Renewable fuels are biofuels produced using advanced biomass such as agricultural wastes, forestry, food processing, and non-edible crops. These are rapidly gaining popularity among refiners globally due to their potential role in the global energy transition compared to petroleum fuels. Hence, biofuels such as renewable diesel and sustainable aviation fuel (SAF) are attracting investments from downstream companies around the world, according to GlobalData, a leading data and analytics company.
GlobalData’s thematic report, Biofuels, provided an overview of the global biofuels industry and its potential role in the global energy transition. It benchmarks leading companies, such as Neste, Marathon Petroleum, Valero, and Phillips 66, based on their active and upcoming capacity in renewable fuels. It also evaluates the industry, technology, and regulatory trends within the biofuels industry.
Ravindra Puranik, Oil and Gas Analyst at GlobalData, said Biofuels could be produced from a diverse set of biomasses, a renewable energy source, through combustion or processing. Conventional biofuels, such as ethanol or biodiesel, which use edible biomass as feedstock, have been in commercial use for a long time.
“However, using advanced feedstock for fuel production is the need of the hour as it would ease food security concerns that have aggravated globally in recent years,” said Puranik.
Biofuels are intended to blend with conventional fuels and be used as transportation fuels in the long term to reduce the dependency on fossil fuels. Hence, the biofuel production process is mainly similar to crude oil refining.
Renewable fuels are regarded as ‘drop-in’ fuels as they can be blended with petroleum in varying concentrations or used directly in vehicles without any major engine modifications. Their wide-ranging application set includes automobiles, aviation, shipping, domestic and industrial heating, and petrochemical feedstock.
Puranik continued that several countries have introduced mandates for blending biofuels with gasoline, diesel, and jet fuel to help reduce emissions from the transportation sector. Neste, Valero, Marathon Petroleum and many others are setting up renewable diesel and SAF plants to reap from the regulatory push.
There is further potential for technology development in processing advanced biomass to boost renewable fuel production.
“The biofuel industry could benefit from feedstock diversification to prevent the scarcity of any one source.”
Advanced biofuels address these concerns and tackle challenges over land availability, biodiversity loss, and price volatility due to crop failure. The scaling up renewable refinery capacities is also essential to lower production costs in the long term, making these fuels competitive enough to replace petroleum fuels.
