The fuel works in any diesel engine with few or no modifications, and offers similar fuel economy, horsepower and torque to petroleum-based diesel. Biodiesel also burns more cleanly than petroleum diesel, said Jenna Higgins, of the Missouri-based National Biodiesel Board, a trade association representing the biodiesel industry.

The widespread use of biodiesel has been held back because of production costs and perceptions that it performs poorly in extremely cold weather.

"Concerns that biodiesel can't perform or flow well in adverse weather are based on myths," said Kelly Strebig, a research engineer at the University of Minnesota Center for Diesel Research, in Minneapolis.

Proponents of biodiesel - which is biodegradable, nontoxic and free of sulfur - have said the home-grown fuel could be key in weaning Americans off imported oil.

Biodiesel use across the United States has grown from 500,000 gallons in 1999 to more than 20 million gallons last year as farmers and fuel producers looked for US-produced energy sources to lessen the dependence on foreign oil.

American farmers, the second-largest diesel-using group in the United States, generally use the fuel in blends of 2 percent or 20 percent (B20) with petroleum diesel. Farm machinery is mostly diesel-powered.

Strebig and other researchers recently verified that B2, a blend of 2 percent biodiesel and 98 percent petroleum diesel, had no measurable difference in cold flow properties compared with standard diesel.

And higher blends, such as B20, can be traded with standard flow-improvers, just as most diesel fuel is treated with in cold weather, he said.

"The key is using appropriate winter diesel fuel for (temperature) range you're going to experience, and if B20 doesn't give you the properties you need, then try some of these new additives," Strebig said. Many of the cold-flow improvers only cost 3/4 to 1-1/2 cents per gallon, and need to be used only during the coldest months of the year.

BIODIESEL CLEANER THAN PETROLEUM DIESEL - EPA

The Center also recently completed studies of two additives that lowered the point at which B20 gels to 50 degrees below zero Fahrenheit (-45.55 Celsius). Both are currently commercially available from biodiesel distributors, Strebig told Reuters.

"We aren't surprised at reports like these because biodiesel is such a well-tested fuel, both in the laboratory and in the real world," said Joe Jobe, executive director of the National Biodiesel Board. "For many years, Europeans have used biodiesel year-round in cold locations like the Swiss Alps."

In addition to the recently published University of Minnesota data, biodiesel proponents noted that the US Environmental Protection Agency late last year released data showing use of B20 could reduce emissions of total unburned hydrocarbons by 20 percent compared with petroleum diesel.

Hydrocarbons are a contributing factor in the development of smog and ozone.

The report also verified a 12 percent reduction of both carbon monoxide and particulate matter in use of B20.

Carbon monoxide is a poisonous gas and also a factor in smog and ozone formation, while particulate matter has been recognized as a contributor in the development of respiratory disease.

The United Soybean Board, a group of US farmers that oversees the investment of national soy checkoff dollars, this winter launched a major drive to spur soy biodiesel use.