Market Size of Biofuels in United States of America (2017 – 2021)
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The Market value of Biofuels in United States of America reached $36,893.2 million in 2021
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During the same period, the industry witnessed a Market volume of 14,830.0 million gallons
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The industry recorded a historical decline (CAGR) of 4.2% between 2017 and 2021 in terms of value, while the underlying market volume declined (CAGR) by 2.6% between 2017 and 2021
Market Size of Biofuels in United States of America (2017 – 2021)
Increasing demand for energy globally poses a threat to climate and the Paris Agreement’s goal of achieving a climate neutral world by 2050. The battle against climate change forces countries to switch to low-carbon sources of energy such as biofuels. Fossil fuels, being one of the largest sources of greenhouse gas (GHG), are prompting companies to shift to the production of biofuels. For example, Shell has committed to reducing its carbon footprint by a fifth by 2035, which resulted in the company producing ethanol from sugarcane through Raízen.
Biofuels are derived from biomass, i.e., plant, animal waste, and algae, and are considered renewable sources since they can be replenished readily unlike oil, coal, and natural gas. Biofuels are segmented into biodiesel and ethanol. Biodiesel is manufactured from vegetable oils and animal fats, while ethanol is a form of alcohol produced from feedstock.
The global biofuel market is expected to grow as the world targets carbon neutrality by 2050. The US is one of the five dominant markets, along with Brazil, France, Colombia, and Germany.
The US is the leader in the biofuel market. The US biofuel market is valued at $36,893 million, with a market consumption volume of 14,830 million gallons. The country’s market value declined at a CAGR of 4.2% during 2017–21, and the market volume also declined at a CAGR of 2.6% during this period.
Despite a decline since 2020 due to the COVID-19 lockdowns, the US continues to be a significant participant in the global biofuel market. The US government has launched various programs to increase the use of biofuels to cut GHG emissions. The Energy Independence and Security Act in the US aims at achieving greater energy independence and better energy security. This Act includes increasing the supply of non-conventional energy sources by setting a mandatory Renewable Fuel Standard (RFS) requiring fuel producers to use at least 36 billion gallons of biofuels by 2022. It also incentivizes organizations for the development of renewable energy technologies. Such initiatives have spurred growth in the market and will continue to do so in the coming years. Furthermore, the US Department of Agriculture (USDA) Office of Rural Development is offering loan guarantees for the development, construction, and retrofitting of commercial-scale bio-refineries.
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