Inside a green metal-clad building in the Port of New Haven, a kind of modern day alchemy is at work, turning used cooking oil into fuel capable of powering trucks and heating homes.
Within a maze of tightly stacked tanks, pipes and collection units, workers take the grease — or other available waste products such as animal fats, tallow and vegetable oils — and add an alcohol catalyst to trigger a chemical reaction that produces biodiesel, which is marketed as a more climate friendly alternative to traditional fossil fuels.
A series of rapid expansions in recent years has made the plant, home of American GreenFuels, the largest producer of biodiesel on the East Coast.
Originally opened in 2011 as Greenleaf Biofuels, the plant was later purchased by the American division of Swiss commodities trader Kolmar Group and renamed American GreenFuels. Since 2016, its output has quadrupled, from 15 million gallons to nearly 60 million gallons a year.
The most recent expansion, completed this summer, added a second story to the production floor.
“It often smells like french fries, as you might expect,” said Paul Teta, the vice president and general counsel for Kolmar Americas, which is based in Shelton.
The company’s growth has been spurred, in part, by government subsidies and laws requiring fuel dealers to blend home heating oil with biodiesel in an effort to reduce carbon emissions. Teta declined to say how much the company has invested in its New Haven plant, other than to say it was in the “many millions of dollars.”
According to Kolmar, the biodiesel made at its New Haven facility produces 86% less greenhouse gas emissions, on average, compared with ultralow-sulfur heating oil. The emissions reductions are even more substantial when the fuel is sold and burned in Connecticut, removing the need to transport it long distances on trucks.
New York City passed the nation’s first blended biofuel mandate in 2012 and was followed by a state laws in New York, Connecticut and Rhode Island.
Connecticut’s law, Public Act 181 of 2021, required that heating oils contain at least a 5% blend of biodiesel starting in 2022. That amount increased to 10% this year and is set to grow steadily until reaching a minimum 50% blend in 2035. (Roughly 400 million gallons of fuel oil is delivered each year in Connecticut, according to the Connecticut Energy Marketers Association.)
In addition to state incentives, biodiesel fuels were previously eligible for a $1 per gallon federal tax credit. As a result of the Inflation Reduction Act, those credits were replaced by other tax incentives based on lowering carbon emissions. Despite what he called an “ambiguity” around the changes to federal policy, Teta said that increasing blended fuel ratios in the Northeast has provided stability to the industry.
“When the law got passed, that gave us enough certainty to be able to make the next level of investment,” Teta said.
“The federal program’s certainly still important, because it incentivizes the price, otherwise biodiesel would be more expensive,” he added. “We want to keep the price low. So all put together, it has been a good mix for us to be able to expand.”
Not everyone is happy about the push to adopt biofuels. Environmental advocates, including the Sierra Club, have argued that biodiesel perpetuates a reliance on fossil fuels and that states should instead seek to transition as rapidly as possible to all-electric options such as heat pumps.
“Electrification is really the answer for reducing emissions from vehicles and from home heating,” said Samantha Dynowski, the president of the Connecticut chapter of the Sierra Club. “We just want to make sure that our emphasis is on the long term solution, not kind of a bridge, because the more we invest in this, the less you can get off of it.”
Supporters of biofuels, however, say they offer a path for states like to Connecticut to achieve reductions in greenhouse gas emissions over the next several decades. Earlier this year, Gov. Ned Lamont signed a law setting a statewide net-zero emissions target by 2050.
Chris Herb, the president of the Connecticut Energy Marketers Association, said the state’s reliance on natural gas to meet its energy needs, along with the high cost of building out greener technologies such as solar and wind, make the expansion of biofuels essential to meeting to those targets.
“There’s no way to blend [natural gas] down like we can petroleum,” Herb said. “Our industry is the only way we, the state of Connecticut, are going to be able to continue to make gains in carbon dioxide reductions in the fastest, least expensive way.”
But even biodiesel production has faced concerns around environmental pollution. In September, the EPA announced that American GreenFuels will pay $143,000 to settle penalties in the wake of Clean Air Act violations that occurred at the plant between 2020 and 2022. In a press release, the federal agency explained that it “found that the facility failed to control the release of certain air pollutants” during maintenance and system repairs.
