Renewable Diesel Market: Global Industry Analysis and Forecast (2024 -2030) Trends, Statistics, Dynamics, Segmentation by Feedstock Type, Production Process, Application, and Region

Renewable Diesel Market size was valued at USD 12.69 Bn. in 2023 and the total Renewable Diesel revenue is expected to grow by 7.6 % from 2024 to 2030, reaching USD 21.20 Bn.
Renewable Diesel Market Overview:
Renewable diesel is made from non-fossil feedstocks such as vegetable oils, animal fats, and waste oils. It is also known as green diesel or second-generation biodiesel. The number of advantages over traditional diesel include lower greenhouse gas emissions, lower particulate matter, and better air quality. Stringent environmental regulations aimed at reducing carbon emissions and promoting renewable energy sources drive the renewable Diesel market. Government incentives, tax credits, and renewable fuel mandates have boosted demand for renewable diesel even further. Increased investment in renewable energy technologies has resulted from increased awareness of the environmental impact of fossil fuels and the need for energy security.

Prominent manufacturers in the renewable diesel market are investing in research and development to improve production processes and expand feedstock options. Advanced conversion technologies such as hydrotreating and Fischer-Tropsch (FT) process are being utilized to efficiently convert feedstocks into renewable diesel. This has contributed to an increase in production capacity and a broader range of feedstock choices, including used cooking oil and algae. The transportation sector is the primary consumer of renewable diesel, with the automotive, aviation, and marine industries adopting it as a viable alternative to conventional diesel. Many fleet operators and transportation companies are transitioning to renewable diesel due to its compatibility with existing infrastructure and engines, without requiring significant modifications.To know about the Research Methodology :- Request Free Sample Report
Renewable Diesel Market Market Dynamics:
Renewable Diesel Market Drivers

Shift Towards Sustainable Energy Drives Growth of Renewable Diesel Market

The global transition towards sustainable energy sources and the urgent imperative to mitigate carbon emissions are fueling strong demand for the renewable diesel market. Stringent environmental regulations and heightened awareness of the environmental impact of traditional diesel are fueling the demand for renewable diesel. Governments worldwide are taking strong action to combat climate change by implementing strict regulations and renewable fuel standards.

Renewable diesel has emerged as an environmentally beneficial solution, reducing CO2 emissions and greenhouse gases. It improves air quality by decreasing promoting a healthier environment, and particulate matter. As a result, renewable diesel is gaining popularity as a sustainable alternative to conventional diesel, aligning with the global commitment to sustainability. These factors are fueling its growing adoption. Moreover, renewable diesel serves as a drop-in fuel, seamlessly compatible with existing diesel engines without necessitating costly modifications or infrastructure investments. This feature renders it an appealing choice for fleet operators and transportation companies, seeking to embrace cleaner fuels while minimizing operational disruptions.

The driving force behind the surge in renewable diesel adoption lies in the enhanced energy security it provides. By diversifying fuel sources and reducing reliance on imported fossil fuels, renewable diesel offers countries the opportunity to achieve greater energy independence. This, in turn, helps mitigate risks associated with oil price fluctuations and geopolitical uncertainties tied to fossil fuel imports. With these advantages, countries are increasingly turning to renewable diesel as a means to bolster their energy resilience and reduce vulnerabilities. Moreover, the confluence of factors, including global sustainability commitments, regulatory support, and the undeniable benefits of renewable diesel, has generated a substantial demand in the market. As the world continues to prioritize sustainability and emission reduction, the demand for renewable diesel is expected to experience a significant upward trajectory, driving its market growth in the foreseeable future.
Renewable Diesel Market Restraint
Limited availability and fluctuations in feedstock prices

The primary challenge in the renewable diesel market is the availability and cost of feedstock. Feedstocks, such as vegetable oils, animal fats, and waste oils, are essential for renewable diesel production. Limited availability and fluctuations in feedstock prices are impacting the production capacity and cost-effectiveness of renewable diesel in the historical period according to the MMR analysis. Ensuring a stable and cost-competitive feedstock supply chain is vital for market growth. According to MMR analysis, feedstock costs constitute a significant portion (up to 70%) of renewable diesel production costs.

