The Digest’s Top 10 Advanced Bioeconomy Markets and Predictions for 2021

6. Big Renewable Diesel Buildouts and Busts a’comin

We love renewable diesel! While it does not have all the environmental benefits of America’s favorite advanced biofuel, biodiesel — it has proven easier to deploy as a 100% drop-in alternative fuel, and it has proven easier to construct massive facilities that achieve some impressive economies of scale. 100 million gallons is a huge biodiesel or ethanol plant, but some renewable diesel plants are on the drawing board that will produce as much as 800 million gallons per year. That’s 50,000 barrels per day — that’s a decent-sized petroleum refinery.

In the past two years, nearly 6 billion gallons of renewable diesel production has been built or proposed — that’s 10 billion gallons of ethanol-equivalent renewable fuels, taking into account the higher energy density of renewable diesel. Why, that’s a faster build-up than the ethanol industry at the height of its expansion phase. And, the story is even more exciting when you consider the number of petroleum refineries being converted over the renewable diesel. At least 8 such projects are complete or on the drawing boards. Something that was a dream just a few years ago is a reality today.

The trouble is, where’s all the affordable feedstock going to come from. We’re reaching Peak Grease far faster than Peak Oil, and using plant oils is the next obvious step, but biodiesel’s there, plant oils are expensive, and some plant feedstocks have been demonized, such as palm oil, when they are used at fuel-scale.

So, there’s a SARA problem — not enough sustainable, affordable, reliable, available feedstocks. Will the SARA feedstocks arrive in sufficient quantities? If not, we fear that many of these monster projects will not be built, or will operate in the stop-start fashion of some other renewables sectors (such as biodiesel) when there are constraints on demand or supply.