Global biofuel production rises to 61B gallons/year by 2018 – study

Biofuel capacity growing in Europe, Americas, Asia

The United States continues to dominate the global biofuel industry, which is forecast to grow from 55 in 2014 to 61 billion gallons a year by 2018, according to a new report.

Ethanol and biodiesel will continue to dominate with 96 per cent of the capacity in 2018, but novel fuels and novel feedstocks will be major drivers of capacity growth, according to Lux Research.

Novel fuels and novel feedstocks will grow at a rapid 27 per cent and 16 per cent compound annual growth rate (CAGR), respectively, through 2018.

Ethanol and biodiesel will grow at a slower 2 per cent rate but will reach capacities of 40 bgy and 19 bgy, respectively.

“While ethanol and biodiesel dominate global biofuel capacity today, limits on their growth mean that novel fuels like renewable diesel, biojet fuel and biocrude are crucial to the future of the industry,” said Victor Oh, Lux Research Associate and lead author of the report titled, “Biofuels Outlook 2018: Highlighting Emerging Producers and Next-generation Biofuels.”

“Producers also need to tap into novel feedstocks like waste oils, non-edible biomass, and municipal solid waste to push the industry beyond food-vs.-fuels competition,” he added.

Lux Research analysts studied growth of biofuel utilizing an alternative fuels database of over 1,800 production facilities globally. Among their findings:

• Waste oils will dominate next-generation biofuel. With a 52 per cent share, biodiesel made from novel feedstock, specifically waste oils, will lead novel fuels capacity in 2018. Cellulosic ethanol and renewable diesel follow with 19 per cent and 18 per cent, respectively.
• Americas continue dominance. With a 64 per cent share of global biofuel capacity, the Americas are a dominant force. The region, led by the U.S. and Brazil, also leads in utilization of global production capacity with 86 per cent, much higher than the global average of 68 per cent in 2014.
• Eight countries are biggest emerging producers. China, Indonesia and Thailand in Asia; Colombia and Argentina in the Americas; and Portugal, Poland and France in Europe are the biggest emerging production centers for biofuel after the U.S. and Brazil.