Greenline Industries, a San Franscisco-based biofuel equipment company, secured $20 million in investment capital to further the development of its patented “waterless” biodiesel system. Increased demand for water for use in biofuel production, including the refining of biodiesel, has led to concerns about water scarcity. Greenline eliminates these problems by utilizing an ion resin catalyst instead of water to cleanse the fuel.

Peter Brown, head of international sales for Greenline Industries, told HybridCars.com, “Our systems use no water and no chemicals.” Brown also said that the Greenline process could be applied to existing biodiesel refineries to eliminate the use of water and chemicals. “Our ‘waterless’ biodiesel process does not have to be built from ground up.” The company has sold 30 biodiesel plants worldwide.

Biodiesel is a renewable fuel that can be used in diesel engines without any modification—although most diesel-producing carmakers will only allow a 5 percent blend under warranty. In the United States, commercial biodiesel is defined by ASTM specifications, which outline specific properties of the fuel, such as viscosity and sulfur content. Rules like the ASTM standard ensure that certified biodiesel burns properly in modern diesel engines. Biodiesel can also be home-brewed using waste cooking oil as the base fuel. Residual water in biodiesel fuel can make it more difficult for the fuel to combust, reducing its power.

The funding comes from London-based Leaf Clean Energy, an energy venture firm that invests in alternative fuels and renewable power generation. The deal comes as biofuels are coming under greater scrutiny for potential negative environmental and economic impacts. Amber Thurlo Pearson, spokeswoman for the National Biodiesel Board, was quoted on BusinessGreen.com, “Right now, we’re seeing more of a steady growth, rather than the extreme growth that we saw over the last couple of years.”