The volatility of feedstock prices can pose challenges to achieving competitive pricing and long-term profitability in the market. The renewable diesel Industry is greatly influenced by policies and regulations governing biofuels and emissions. Inconsistent or uncertain policy frameworks can create barriers to investment and hinder market growth. Clear and supportive policies that provide long-term stability, incentives, and market signals are necessary to encourage increased production and adoption of renewable diesel.

Renewable Diesel Market Opportunity

Increasing environmental concerns and the need to reduce greenhouse gas emissions

The advancements in technology and increasing support for renewable energy. The shift towards sustainable transportation is a key driver of the renewable diesel market. As governments in the North American region, as well as industries worldwide, aim to decarbonize the transportation sector, renewable diesel offers a viable solution. Its lower carbon footprint compared to traditional diesel, along with its compatibility with existing infrastructure, makes it an attractive option for reducing emissions in the transportation sector. The ambitious biofuel targets and the need to achieve sustainability goals, According to the MMR analysis renewable diesel production capacity is expected to increase by over 43% by 2025.

Governments across the globe are implementing regulations and incentives to encourage the use of biofuels and reduce reliance on fossil fuels. These policies include blending mandates, carbon pricing mechanisms, tax incentives, and renewable fuel standards, creating a conducive environment for the growth of the renewable diesel market. For instance, the Renewable Fuel Standard (RFS) in the United States requires a certain volume of renewable fuels, including renewable diesel, to be blended into transportation fuels. This policy has spurred investments in renewable diesel production capacity in the country.
Renewable Diesel Market Segment Analysis:
Based on Feedstock Type, The Vegetable Oil segment dominated the renewable diesel market share in the year 2023 and is expected to do the same during the forecast period. Vegetable oils, such as soybean oil, rapeseed oil, palm oil, and others, offer several advantages as feedstocks for renewable diesel. They are readily available and have well-established supply chains and are efficiently processed into high-quality renewable diesel fuel. These oils are extracted from oilseed crops and are widely cultivated around the world, making them a reliable and abundant feedstock option.

The key advantage of vegetable oils is their favorable carbon footprint compared to fossil fuels. Renewable diesel produced from vegetable oils can significantly reduce greenhouse gas emissions, as they have lower lifecycle emissions and contribute to a more sustainable and environmentally friendly fuel option. Moreover, vegetable oils have garnered attention due to their compatibility with existing infrastructure and diesel engines.

Based on the Production Process, the Hydrotreating segment dominated the renewable diesel market in the year 2023 and is expected to do the same during the forecast period. Hydrotreating is known for its ability to produce renewable diesel with excellent fuel properties and low emissions. The process effectively removes impurities, such as sulfur, nitrogen, and oxygen compounds, resulting in a cleaner and higher-quality fuel. The renewable diesel produced through hydrotreating exhibits properties similar to petroleum-based diesel, allowing for seamless integration into existing infrastructure and diesel engines.

Moreover, the dominance of hydrotreating is further reinforced by its maturity as a refining process. It has been extensively used in the petroleum refining industry for many years, providing a well-developed and reliable technology for renewable diesel production. This maturity contributes to the scalability and commercial viability of hydrotreating, making it a preferred choice for large-scale renewable diesel plants. While other production processes, such as the Fischer-Tropsch (FT) process and pyrolysis, also play significant roles in the renewable diesel market, hydrotreating maintains its dominant position due to its widespread adoption, flexibility in feedstock utilization, and proven track record of producing high-quality renewable diesel.

