view it as an opportunity. Here’s how to take the latter view, and how to take advantage of the situation to improve your financial bottom line and your environmental performance.

First, an important note about FOG: The main kitchen grease types are yellow grease (typically processed fryer oil) and brown grease (drippings and other grime that collect in a commercial kitchen’s grease trap). Both may be picked up by a collection company, though yellow grease is much more valuable than brown grease as it is easier to process and repurpose (one application is to process this into biodiesel fuel; more on this in a moment). Restaurants pay to have their used oils picked up and the collection company in turn sells the waste FOG to a rendering business. The renderers then process the grease for a variety of products including livestock feed, pet food, cosmetics, and paints.

Currently, the yellow grease tide is turning. A major trend among the used kitchen grease industry is the production of biodiesel, which is “a clean burning alternative fuel, produced from domestic, renewable resources.” Biodiesel is a much more environmentally friendly fuel, reducing greenhouse gas emissions by 78 percent when compared to petroleum diesel. Yellow grease can easily be converted to biodiesel and, as eco-friendly fuels become a hot commodity, collection companies are now opting to sell restaurants’ used oil to biodiesel plants.

Waste FOG collection businesses are starting to waive the charge for pick up or even pay restaurants for their increasingly valuable yellow grease. Wesley Caddell, founder of Northern California’s People’s Fuel Cooperative, says an Oakland biofuel company was paying restaurants up to $0.40 per gallon for used kitchen oils during the height of gas prices last year. As the inevitable rise in gasoline prices and environmental awareness continues, more companies will likely find lucrative markets for used yellow grease and pay restaurants for their waste FOG.

Often, and depending on where you are, collection companies are not paying for the used grease, but are also not charging for its collection. This represents a savings of several hundred dollars a month for many commercial kitchens. To take advantage of this trend, first be sure all of the right grease traps are in place to avoid blocked sewers and ecosystem harm. Next, see if your municipality has a biofuel plant – a representative there may be able to tell you if there is a grease recycling program in your area. You can also check Biodiesel.org to look for biodiesel distributors. You may even find a kitchen grease collection company that will pay you for your yucky gunk, or at least, pick it up for free. You could be making (or at the very least, saving) money and putting that nasty FOG to good use, all with the environment in mind.

Local and state governments are also creating their own grease recycling programs, such as San Francisco’s Greasecycle, which collects waste FOG from local restaurants for free and converts it to biofuel, which is then used to power San Francisco fleets (www.sfwater.org). A similar program is the Massachusetts Alternative Fuel Foundation, which even offers a tax deduction in exchange for donating used kitchen oil (www.alternativefuelfoundation.org).

Some eco-innovators take it a step further. FOG can be given a second life by using it as heating oil. This might be more effective for larger institutions such as schools, hospitals, etc., which produce greater quantities of grease. Last fall, for instance, Boston University began using its yellow grease from dining halls to produce fuel for heating some of its campus buildings. Don Levy, the owner of the Deluxe Town Diner in Watertown, MA, has reduced his heating bill to zero (and saves $150 per month without the cost of waste FOG collection) by repurposing his used fryer grease. With the help of a specialized boiler, Levy uses his own spent grease and collects from several other restaurants in his area to heat his restaurant and its water.