Diesel fuel filters that have water drains on them are "coalescing filters". As small water droplets hit the filter element they will join up with other droplets and fall to the bottom of the filter, where the water can be drained off. Sometimes there is a relatively weak centrifugal force action going on as the fuel spins whe it enters the filter, but not on all filters. Coalescing filters are nearly 100% effective at removing water in diesel fuel, but nearly 95% ineffective at removing water from Biodiesel or WVO. Water needs to be boiled out of WVO before making Biodiesel, or adding WVO directly to your tank.

Old 300-D-, I prefer dumpster oil to any other kind. The good oil floats to the top and the sludge drop to the bottom. I just pump off the good stuff and leave the rest for the rendering company. The dumpster oil I come across has virtually no water or food particles in it, unless it's cold out and the oil stays sludgy...

Joe

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1978 300SD
Running Biodiesel/SVO, 2 tank system
127,000 Miles