As of this 2022 writing, it appears to be a boom time for renewable diesel projects. The Energy Information Administration estimates that renewable diesel production capacity in North America will surge by up to 500% in a few short years. The question facing the industry is whether there are enough feedstock fats, oils, and greases needed to supply this growth.
The major categories of renewable diesel feedstock are inedible corn oil (mostly from ethanol production), animal fats, used cooking oils (UCO), and virgin plant oils (like soy and canola). In the long term, the demand for ethanol seems to currently be a bit flat. Sourcing animal fats and UCO requires feedstock to come from farther away and be aggregated from multiple sources, driving up logistics and handling costs. Bringing new land into production for soy or canola would likely require a significant premium for the farmers.
These things appear to indicate that the likely result for the additional feedstock required to meet all the current and proposed RD projects is not going to be cheap. Thus, project developers and investors of renewable diesel projects will need to maintain a close eye on the feedstock sources and costs to ensure the profitability of projects going forward. It is not that these cannot be done. It is that they must be done with proper planning and expertise.
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Look at our experts and the services we provide. Most of our experts are also available to advise and serve as expert witnesses in bioeconomy litigation matters. For the larger projects, we specialize in putting together full-service, interdisciplinary teams with one point of contact. See a video about LEC here. Call us at 1+ (501) 833-8511 or email us for more information.
See also: Renewable Diesel Feedstocks.
