NREL is a national laboratory of the U.S. Department of Energy, Office of Energy 

Efficiency & Renewable Energy, operated by the Alliance for Sustainable Energy, LLC.

Contract No. DE-AC36-08GO28308

The Feasibility of Producing and 

Using Biomass-Based Diesel 

and Jet Fuel in the United States

A. Milbrandt, C. Kinchin, and R. McCormick

National Renewable Energy Laboratory

Technical Report

NREL/TP-6A20-58015

December 2013
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Efficiency & Renewable Energy, operated by the Alliance for Sustainable Energy, LLC.

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Contract No. DE-AC36-08GO28308

The Feasibility of Producing 

and Using Biomass-Based 

Diesel and Jet Fuel in the 

United States

A. Milbrandt, C. Kinchin, and R. McCormick

National Renewable Energy Laboratory

Prepared under Task No. BB07.1D00

Technical Report

NREL/TP-6A20-58015

December 2013
NOTICE

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Acknowledgments

The authors would like to thank the Department of Energy’s (DOE) Bioenergy Technologies 

Office (BETO) for providing the financial support for this study, and particularly Mr. Zia Haq 

for his leadership and guidance. We also thank Rich Bain, Adam Bratis, Mary Biddy, and Ling 

Tao from the National Renewable Energy Laboratory (NREL) for their review and valuable 

recommendations.
iv

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Abbreviations, Acronyms, and Definitions

ATJ alcohol-to-jet fuel

ASTM American Society for Testing and Materials

CAFE Corporate Average Fuel Economy 

C&D construction and demolition

DoD Department of Defense

EIA Energy Information Administration 

EISA Energy Independence and Security Act

EPA Environmental Protection Agency

EtOH Ethanol

FAME fatty acid methyl esters

FOG fats, oils, and greases

FT Fischer Tropsch

gge gasoline gallon equivalent

GHG greenhouse gas

ha hectare 

HEFA hydrogenated esters and fatty acids

IPK iso-paraffinic kerosene

LPG liquefied petroleum gas

mpg miles per gallon

MSW Municipal solid waste

PADD Petroleum Administration for Defense District

R&D research and development

RFS Renewable Fuels Standard

TAG triacylglycerol

TEA techno-economic analysis
v

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Executive Summary

In recent years, growing concern about U.S. dependence on oil imports and greenhouse gas

(GHG) emissions has resulted in greater interest in alternative fuels that can be produced from 

domestic renewable feedstock. Currently, diesel and jet fuel substitutes derived from biomass 

material—such as crop and forest residues, dedicated energy crops, and plant oils—are receiving 

increasing attention. 

The purpose of this study is to evaluate the technical and economic feasibility of producing and 

using biomass-based diesel and jet fuel in the United States. To achieve this goal, data on 

production, capacity, cost, market demand, and feedstock availability were gathered and 

analyzed. Environmental considerations and legislative climate were not evaluated here, but 

these factors would contribute to an important follow-up study and provide a more complete 

picture of the biomass-based diesel and jet fuel potential in the United States. 

Some of the key findings of this study include the following:

1. It is technically feasible to produce biomass-derived diesel and jet fuel substitutes in the 

United States. Many conversion technology options exist. Some are commercially available

or in demonstrational stage; others are still in the research and development phase. 

2. Biodiesel, consisting of fatty acid methyl esters (FAME) produced from lipids (fats, oils, and 

greases), is currently the predominant form of biomass-based diesel. Production reached a 

record 1.1 billion gallons in 2011 and kept at that level in 2012. It is expected to be higher in 

2013. Biodiesel blends cannot yet be considered fully “drop-in” fuels because they cannot be 

transported in all petroleum product pipelines. For pipelines that transport jet fuel, there is a 

concern that the jet fuel will be contaminated with biodiesel, making it unsuitable for use. 

Ongoing research aims to determine what, if any, level of FAME can be tolerated in jet fuel. 

3. In comparison, the current U.S. renewable diesel and jet fuel production capacity is small, 

about 225 million gallons per year. These fuels can be produced from various biomass 

resources and through several different approaches which all target hydrocarbon products 

that are similar to petroleum fuels in chemical makeup, and therefore may be considered 

“drop-in” fuels. It is anticipated that, as “drop-in” fuels, they can be blended with petroleum 

diesel/jet fuel at high levels, or possibly used in neat form. 

• Renewable diesel is produced at commercial scale primarily by hydroisomerization of 

lipid feedstock. Currently, there are two commercial facilities utilizing this process: 

Dynamic Fuels, a joint venture between Syntroleum Corporation and Tyson Foods

(Geismar, Louisiana) and Diamond Green Diesel, a joint venture between Valero 

subsidiary Diamond Alternative Energy LLC and Darling International Inc. (Norco, 

Louisiana).

• A number of processes are under development for production of renewable diesel from 

biomass-derived sugars (corn, sugarcane, and sorghum, as well as sugars from 

thermochemical or biochemical depolymerization of cellulose and hemicellulose).
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• Processes are also being developed for direct conversion of lignocellulosic biomass by 

fast pyrolysis, gasification, and other thermochemical means. The first commercial plant 

is operated by KiOR in Columbus, Mississippi and became operational in early 2013. 

4. The costs for producing renewable diesel and jet fuel are not well known and involve a high 

degree of uncertainty. The process economics for these fuels is highly dependent upon the 

cost of the feedstock, similar to biodiesel. Additionally, variables such as plant size and coproduct credits can have a significant impact on the overall production cost. 

Hydroisomerization of lipids is performed commercially by Dynamic Fuels and Diamond 

Green Diesel and internationally by Neste Oil. The KiOR technology, utilizing pyrolysis, is 

at an initial commercial scale. Other technology routes are not yet commercial and display a 

wide range of estimated costs in public sources. As these technology pathways mature and 

become more widespread, more specific information regarding their economics will be 

available, which will enable a more detailed analysis and performance comparison. 

5. From a feedstock perspective, enough lignocellulosic material is projected to be available in 

support of the Renewable Fuels Standard (RFS) mandate of 21 billion gallons of advanced 

biofuels. Crop and forest residues alone could yield about 8-24 billion gallons of biomassbased diesel/jet fuel in 2022 (assuming a conversion via fast pyrolysis).This potential could 

be larger if the conversion technologies achieve higher yields and if additional feedstock,

such as dedicated energy crops, become available. However, there will be competition for 

lignocellulosic feedstock with the ethanol industry and renewable gasoline producers to meet 

the RFS mandate. Thus, it is unclear what share the renewable diesel/jet fuel would have in 

the total biofuels contribution. Ultimately, it will depend on the rate of commercialization of 

these technologies, selling price, and the transportation market demands. 

6. Based on current statistics, and proven by the biodiesel industry, there is enough lipid 

feedstock to support the production of 1 billion gallons of biomass-based diesel mandated by 

the RFS. Today, roughly half of the biodiesel in the United States is produced from soybeans. 

The remaining portion consists of animal fat, used cooking oil, canola, and some other minor 

feedstocks. While soybean production is projected to grow in coming years, the biodiesel 

industry hopes to achieve higher output through advanced technologies for increasing oil 

supply and production of new feedstock. If algal oil becomes commercially available, as 

projected within the next 5-10 years, it would greatly benefit both biodiesel and renewable 

diesel/jet fuel industries. Given the right resources, algal oil productivity can be quite high.

Algae are a potential aquatic oil crop, but may also yield carbohydrates that can be converted 

to sugar.

7. Demand for diesel and jet fuel in the United States is projected to grow. As easily 

recoverable crude oil resources are diminishing and as their prices rise, more substitutes are 

expected to enter the market. 

• Among the diesel consumers in the country, freight trucking has the largest share. The 

number of light-duty vehicles using diesel is projected to increase, the rate of which will 

depend on the market penetration of other alternatives such as hybrid and electric 

vehicles. 
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• Jet fuel is forming as a large and profitable market for the renewable fuels industry. 

Success in this area could stimulate a significant increase in the production of biofuels 

and associated feedstock. It is expected that jet fuel consumption by commercial carriers 

will continue to grow over the next years, whereas jet fuel consumption by the military 

will remain flat.