When asked to respond to questions about the violations and the settlement, Kolmar Americas did not offer a detailed response.
“American GreenFuels, LLC is in compliance with the Clean Air Act,” Teta said in an email.
When it comes to the carbon-reducing benefits of biofuels, it also depends on the kind of feedstock that goes into the production process.
Oils that are processed directly from crops such as soybeans and corn require land clearing and mechanical harvesting that itself produces more emissions than recycled feedstocks such as used cooking oil. Only 36% of the biofuels produced nationally in 2022 came from waste or recycled feedstocks, according to the U.S. Energy Information Administration.
Teta declined to say what percentage of American GreenFuels’ products is recycled, but he said historically the company has sourced most of its feedstock from waste products.
That could change next year, he said, due to the elimination of tax penalties for biofuels derived directly from crops. The change, which was implemented as part of the One Big Beautiful Bill Act signed by President Donald Trump in July, is likely to result in American GreenFuels using more bean oils in its production.
“We are mindful that we must remain competitive and diffuse the market’s concern that we will be priced out of the market for waste feedstocks and therefore become uncompetitive,” Teta said in an email.
Currently, Teta said the company sources cooking oil from more than 5,000 locations, including restaurants in New York City where it’s shipped to New Haven on trucks or barges. Middlemen who pick up the oil from the restaurants or food manufacturing facilities are supposed to filter it to remove bits of food and other impurities. Still, workers sometimes have to remove those impurities once the feedstock arrives or rejigger their process based on the types of oil used in frying machines.
“Using all these waste streams, all these different types of oil, it makes it harder on ourselves,” said Sean Hayden, the quality lab manager at American GreenFuels. “Luckily, our formulation is flexible.”
The biodiesel industry has expanded considerably in recent years, a shift that has helped expand biodiesel applications beyond transportation to include uses like electric power and heating oil, one of the main uses of biodiesel in Connecticut. Those changes have had broader economic effects: Recent research found the biodiesel industry generated nearly $42.5 billion in economic impact nationally in 2024, along with 107,400 jobs and $5.8 billion in wages.
While American GreenFuels is one of a handful of East Coast operations, much of the growth in biofuels — a broader category that includes ethanol, biodiesel, and renewable hydrocarbon fuels — has been concentrated in the Midwest. The majority of corn-based ethanol and biodiesel production takes place in states like Illinois, Iowa and Nebraska, where crops used for these fuels are grown. That expansion has led to concerns that some crops, like corn, are being diverted to biofuel production rather than the food supply.
The exact impact of corn-based biofuel production on food supplies and prices has been a point of contention between environmental groups and biofuel supporters. Biodiesel industry experts say other production methods, like the use of soybeans and specific operations like American GreenFuels’ use of previously used oils and fats, sidestep those tensions.
“There’s no food-for-fuel issue,” said Stephen Dodge, the director of state regulatory affairs for Clean Fuels Alliance America, the trade organization that represents American GreenFuels and other member organizations. “It’s not like ethanol.”
In its latest biodiesel plant production capacity report, the U.S. Energy Information Administration found there were 48 biodiesel production plants operating in the U.S. as of January 2025. Collectively, those plants are capable of producing nearly 2 billion gallons of biodiesel in a year.
And the industry is expected to grow further. Estimates currently suggest that biodiesel use could top 6 billion gallons by 2030 and reach 15 billion gallons by 2050.
But production has faced headwinds in 2025, with biodiesel output falling earlier this year due to uncertainty around the future of federal tax credits and lower-than-expected profit margins.
Even so, American GreenFuels’ growth has made it a notable example of the manufacturing industry’s efforts to bounce back in Connecticut. The biodiesel industry supports some 1,250 jobs in the region, according to Clean Fuels Alliance America, and brought in some $47 million in revenue, according to Dodge.
Supporters of biofuels argue that the energy source can help serve as a transitional step as the country moves towards electrification.
“It’s really paramount upon private industry and government to do everything they can to start reducing carbon emissions as quickly as they can,” said Dodge. “We think that biomass-based diesel is the way to go.”
P.R. Lockhart and John Moritz are reporters for the Connecticut Mirror. Copyright 2025 @ CT Mirror (ctmirror.org).
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