Renewable Diesel: The Fuel of the Future
Aug 5, 2020
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Aug 5, 2020
8 min readAdd to Favourite
Renewable diesel (Hydrotreated vegetable oil or green diesel), a biomass-derived fuel, which is suitable for use in diesel engines. It can be produced from various biomass sources such as lipids (such as vegetable oils, animal fats, greases, and algae) and cellulosic material (such as crop residues, woody biomass, and dedicated energy crops) by hydrotreating, gasification, pyrolysis, and other biochemical and thermochemical technologies. It is to be noted that renewable diesel and biodiesel are not the same fuel; biodiesel is a mono-alkyl ester produced via transesterification, whereas, renewable diesel is a mixture of straight-chain and branched paraffin with typical carbon numbers of C15–C18 and chemically identical to petroleum diesel.
Renewable diesel can be produced via different routes such as hydrotreating or hydroprocessing, pyrolysis, gasification, and other biochemical and thermochemical technologies. The most widespread among them is hydroprocessing technology. In the hydroprocessing step, hydrogenation is performed to saturate the double bonds and remove the oxygen, either as water or CO2, from the fatty acid chains of the triacylglyceride. The triglyceride is broken down into several intermediates including monoglycerides, diglyceride and carboxylic acids and converted into renewable diesel by three different pathways: 1) decarboxylation, 2) decarbonylation, and 3) Hydrodeoxygenation (See Exhibit 2).
R−CH2−COOH + H2→R−CH3 + CO2 Decarboxylation (1)
R−CH2−COOH + H2→R−CH3 + CO + H2O Decarbonylation (2)
R−CH2−COOH + 3H2→R−CH2−CH3 + 2H2O Hydrodeoxygenation (3)
Source: George W. Huber, et al
Besides stand-alone production, renewable diesel can also be produced by:
The majority of oil refineries are equipped with hydrotreaters (originally installed for sulfur and nitrogen removal from fossil fuels by hydrotreatment), which could be converted to renewable diesel production facilities. For example, ENI’s Venice refinery converted to 0.3 million tonnes of renewable diesel, Total refinery at La Mede, France transformed to 0.5 million tonnes facility, etc.
In co-processing, vegetable oils feed into refinery units together with petroleum distillates to produces renewable diesel. Several companies are producing renewable diesel by co-processing such as Preem in Gothenburg Sweden with 0.2 million tonnes/year production, Petrobras in Brazil, Cepsa (with several refineries in Spain), Repsol (with several refineries in Spain) and BP in Australia.
Exhibit 3: Representation of Direct Renewable Diesel Production Plant (a) and Co-processing Plant (b)
Properties of renewable diesel are very similar to high-quality sulfur-free petroleum diesel. Earlier, the synthetic gas-to-liquids (GTL) diesel was viewed as the best choice for engines and exhaust emissions. Renewable diesel can offer the same compositional advantages and has a lot of similarities as GTL diesel, in addition to that, it is completely renewable.
The low sulfur content, metal-free, and ash-free characteristics of renewable diesel make it a safer fuel for various applications. It possesses higher heating value as compared to other biofuels and higher energy content than its biodiesel form. Renewable diesel also shows excellent cold properties, i.e., cloud point below -30 to -40 ºF, which gives a high bio-mandate for blending ratios possible all over the year even in winter. Its density also remains nearly constant even at a low cloud point. The high Cetane number and low-density values make it more suitable for compression ignition engines. Moreover, the flashpoint is also higher compared to biodiesel for safe storage and transportation.
The typical properties of petroleum diesel, biodiesel, and renewable diesel are provided below.
*Petroleum diesel for use in CI engines with a maximum sulfur content of 15 ppm according to ASTM D975
Source: Savvas L. Douvartzides
Europe: In 2018, The European Commission issued a new directive, renewable energy directive-II (RED-II), which mandates fuel suppliers to supply a minimum 14% of renewable energy in road and rail transport by 2030. Within the 14% target, there is a 3.5% dedicated sub-target for advanced biofuels produced from biomass and waste base feedstock (Annex VI of RED-II has pre-defined total 20 biomass and waste-based feedstock and excluded used cooking oil and category 1 & 2 animal fats).
