(Feb. 27) The amount of biodiesel produced in the U.S. tripled from 2005 to 2006, and another significant jump is expected this year, according to the National Biodiesel Board.

“Growth is definitely starting to happen,” said Jenna Higgins, a spokeswoman for the Jefferson City, Mo.-based board. “One of the things driving it is the federal tax incentives that make biodiesel more competitive for consumers.”

Higgins said 225 million gallons of pure biodiesel were produced last year, up from 75 million in 2005. She said the board expected at least 300 million gallons to be produced this year.

That’s a huge jump from just 2 million gallons in 2000, said Mindy Long, spokeswoman for NATSO, the Alexandria, Va.-based national association of truck stop operators.

There are 105 companies with a combined capacity of 864 million gallons a year manufacturing and marketing biodiesel, according to the biodiesel board. Additional plants under construction could push capacity to 1.7 billion gallons a year within the next 18 months.

In January, President Bush set a target to produce 35 billion gallons of alternative fuel annually by 2017, but demand is a long way from catching up to the industry’s expanding capacity and the president’s target.

“We’re seeing more members offering it,” Long said, “especially in states with tax incentives for retailers.”

There are 1,000 retailers and 1,700 distributors offering biodiesel across the nation, according to the biodiesel board, but the alternative fuel’s use is still far from widespread. There are numerous distributors and retailers offering biodiesel in the Midwest, as well as clusters of retailers and distributors dotting both coasts, but states like Alabama, Wyoming and New Mexico still have limited availability.

“You see a lot of biodiesel in agricultural states,” Long said. “For them, it makes sense. They have tax incentives to support their farmers.”

Long said that at one truck stop in Illinois, B20 — a diesel mix that contains 20% biodiesel — was 20 cents cheaper than regular diesel.

Higgins said that finding an average biodiesel price was difficult because of varying state tax incentives and varying blends. Minnesota, for example, has mandated that all diesel fuels contain 2% biodiesel. The biodiesel board said the B2 blend costs about two cents more per gallon than regular diesel. Higgins said B20 generally ranges from the same price as regular diesel to 20 cents a gallon more.

Debate continues as to which blend is best. The Engine Manufacturers Association, Chicago, recommends a blend of no more than 5% because blends containing more biodiesel can lead to filter plugging and other mechanical issues.

One problem with biodiesel is that it gels in extremely cold temperatures.

Robert Davis, a spokesman for Natchez, Miss.-based U.S. Sustainable Energy Corp., said his employer has produced a new biofuel that eliminates that problem. He said that while biodiesel gels at around 22 degrees and regular diesel at minus-14, the new fuel remained fluid at minus-90.