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Cabbies, Accountants Look to Chip-Fat Fuel on Cost, Environment

May 18, 2010, 7:22 PM EDT

By Howard Mustoe

May 19 (Bloomberg) -- Drivers of London’s iconic black cabs may soon find themselves competing with accountants to obtain an unusual commodity: chip fat.

Cabbies in the U.K. capital city, who spend almost 440,000 pounds ($634,000) a day on diesel, are starting to switch to biodiesel, a fuel derived from vegetable oil, to cut costs. Accounting firm PricewaterhouseCoopers is also looking at using biodiesel to power its new London office, due to open next year.

PwC is seeking local sources for 45,000 liters of biodiesel to meet one quarter of its monthly office fuel needs, said Jon Barnes, head of building and facilities services at the firm.

“I’m trying to locally source used chip fat from restaurants,” he said. “It’s a pretty pointless exercise of using biofuel if it’s been all round the world on a ship.”

The European Union will limit all new buildings’ use of fossil fuels to “nearly zero” by 2020, expanding the fight against climate change after the European Parliament voted to add a clean-energy provision to the building codes of EU countries. Having a renewable source for some of PwC’s office’s energy needs could help the company sell its services to clients wanting to do the same.

“They’re giving advice to clients on sustainability, so this is huge because they can practice what they preach,” said Steve Runicles, a director at BDP, a U.K. design company, which is responsible for planning how PwC’s new building will save energy, including choice of generators and solar panels on the office’s roof.

Cost Benefits

Uptown Oil Ltd., which started out delivering ice, has been refining biodiesel from waste oil supplied by 750 restaurants, pubs and companies across London since 2007. It sells the fuel at 105 pence ($1.53) per liter, while the average price of diesel in the U.K. is 121.6 pence per liter, according to the Automobile Association Ltd.

“If I had to choose, hand on heart, why people buy it, it’s the cost,” said Jason Askey-Wood, a director of Uptown, in an interview at the company’s factory in south London.

Uptown collects waste rapeseed, soya, and sunflower oil from companies including Young & Co.’s Brewery Plc and Corney & Barrow Wine Bars Ltd., which is filtered and distilled, with the oil being siphoned off and added to methanol, a process that produces biodiesel and glycerol, with the biodiesel being filtered again and heated to remove excess methanol.

‘Grime’

The benefits for the 500 or so cab drivers who buy their fuel from Uptown are also environmental, with reduced smoke fumes, Askey-Wood said.

“One cab driver said he was sick of seeing all the grime come out of the back of his cab,” he said. “The biodiesel produces far less.”

Barnes said he’s is in talks with Uptown to see if the company can provide enough recycled fuel to meet the accountant’s needs. Other sources for the fuel could be Thames Water or Anglian Water, which skim off the waste oil as part of the treatment process, he said.

Would-be users of the fuel should check the product can be used in their autos by asking the manufacturer, said Vanessa Guyll, a technical specialist at the AA.

“If it’s made properly and it’s cleaned properly, then it’s good,” she said. “It’s quite a lot of work to get it clean and to a suitable standard.”

London has about 22,000 black cabs, according to Bob Oddy, general secretary of the Licensed Taxi Drivers Association. Each cabbie drives an average 90 to 100 miles per day while working and a cab will, on average, drive about 22 miles per gallon of diesel, he said. That’s about 5.8 miles per litre and means, at 121.6 pence per litre over 95 miles, London black cab drivers spend about 438,240 pounds per day on fuel.

Twitter Service

Biodiesel from recycled cooking oil isn’t the only innovation cabbies are using. Twitter service tweetalondoncab, which began in July, is also being used by some drivers of Hackney Carriages, named after their horse drawn forebears, to find customers and avoid the fees of a so-called cab circuit.

Tweetalondoncab’s 40 cab drivers use their phones to post information of where fares can be found, such as recently finished concerts or exhibitions and receive requests from potential customers.

Organizer Richard Cudlip, 42, a driver of four years whose fares have included Mr. Bean actor Rowan Atkinson and television presenter Michael Palin, said cricket commentator Jonathan Agnew follows the service on Twitter.

“You can have that quick personal communication,” he said. “We can say yes or no within time to suit the customer, people like that personal touch they get.”

--With assistance from Jonathan Stearns in Strasbourg. Editors: Peter Branton, Mark Gilbert

To contact the reporter on this story: Howard Mustoe in London at hmustoe@bloomberg.net.

To contact the editors responsible for this story: Colin Keatinge at ckeatinge@bloomberg.net

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