Darling International, a company that processes food scraps, animal parts and used restaurant grease in San Francisco, is trying to turn that waste into fuel, it was reported on Tuesday.

Under a tentative agreement with the Port of San Francisco, the company will build a biodiesel plant on the city's southeastern waterfront, according to the San Francisco Chronicle.

The plant will be capable of churning out 7.5 million to 10 million gallons of biodiesel each year. The project will cost roughly 7 million U.S. dollars to 10 million dollars.

"This facility will serve as a model for cities throughout the world who aim to reduce their carbon footprint and transform their grease waste into useable, sustainable energy," said Mayor Gavin Newsom.

The city government uses a blend of 20 percent biodiesel in all 1,500 of its diesel vehicles. The proposed agreement with the port, however, does not obligate the city to buy biodiesel from Darling International.

For 38 years, the company has run a rendering plant that creates tallow by processing byproducts from dairies, meatpacking facilities, butcher shops and restaurants. The plant ships so much finished tallow -- 21,731 liquid tons in 2007 -- that the company has become the port's largest exporter, said the paper.

Tallow can be used to make biodiesel, a fuel that can be blended into regular, petroleum-based diesel or used on its own in vehicles with minor modifications.

Biodiesel has grown in popularity during this decade's historic run-up in oil prices, which pushed the price of regular diesel above five dollars per gallon this summer in California. Biodiesel can be made from multiple sources, such as soy oil or recycled restaurant grease.

Under the proposal, Darling and the port also will collaborate on creating a marine fueling station for boats that use biodiesel.

Darling International is based in Irving, Texas.