I'm burning biodiesel in two vehicles (1985 Jetta and 1989 Cummins) and Waste Vegetable Oil (WVO) directly in
Veggie Van Gogh.
There are some common misconceptions in this thread to date:
There are three ways to use vegetable oil in a common diesel engine, all of which have the common goal of making the vegoil thinner:
1) Chemical (biodiesel): trans-esterfication separates the hydrocarbon chains from the glycerin via the introduction of alcohol in the presense of a catalyst. The most common process uses methanol, but ethanol can also be used, albeit in a more complicated process.
2) Dilution: some people simply mix diesel fuel or gasoline or mineral spirits or whatever with vegetable oil. IMHO, this is the most risky way of doing it -- both to the engine, and for safety.
3) Heat: using engine waste heat and/or electric heat, vegetable oil becomes as thin as cold diesel fuel. This requires about 80 degrees C, or 180 F. A combination of coolant heat and electric heat is often used. See my site posted above for design notes and schematics on this process.
The critical item for any of these is the injection pump. Bosche is well regarded in vegoil circles, while Lucas is almost universally despised.
Other than that, damage due to biodiesel is rare and limited. After several years of use of commercial, washed biodiesel, rubber fuel lines may swell or weep and need replacing. I replaced the 1989 lift pump (NOT the expensive injection pump) on Veggie Van Gogh with one with a Viton diaphram for about $70, and am still using the original rubber fuel lines, two years later, with no obvious damage.
The point about using cropland for fuel production is well taken. However, we are currently growing food with a heavy input of non-sustainable petroleum, at approximately 2-4 calories of petroleum for every calorie of food produced! When that oil goes into decline within the decade, we'd better have something else in the pipes!
Soy is used for most commercial biodiesel production today, but it is a very inefficient source. This probably has more to do with farm state subsidies than anything else. Rapeseed produces over twice as much oil per hectare. Tropical oils can produce nearly ten times as much oil as soy. Small test plots of algae suggest it may produce as much as 500 times as much as soy, but it is not a mainstream product, and there are lots of bugs to work out.
Biofuels are widely derided as incapable of supplanting the entire petroleum fuel stream. This is true, but that doesn't mean they shouldn't be used. No single proposal is currently capable of replacing petroleum. The ideal future hold a distributed, diverse energy structure, versus the "energy monoculture" we have today.
The current US waste vegoil stream is about 3 billion gallons per year, or about 10% of the US diesel fuel consumption, or about 1% of the US gasoline consumption.
In short, making biodiesel or using vegoil directly works well and is easily within the capabilities of a home handyman tinkerer.