North America's Booming Renewable Diesel Market: A Sustainable Fuel for a Changing World
The demand for sustainable fuels is rapidly increasing in North America, propelling the renewable diesel market towards significant growth. This biofuel, produced from waste oils and fats, offers a compelling alternative to traditional fossil fuels due to its lower carbon footprint and compatibility with existing engine technology.
According to a new report by MarketsandMarkets, the North American renewable diesel market is forecast to soar from £10.2 billion in 2022 to £39.1 billion by 2044, with a compound annual growth rate (CAGR) of 7.1%. This surge is driven by a combination of factors, including government incentives, increasing environmental regulations, and a growing focus on renewable energy sources.
Renewable diesel shares a similar chemical composition with conventional diesel, making it a "drop-in" fuel that can be used directly in existing engines without requiring modifications. It also meets the stringent D975 fuel quality standards. The production process utilises a variety of feedstocks, including waste oils (such as fat, fish oil, used cooking oil) and vegetable oils (including canola, soybean, and sunflower oil).
The diverse applications of renewable diesel span various sectors, including transportation and fleet operations, industrial use, and green mobility initiatives. It also forms the foundation for sustainable aviation fuel (SAF), produced using a slightly modified technological process.
The report categorises the market based on feedstock, highlighting the use of both waste oils and vegetable oils. Waste oils include tallow, used cooking oil, fish oil, lard, and poultry fat, while the vegetable oil segment comprises corn oil, canola/rapeseed oil, soybean oil, sunflower oil, and palm oil.
The market's growth is further propelled by the rising demand for renewable diesel across various industries, including fleet operators, aviation, and transportation. This trend is fuelled by growing concerns over fossil fuel depletion and a pressing need to integrate renewable energy sources into the energy mix for long-term sustainable growth.
Leading players in the renewable diesel market include Neste OYJ (Finland), Chevron Renewable Energy Group (U.S.), PBF Energy Inc. (U.S.), Valero Energy Corporation (U.S.), and Gevo, Inc. (U.S.). These companies are actively pursuing strategies for expansion, mergers, joint ventures, and development of novel products to solidify their position in this rapidly evolving market.
The United States, with a market share of 99% in 2021, dominates the North American renewable diesel market. As the global energy landscape shifts towards sustainability, the North American renewable diesel market is well-positioned for continued growth, driving a greener future for transportation and industry.
