Next-generation technologies to push global biofuel output to 67 billion gallons by 2022

Overall global biofuel output is projected to reach 67 billion gallons per year (BGY) by 2022, from the 59 billion gallons achieved in 2016.

According to a fresh market report by Lux Research, new biofuel technology is “finally” starting to push aside traditional biofuels, such as first-generation biodiesel.

New facilities based on non-food feedstocks and producing novel fuels account for over half of new capacity deployment for the first time in the biofuel industry’s history.

“A new era of technology commercialisation has brought the global biofuels industry to the cusp of a tipping point, as new facilities target low-carbon and high-performance drop-in biofuels,” said Runeel Daliah, Lux Research associate and lead author of the report.

“With many of the technologies capable of producing advanced biofuels still at demonstration scale, the next five years will be critical as companies raise capital, establish value chain security and produce commercial volumes as these projects come online,” he added.

Lux Research analysts quantified the commercial deployment of new technologies in the global biofuels industry using a database of nearly 2,000 facilities from 1,461 companies in 90 countries with nameplate capacity data through 2022.

According to their findings, the global biofuels industry will grow at a slower 2.2% annual rate to 67 BGY of nameplate capacity by 2022.

First-generation biofuels, which hold a 91.5% market share at the moment, will continue to dominate, but will lose nearly 6% of their share as advanced biofuels see rapid growth, nearly doubling capacity to 9.6 BGY.

Second-generation biodiesel, making up 65% of the 5 BGY advanced biofuel market today, will begin to fade and is projected to lose 26% market share by 2022 due to the rapid growth of low-carbon and high-performance drop-in biofuels, such as renewable diesel.

Emerging thermochemical and catalytic technologies will surpass bioconversion processes to make up over half of the new capacity deployment for the first time in the history of biofuels.

The report, titled Biofuels Outlook 2022: The Dawn of a New Era in Global Biofuel Capacity Expansion, is part of the Lux Research Alternative Fuels Intelligence service.