Biofuels and Renewable Refineries Continue to Gain Momentum - Market Trends and Outlook

Biofuels and Renewable Refineries Continue to Gain Momentum - Market Trends and Outlook


Summary

Amid strengthening ESG headwinds, consumption of renewable fuels is expected to rise. For example, consumption of SAFs is expected to increase at a CAGR of 32% between 2022 and 2040. As a result, more and more crude oil refineries are considering diversifying their product offerings to include renewable fuels through coprocessing, refinery conversion, and the establishment of standalone renewable refineries. However, the switch to renewable fuels holds a number of challenges and hidden costs that could undermine the economic viability of switching to renewable fuels.

The five biofuels that are most prevalent within the current market are ethanol, FAME biodiesel, renewable diesel, biomethanol, and sustainable aviation fuels (SAFs). These fuels are generated through the processing of biomass. Each biofuel contains a number of advantages and disadvantages. However, most key is that biofuels produce less carbon emissions over their lifetime than conventional fuels and so offer decarbonization potential to industries that are unsuitable for electrification. The decarbonization potential of biofuels has led to their increasing demand and growing policy support, leading many refiners to consider diversifying their products to renewable fuels. Options for refiners include co-processing, conversion of conventional refineries to renewable refineries, and standalone renewable refinery projects. Converting existing refineries offers potential cost savings compared to building new refinery facilities. However, there are a number of challenges that accompany conversion. The economic viability of refinery conversion will hinge on factors such as feedstock proximity, availability and price as well as the degree to which legacy equipment can be retrofitted for renewable fuels.

Key Highlights
  • SAFs are expected to overtake FAME Biodiesel in 2037 and will grow at a CAGR of 32% between 2022 and 2040. This strong growth will be facilitated by policies aimed at decarbonizing the aviation sector such as the Refuel EU Aviation Initiative.
  • Ethanol will show a more gradual increase of 1.8% over the same time frame which reflects some of this fuel’s drawbacks such as its use of edible crops and comparatively lower energy content than conventional fuels, which increases fuel consumption and overall running costs.
  • The number of companies mentioning biofuels within their company filings has been increasing, with the number of filer companies increasing at a CAGR of 14% between 2016 and 2022.
  • Neste Corp recorded the highest number of mentions of biofuels within its filings since 2020, recording 134 across this time frame.
  • The number of global renewable refineries is expected to reach 187 in 2030, compared to 42 in 2020.
  • The United States will remain the dominant player in terms of production, accounting for 45% of renewable fuel production capacity in 2030.
  • Only 8% of upcoming projects are crude refinery conversions, reflecting the challenges of repurposing oil refining infrastructure for the production of biofuels
Scope
  • Assessment of conventional biofuels within the current market and their limiting factors
  • Key market players with respect to each biofuel
  • Upcoming biofuels policies
  • Biofuel deals and company filings data
  • Renewable fuel consumption and production forecasts
  • Geography of active and upcoming renewable refinery projects
  • The current renewable refinery conversion trend and its challenges
  • Leading companies that are converting crude oil refineries
Reasons to Buy
  • Obtain the most up to date information on recent developments and policies related to the oil refinery conversion trend.
  • Identify the opportunities of challenges associated with the switch form oil refining to renewable refineries.
  • Assess competitors based on their active and pipeline capacities for renewable fuel production and gain an overview of largest upcoming renewable refinery project.
  • Develop business strategies by identifying the most promising route to renewable fuel conversion.


Executive Summary
Biofuels Briefing
Introducing our five focus biofuels
Advantages and disadvantages of biofuels
Key players in the biofuels market
Biofuel policies driving increasing consumption
Biofuels Market Outlook
Biofuel consumption trends
Biofuel deal activity
Biofuel filing trends
Renewable Refineries Outlook
Production capacity outlook
Renewable fuels market landscape
Largest active and upcoming renewable refineries
Renewable refinery projects by type
The switch to renewable refineries
Oil and gas sector strategies amid the rise of renewable fuels
Advantages and disadvantages of refinery conversion
Active and upcoming conversion projects
Top companies converting refineries
Standalone vs conversion projects
List of Tables
Key players in the biofuels market
Biofuels main policies, strategies, and targets
Crude refineries conversion and co-processing: active and upcoming projects
List of Figures
Renewable fuel consumption, 2022-2040
Ethanol consumption, 2022-2040
Biofuel deal activity
Number of companies mentioning ‘biofuels’ within their filings, 2016-July 2023
Top ten filer companies for mentions of ‘biofuels’, Jan 2020 - July 2023
Renewable fuel production capacity and projects, 2020 - 2030
Renewable refinery capacity by country, 2020
Renewable refinery capacity by country, 2030
World’s largest renewable refinery projects by capacity in 2030
Current renewable refinery projects by stage of development
Upcoming renewable refineries by type
Top companies retrofitting crude oil refineries capacity
Renewable refineries: converted and co-processing vs standalone

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