The biofuels industry will grow to a capacity of 67 billion gallons a year (BGY) by 2022.
That’s according to a new report from Lux Research, which says the sector will also see first-generation fuels like traditional biodiesel being replaced by newer low carbon fuels.
First-generation biofuels’ 91.5% market share is forecast to drop nearly 6%, which is predicted to be filled by rapidly growing advanced biofuels as they nearly double capacity to 9.6 BGY within five years.
The report says biodiesel will soon begin to fade. Second-generation biodiesel makes up 65% of the advanced biofuels market today but 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.
Currently, new facilities based on novel and non-food feedstocks account for more than half of new capacity deployment for the first time in biofuel’s history, it adds.
Runeel Daliah, Lux Research Associate, said: “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.”
“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.”
Farmers can reportedly earn more money and be more productive by planting energy crops.