Factors such as the escalating concerns over the rising greenhouse gas emissions and mounting need for biodiesel-based fuel, owing to the environmental concerns associated with fossil fuel combustion, will steer the biodiesel market growth during the forecast period (2021–2030). According to P&S Intelligence, the market revenue reached around $39.0 billion in 2020. Besides, the soaring number of research and development (R&D) projects being launched in the renewable energy sector and rising number of government initiatives and regulations mandating the adoption of biodiesel will also facilitate the market growth in the upcoming years.
The soaring concerns being raised over carbon dioxide (CO2) and greenhouse gases, such as carbon monoxide (CO), hydrocarbons (HCs), and Nitrogen Oxides (NOx) emissions act as the key contributor to the market growth. Biodiesel emits 50% lesser greenhouse gases than conventional fuels and it is also free of aromatic and sulfur compounds. For instance, according to the U.S. Energy Information Administration (EIA) and the U.S. Environmental Protection Agency (EPA), in 2019, around 43 billion gallons of biodiesel were consumed in the U.S.
Geographically, Europe accounted for the largest share in the biodiesel market in 2020. This was due to the soaring number of government initiatives and regulations for mitigating greenhouse gas emissions in the region. For instance, the Euro VI emission vehicle emission standards on the New European Driving Cycle (NEDC) limit the emission of CO, HC+NOx, and NOx from diesel-powered light-duty vehicles to 0.5 g/km, 0.17 g/km, and 0.08 g/km, respectively. Whereas, the gasoline light-duty vehicles have an emission limit of 1.0 g/km, 0.1 g/km, and 0.06 g/km of CO, HC, and NOx, respectively.
Therefore, the growing concerns being raised over the rising greenhouse gas emissions and escalating R&D expenditure in renewable energy production will fuel the market growth in the coming years.
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