Based on the Application, the commercial vehicles segment dominated the renewable diesel market in the year 2023 and is expected to do the same during the forecast period. The key drivers of renewable diesel adoption in commercial vehicles are the compatibility and ease of integration with existing diesel infrastructure and engines. Additionally, commercial vehicle operators are increasingly focused on meeting emissions regulations and sustainability targets set by governments and environmental agencies. Availability and accessibility of renewable diesel in the commercial sector have been improving, with a growing number of fueling stations and suppliers offering renewable diesel as a fuel option for commercial vehicles. This infrastructure development supports the widespread adoption of renewable diesel among commercial vehicle operators.
Renewable Diesel Market Regional Insights:
North America region dominated the renewable diesel market in the year 2023 and is expected to continue its dominance during the forecast period. North America is the region's robust regulatory environment and policies promoting clean and renewable fuels. The federal and state-level initiatives, such as Renewable Fuel Standards (RFS) and Low Carbon Fuel Standards (LCFS), incentivize the use of renewable diesel and mandate the reduction of carbon emissions in transportation. These regulations create a favorable renewable diesel industry environment and encourage the widespread adoption of renewable diesel in North America.

Additionally, North America benefits from a well-established infrastructure for renewable fuel production, distribution, and retail. The region has a network of renewable diesel production facilities, blending terminals, and fueling stations that support the supply and accessibility of renewable diesel. This infrastructure development facilitates the availability and adoption of renewable diesel in North America. Furthermore, North American consumers and businesses are increasingly conscious of environmental sustainability and are actively seeking cleaner fuel alternatives. The greenhouse gas emissions and improving air quality provide the renewable diesel offers a viable solution by significantly reducing. This growing demand from environmentally conscious consumers and businesses further drives the dominance of North American renewable diesel market.
Renewable Diesel Market Scope: Inquire before buying



Renewable Diesel Market


Report Coverage
Details


Base Year:
2023
Forecast Period:
2024-2030


Historical Data:
2018 to 2023
Market Size in 2023:
US $ 12.69 Bn.


Forecast Period 2024 to 2030 CAGR:
7.6%
Market Size in 2030:
US $ 21.20 Bn.


 Segments Covered:
by Feedstock Type
Vegetable Oils
Animal Fats and Used Cooking Oil
Algae
Others


by Production Process
Hydrotreating
Fischer-Tropsch (FT) Process
Pyrolysis
Others


by Application
Passenger Vehicles
Commercial Vehicles
Aviation
Marine
Others



by Region
North America (United States, Canada, and Mexico)
Europe (UK, France, Germany, Italy, Spain, Sweden, Austria, and the Rest of Europe)
Asia Pacific (China, South Korea, Japan, India, Australia, Indonesia, Malaysia, Vietnam, Taiwan, Bangladesh, Pakistan, and Rest of APAC)
Middle East and Africa (South Africa, GCC, Egypt, Nigeria, and the Rest of ME&A)
South America (Brazil, Argentina Rest of South America)
Key Players
1. Neste Corporation (Finland)
2.Renewable Energy Group (United States)
3.Diamond Green Diesel (United States)
4.Valero Energy Corporation (United States)
5.REG Grays Harbor (United States)
6.Phillips 66 (United States)
7.Archer Daniels Midland Company (United States)
8. TotalEnergies (France)
9.ENI S.p.A. (Italy)
10.UPM Biofuels (Finland)
11.Honeywell UOP (United States)
12.ExxonMobil Corporation (United States)
13.Chevron Corporation (United States)
14.Marathon Petroleum Corporation (United States)
15. PBF Energy Inc. (United States)
16.Neste US Inc. (United States)
17.Raízen (Brazil)
18. LanzaTech (United States)
19.Gevo, Inc. (United States)
20. Cargill, Incorporated (United States)

Frequently Asked Questions:

1] What segments are covered in the Global Renewable Diesel Market report?
Ans. The segments covered in the Renewable Diesel Market report are based on Feedstock Type, Production Process, Application, and Region.

2] Which region is expected to hold the highest share in the Global Renewable Diesel Market?
Ans. The North America region is expected to hold the highest share of the Renewable Diesel Market.

3] What is the market size of the Global Renewable Diesel Market by 2030?
Ans. The market size of the Renewable Diesel Market by 2030 is expected to reach US$ 21.20 Bn.

4] What is the forecast period for the Global Renewable Diesel Market?
Ans. The forecast period for the Renewable Diesel Market is 2024-2030.

5] What was the market size of the Global Renewable Diesel Market in 2023?
Ans. The market size of the Renewable Diesel Market in 2023 was valued at US$ 12.69 Bn.