Renewable Diesel Market Size, Share, Growth, And Industry Analysis by Type (From Lipids, From Cellulosic Biomass) by Application (Locomotive, Ships, Power Plant, Truck & Other) and Regional Forecast To 2031

Updated On: 22 April 2024

Renewable Diesel Market Report Overview

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global renewable diesel market size was USD 18688.05 million in 2021 and market is projected to touch USD 101838.3 Million By 2031, exhibiting a CAGR of 18.48% during the forecast period.

The global COVID-19 pandemic has been unprecedented and staggering, with renewable diesel market experiencing higher-than-anticipated demand across all regions compared to pre-pandemic levels. The sudden rise in CAGR is attributable to the market's growth and demand returning to pre-pandemic levels once the pandemic is over. 

Renewable diesel is a type of advanced biofuel that is derived from renewable sources, such as waste vegetable oil, animal fats, and other organic materials. Unlike conventional diesel, which is derived from crude oil, renewable diesel is a cleaner-burning alternative that can be used in existing diesel engines without modification. Renewable diesel has several advantages over conventional diesel. It has a lower carbon footprint and emits significantly fewer greenhouse gases, particulate matter, and other pollutants. It is also a sustainable and renewable fuel source that reduces dependence on fossil fuels.

The renewable diesel market size is growing rapidly as more companies and governments around the world prioritize sustainability and environmental stewardship. The demand for renewable diesel is driven by several factors, including concerns about climate change, government incentives and mandates, and corporate sustainability goals. Many countries have set ambitious targets to reduce greenhouse gas emissions, and renewable diesel is seen as a key tool to achieve these goals. In addition, governments and corporations are offering financial incentives for the production and use of renewable diesel, which is driving investment in the industry.

COVID-19 Impact: Pandemic Has Caused Short-Term Disruption To The Market But The Growing Focus On Sustainability And Climate Action Is Expected To Continue  Growth

The COVID-19 pandemic has had a mixed impact on the market for renewable diesel. On one hand, the pandemic has caused a significant reduction in demand for transportation fuels, including diesel, due to decreased economic activity and travel restrictions. This has resulted in lower prices for renewable diesel and reduced production levels in some regions. On the other hand, the pandemic has highlighted the importance of environmental sustainability and has led to renewed focus on reducing carbon emissions. Many governments and companies have announced plans to invest in renewable energy and decarbonize their operations, which is expected to drive demand for renewable diesel in the long term. 

Latest Trends

"The Rising Use Of Waste Feedstocks, Such As Leftover Cooking Oil And Animal Fats, As Manufacturing Inputs Is One Trend In The Market For Renewable Diesel"

One trend in the renewable diesel market is the increasing use of waste feedstocks, such as used cooking oil and animal fats, as raw materials for production. This trend is driven by the desire to reduce waste and increase sustainability, while also creating a new source of revenue for companies that collect and process these materials. As a result, new products and technologies are being launched to support the use of waste feedstocks in renewable diesel production. For example, some companies are developing new catalysts and processes that can convert a wider range of waste materials into high-quality renewable diesel. Leading players in the renewable diesel market, such as Neste, Renewable Energy Group, and Valero Energy, are investing in research and development to advance these new technologies and expand their production capacity. In addition, some companies are forming partnerships with waste management firms and other stakeholders to secure a reliable supply of feedstock and support the circular economy.

Renewable Diesel Market SEGMENTATION

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• By type

Depending on renewable diesel given are types: From Lipids, From Cellulosic Biomass. The From Lipids type will capture the maximum market share through 2031.

• By Application

The market is divided into Locomotive, Ships, Power Plant, Truck & Other based on application. The global renewable diesel market  players in cover segment like Locomotive will dominate the market share during 2023-2031.

Driving Factors

"Government Initiatives And Incentives To Cut Carbon Emissions And Promote Sustainability Are A Key Element Boosting The Market For Renewable Diesel"

One major driving factor for the renewable diesel market growth is government policies and incentives aimed at reducing carbon emissions and promoting sustainability. Many countries around the world have set targets to reduce their greenhouse gas emissions, and renewable diesel is seen as a key tool to achieve these goals. To support the growth of the renewable diesel industry, governments are offering a range of financial incentives, including tax credits, grants, and subsidies for renewable diesel production and use. In addition, some governments are implementing mandates or targets for the use of renewable diesel in transportation and other industries. These policies and incentives are boosting demand for renewable diesel and driving investment in the industry, as companies seek to take advantage of the growing market and meet the sustainability goals of their customers and stakeholders.

