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Boost in consumption of US biomass-based diesel expected

U.S. biomass-based diesel, comprised of both biodiesel and renewable diesel, has increased rapidly in a relatively short time span to become a leading source of alternative transportation fuel. According a new report released March 26 by the Fuels Institute, “Biomass-Based Diesel: A Market and Performance Analysis,” biomass-based diesel has increased its share of the diesel fuel market from 0.5 percent volume in 2010 to 5 percent in 2018 and is projected to reach 10 percent by 2022.

 The widespread acceptance of biomass-based diesel can be attributed to its broad compatibility with the U.S. transportation fuel infrastructure and positive environmental attributes, the report concludes.

The new report was commissioned to analyze the major attributes of the U.S. biomass-based diesel sector at every stage of the supply chain, including its production and consumption trends, distribution and blending practices, technical and environmental performance, and economics associated with production and demand.

“Understanding the different supply and demand drivers for biomass-based diesel, including policy and economic factors, as well as its technical and environmental performance characteristics, can help industry and policymakers make more informed decisions regarding continued reliance on biomass-based diesel as a source of alternative transportation fuel,” said John Eichberger, executive director of the Fuels Institute.

This report delves into the source and dependability of biomass-based diesel supplies in various regions, including the percentages of biomass-based diesel blended around the country and how blending patterns change with seasonal and other fluctuations. It also reviews the different performance values and environmental implications of varying biodiesel blends and renewable diesel.

The surge in U.S. production and consumption of biomass-based diesel can be attributed in part to its role in complying with major public policy initiatives. Programs such as the federal Renewable Fuel Standard and California’s Low Carbon Fuel Standard rely heavily on the production and blending of biomass-based diesel to meet compliance standards, while the blenders tax credit further incentivizes the industry to push biomass-based diesel into the market at a competitive price. At the same time, the global pressure to reduce harmful emissions by relying on alternative fuels and powertrains will only continue to escalate with time, creating additional opportunities for biomass-based diesel.

Biomass-based diesel consumption results in lower life cycle greenhouse gas emissions and has a lower carbon intensity relative to petrodiesel while offering nearly comparable performance, a reason it has come to be so heavily relied upon as an alternative fuel. Additionally, biodiesel has been approved under on-road diesel engine warranties for use in blends of up to 20 percent volume with petrodiesel while renewable diesel, which meets the requirements of the ASTM standard D975 for diesel fuel, can be blended up to 100 percent volume.

The report finds that biomass-based diesel supply economics are driven by a combination of feedstock and ULSD prices, while the widespread recognition of biomass-based diesel fuels’ environmental benefits as well as its compatibility with the U.S. transportation fuel infrastructure have been instrumental in creating demand for biomass-based diesel fuels.

“Biomass-based diesel has benefited greatly from public policies encouraging its use and offsetting its higher cost of production to ensure the final product is affordable to end users,” Eichberger said. “However, the compatibility and performance characteristics presented by both biodiesel and renewable diesel indicate opportunities for commercialization that extend beyond public policy. Currently, production economics do not yield a market that would be price competitive absent government programs, but anticipated expansion of the biomass-based diesel market could yield economies of scale, reduce distribution costs and deliver a compelling fuel product at a price that consumers would accept.”

“Biomass-Based Diesel: A Market and Performance Analysis” can be downloaded free of charge here.  

The Fuels Institute, founded by NACS in 2013, is a nonprofit research-oriented think tank that evaluates market issues related to vehicles and the fuels that power them, incorporating the perspective of diverse stakeholders to develop and publish peer-reviewed, comprehensive, fact-based research projects. The Fuels Institute is a nonbiased organization that does not advocate.

Fuente : The Fuels Institute

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