8. For biomass-based diesel and jet fuel to be successful among the trucking and aviation 

companies, they must be cost-competitive with petroleum-based fuels. It is uncertain what 

the future holds for these substitutes, but it is expected that the next several years, as more 

facilities come online, will answer many questions about the economic viability of these

technologies. Much will depend on the rate of recovery of U.S. and world economies, oil 

prices, carbon market, and political climate. 
viii

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Table of Contents

Acknowledgments ..................................................................................................................................... iii

Abbreviations, Acronyms, and Definitions........................................................................................... iv

Executive Summary.................................................................................................................................... v

Introduction ................................................................................................................................................. 1

Overview.......................................................................................................................................... 1

Biodiesel from Transesterification................................................................................................... 3

Renewable Diesel and Jet Fuel from Hydroprocessing of Lipid Feedstocks................................... 3

Renewable Diesel and Jet Fuel from Cellulose via Carboxylic Acid .............................................. 4

Renewable Diesel and Jet Fuel Using Synthetic Biology................................................................ 4

Renewable Diesel and Jet Fuel from Biomass Gasification (Fischer-Tropsch)............................... 5

Renewable Diesel and Jet Fuel from Syngas Fermentation............................................................. 5

Renewable Diesel and Jet Fuel from Acetic Acid Production and Lignin Gasification.................. 5

Renewable Diesel and Jet Fuel from Catalytic Depolymerization of Cellulose.............................. 5

Renewable Diesel and Jet Fuel from Pyrolysis Oil.......................................................................... 6

Renewable Diesel and Jet Fuel from Thermal Depolymerization ................................................... 6

Renewable Diesel and Jet Fuel from Catalytic Reforming of Sugars from Cellulose..................... 6

Alcohol-to-Jet Fuel .......................................................................................................................... 6

Capacity and Production............................................................................................................................ 7

Production Cost .......................................................................................................................................... 8

Biodiesel .......................................................................................................................................... 8

Hydroprocessing of Lipid Feedstock............................................................................................... 8

Algae................................................................................................................................................ 9

Fischer Tropsch Diesel .................................................................................................................... 9

Non-Catalytic Fast Pyrolysis ......................................................................................................... 10

Catalytic Fast Pyrolysis.................................................................................................................. 10

Hydropyrolysis............................................................................................................................... 10

Biojet Fuel...................................................................................................................................... 10

Renewable Identification Numbers and the Renewable Fuel Standard......................................... 11

Demand ...................................................................................................................................................... 12

Diesel ............................................................................................................................................. 12

Biodiesel ........................................................................................................................................ 16

Jet Fuel........................................................................................................................................... 17

Feedstock Assessment ............................................................................................................................ 20

Discussion ................................................................................................................................................. 27

Conclusion................................................................................................................................................. 34

References................................................................................................................................................. 36

Appendix.................................................................................................................................................... 41

List of Figures

Figure 1. Sales of distillate fuel oil by end use, 2012........................................................................... 13

Figure 2. No. 2 diesel sales for on-highway use by state, 2012 ........................................................... 13

Figure 3. Total U.S. distillate retail deliveries, 1984 - 2012 ................................................................ 14

Figure 4. Projected diesel fuel consumption, 2013 – 2035 .................................................................. 15

Figure 5. Projected diesel fuel consumption by the transportation sector............................................ 15

Figure 6. Projected diesel fuel consumption by the transportation sector excluding freight trucks..... 16

Figure 7. Historic biodiesel consumption, 2001 – 2012....................................................................... 17

Figure 8. Historic kerosene-type jet fuel consumption, 1981 – 2012................................................... 18

Figure 9. Jet fuel consumption by state, 2012...................................................................................... 18
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Figure 10. Projected commercial jet fuel consumption, 2013 – 2035.................................................. 19

Figure 11. Projected military jet fuel consumption, 2013 – 2035 ........................................................ 19

Figure 12. Mean annual algal oil production using current technology............................................... 25

Figure 13. Renewable fuel volume requirements for RFS2 under EISA ............................................. 27

Figure 14. Comparison of fuel prices and taxes in the United States and Europe, 2007...................... 32

List of Tables

Table 1. Conversion Processes for Biomass-based Diesel and Jet Fuel................................................. 3

Table 2. Summary of Potential Forest Biomass and Wood Wastes in the BTS, 2012......................... 21

Table 3. Summary of Baseline and High Yield Scenarios in the BTS —Agricultural Residues and 

Waste Resources............................................................................................................................ 22

Table 4. Summary of Baseline and High Yield Scenario Availability of Energy Crops in the BTS... 23

Table 5. U.S. Production of Fats, Oils, and Greases in 2010 ............................................................... 24

Table 6. Total Biomass Resource Potential.......................................................................................... 26

Table 7. Top 25 U.S. Trucking Companies in 2012............................................................................. 31

Table 8. Distillate Fuel Oil and Kerosene Sales by End Use ............................................................... 41

Table 9. No. 2 Diesel Sales for On-Highway Use................................................................................ 42

Table 10. Diesel Sales for Farm Use .................................................................................................... 43

Table 11. Sales of Distillate Fuel Oil for Railroad Use........................................................................ 44

Table 12. Sales of Distillate Fuel Oil for Off-Highway Use ................................................................ 45

Table 13. Distillate Fuel Oil Sales for Vessel Bunkering Use ............................................................. 46

Table 14. Diesel Sales for Military Use ............................................................................................... 47
1

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Introduction

In recent years, growing concern about U.S. dependence on oil imports and greenhouse gas 

(GHG) emissions has resulted in greater interest in alternative fuels that can be produced from

domestic renewable feedstock. Currently, diesel and jet fuel substitutes derived from biomass 

material—such as crop and forest residues, dedicated energy crops, and plant oils—are receiving 

increasing attention. 

The purpose of this study is to evaluate the technical and economic feasibility of producing and 

using biomass-based diesel and jet fuel in the United States. To achieve this goal, data on 

production, capacity, cost, market demand, and feedstock availability were gathered and 

analyzed. Environmental considerations and legislative climate were not evaluated here, but 

these factors would contribute to an important follow-up task to provide a more complete picture 

of the biomass-based diesel and jet fuel potential in the United States.

Overview

The Renewable Fuel Standard (RFS), a program introduced by the Energy Independence and 

Security Act of 2007 (EISA), defines biomass-based diesel as follows: (a) renewable fuel made 

from biomass; (b) meeting the definition of either biodiesel (mono-alkyl esters) or non-ester 

renewable diesel; (c) with lifecycle GHG emissions at least 50% less than the diesel fuel it 

displaces; and (d) which excludes renewable fuel derived from co-processing biomass with a 

petroleum feedstock1 (EPA 2009). The jet fuel substitutes fall under the “additional renewable 

fuel” category of RFS2, defined as fuel produced from renewable biomass that is used to replace 

or reduce fossil fuels used in home heating oil or jet fuel (EPA 2009).

There are several technologies and processes that produce biomass-based diesel and jet fuel. 

Some of these technologies are in commercial or pre-commercial production while others are 

still in the research and development phase. The different technologies use a variety of 

feedstocks, including lignocellulosic biomass (such as wood and crop residues, dedicated 

herbaceous or tree energy crops), grains, sugar crops, vegetable oil (soybean, canola/rapeseed, 

etc.), animal fat (beef tallow, pork lard), and waste cooking greases. Table 1 summarizes the 

different processes used to create biomass-based diesel and jet fuel, as well as examples of 

companies involved in these technologies.

Biodiesel is currently the predominant form of biomass-based diesel. It is a liquid fuel made 

from recycled or virgin vegetable oils and animal fats through a chemical process

(transesterification, described below) to produce chemical compounds known as fatty acid 

methyl esters (FAME). Biodiesel is the name given to these esters when they meet specifications 

such as ASTM D6751 or European Norm EN14214 for use as transportation fuel. Biodiesel is 

used in its pure form or in blends with petroleum diesel. Blends containing up to 5% volume are 

considered the same as conventional diesel and are fully compatible with all engines and 

infrastructure. Blends containing 6-20% volume biodiesel are accepted by many engine 

manufactures and are compatible with underground storage tanks. Fuel dispensers and related 

equipment that are compatible with B6 to B20 blends are available. Biodiesel blends cannot yet 

 1 The EPA considers co-processing to occur if both petroleum and biomass feedstock are processed in the same unit

simultaneously.
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be considered fully “drop-in” fuels because they cannot be transported in all petroleum product 

pipelines. For pipelines that transport jet fuel, there is a concern that the jet fuel will be 

contaminated with biodiesel, making it unsuitable for use. Ongoing research aims to determine 

what, if any, level of FAME can be tolerated in jet fuel, and in the meantime, biodiesel is being 

shipped on pipelines that do not transport jet fuel. A few engine manufacturers approve of the 

use of B100 (pure biodiesel) in some engine models. 

Renewable diesel refers to diesel fuel substitutes derived from biomass sources that chemically 

are not esters and thus are distinct from biodiesel. Renewable diesel and jet fuel can be produced 

by several different approaches (Table 1), which all target hydrocarbon products that are similar 

to petroleum diesel/jet fuel in chemical makeup and therefore may be considered “drop-in” fuels. 

It is anticipated that, as “drop-in” fuels, they can be blended with petroleum diesel/jet fuel at high

levels or possibly be used in neat form. They are also expected to be transportable by pipeline.
3

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Table 1. Conversion Processes for Biomass-based Diesel and Jet Fuel

Note: The list of companies in the table is shown as an example and it is not meant to be complete. Some of the 

listed companies (such as Terrabon and Choren) were inactive at the time of writing. However, these companies are 

associated with either pioneering or further developing a process, and thus, they are included in this summary for 

illustrative purposes. 

Biodiesel from Transesterification

The process of transesterification is used for the conversion of triglycerides (the main component 

of vegetable oils and animal fats) to biodiesel. In this process, the feedstock is chemically reacted 

with an alcohol (usually methanol) in the presence of a catalyst like lye. The products are 

glycerin and the biodiesel fuel or FAME. These separate into a bottom glycerin layer and a top 

FAME layer, which can then be physically segregated.

Renewable Diesel and Jet Fuel from Hydroprocessing of Lipid Feedstocks

Renewable diesel, sometimes referred to as “green diesel” or hydrogenated esters and fatty acids 

(HEFA), can be produced from fatty acids (fats, oils, and greases [or FOG]) by the traditional 

hydroprocessing and hydroisomerization technology used in petroleum refineries. 

