WHO uses renewable diesel?
Renewable diesel can be used by farmers, fleets, the construction industry, and everyday travelers. It is
suitable for all diesel engines. There are no modifications required. It is considered a “drop in” fuel, which means that it can be substituted with fossil diesels in existing engines because they are chemically similar, and it meets all the current regulations. Renewable gasoline and renewable jet fuel are also being produced.
WHAT is renewable diesel?
Renewable diesel is a hydrocarbon diesel fuel produced by the hydro-processing of up to 10 different sustainably produced raw materials such fats, vegetable oils, and waste cooking oils. Some of these raw materials are leftovers from the food industry, including used cooking oil from fried chicken, French fries and many other comfort foods. Renewable diesel can be blended with both bio-diesel and fossil fuel diesel.
Renewable diesel is already available in parts of the world. Within the U.S. it is only available in the West Coast states of California, Oregon, and Washington. The U.S. renewable diesel production capacity totaled 0.6 billion gallons in 2020. The U.S. has plans to increase production capacity to 5.1 billion gallons by the end of 2024, which would make up about 5% of the U.S. diesel production capacity if all expansions occur as planned.
There are five renewable diesel plants in the U.S. These plants are in Kansas, North Dakota, Louisiana,
Wyoming, and California. There are plans to expand production at three of these sites and six additional green sites are under construction. One primary risk in the expansion of renewable diesel fuel production capacity is the availability of the raw materials. Demand and prices for feedstocks from soybean oil to grease and fat is soaring since the production of renewable diesel has increased. Another concern is the availability of government incentive programs. U.S. producers have been relying on government incentives to make a profit.
WHY renewable diesel?
Our society is in the process of shifting towards a more environmentally conscious approach to clean energy.
Renewable diesel is a solution that enables U.S. energy producers to utilize current assets to produce clean diesel without having to invest a large amount of money into existing infrastructure. It burns cleaner which reduces greenhouse gas emissions without sacrificing quality and performance.
HOW does this impact you?
Renewable diesel is good for the environment, but it could cause prices to increase. It currently costs more to produce renewable diesel than fossil diesel, which will ultimately raise prices at the pump and in the fields for our producers. If prices increase, freight rates and input costs will increase, thus causing a chain reaction of price increases to all consumer goods. However, as more processing plants and refineries are brought online, the cost of production could go down. There are plans to add more soybean processing plants in the Midwest. These new production facilities could mean more value for our soybeans which could benefit local co-ops and its owners by creating new outlets to market producers‘ grain. Another benefit will be the positive impact it will have on the economy in these local communities by creating new job opportunities.
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