SOUTH PARIS – A new facility that stores and blends biofuels in South Portland is a big step for customers who want to use alternate energy fuels – and for the businesses that supply them.

“We’ve seen quite a demand for alternate diesel fuels from big trucking companies,” said Ken Cannell, transportation manager for C.N. Brown. “The problem has been one of not enough supply.”

That should change with new facilities built by Sprague Energy. Cannell and Ford Reiche, president of Safe Handling Inc. in Auburn, were among the invited guests Tuesday to unveil the new facility, which stores and blends biofuels with conventional petroleum products.

“We needed a big backer, someone willing to spend the time and money to handle this and make it viable,” said Cannell of Sprague’s investment. He said his company has meetings already slated with several large trucking companies interested in converting to biodiesel fuel now that they can be assured of quality and supply.

“They’ve been asking about it for six months to a year now,” Cannell said. Oakhurst Dairy, one of C.N. Brown’s commercial customers, has already converted its fleet.

Sprague’s new facility at its South Portland terminal represents the first venture into the biofuel market by a major wholesaler. Some smaller energy companies have offered biofuel to power vehicles or to heat buildings, but no one so far has done it on the scale of Sprague, said Erika Morgan of Maine Energy Investment Corp., a nonprofit advocacy group that promotes biofuel use.

“This is great. It allows a lot of heating oil suppliers to get biofuel,” she said.

The new facility stores 42,000 gallons of pure biofuel (referred to as neat or B100) that is delivered via Safe Handling from its rail facility on Rodman Road in Auburn to the South Portland terminal. The B100, a derivative of soy bean oil, arrives from producers in the Midwest.

The B100 is pumped through special heated pipes into storage tanks for blending with conventional petroleum to use as diesel fuel or heating oil. Andy Lynch, spokesman for Sprague, said the energy company sees a promising future for biofuels, which motivated the investment.

“We see the growth potential with biofuels, even though it’s a small portion of our business now,” he said. The 42,000 gallons of B100 storage compares with 46 million gallons of traditional petroleum fuels at South Portland. “But we’ve sold over 2 million gallons so far in our network since March.”

He said other states, such as New York, have already embraced biofuels in a big way. Sprague upgraded two facilities there to accommodate the increased demand. Lynch said he’s beginning to see similar interest in Maine, and thinks tax incentives help.

Truckers who use biodiesel fuel already get an almost 8-cent-a-gallon tax break. Cannell said the break levels the playing field between conventional and bio fuels, making the costs nearly the same.

Morgan said biofuel for homes is also often on parity with conventional heating oil (a comparison of fuel prices is available at www.mainenergyinfo.com).

The upside for residential and commercial customers is using cleaner fuels that produce fewer emissions and cause less pollution.

“People realize it’s better for the environment and try to make a difference,” Cannell said.

They also take some comfort from reducing reliance on foreign oil, Lynch said.

“B100 is literally grown, produced, shipped, sold and used domestically,” he said. “We’re very proud of that.”