I see a few things with this:
1) This is good. The Fed wants to move all Fed-owned Diesels to a 20% blend by like 2012 ... it's a close approaching date.. this is forcing auto makers to accept the alternative fuels (seriously, whose had a specific failure in a ALH or later TDI that was the biodiesel's fault?)
2) Biodiesel produced from soy can't save the world. Biodiesel produced from hemp using similar processes very much could. Factor in Algae and suddenly the only "limitation" is how much antigel. The 2-3MPG hit isn't a big deal for most consumers, even business consumers.
3) The state of Iowa would repair any vehicle damanged by their fuel mandate.
It always take a leader. I think this is a good move on their part. Do I think 20% is enough? no. I'd like a 50 to 70% blend, at those ratios it often does not gel (unless its animal fat, and due to the CDC and laws about fats, esp. human fats being considered biohazzardous, i doubt we're going to see a lot of fat-based fuels) in colder temps and it displaces that much more fossil fuel -- be it domestic or imported fossil product.
As a whole I think their move is pushing the issue. When I get a transmissionless electric that is powered by farts and sunshine, I'll give up on the manual/biodiesel.. not until (and if you don't laugh at the idea, methane gas is going to be as valuable in the future as natural gas is today).
One of my pet projects is attempted methane injection, or just making a diesel run off methane from composting w/ no diesel fuel at all. technically this is possible.
Also let's drop this whole "doesn't it break thing?" routine. Any diesel pre-1995 thats on the road has already had its IP repaired at least once during our two major sulphur-reduction changes in diesel fuel -- either in the 90s when we moved to 550ppm or in the last 2 years when we moved to 15ppm diesel fuel. Forget not that 5ppm is in the pipeline, still.
I was shown some rather convincing looking documents from a known diesel maker who use FAME Biodiesel in a simulated 60,000 mile test and the injectors looked bad. They concluded that by the 70k mile mark the vehicle would be underperforming and need the injectors replaced.
I stopped using Bio (due to price, and political reasons) at 62,000 in my Jetta. I logged a successful 60k with B100, no less than B20 at any time, and now at 82,000 I'm back on bio (this time WVO based and not animal fat based). Economy did drop a little, but peoples jaws still drop when I say "570 miles the light comes on."
At the end of the day I'd rather use a domestic, renewable product. Despite the economy I've always been able to buy biodiesel; the feedstocks never ran out -- but the price got to the point where it was just not cost effective anymore (I can't just stop going to work, even if I want to make a politcal/economic point).
Those who think that it's impossible to make FAME-type Biodiesel on a large scale are the same who think we cannot run the country off Wind and Solar power alone (and the facts are, we surely could -- and make a two-way grid at the same time, power failures become a thing of the past, and the power company serves only to connect "pipes" to homes in communities and communities to communities, they don't supply the product in the pipe anymore).
But I'm the wacko. What do I know ?
IMO...... of course.