Green Diesel Market Updates: High Demand Creates New Investments

The green diesel markets have seen a bright spotlight in recent months with increasing attention on renewables. With North America emerging as a serious market for these commodities, we’re seeing substantial interest and investments into 2024.

We’ve compiled a few of the top market stories from our Green Diesel Reports available in ResourceWise’s biofuels and feedstocks platform, Prima CarbonZero.

International Energy Agency Forecasts Over 20% Rise in Biofuel Demand in Next Five Years

The International Energy Agency (IEA) forecasts an over 20% rise in total global biofuel demand compared to the last five years. This amounts to a 38-billion-pound change by 2028. The news comes from the IEA’s Renewables 2023 report.

The total demand will hit 200 billion pounds, driven primarily by hydrogenated vegetable oil (HVO) and ethanol. Biodiesel and biojet fuel will also see a significant rise in the same period.

A Paris-based independent organization, the IEA offers non-partisan, intergovernmental analysis of energy policy. Their work helps both public and private organizations partner with sustainably-focused technology systems to accomplish decarbonization objectives.

Oil Giant Phillips 66 to Invest in Renewable Diesel and SAF Production Site

Speaking of rising demand, oil refining leader Phillips 66 is making a groundbreaking shift toward biofuels.

The energy giant already announced its intention to convert its immense Rodeo refinery into an 800 million gallon/year production site for the creation of renewable diesel and sustainable aviation fuel. The project got some good news recently as the Contra Costa County Supervisory Board approved the company’s environmental impact report on the site.

The company worked through several steps and complications before making it to this point. P66 has already invested over $850 million in the new project. With this approval on the books, it aims to begin operation during the first quarter of 2024.

Investments in biofuels from major oil producers like P66 mark a distinct conversation shift between fossil fuels and renewables. We expect to see a continued rise in oil companies investing in the future with sustainable biofuel development, production and technology.

US Firms Seeking ISCC Distinction In-Line with EU "Carbon Creep"

The European "carbon creep" is beginning to influence businesses outside of the EU. The term refers to the EU’s various carbon programs, requirements and regulations impacting global markets. To remain competitive on the European market, other companies are investing in compliance through the International Sustainability and Carbon Certification (ISCC).

The ISCC utilizes its certification process as a direct and measurable tool to help organizations reduce their greenhouse gas emissions. It also helps these organizations trace production origins across the supply chain. Through these standards, various ESG criteria can be implemented at scale (e.g. organizationally, community-based, or at a broader government-level).

Several US-based companies have followed suit and sought out ISCC distinction. Why take these additional steps? The answer comes down to the money.

European natural gases trade on European markets at a price multiple times higher than US-based gases. This is the case due to this certification. With an ISCC acknowledgment, companies can clearly identify both the legitimacy and quality of the traded commodities. Without the certification, they cannot even trade on the EU’s ticketed renewable fuels markets.

This creeping outward—or various certifications which legitimize commodities—will continue taking hold of the market. We can expect growing interest in ISCC and other certifications as more firms adopt various renewable commodities in their operations.

Get Detailed Pricing Data and Market Insights from Prima CarbonZero

These stories are excerpts from various market insights available in the North American and European Weekly Green Diesel Reports, only available in Prima CarbonZero™ from ResourceWise.

Prima CarbonZero™ is an online pricing and analytics platform providing a wealth of pricing on biofuels, feedstocks, and low carbon markets. Our experts provide a streamlined solution for tracking the data that is critical to your organization’s transition to a carbon-free future.

With market insights, predictions, and forecasts, you can better understand how these markets move, where they are going, and how you can stay competitive.

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