The 14% target cannot be achieved by biodiesel (FAME) alone due to the reasons such as FAME chemical composition (Biodiesel (FAME) blending ratio with petroleum fuel is limited to 7% max. (v/v) to avoid engine damage) and technology readiness i.e. the available technology/solutions to produce biofuels from the most of advanced feedstock are mostly suitable to petroleum biofuels production than FAME. As a result, the renewable diesel can become an alternative for refineries to pave the renewable energy gap for FAME and achieve RED-II goals.
United States: The United States of America has enacted various federal and state-level environmental policies which support the renewable diesel demand. The US Environmental Protection Agency has established the Renewable Fuel Standard (RFS) to support biodiesel and renewable diesel refiners and blenders through a tradable credit system called “Renewable Identification Numbers” (RINs). The Renewable Fuel Standard (RFS) program requires renewable fuels (biodiesel or renewable diesel) to be blended with gasoline or diesel fuel.
State-level regulations such as the Low Carbon Fuel Standard (LCFS) program has been enacted to gradually cut down the carbon intensity of California’s transportation fuel. Under this regulation, California aims to decrease the carbon intensity of fuels by 10% in 2020 and by 30% in 2030. The biomass-based diesel also generates credits under the LCFS program, i.e., the low carbon fuels below the annual standard earn credits, while fuels with a carbon intensity higher than annual standard generate deficits. Since California’s LCFS program came into effect, the net supply of renewable diesel has increased in the state. The net supply has reached 100 million gallons in 2018 (Q2). In 2019, most of the US biomass-based diesel imports came from renewable diesel imports and obtained mainly from Singapore since 2015. In 2019, the imports from Singapore rose by 49%, i.e. up to 17,000 b/d and the overall import of US biomass-based diesel (includes biodiesel/renewable diesel) grew by 26% i.e. more than 27,000 barrels per day (b/d).
Furthermore, other states such as Oregon and Washington in the US and British Columbia in Canada also following California’s footsteps to reduce their transportation fuels’ carbon footprints.
The commercial plants for the production of renewable diesel have been installed all over the world. Currently, over 5.5 billion litres of renewable diesel is produced globally and is forecasted to grow up to 13 billion litres in 2024.
Neste, a Finland based petroleum refining company, is currently dominating the production of renewable diesel. It is the world’s top producer which operates four facilities, 2 in Finland and 1 each in Rotterdam and Singapore. Oil & gas companies such as ENI and Total also producing a significant amount of renewable diesel and employing technologies such as Ecofining™ (ENI’s proprietary technology), Vegan® (technology by Axens), etc. The companies employing HydroFlex™ hydrotreating process by Haldor Topsoe are UPM and Preem. Diamond Green Diesel, a joint venture between Diamond Alternative Energy LLC (a subsidiary of Valero Energy Corporation) and Darling Ingredients Inc., also employs the Ecofining™ process and is the largest producer in the US. A list of renewable diesel producers, their product, production capacities and technologies are illustrated below.
Source: Bo Zhang et al
Source: Futurebridge analysis; EC Reports
The production of renewable diesel is expected to reach 6 to 7 million tonnes per year at the end of 2020 and up to 13 billion litres by 2024 globally. The global regulations and policies are playing a vital role in the development of the renewable diesel production. The regulation-driven demand in the US and EU is forecasted to encourage a USD 5 billion of investment (over the next five years) in new renewable diesel plants.
Additionally, several planned renewable diesel production capacities are coming up in the next five years to the global market (see Exhibit 3). For instance, in the United States of America, the plants such as NEXT Renewable Fuels’ Oregon project, Diamond Green Diesel’s expansion project at Louisiana, and World Energy in California are planned. Similarly, In Singapore, Neste’s expansion project and in Italy, ENI’s Venice project expansion is planned for the coming years Hence, the planned renewable diesel production capacity expansions also have the potential for renewable diesel growth in the global market.
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