Hydroprocessing is the process of reacting feedstock with hydrogen under elevated temperatures 
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and pressures and in the presence of a catalyst in order to remove oxygen, sulfur, and nitrogen

and saturate double bonds. For processing of triglycerides, some of the oxygen can also be 

removed as carbon dioxide by decarboxylation in some processes (Kalnes et al. 2007). While the

feedstock can be hydroprocessed as a co-feed with petroleum, in order to qualify as a renewable

fuel (according to the RFS) the diesel must be produced as a dedicated feed in a stand-alone 

process. The products consist predominantly of isoparaffins with some residual normal paraffins 

(Smagala et al. 2013). The degree of isomerization can be adjusted to lower the cloud point, and 

it is even possible to obtain cloud point in the jet fuel range (less than -40oF). However, 

increased isomerization reduces the cetane number and leads to increased production of naphtha 

as a by-product. Nevertheless, for fuels with cloud points in the diesel fuel range, the cetane 

number will likely be over 80.

Renewable Diesel and Jet Fuel from Cellulose via Carboxylic Acid

Terrabon, a company involved in creating renewable fuels using carboxylic acid, describes the 

process as follows: 

It begins by treating the feedstock with lime to enhance its digestibility, and then 

fermenting the biomass using a mixed-culture of microorganisms to produce a mixture 

of carboxylic acids. Calcium carbonate is added to the fermentation to neutralize the 

acids to form corresponding carboxylate salts, which are then dewatered, concentrated, 

dried and thermally converted to ketones. The ketones are then hydrogenated to 

alcohols that can be refined into renewable gasoline, diesel or jet fuel blendstocks

(Ethanol Producer Magazine 2011, ¶ 3).

Renewable Diesel and Jet Fuel Using Synthetic Biology

Synthetic biology modifies existing biological systems or builds new systems to produce novel 

substances. Amyris (2012) has developed genetic engineering and screening technologies that 

enable modification of the way microbes process (i.e., metabolize) sugar. By controlling these 

metabolic pathways, Amyris is able to design microbes, primarily yeast, to be living factories 

that convert plant-sourced sugars from crops such as sugarcane or sweet sorghum into target 

molecules. Using its industrial synthetic biology platform, Amyris develops yeast strains 

designed to produce a broad range of molecules. Amyris’s building block molecule is Biofene 

(an Amyris-brand farnesene), a hydrocarbon molecule that can replace petrochemicals in a wide 

variety of products including transportation fuels such as diesel and jet fuel.

LS9 has focused on developing renewable petroleum products using a one‐step fermentation 

process. In July 2010, the company announced the discovery of novel genes that, when 

expressed in E.coli, produce alkanes—the primary hydrocarbon components of gasoline, diesel,

and jet fuel. This discovery is the first description of the genes responsible for alkane 

biosynthesis and the first example of a single-step conversion of sugar-to-fuel‐grade alkanes by 

an engineered microorganism. A spokesperson for the company describes the process as a onestep sugar‐to‐diesel process that does not require elevated temperatures, high pressures, toxic 

inorganic catalysts, hydrogen, or complex unit operations (Greentech Media 2010). Similarly, 

the Joule process uses optimized microorganisms that act as living catalysts to produce fuel 

rather than first producing biomass and later extracting lipids or sugars for a subsequent multistep conversion into fuel (European Biofuels Technology Platform [EBTP] 2012).
5

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Renewable Diesel and Jet Fuel from Biomass Gasification (Fischer-Tropsch)

Another process for making renewable diesel and jet fuel is converting cellulosic biomass 

through high-temperature gasification into synthetic gas or “syngas”, a gaseous mixture rich in 

hydrogen and carbon monoxide. Next, a Fischer-Tropsch (FT) process is used to catalytically 

convert the syngas to liquid and wax products that can be refined into synthetic fuels. The 

production of FT liquids is a commercial technology applied to coal and natural gas. 

Renewable Diesel and Jet Fuel from Syngas Fermentation

This hybrid technology is currently used to produce ethanol. However, the companies involved 

in this process are working on diesel/jet fuel production as well. The strategy involves the 

gasification of biomass to syngas before processing it into ethanol using a biochemical 

fermenter. Coskata (2011) describes the process: during gasification, the biomass material is

converted into syngas using well-established gasification technologies. After the chemical bonds 

are broken in the process, Coskata’s proprietary microorganisms convert the resulting syngas 

into ethanol by consuming the carbon monoxide (CO) and hydrogen (H2) in the gas stream. 

Once the gas-to-liquid conversion process has occurred, the resulting ethanol is recovered from 

the solution using proven distillation methods. 

Renewable Diesel and Jet Fuel from Acetic Acid Production and Lignin 

Gasification

Similar to the hybrid process above, this technology is currently used to produce ethanol, but the 

company involved in this process, ZeaChem Inc., has developed a platform capable of producing 

other fuels as well. After fractionating the biomass, the sugar stream (both xylose [C5] and 

glucose [C6]) are sent to fermentation where an acetogenic process is utilized to ferment the 

sugars to acetic acid without CO2 as a by-product. In comparison, traditional yeast fermentation 

creates one molecule of CO2 for every molecule of ethanol. Thus, the carbon efficiency of the 

ZeaChem fermentation process is nearly 100% vs. 67% for yeast. 

The acetic acid is converted to an ester, which can then be reacted with hydrogen to make 

ethanol. To get the hydrogen necessary to convert the ester to ethanol, ZeaChem takes the lignin 

residue from the fractionation process and gasifies it to create a hydrogen-rich syngas stream. 

The hydrogen is separated from the syngas and used for ester hydrogenation, and the remainder 

of the syngas is burned to create steam and power for the process. The net effect of combining 

the two processes is that about two-thirds of the energy in the ethanol comes from the sugar 

stream and one-third comes from the lignin steam in the form of hydrogen (ZeaChem 2011).

Renewable Diesel and Jet Fuel from Catalytic Depolymerization of Cellulose

The catalytic depolymerization process uses heat and catalysts to break long chain polymers 

of hydrogen, oxygen, and carbon into short-chain petroleum hydrocarbons.

The Green Power process catalytically depolymerizes cellulosic feedstocks at moderate 

temperatures into liquid hydrocarbon fuels. The feedstock is first ground to a size finer 

than 5 mm and then placed--along with a catalyst, a low loading of lime that serves as a 

neutralizing agent, and a fuel that provides a liquid medium--into a reactor and heated 

to around 662o

F. In the reactor, the feedstock is catalytically converted to liquid fuels 

which primarily fall within the gasoline and diesel fuel boiling ranges, although these 
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fuels may need further upgrading. The liquid fuels are separated from any solids which 

are present and are distilled into typical fuel streams including naphtha, diesel fuel,

kerosene, and fuel oil (EPA 2010a, p. 42261).

Renewable Diesel and Jet Fuel from Pyrolysis Oil

Another technique for producing renewable diesel uses pyrolysis, the chemical decomposition of 

organic materials at elevated temperatures in the absence of oxygen. During this process, large 

polymers (i.e., cellulose, hemicellulose, lignin, and proteins of organic waste streams) are 

converted into smaller molecules and produce organic vapors, gases, and a solid residue 

containing carbon and ash. The vapors are condensed to produce pyrolysis oil (often referred to 

as bio-oil) that is then refined into diesel-like fuel. Yields of raw bio-oil as high as 75% of the 

initial dry weight of the biomass can be achieved (PNNL 2009).

Renewable Diesel and Jet Fuel from Thermal Depolymerization

Thermal depolymerization is similar to the geological processes thought to be involved in the 

production of fossil fuels—except that the technological process occurs in a timeframe measured 

in hours. Biomass is reacted in water at elevated temperature and pressure to form oils, gases, 

carbons, and ash. Hydrothermal conversion temperatures are typically 570°-660°F, with pressure 

sufficient to keep the water primarily as liquid (100-170 atm). The resulting bio-oil could be

upgraded to a hydrocarbon product consistent with gasoline and diesel. The technology is being 

commercialized in the United States by Changing World Technologies (CWT). The National 

Advanced Biofuels Consortium (NABC) is working on further developing this process. NABC’s 

researchers have achieved bio-oil yields of about 50% on a carbon basis from two feedstocks—

wood residues and corn stover (NABC 2012b).

Renewable Diesel and Jet Fuel from Catalytic Reforming of Sugars from Cellulose

Catalytic upgrading of sugars to hydrocarbons involves separating sugars from biomass (e.g.,

milled corn stover) through a series of chemical and biochemical processes and catalytically 

upgrading it into hydrocarbon fuels. The process has been researched by Virent, Inc. Virent’s 

BioForming process integrates the company’s patented aqueous phase reforming (APR) 

technology with conventional catalytic processes. First, the lignocellulosic biomass is pretreated,

followed by enzymatic hydrolysis (saccharification) of the remaining cellulose. Next is catalytic 

conversion of the resulting glucose, xylose, and other solubilized carbon components to 

hydrocarbon fuels in the gasoline, jet, and diesel fuel ranges (Biddy and Jones 2013). 

Alcohol-to-Jet Fuel 

Alcohol-to-jet fuel (ATJ) converts short carbon chain alcohols (such as methanol, ethanol, and 

butanol) to the longer C12/C16 alkanes of jet kerosene. The alcohol is produced conventionally 

(sugar/starch fermentation), thermochemically (e.g., gasification with upgrading), or through 

other pathways (industrial microbiology and algae). Several companies are exploring ATJ 

pathways, including Gevo and Cobalt. Gevo has developed a proprietary integrated fermentation 

technology (GIFT) consisting of a yeast biocatalyst that converts sugars into isobutanol. The 

alcohol is then converted into iso-paraffinic kerosene (IPK), a blendstock used in jet fuel, via 

additional reactions such as dehydration, oligomerization, hydrogenation, and distillation (Gevo 

2011). Similarly, Cobalt has developed its own process for extracting sugars from biomass and 
7

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converting them directly into bio n-butanol, a platform molecule for the production of a broad 

array of fuels and chemicals, including jet fuel (Cobalt 2013). 

