SALISBURY -- Cato Gas & Oil, the city's first marketer and distributor of biodiesel fuel, hauled in a first tanker load this week from a Princess Anne manufacturing plant, a batch that could find its way into the gas tanks of Shore Transit commuter buses -- and hopefully, the furnace at City Hall.

Cato is partnering in an exclusive contract with the Greenlight Biofuels Inc. that opened a biodiesel manufacturing plant earlier this year in the Princess Anne Industrial Park. Cato invested $5 million in a new terminal at its Parsons Road facility near downtown to where the alternative fuel will be hauled and blended, then distributed to customers, said Chris Mergner, fuels marketing director at Cato.

The terminal will be unveiled today at 11 a.m. when Salisbury, Wicomico and Greenlight officials join Cato owner Michael Abercrombie Jr. to cut a ribbon on the facility and welcome the company's diversification initiative that the owner says "helps reduce our dependency on fossil fuels and foreign supply."

The company is courting several businesses or agencies as prospective customers for the fuel currently made from chicken fat. Wicomico County and the City of Salisbury are among entities being eyed, Mergner said. Shore Transit, the tri-county public transportation service, has agreed to fuel three new fleet buses.

The expansion comes as the third-generation fuel and gas distribution firm explores a similar venture to market and distribute ethanol, an alternative fuel made from a corn by-product, Mergner said.

"We are very excited about the completion of the terminal infrastructure for biodiesel," Abercrombie said Tuesday in a statement. "The upgrades we have done are essential for marketing biodiesel in a safe and effective manner."

Cato on Monday trucked the first two loads of 12,000 gallons of B100, or 100 percent biodiesel fuel from Princess Anne to the Salisbury terminal.

"We put the product in our tanks, and so far, so good," Mergner said, adding that the process also involves heating the product.

The Princess Anne facility manufactures biodiesel fuel from soybean by-products, although the product can be made from grease or fat from other animals. Mergner said the project launched with poultry greases because the current price was lower than soy.

"Soy is popular because it was one of the first ways to make biodiesel," he said. "We're not using it now because the price is high because of demand, double the price of fat."

If the company moves forward with the ethanol venture, the product would be re-formulated as E10, or a blend of 10 percent ethanol, from a Yorktown, Va., refinery, he said.

"We are doing a cost analysis now," he said.

SALISBURY -- Shore Transit riders go green later this month when fuel tanks on three buses joining the transportation authority fleet are fed a biodiesel and petroleum gas blend.

The switch comes as Maryland agencies and other vehicle operators turn to fuels made from soybeans or other vegetable byproducts as an alternative to the more toxic petroleum gasoline, much of which is made from imported oil. Cato Gas & Oil of Salisbury will distribute the fuel that blends 20 percent of soybean or vegetable oils with petroleum, said Latonya Franklin, a project specialist for the authority's Fixed Route Operations division.

Environmental benefits outweigh the increase in cost by a few cents per gallon for the blended product, Franklin said. The blend for Shore Transit costs about $2.81 a gallon, or about 2 cents more than traditional fuel that currently keeps the authority's fleet of 50 buses running, she said.

Fleet buses are equipped with 100-gallon fuel tanks and are filled on average twice a day, Franklin said.

"Biodiesel is a safer, more cost-effective fuel that offers better emissions and is less toxic," she said. "We intend to convert all new buses. It's more per gallon, but it is cleaner."

The new 30-foot passenger buses, which were unveiled Thursday for drivers, also are up to 10 feet shorter in length than other carriers in the public transportation fleet that serves the three Lower Shore counties, according to Riggin Johnson, director of Shore Transit's Fixed Route Operations.

The first of the new Champion-brand buses takes the road this week on the Orange Line, or Route 22, Johnson said in a statement. The route serves north Salisbury from Calvert Street to The Centre at Salisbury, Wal-Mart on Route 13 and the Northwood Industrial Park.

Other routes for a shorter, biodiesel-powered bus are:

A Pink Line bus serving Giant Food, the Fruitland Wal-Mart, Pine Bluff Village and other points south of will likely have a new 30-foot, biodiesel-powered bus by next week, Franklin said.

A soybean-fueled Route 11 bus will be on the road by the end of September to southern towns of Princess Anne, Pocomoke City, Berlin, and West Ocean City, she said.

Cato intends to have fuel for the transit fleet by Oct. 1, said a company official, Chris Mergner. Mergner also said other municipalities have expressed interest in using alternative fuel.

Over five years, Shore Transit plans to add an additional seven buses that also are shorter in length and fueled by biodiesel, Franklin said. With a shorter length, drivers can navigate more freely in heavily populated or congested areas, she said.

Clinton, SC – Greenlight Biofuels, Inc. announced plans to to construct an $8.5 million biodiesel fuel plant in Laurens County, South Carolina. The plant, to be called "Carolina Gateway", is scheduled to be in operation in mid- to late 2008 and will produce approximately 10 million gallons of biodiesel per year. Please read the entire story on page three (3) of the Palmetto Power Newsletter.

Charlottesville, VA – Greenlight Biofuels, Inc. has broken ground today on a 4.0 million gallon per year multi-feedstock biodiesel facility in Princess Anne, Maryland. This follows upon Greenlight’s recent purchase of a controlling interest in Baltimore Biodiesel, LLC, the developer of the project. Greenlight President Allen Cunningham remarked, “We are excited to be a part of an industry that contributes to environmental progress, national energy independence and local economic growth. This project is the first step in a broader strategy for Greenlight Biofuels.”

Greenlight Vice President Erik Lytikainen added, “This is an important day for Greenlight and the town of Princess Anne. Thanks to the help of community leaders, and together with first-class local partners, a new facility to produce renewable fuels will be coming online this year. This facility will bring new jobs to a high unemployment area, and will help support the agricultural community of the Eastern Shore.”

Greenlight Biofuels, Inc. was founded by Greenlight Capital Management, Inc. to develop, build, own & operate biofuel facilities in North America.

Greenlight Capital Management, Inc was formed by the principals of Greenlight Energy, Inc (GEI) following the $100 million sale of their wind energy company to BP Alternative Energy North America, Inc. At the time of the sale in 2006, GEI was one of the largest independent wind energy companies in the country with a 6,000 MW development pipeline comprised of large-scale wind energy projects in 15 states. By year-end 2007, over $700 million of wind energy facilities developed by GEI will be operational, including a $500 million facility in Colorado being completed this year by BP.

With an experienced management team and a strong track record in the renewable energy industry, Greenlight Biofuels is well-positioned to participate in the growth of the biofuels industry.