Biofuel Market is Projected to Reach $ 242.24 Billion by 2032 

According to the new report titled “ Biofuel Market, By Fuel Type {Ethanol, Biodiesel, Renewable Diesel, Other Biofuels}, By Generation {First Generation, Second Generation, and Third Generation}, By End-Use {Transportation, Aviation, And Others} Global Analysis to 2024″, the valuation of the Biofuel market was $ 142.92 Billion in 2024 and is projected to reach $ 242.24 Billion by 2032, at a CAGR of 6.8 % from 2024 to 2032

Biofuels are fuels produced from biological sources, including plants and algae. Since such feedstock material can be replenished readily, biofuel is considered to be a source of renewable energy, unlike fossil fuels such as petroleum, coal, and natural gas. These plant and animal based fuels include gaseous fuels such as hydrogen (H2) and methane (CH4), and liquid fuels such as methanol (CH3OH), ethanol (C2H5OH), biodiesel, and acetone (C3H6O), among others. Biofuel is commonly advocated as a cost-effective and environmentally benign alternative to petroleum and other fossil fuels, particularly within the context of rising petroleum prices and increased concern over the contributions made by fossil fuels to global warming. This acts as a growth factors for the Biofuel market as many developed and developing country making policies which are directly or indirectly fuelling the biofuel market growth. For instance, in August 2022, Canada pledged to reduce carbon emissions by 40-45% below 2005 levels by 2030 and to achieve net-zero emissions by 2050. Biofuels have gained global significance with support from different governments across world for their multiple benefits including reduced greenhouse gas (GHG) emissions and improved domestic energy security. 

Biofuels are categories and terminology varies in government legislation and incentive programs and in industry branding and marketing. By The U.S. Energy Information Administration (EIA) four major categories of biofuels that qualify for the federal RFS Program are as Ethanol, Biodiesel, Renewable Diesel, Other Biofuels in which Ethanol an alcohol fuel blended with petroleum gasoline for vehicles. Biodiesel—a biofuel usually blended with petroleum diesel for consumption. Renewable diesel—a fuel chemically similar to petroleum diesel fuel used as a drop-in fuel or a petroleum diesel blend. Other biofuels include renewable heating oil, renewable jet fuel (sustainable aviation fuel, alternative jet fuel, and biojet), renewable naphtha, renewable gasoline, and other emerging biofuels that are in various stages of development and commercialization. The biofuel Market, Biofuels can also be categorized into first, second, and third generation depending on the feedstock used for their production. The product range for first-generation biofuels is largely limited to ethanol produced from corn and distillers grains. The second-generation biofuels are produced from non-food residues or lignocellulosic biomass such as agricultural biomass and forestry refuse, as well as energy crops. The third-generation biofuels are produced from algae, sewage sludge, and municipal solid wastes. first-generation biofuels dominated the global biofuels market, accounting for nearly 84% of the market share. technological advancements and the commercialization of processes that resulted into the dominance of first generation fuel in the market

By End Use, Transportation is the Largest Segment During the Forecast Period.

The biofuel market is segmented into three primary end-use categories which are transportation, aviation, and others. The transportation sector, has a significant contribution to greenhouse gas emissions, whereas biofuels release less carbon dioxide compared to traditional fossil fuels, making them a best alternative that can help reduce the overall carbon footprint. Governments around the world are implementing policies and regulations to promote the use of renewable energy sources, including biofuels. for Instance “European Parliament adopted the European Climate Law, which raises the EU’s target of reducing net greenhouse gas emissions at least 55% by 2030 (from the current 40%) and makes climate neutrality by 2050 legally binding”. In case of the aviation industry, which is also exploring the potential of biofuels to reduce its environmental impact. Biofuels can serve as a sustainable alternative to conventional jet fuels, which are major sources of carbon emissions. The integration of biofuels in aviation is crucial for achieving long-term sustainability goals and compliance with international carbon reduction agreements.

North America to Dominate the Biofuel Market in 2024.

Biofuel market in North America region account for the largest share of market the reason for share is impressive growth and production capacity of region, particularly the United States. In January 2023, the total biofuels production capacity in the U.S. reached 23 billion gallons per year, reflecting a 6% increase compared to January 2022. Fuel ethanol made up 78% of this capacity, while renewable diesel and other biofuels contributed 13%, and biodiesel accounted for the remaining 9%. With that The United States is the world’s largest producer of biofuels as per the latest data. The country produced 1,557 petajoules in this year. It remains a major producer of biodiesel, and annual consumption of ethanol and biodiesel is projected to exceed 200 billion liters from 2026 onward, ensuring the U.S. along with that United states largest consumer of biofuels globally. Along with that U.S. policy is strongly geared towards expanding biofuel production, aiming to reach 36 billion gallons by 2023 through the Renewable Fuel Standard. These strategic initiatives and substantial production capacities makes North America, particularly the United States, as the dominant force in the global biofuels market.

Key market players operating in the market that are profiled in the report are Air Liquide, Archer Daniels Midland Company, Bunge North America, Inc., Butamax Advanced Biofuels LLC, Green Plains Inc., Petrobras, Renewable Energy Group, Inc., Royal Dutch Shell Plc, Scandinavian Biogas Fuels International AB, Wilmar International Ltd., lanzajet, Inc.