Capacity and Production

Current U.S. biodiesel production capacity is more than 1.8 billion gallons, with about 160 plants 

registered with the Environmental Protection Agency (EPA) under the RFS program (Soybean 

Review 2011). The industry struggled in 2010 due to increased feedstock prices and the 

expiration of a key $1.00/gallon blender tax credit at the beginning of the year. According to the 

Energy Information Administration (EIA), biodiesel production decreased from 678 million 

gallons (Mgal) in 2008 to 343 Mgal in 2010 (EIA 2012a). The revised RFS (RFS2, initiated in 

July 2010) mandates the blending of 1 billion gallons per year of biomass-based diesel; biodiesel 

produced from soybean oil, animal fat, waste grease, and several other feedstocks qualifies for 

meeting this mandate. Driven by the RFS2 mandate and reinstatement of the $1/gallon blender

tax credit, biodiesel production reached a record 1.1 billion gallons in 2011, kept that level in 

2012, and it is expected to be higher in 2013 (EPA 2013a).

In comparison, the current U.S. renewable diesel and jet fuel production capacity is small, about 

225 million gallons per year (Mgy) (Biofuels Digest 2012, KiOR 2013). The industry is just 

starting out and most of the facilities are at pilot/demonstration scale, under construction, or in 

planning phase. At the time of writing, there were three commercial facilities as described below. 

Dynamic Fuels, a 50/50 joint venture between Syntroleum Corporation and Tyson Foods is 

located in Geismar, Louisiana. The facility has a capacity of 75 Mgy and became operational in 

November 2010. The plant uses animal fats, greases, and vegetable oils as feedstock. In the 

summer of 2011, Syntroleum announced that Dynamic Fuels achieved a record production of 

renewable fuels, about 87% of plant’s capacity (Syntroleum 2011). High production level (71%

of plant’s capacity) was kept in 2012 as well (The City Wire 2013a). However, the plant was 

idled in November 2012 because of deteriorating market conditions and the partners opted for 

replacement of a catalyst in the facility that would increase production efficiency. That catalyst 

was installed in June 2013 but the plant still remains idle today, mainly because the partners 

can’t reach amicable restart terms (The City Wire 2013b).

KiOR’s production facility in Columbus, Mississippi became operational in early 2013. It uses

woody biomass as feedstock and has 13 Mgy capacity (KiOR 2013). Given that the facility 

produces both renewable gasoline and diesel, it is unknown at this time the share of renewable 

diesel in the final output. 

Diamond Green Diesel, a joint venture between Valero subsidiary Diamond Alternative Energy 

LLC and Darling International Inc. is located in Norco, Louisiana. The facility has a capacity of 

137 Mgy and became operational in the summer of 2013. The plant uses recycled animal fat and 

used cooking oil as feedstock.

It is projected that other companies will come online within the next several years, although 

some may produce renewable gasoline instead of, or in addition to, renewable diesel and jet fuel 

(Biofuels Digest 2012).
8

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Production Cost

This section presents production cost estimates for several technology pathways. It is important 

to note that the costs presented here are production costs rather than final selling prices at the 

pump.

Very little data are available publicly on the production costs for renewable diesel and jet fuel. 

Some techno-economic analyses (TEAs) have been conducted for certain technology pathways, 

and other data from specific companies can be extracted from S-1 filings when a company goes 

public. 

In an effort to make the production costs reported here as comparable as possible, only recent 

sources (2008 to 2011) have been cited, and care was taken to exclude estimates with unusual 

assumptions such as optimistic feedstock price. However, the cost estimates are still not perfectly 

comparable. Variables such as plant size and co-product credits can have a significant impact on 

the overall production cost. Also, each pathway is at a different level of technology maturity, 

which contributes to the uncertainty of the cost estimates. None of the analyses cited address 

costs associated with carbon capture and sequestration (CCS), and none benefit from GHG 

emission credits.

Biodiesel

An analysis of soybean biodiesel (Tao and Aden 2009) reports a production cost of $2.55 per 

gallon of biodiesel ($2.48 gallon-of-gasoline-equivalent or gge) in 2007 dollars at a feedstock 

cost of $0.30/lb of soybean oil. The feedstock cost is by far the most significant cost of biodiesel 

production, accounting for about 70% of the overall production cost, and 75%- 95% of the 

overall operational cost. Other publications confirm the significance of feedstock cost, estimating 

it accounts for as much as 80% of the overall production cost (Yusuf et al. 2011). A literature 

review in Tao and Aden (2009) revealed overall production costs ranging from $2.00-$2.50 per 

gallon ($1.94- $2.43/gge), although the cost years of the data points in the literature review are 

not provided. Current biodiesel production facilities use a caustic soda-based catalyst, sodium 

methoxide, which complicates product clean up. Enzymatic transesterification using a lipase 

biocatalyst is an attractive alternative due to reduced wastewater treatments needs, easy glycerol 

recovery, and absence of side reactions—although the production costs are significantly higher 

(Jegannathan et al. 2011). An economic analysis employing an immobilized lipase catalyst 

resulted in a biodiesel production cost of $8.04 per gallon ($7.81/gge), although no cost year is 

provided.

Hydroprocessing of Lipid Feedstock

Pearlson et al. (2013) is the only publicly-available, peer-reviewed journal article that could be 

found containing production cost estimates for HEFA fuels. It models diesel and jet fuel 

production via hydroprocessing of soybean oil for three production capacity scenarios: 31, 61, 

and 100 Mgy. Maximizing the process for diesel production (jet fuel and LPG are co-products) 

results in cost per gallon ranging from $3.82 to $4.39/gal ($3.61 to $4.15/gge). Catalytically 

cracking a portion of the diesel range products was modeled to maximize jet fuel production 

(diesel and LPG are co-products), which resulted in a jet fuel cost per gallon of $4.09 to 

$4.69/gal ($3.81 to $4.37/gge). No cost year is provided, although input costs for the model, such 

as electric power, natural gas, and purchased hydrogen, are cited in 2010 dollars.
9

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An estimate of renewable diesel production cost via the HEFA technology pathway can be 

gleaned from Syntroleum Corporation financial disclosure statements. Dynamic Fuels produces 

renewable diesel, along with naphtha and LPG co-products, from animal fats and yellow grease. 

According to Syntroleum Corporation financial statements (Syntroleum 2013), the feedstock was 

$3.62/gal of renewable diesel produced, and operating expenses were $1.03/gal of renewable 

diesel produced for the quarter ending September 30, 2012 (Syntroleum 2013). Cost per gallon 

due to capital costs is not provided, but the Dynamic Fuels website reports the capital cost of the 

75 Mgy production facility at $150 million (Dynamic Fuels 2013). Assuming a 30-year project 

life and 10% discount rate, we can amortize a $150 million overnight capital cost over the total 

amount of fuel produced over the life of the project. The resulting capital cost is $0.22/gal. 

Adding the capital cost per gallon to the feedstock cost and operating cost results in a production 

cost of about $5/gge. It should be emphasized that this cost was not reported by Syntroleum 

Corporation, Tyson Foods, or Dynamic Fuels. It was estimated in this study based on feedstock 

and operating costs provided by Syntroleum, and total capital cost (provided by Dynamic Fuels) 

amortized using financing assumptions common in scoping studies such as the National 

Renewable Energy Laboratory (NREL) techno-economic reports cited elsewhere in this section. 

Algae

Davis et.al. (2011) recently published modeled costs for the co-production of diesel and naphtha 

from photosynthetic algae. In this analysis, both open pond and photobioreactor technologies are 

examined. In general, the costs for finished (hydro-treated) blendstocks range from $9.84/gallon 

($9.30/gge) for open-pond systems to $20.53/gallon ($19.39/gge) in 2007 dollars for 

photobioreactor systems. 

Algal biofuel production is a nascent technology at commercial scale. Therefore, previous 

analyses apply inconsistent assumptions, making comparison of results difficult. Consequently, 

the Department of Energy’s (DOE) Bioenergy Technology Office (BETO) hosted a workshop at 

the University of Arizona, Tucson, from November 30–December 1, 2011, for the purpose of 

harmonizing assumptions used in previous algal biofuel TEAs, life cycle assessments (LCAs), 

and resource assessments (RAs). Due to the favorable cost estimates of open-pond systems over 

photobioreactor systems, only open-pond systems were considered for the harmonization 

exercise. Applying the harmonized assumptions resulted in a cost of $19.60/gal ($18.52/gge) in 

2007 dollars. The increase in cost above the Davis et al. (2011) estimate is due largely to the

addition of pond liners, a reduction of the baseline algae production activity from 25 g/m2

/day to 

13.2 g/m2/day, and accounting for location and seasonal variabilities (Davis et al. 2012).