"The Growing Emphasis On Sustainability And CSR Among Organisations And Customers Is Another Key Element Boosting The Market For Renewable Diesel"

Another major driving factor for the renewable diesel market growth is the increasing focus on sustainability and corporate social responsibility among businesses and consumers. As awareness of climate change and environmental degradation grows, more companies and individuals are looking for ways to reduce their carbon footprint and support sustainable practices. Renewable diesel offers a cleaner-burning and more sustainable alternative to conventional diesel, with significantly lower greenhouse gas emissions and other pollutants. This is driving demand for renewable diesel among companies and individuals who are looking to reduce their environmental impact and meet their sustainability goals. As a result, companies are investing in renewable diesel production and expanding their offerings to include sustainable fuel options. In addition, consumers are increasingly seeking out sustainable products and services, which is driving demand for renewable diesel in transportation and other industries.

Restraining Factors

"The Availability And Cost Of Feedstock Are Two Main Barriers To The Market For Renewable Diesel"

One major restraining factor for the renewable diesel market growth is the availability and cost of feedstock. The production of renewable diesel requires large amounts of organic materials, such as waste cooking oil, animal fats, and other vegetable oils. The availability of these materials can be limited, particularly in certain regions or markets, which can make it difficult for companies to scale up their production. Moreover, the cost of feedstock can fluctuate depending on supply and demand, which can impact the profitability of renewable diesel production. In some cases, the cost of feedstock may be higher than the price of conventional diesel, which can make it difficult for renewable diesel to compete in the market.

Renewable Diesel Market Regional Insights

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"North America Is Anticipated To Maintain Its Supremacy In The Years To Come"

North America is a leading region in the renewable diesel market, with significant growth potential in the coming years. The region has seen strong demand for renewable diesel from various industries, including transportation, aviation, and marine, as well as increasing government support for renewable energy and sustainability initiatives. In addition, North America has a well-established infrastructure for biofuels production and distribution, which is expected to support the growth of the renewable diesel market share in the region. The region also has a high concentration of leading companies in the renewable diesel industry, such as Neste, Renewable Energy Group, and Valero Energy, which are expected to drive innovation and investment in the market. 

Europe is the second-leading region in the renewable diesel market share, with a significant market share and strong growth potential. The region has a well-established biofuels industry, with a focus on sustainable production and consumption, and a supportive regulatory environment for renewable energy and sustainability initiatives. In addition, Europe has set ambitious targets to reduce greenhouse gas emissions and increase the use of renewable energy sources, which is driving demand for renewable diesel in transportation and other industries. The region also has a high concentration of leading companies in the renewable diesel industry, such as Neste and TotalEnergies, which are investing in research and development and expanding their production capacity to meet growing demand.

Key Industry Players

"Key Players Focus on Partnerships to Gain a Competitive Advantage "

Prominent market players are making collaborative efforts by partnering with other companies to stay ahead of the competition. Many companies are also investing in new product launches to expand their product portfolio. Mergers and acquisitions are also among the key strategies used by players to expand their product portfolios.

List of Market Players Profiled

• Preem (Sweden)
• Neste (Finland)
• GEVO (U.S)
• Eni (Italy)
• UPM Biofuels (Finland)
• Sunshine Biofuels (U.S)
• World Energy (U.S)
• Marathon Petroleum (Marathon Oil) (U.S)
• REG (U.S)
• Repsol (Spain)
• Cepsa (Spain)
• Valero (U.S)
• BP (U.K)

Report Coverage

This research profiles a report with extensive studies that take into description the firms that exist in the market affecting the forecasting period. With detailed studies done, it also offers a comprehensive analysis by inspecting the factors like segmentation, opportunities, industrial developments, trends, growth, size, share, and restraints. This analysis is subject to alteration if the key players and probable analysis of market dynamics change.