Fischer Tropsch Diesel 

Gasification and pyrolysis modeled costs have been most recently described in a series of papers 

from ConocoPhillips/Iowa State. Anex et al. (2010) estimate the production cost of diesel and 

gasoline produced via gasification of corn stover followed by FT synthesis at $4.50 to $5.00/gge

in 2007 dollars, depending on the operating temperature of the gasifier. The National Energy 

Technology Laboratory (NETL 2009) estimates the production cost of diesel produced via 

gasification followed by FT synthesis as $6.45/gallon ($6.09/gge) in 2008 dollars. The NETL 

study assumes a 20% rate of return, whereas Anex et al. (2010) assume only a 10% rate of 

return. 
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Wright et al. (2008) explore distributed pyrolysis processing (on-farm and small co-op 

pyrolyzers) followed by centralized gasification and FT synthesis of the pyrolysis oil to FT

liquids. The distributed processing scenario yields FT liquids for $1.43 to $1.56 per gge, 

although the analysis does not describe the composition of the FT liquid product. Additional 

separation and upgrading steps may be necessary. Additionally, transporting raw pyrolysis oil 

can be problematic due to its tendency toward phase separation. No cost year is provided for the 

estimate. 

Non-Catalytic Fast Pyrolysis

Brown et al. (2011) perform a techno-economic analysis of a non-catalytic fast pyrolysis process 

that produces gasoline from corn stover for a selling price of $2.96/gal in 2007 dollars. Biochar 

and pyrolysis gas are also produced, but are consumed in the overall process for heat generation. 

The final price is most sensitive to bio-oil yield, followed by feedstock price. The same research 

group analyzed two fast pyrolysis pathways, one with on-site hydrogen generation for fuel 

upgrading, the other relying on merchant hydrogen (Wright et al. 2010). Results show selling 

prices of $3.09/gge for the on-site hydrogen production scenario and $2.11/gge with purchased 

hydrogen. Selling prices in 2007 dollars for pioneer plants are $6.55/gge for the on-site 

hydrogen production and $3.41/gge with purchased hydrogen.

Catalytic Fast Pyrolysis

The National Academy of Sciences (NAS) reviewed cost estimates made by Wright et al. (2009)

and catalytic fast pyrolysis company KiOR, based on KiOR’s Form S-1 filing to the Securities 

and Exchange Commission (NAS 2011). Using its own feedstock cost and financing 

assumptions, the NAS updates the estimated selling prices of $2.10/gge for Wright et al. (2009)

and $3.24/gge for the KiOR catalytic fast pyrolysis process, although most details of the analysis 

are not provided, and it is unclear what year the costs are indexed.

Hydropyrolysis

Marker et al. (2012) modeled an integrated hydropyrolysis and hydroconversion process for 

gasoline and diesel production, called IH2

, developed by the Gas Technology Institute (GTI). 

Biomass is pyrolyzed in the presence of hydrogen to gas and liquid products. The gas phase 

proceeds to a hydro-conversion stage, which removes oxygen, resulting in deoxygenated 

gasoline and diesel products. The production cost of the finished fuel is $1.60/gal in 2007 

dollars. A gge production cost is not provided, although the product mix is reported as 

approximately 75% gasoline and 24% diesel, which results in a gge production cost of 

approximately $1.56 in 2007 dollars.

Biojet Fuel

A review of biojet fuel cost produced several estimates, but only one peer-reviewed journal 

article. Agusdinata et al. (2011) estimates the cost in 2007 dollars of producing biojet fuel via 

gasification and FT synthesis at $4.00/gge from corn stover, $5.50/gge for switchgrass, and 

about $5.80/gge for short rotation woody crops (SRWCs). Several estimates found in trade 

journals and industry blogs are consistent with this cost range of $4 - $6, although these sources 

are not reviewed and do not provide supporting material. Agusdinata et al. (2011) also estimates 

the cost of producing biojet fuel from algae in open ponds to be about $17/gge. 
11

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Renewable Identification Numbers and the Renewable Fuel Standard

The RFS program was created to ensure that transportation fuel sold in the United States 

contains a minimum volume of renewable fuel. The EPA is responsible for implementing the 

RFS regulations. The obligation to meet the minimum volume falls on fuel blenders. 

Renewable Identification Numbers (RINs) are the mechanism used by the EPA to track volumes 

of renewable fuel and verify blenders are meeting minimum blending requirements. Each 

volume of renewable fuel produced has an RIN attached to it. Each fuel blender must acquire 

enough RINs to cover its share of the mandate. RINs are tradable and can be purchased and 

sold. Therefore, a blender can meet RFS requirements by actually blending the mandated 

amount of biofuels, or by purchasing RINs from other fuel blenders who blend more biofuels 

than required and have excess RINs (FAPRI-MU 2009).

The RFS and RIN trading system do not affect the production cost of renewable fuels, but are 

worth mentioning here because they can serve as economic drivers to make renewable fuels 

competitive with petroleum-derived fuels (NABC 2012a) and aid in initial market penetration.
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Demand

Diesel

Distillate fuel oils, a category that includes diesel and heating oil, are a general classification for 

one of the fractions obtained from petroleum distillation. These oils are used in all sectors of the 

U.S. economy and rank second behind gasoline as the most consumed liquid fuels (EIA 2012c).

Diesel fuel (often referred to as No. 2 diesel fuel) is defined by EIA as a fuel that has distillation 

temperatures of approximately 500oF at the 10% recovery point and no more than 640oF at the 

90% recovery point; it meets the specifications defined in ASTM Specification D 975.

2 No. 1 

diesel fuel is a light distillate fuel oil that has distillation temperatures of no more than 550oF at 

the 90% point and meets the specifications defined in ASTM Specification D 975. Both fuels are 

used in high-speed diesel engines found in trucks, buses, automobiles, and locomotives, as well 

as farm and construction equipment. No. 1 diesel exhibits a much lower cloud point than No. 2 

diesel, so it is used neat, or it is blended with No. 2 in winter months.

Heating oil (often referred to as No. 2 fuel oil) is used for domestic heating and for moderate 

capacity commercial/industrial buildings. EPA defines it as a distillate fuel oil that has a 

distillation temperature of up to 640o

F at the 90% recovery point and it meets the specifications 

defined in ASTM Specification D 396.

2 No. 1 fuel oil is a light distillate fuel oil that has 

distillation temperatures of up to 400oF at the 10% recovery point and no more than 550oF at the 

90% point; it meets the specifications defined in ASTM Specification D 396. It is used primarily 

as fuel for portable outdoor stoves and portable outdoor heaters and is commonly referred to as 

kerosene.

More than three-quarters of distillate fuel sales are used primarily for transportation: on-highway

(by trucks, buses, and automobiles); railroad; vessel bunkering; and construction, farm, and 

military equipment (Figure 1). About 6% of distillate sales are for residential heating purposes, 

concentrated during the winter months. Table 8 in the Appendix provides a detailed breakdown 

of the different types of fuels used in each sector, as well as their volumes during the period 

2007-2012. On-highway motor vehicles consume about 64% of distillate fuel oils, namely diesel, 

with freight trucks using most of the fuel. The states of Texas and California are the largest 

consumers of diesel in the country, accounting for about 20% of all sales (Figure 2). Diesel 

consumption by on-highway motor vehicles follows population distribution: the top consuming 

states are also the most populated. Table 9 in the Appendix provides information on the historic 

use of No. 2 diesel fuel by state. 

 2 EIA. (2013). “Petroleum and Other Liquids - Definitions, Sources and Explanatory Notes,” Accessed August 2011: 

http://www.eia.gov/dnav/pet/TblDefs/pet_cons_821dst_tbldef2.asp. 

 
13

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Figure 1. Sales of distillate fuel oil by end use, 2012

Data source: EIA 2013b

Figure 2. No. 2 diesel sales for on-highway use by state, 2012

Data source: EIA 2013b

Total distillate consumption was on the rise during the 1990s, and it reached a plateau during 

2003-2007 (Figure 3). The growth was mainly due to increased use of diesel for transportation. 

From 2007-2009, low demand and a weak economy contributed to a downward trend. In 2010, 

this reversed to an upward trend, which experts believe is due to growth in manufacturing, 

usually associated with trucking demand.
14

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Figure 3. Total U.S. distillate retail deliveries, 1984 - 2012

Data source: EIA 2013b

Diesel consumption is projected to continue to grow, as illustrated in Figure 4. EIA notes that 

this growth results from both an increase in industrial output that leads to more fuel use by heavy 

trucks and an expansion of light-duty diesel vehicle sales to meet more stringent Corporate 

Average Fuel Economy (CAFE) standards.

3 As shown in Figure 5, freight trucks are expected to 

continue to dominate diesel consumption. Freight rail fuel use is expected to increase slightly 

while the consumption of diesel by the remaining market segments (such as commercial light 

trucks, shipping, school buses, etc.) remains almost flat over the years (Figure 6). An exception 

is the transit bus segment, which is projected to decrease its diesel use because of an increase in

natural gas use. Historical diesel share of the transit bus segment declined relative to natural gas 

transit buses between 1995 and 2008, and this tradeoff is expected to continue. 

 3 In July 2011, President Barack Obama proposed that the CAFE standards for cars and light trucks increase to 54.5 

miles per gallon (mpg) by 2025 (currently 30.2 mpg for passenger cars and 24.1 mpg for light trucks), the biggest 

increase since the federal government started regulating fuel economy in the 1970s. The auto industry will be given 

time to adapt to the proposed 2025 standard. Under the supplemental notice of intent, passenger cars are required to 

increase fuel economy from 2017-2021 by 4.1% annually while light-duty trucks are required to have 2.9% annual 

improvements.
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Figure 4. Projected diesel fuel consumption, 2013 – 2035

Data source: EIA 2011

Figure 5. Projected diesel fuel consumption by the transportation sector

Data source: EIA 2011, Reference Case.

1/ Commercial trucks from 8,500 to 10,000 pounds.

2/ Does not include military distillate. Does not include commercial buses. 3/ Does not include passenger rail. 
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Figure 6. Projected diesel fuel consumption by the transportation sector excluding freight trucks

Data source: EIA 2011, Reference Case.

1/ Commercial trucks from 8,500 to 10,000 pounds. 3/ Does not include passenger rail.

Biodiesel

Biodiesel consumption was on the rise from 2005-2009, plummeted during 2010 due to low 

demand resulting from the economic downturn and the expired $1.00 per gallon blender tax 

credit, and was back up in 2011 mainly in response to RFS2 and the reinstated tax credit (Figure 

7). Biodiesel is distributed through fueling stations nationwide. Low-level biodiesel blends such 

as B2 and B5 are used safely in any compression-ignition engine designed to use diesel fuel. 

There are several hundred major fleets in the United States that use biodiesel. These include 

municipal bus fleets; national park trucks and buses; federal, state, and local government fleets; 

school buses; and many commercial businesses, such as public utilities and refuse haulers (Hart 

Energy Consulting 2010). Off-road applications (tractors, boats, and electrical generators) also 

use biodiesel. EIA projects an annual growth of 7% for biodiesel consumption by 2035 (EIA 

2011).
17

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Figure 7. Historic biodiesel consumption, 2001 – 2012

Data source: EIA 2013a

Jet Fuel 

Jet fuel is a type of aviation fuel designed for use in commercial and military aircrafts powered 

by gas-turbine engines. It is the third-most used fuel in the country after gasoline and diesel. EIA

defines jet fuel as a kerosene-based product having a maximum distillation temperature of 400o

F

at the 10% recovery point and a final maximum boiling point of 572o

F and meeting ASTM 

Specification D 1655 (JET A and JET A-1) and Military Specifications MIL-T-5624P and MILT-83133D (Grades JP-5 and JP-8).4

Jet fuel consumption was on the rise during the 1980s and 1990s and it reached a plateau during 

2000 - 2007 (Figure 8). Since 2007, similar to diesel consumption, jet fuel consumption began a 

downward trend due to low demand and a weak economy. States consuming the most jet fuel 

include California, Texas, New Jersey, Florida, and Illinois (Figure 9); they are home to some of 

the busiest airports in the United States as well as large military bases. 

 4 EIA. (2013). “Petroleum and Other Liquids - Definitions, Sources and Explanatory Notes,” Accessed August 2011: 

http://www.eia.gov/dnav/pet/TblDefs/pet_cons_821dst_tbldef2.asp. 
18

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Figure 8. Historic kerosene-type jet fuel consumption, 1981 – 2012

Data source: EIA 2013c

Figure 9. Jet fuel consumption by state, 2012

Data source: EIA 2013d

EIA projects that jet fuel consumption by commercial carriers will continue to grow over the 

next years, the rate of which will depend on economic growth and oil prices, whereas jet fuel 

consumption by the military will remain flat (Figure 10 and Figure 11).
19

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Figure 10. Projected commercial jet fuel consumption, 2013 – 2035

Data source: EIA 2011

Figure 11. Projected military jet fuel consumption, 2013 – 2035

Data source: EIA 2011
20

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Feedstock Assessment

Various biomass resources can be used for the production of diesel and jet fuel substitutes, as 

established earlier. These include lignocellulosic material such as wood waste, crop residues, and 

dedicated energy crops, as well as lipid feedstock such as vegetable and waste oils, animal fat, 

and algae. A recent study by the U.S. Department of Energy’s Oak Ridge National Laboratory

(U.S. DOE 2011), the Billion Ton Study (BTS), estimated the amount of currently available and 

potential biomass resources in the conterminous United States. The study included the following 

biomass categories:

1. Forest Biomass and Wood Waste 

• Forest residues (logging residues and thinnings) from integrated forest operations from 

timberland

• Other removal residue5

• Thinnings from other forestland6

• Unused primary and secondary mill processing residues7

• Urban wood wastes (woody component of municipal solid waste [MSW] and 

construction and demolition [C&D] wood)

• Conventionally sourced wood8

2. Agricultural Biomass and Waste Resources

• Crop residues from the major grain-producing crops (corn, wheat, barley, oats, and 

sorghum)

• Secondary agricultural processing residues (sugarcane trash and bagasse, cotton gin trash 

and residues, soybean hulls, rice hulls and field residues, wheat dust and chaff, orchard 

and vineyard prunings)

• Waste or tertiary resources (e.g., manures, waste fats, and greases)

3. Energy Plantations (perennial grasses, trees, and annual crops).

The BTS makes use of POLYSYS, an agricultural policy model, and data from the United States 

Department of Agriculture (USDA) to estimate supply/cost curves for each feedstock by county

 5 These residues include unutilized wood volume from cut--or otherwise killed--growing stock from cultural 

operations, such as pre-commercial thinnings or from timberland clearing. This category does not include volume 

removed from inventory through reclassification of timber land to productive reserved forest land. 6 Other forestlands are defined as incapable of producing at least 20 cubic feet per acre per year of industrial wood 

under natural conditions because of a variety of adverse site conditions including poor soils, lack of rainfall, and 

high elevation.

7 Primary mill residues include wood materials (coarse and fine) and bark generated at manufacturing plants 

(primary wood-using mills) when round wood products are processed into primary wood products like slabs, 

edgings, trimmings, sawdust, veneer clippings and cores, and pulp screenings (USDA – Forest Service). Secondary 

mill residues include wood scraps and sawdust from woodworking shops such as furniture factories, wood container 

and pallet mills, wholesale lumberyards, and flooring. 8 This category includes wood that has a commercial value for other uses but is used as an energy feedstock because 

of competitive market conditions.
21

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for 2012-2030. Two scenarios are used: baseline and high yield. The baseline scenario assumes a 

continuation of USDA’s 10-year forecast for the major food and forage crops, as well as a 

continuation in trends toward no-till and reduced cultivation. Energy crop yields assume an 

annual increase of 1% due to experience in planting and additional R&D. Forest residues are 

estimated using resource cost analysis with data from the USDA’s Forest Service. The high-yield 

scenario assumes a greater proportion of corn in reduced and no-till cultivation and increased 

corn yields to about double the current rate of annual increase. The energy crop productivity 

increases at 2%, 3%, and 4% annually, not only due to experience in planting, but also to more 

aggressive implementation of breeding and selection programs. No high yield scenario was 

evaluated for forest resources except for the woody crops.

The forest resources are available over a wider price range than the agricultural resources–$20

per dry ton or less to $100 per dry ton or less for forest resources vs. $40 per dry ton or less to

$60 per dry ton or less for agricultural resources–with increasing quantities at higher prices. Over 

the estimated price range, forest resource quantities vary from about 33 to 142 million dry tons 

currently (Table 2). Due to data limitations, there is little estimated change over the next 20 

years. Another study looked at the currently available forest resources in the country, regardless 

of price, and estimated that there are about 92 million dry tons of woody biomass available in the 

country today (Milbrandt 2005).

9 A study by NAS reports a similar amount of currently 

available woody biomass, about 110 million dry tons, and projects that about 124 million dry 

tons could be available in 2020 (NAS 2009).

Table 2. Summary of Potential Forest Biomass and Wood Wastes in the BTS, 2012

Source: U.S. DOE 2011

Under the baseline scenario, agricultural resource quantities vary from about 59-162 million dry 

tons currently to about 126-265 million dry tons in 2030. About two-thirds of this quantity comes 

 9 This volume includes logging residues and other removals, unused primary mill residues, secondary mill residues, 

and urban wood waste. 
22

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from crop residue and the rest is from various agricultural processing residues and wastes. Under 

the high yield scenario, the quantities vary from about 115-244 million dry tons currently to 

about 284-404 million dry tons in 2030 (Table 3). As a reference, Milbrandt (2005) reports about 

157 million dry tons of crop residues available in 2002. This amount is one-third of the total crop 

residues, accounting for a portion that needs to be left on the field for soil protection, grazing, 

and other agricultural activities. NAS (2009) reports a lower amount of currently available 

agricultural resources10--about 106 million dry tons—and projects that about 148 million dry 

tons of agricultural resources could be available in 2020. 

Table 3. Summary of Baseline and High Yield Scenarios in the BTS —Agricultural Residues and

Waste Resources

Source: U.S. DOE 2011

Energy crops considered in the BTS include switchgrass, miscanthus, sugarcane, sorghum, 

poplar, willow, eucalyptus, and southern pine. The study estimates that between 3.7 and 101 

 10 NAS (2009) evaluates corn/wheat residues and hay only, while Milbrandt (2005) considers residues from 18 

major agricultural crops. 
23

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million dry tons of energy crops could be available under the baseline scenario in 2017 (Table 

4). This wide range is due to uncertainty in crop yield and the rate of industry’s development. 

The high yield scenario is simulated at three levels–2%, 3%, and 4% increase in annual crop 

productivity. Over the estimated price range, the quantity of energy crops varies between 13 and 

180 million dry tons in 2017 to about 69 and 799 million dry tons in 2030. NAS (2009) reports 

that with current technologies and agricultural practices, about 104 million tons of energy crops 

could be produced today. Advanced technologies and practices could lead to increased 

production, potentially up to 164 million tons in 2020.

Table 4. Summary of Baseline and High Yield Scenario Availability of Energy Crops in the BTS

Source: U.S. DOE 2011

FOG is another resource category for the production of diesel and jet fuel substitutes. The United 

States produced about 18 million tons of FOG in 2010 (Table 5), which could theoretically be 

converted to over 5 billion gallons of biodiesel or renewable diesel. Another 3.7 million tons of 

oils were imported (mainly edible oils such as canola, palm, and coconut). Edible oil imports 

have increased from 13% of domestic edible oil production in 1998 to 27% in 2010 as a result of 

the shift from soy to low polyunsaturated oils (because of negative health effects of trans-fatty 

acids and rising U.S. food demand). However, not all of these resources are available for energy 

use. Roughly 85% were used for edible (baking or frying fats, margarine, salad or cooking oil)

and inedible products (fatty acids, animal feed, methyl esters, etc.). In addition, about 1.5 million 

tons of edible oils (mostly soy) and 900,000 tons of animal fats were exported in 2010 (USDA 

2012; U.S. Census Bureau M311K). The 1.1 billion gallon biodiesel production in 2011 

consumed over 4 million tons of FOG, which is a significant increase from the 1.1 million tons 

consumed in 2010.
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Table 5. U.S. Production of Fats, Oils, and Greases in 2010

* Data Source: USDA, Oil Crops Yearbook 2011

** Data Source: U.S. Census Bureau, M311K

Algae are a potential aquatic oil crop, but may also yield carbohydrates that can be converted to 

sugar. This feedstock has received increased attention in recent years. Given the right resources–

suitable climate, availability of water, CO2 and other nutrients – algal oil productivity can be 

quite high. A recent study suggests that under current technology, microalgae have the potential 

to generate 58 billion gallons of oil per year, equivalent to 48% of current U.S. petroleum 

imports for transportation (Wigmosta et al. 2011). The authors emphasize that this level of 

production requires 5.5% of the land area in the conterminous U.S. and nearly three times the 

water currently used for irrigated agriculture. The intensive water use for growing algae can be 

addressed in a sustainable manner by using low-quality water with few competing uses, such as 

brackish/saline groundwater, “co-produced water” from oil and natural gas wells, and 

wastewater discharged from domestic, industrial, and agricultural activities. Therefore, algal

technology need not put additional demand on freshwater supplies. 

Figure 12 illustrates the algal oil productivity at different locations in the United States. The 

pattern shows a strong linkage to climate and topography–locations with warm temperatures and 

flat terrain are most productive. The southern portions of the country exhibit the highest 

production rates ranging from 6,000 to 8,221 liters/ha/year (between 540-740 gallons/acre/year )

of potential biofuel production. These areas are characterized with relatively warm temperatures 

year‐round and longer hours of solar insolation in comparison to northern locations. Locations in 
25

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the north and at higher elevations exhibit the lowest production rates, ranging from 2,291 to 

4,000 liters/ha/year (206-360 gallons/acre/year). A long winter season in these areas contributes 

to a shorter growing season.

Figure 12. Mean annual algal oil production using current technology

Source: Wigmosta et al. 2011

Table 6 summarizes the biomass resource potential outlined above. Depending on the conversion 

pathway, different yields of biofuels can be achieved. Using current conversion technologies for 

lignocellulosic biomass, about 43.3 gallons of renewable diesel/jet fuel could be produced per 

dry ton via gasification/FT technology (Davis 2009) and about 65 gallons per dry ton via fast 

pyrolysis (PNNL 2009). For example, forest resources alone could produce about 1.4 - 6 billion 

gallons of renewable diesel via gasification/FT technology which could displace between 4% and 

17% of current diesel consumption on highways (about 36 billion gallons of diesel fuel was used 

in 2011; see Figure 1 and Figure 3). Using fast pyrolysis, forest resources could yield even more 

“drop-in” fuels and displace between 6% and 26% of current diesel consumption. Renewable 

diesel and jet fuel yields from lignocellulosic biomass via biochemical conversion pathways are 

not readily available at this time.
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On average, about 300 gallons of biodiesel, using a transesterification process, could be 

produced per ton of FOG. Thus, the 3.8 million tons of currently available FOG could yield 

about 1.1 billion gallons of biodiesel, which could displace about 3% of current diesel 

consumption on highways in the United States. About 245 gallons of “drop-in” fuel could be 

produced per ton of triacylglycerol (TAG) oil via hydroprocessing (Davis et al. 2012). Thus, 

about 931 million gallons of renewable diesel could be produced from the existing FOG in the 

United States, which could displace about 2.5% of current diesel consumption on highways in 

the country. 

Table 6. Total Biomass Resource Potential

* Assumes 21% of FOG [about 85% of total FOG (18 million tons) is currently used for 

edible and inedible products, of which 6% is used in methyl esters (biodiesel)]. Future 

potential is estimated using population projections from the U.S. Census Bureau in 2022 

(0.93 percent change) and applying the same ratio (21% of total).

** Assumes 1/5 of projected future potential.

It is unrealistic to assume that all of the biomass resources could be used for the production of 

diesel and jet fuel substitutes. There are other competing uses for these resources. For 

lignocellulosic biomass, these include the production of ethanol, renewable gasoline, chemicals 

and allied products, as well as power generation. For FOG, competing industries include the 

production of edible (baking/frying fats, cooking oil, etc.) and inedible (lubricants, paints, 

plastics, etc.) products. However, even if a small portion of the current biomass potential is 

dedicated to diesel and jet fuel substitutes, they can still play a role in diversifying the country’s 

energy portfolio. This role would be more significant if the projected future potential is realized 

and feedstock, such as dedicated energy crops and algae, become commercially available.
27

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Discussion

The Congressionally mandated RFS2 goal is to use at least 36 billion gallons of biomass-based 

transportation fuels by 2022 (Figure 13). Of the total 36 billion gallons, 15 billion gallons are 

projected to come from conventional biofuel sources, such as corn ethanol, and the remaining 21 

billion gallons from advanced biofuels divided into three categories: cellulosic biofuels, biomassbased diesel, and other advanced biofuels (EPA 2009, Table V.A. 2-1). Sixteen billion gallons 

are required to come from cellulosic biofuels (fuels, not necessarily ethanol, made from 

lignocellulosic biomass that also reduce GHG emissions by at least 60% relative to the gasoline

or diesel fuel they displace). The contribution of biomass-based diesel to this goal can be no less 

than 1 billion gallons11: 0.81 billion gallons are projected to come from biodiesel and 0.19 billion 

gallons from renewable diesel. An additional 4 billion gallons of other advanced biofuels (any 

renewable fuel other than ethanol derived from corn that achieves 50% GHG emissions) is also 

mandated by RFS2. 

Biomass-based diesel and jet fuel are considered to be advanced biofuels and can meet several 

RFS criteria. For example, renewable diesel derived from lignocellulosic biomass falls within the 

biomass-based diesel and cellulosic biofuels categories while jet fuel substitutes from biomass 

can meet the cellulosic biofuels and other advanced biofuels standards.

Figure 13. Renewable fuel volume requirements for RFS2 under EISA

Source: EPA 2010b

 11 In 2013, biomass-based diesel mandate was revised upwards from 1 billion gallons to 1.28 billion gallons actual 

volume (EPA 2013b).
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During 2011 and 2012, the biodiesel industry proved that it has the ability to fulfill the entire 

biomass-based diesel volume requirements under RFS2. The mandate calls for at least 1 billion 

gallons of biomass-based diesel annually and biodiesel production was reported at 1.1 billion 

gallons during these two years. Production in 2013 is forecasted to be even higher. In addition to 

the RFS mandate, another factor for the industry’s growth during the past three years was the 

extended tax credit. This key $1.00-per-gallon blender tax credit is scheduled to expire on 

December 31, 2013 and it is unknown at this point whether or not it will be extended. The 

industry could face significant setbacks if extension does not occur. In addition, EPA proposes to 

keep the biomass-based diesel standard at 1.28 billion gallons next year, the same volume set for 

2013, which could further jeopardize the industry’s further development (EPA 2013c). The next 

several months will reveal the biodiesel industry’s future directions as these two legislative 

pieces get resolved. 

Biofuels Digest (2012) projects that “drop-in” fuels capacity (inducing renewable diesel and jet 

fuel) will reach about 1 billion gallons in 2017. This projection is based primarily on companies’ 

statements and media releases on planned facilities. Whether or not this capacity level is reached 

will depend on many factors, including commercialization of proven technologies (namely 

gasification, FT, and pyrolysis), success of trial technologies, feedstock availability, production 

cost, and diesel/jet fuel demand. As mentioned earlier, currently there are three commercial 

plants in the United States producing renewable diesel, although one of them (KiOR) produces 

other renewable fuels as well such as renewable gasoline. At present, Dynamic Fuels is idle and 

it is unknown when the facility will resume operation again. The other two plants, KiOR and 

Diamond Green Diesel are in an initial phase and thus it is difficult to evaluate the performance 

and economics of these plants. Neste Oil is the world’s largest renewable diesel producer with 

about 572 MGY of installed capacity worldwide (Biofuels Digest 2012). It operates abroad in 

Finland, Singapore, and the Netherlands. While Neste Oil is using hydrotreating, a common 

practice in petroleum refineries, other technologies such as pyrolysis (employed by KiOR) and

FT (utilized by Syntroleum) have yet to demonstrate their economic viability. The next few years 

will likely answer many questions about the feasibility and profitability of producing renewable 

diesel and jet fuel through the various conversion pathways.

Based on current statistics, and as proven by the biodiesel industry, there is enough lipid 

feedstock to support the RFS2 mandate. Today, roughly half of the biodiesel in the United States 

is produced from soybean oil. The remaining portion consists of animal fat, used cooking oil, 

canola, and some other minor feedstocks such as cottonseed oil, tall oil fatty acids, and corn oil 

recovered from corn ethanol dry mills. The Food and Agricultural Policy Research Institute 

(FAPRI) projects that soybean oil production in the United States will continue to rise over the 

next decade, from about 9.5 million tons today to about 11 million tons in 2022 (FAPRI-ISU

2012). One of the drivers for this increase is the anticipated volume required to meet the biofuels 

quota under the RFS2. Even if half of the projected soybean potential is used for 

biodiesel/renewable diesel production it would be sufficient to meet the mandate. Higher output 

could be achieved through advanced technologies for increasing oil supply (increasing crop yield 

and seeds’ oil content, as well as recovering sewage and trap greases) and production of new 

feedstock such as oil from camelina (Camelina sativa L.) and field pennycress (Thlaspi 

arvense). Moreover, if algal oil becomes commercially available in the next 5-10 years, the 

biodiesel and renewable diesel production potential would increase substantially.
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With regard to the lignocellulosic feedstock, enough material is projected to be available to 

support the RFS mandate of 21 billion gallons from advanced biofuels. Crop and forest residues

in 2022 are projected to be between 126 - 371 million tons. Assuming a conversion via fast 

pyrolysis (with an average yield of 65 gallons/dry ton), this amount could yield about 8-24

billion gallons of biomass-based diesel/jet fuel. This potential could be larger if the conversion 

technologies achieve higher yield and if additional feedstock such as dedicated energy crops 

become available. The fuel produced from these resources would qualify under any of the 

advanced biofuels categories: cellulosic biofuels, biomass-based diesel, or other advanced 

biofuels. However, there will be competition for lignocellulosic feedstock with the ethanol 

industry and renewable gasoline producers to meet the RFS mandate, so it is unclear what share 

the renewable diesel/jet fuel would have in the total biofuels contribution. Ultimately, it will 

depend on the rate of commercialization of these technologies as well as the transportation

market demands.

The costs for producing renewable diesel and jet fuel are not well known and include a high 

degree of uncertainty. Hydroprocessing of FOG is being done commercially by Dynamic Fuels, 

Diamond Green Diesel, and internationally by Neste Oil. The KiOR technology is at an initial 

commercial scale. Other technology routes are not yet commercial and publicized cost estimates 

vary widely. As these technology pathways mature and become more widespread, more specific 

information regarding their economics will be available, which would enable a more detailed 

analysis and performance comparison. Based on Syntroleum Corporation financial disclosure 

statements, we estimate the production cost for renewable diesel by Dynamic Fuels to be about 

$5/gge as of September 2012. As a reference, the average production cost of petroleum-derived 

diesel in the United States is about $2.87 ($2.59/gge) as of October 2013 (EIA 2013e).

12 As 

another reference, production cost for biodiesel is in the range of $2.00-$2.50 per gallon ($1.94-

$2.43/gge). However, it should be noted that this range was documented in 2009; thus it is likely 

that biodiesel production cost is higher today given the increase in soybean and other relevant 

feedstock prices during the past several years (USDA 2013). As a reminder, this is the cost of 

production (feedstock and processing), not the price paid at the pump by the consumer. The 

price at the pump also includes distribution expenses, taxes, etc.

Biodiesel faces some technical limitations which may direct future industry decisions toward 

renewable diesel. While the lower-level biodiesel blends (B20 and below) can be used in 

traditional diesel vehicles without engine modifications, higher-level blends may require engine 

modifications and other usage considerations. More importantly, biodiesel is currently 

transported from the production sites to petroleum terminals where it is blended with petroleum 

fuels, via truck or rail and occasionally, by barge. These modes are much more expensive than 

transportation by pipeline, which is used for most petroleum fuels. The potential for biodiesel to 

contaminate jet fuel is preventing widespread pipeline transport. Hydrocarbon renewable diesel 

is likely to be easily transported in existing pipelines already utilized for petroleum-based fuels.

Renewable diesel and jet fuels produced by hydroisomerization of lipid feedstocks, gasification 

followed by FT synthesis, or biochemically using the approaches by Amyris, LS9, and other 

companies will consist entirely of paraffinic hydrocarbons (also known as alkanes). These are 

 12 West Texas Intermediate crude oil price: $100.54/barrel.
30

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completely miscible with conventional fuels and, from a purely combustion standpoint, they

could be blended at any level or even used in neat form as long as they meet the requirements of 

the respective fuel standard specifications (ASTM D975 for diesel fuel and ASTM D1655 for jet 

fuel). For both diesel and jet applications, it is likely that fuel additives will be required to meet 

specifications for lubricity, conductivity, stability, and other properties. All of these additives 

are also commonly used in petroleum-derived fuels. However, fuel system elastomeric 

components for both ground transport and aviation have been conditioned over time in a 

significant level of aromatic compounds. When exposed to a zero aromatic fuel such as the 

renewable diesel and jet fuels described above, aromatics can be extracted from the elastomers,

causing them to shrink and leading to fuel system leaks. To avoid this scenario in aviation 

applications, ASTM International has developed standard D7566 “Standard Specification for 

Aviation Turbine Fuel Containing Synthesized Hydrocarbons,” which allows no more than 50%

volume paraffinic kerosene in jet fuel. The blended fuel is also required to contain a minimum 

of 8% volume aromatics. A similar situation could be envisioned for elastomeric components in 

diesel engine fuel systems, but to date, ASTM has not specified a minimum required aromatic 

level or a maximum allowable blend level of paraffinic components.

Other renewable diesel fuels, such as those produced by fast pyrolysis and related 

thermochemical processes, will likely contain significant levels of aromatics, and perhaps low 

levels of oxygenates. More data on the composition of these fuels will be required in order to 

assess any possible limit on blend level. For widespread application, biodiesel blending is limited 

to 20% volume due to lack of engine manufacturer approval and limited data on compatibility 

with infrastructure for higher blends.

As noted earlier, on-highway motor vehicles consume about 64% of the diesel fuel in the 

country, with freight trucks being the largest consumer in this category. Therefore, the trucking 

industry could provide a strong business opportunity for biomass-based diesel producers. The

American Trucking Association (ATA) is supportive of alternative fuels, evident from the fact 

that it currently supports biodiesel use in blends up to 5%. The organization highlights that 

renewable diesel has not been subjected to rigorous on-road fleet testing; however, preliminary 

information indicates that renewable diesel may have advantages over biodiesel for the end-user

(ATA 2012). These advantages may include a higher energy content and better cold weather 

performance compared to biodiesel. Regardless, for any biomass-derived diesel to be a success 

among the trucking companies, the fuel price has to be equal to or less than petroleum-based

diesel. Table 7 illustrates the top 25 U.S. trucking companies in 2012. By far, the two major 

package delivery companies UPS and FedEx lead the ranking in revenue. The e-commerce boom 

in recent years is the main contributor to the success of these companies.
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Table 7. Top 25 U.S. Trucking Companies in 2012

Data source: JOC 2013

As illustrated earlier, diesel consumption by light-duty vehicles in the United States is relatively 

low, but it is projected to double over the next decade. The fuel is not as popular among U.S.

passenger-car drivers as it is in Europe, but diesel vehicle sales show consistent double-digit 

increases over the last two years (PR Newswire 2012). Whether diesel cars remain niche vehicles 

in the U.S. market or enter the mainstream will depend on government policies, consumer 

demand, and fuel prices. The recently issued new CAFE standard of 54.5 mpg by 2025 is 

expected to have a positive effect on future clean diesel car sales. The Diesel Technology Forum 

(DTF), a non-profit educational organization dedicated to raising awareness about the economic 

importance and essential uses of diesel engines, issued a statement welcoming the new standards: 

“Because clean diesel autos are 20 to 40 percent more efficient than gasoline vehicles, diesel will 

be a major player in the nation’s effort to achieve the new mileage standards” (Time 2012, ¶ 8). 

Demand for gasoline is higher in the United States and fuel taxes favor gasoline, which makes

gas less expensive. It is exactly the opposite in Europe where the fuel tax structure favors diesel 

(Figure 14). The U.S. diesel passenger vehicle market may expand as consumers are drawn more 

to diesels because they’re economical, offering greater fuel efficiency than comparable gaspowered cars. Moreover, if the U.S. fuel prices take off more abruptly than analysts predict, we 

could see a deeper penetration of diesel vehicles.
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Fuel taxes for the United States include $0.184/gal for gasoline and $0.244/gal for diesel.

Figure 14. Comparison of fuel prices and taxes in the United States and Europe, 2007

Source: U.S. DOE 2010

Other transportation segments that could provide business opportunities for the biomass-based 

diesel industry are railroad; vessel bunkering; and construction, farm, and military equipment. 

While overall these segments do not consume as much diesel as freight trucks, they could still 

play a role at local levels. Tables 10-14 in the Appendix illustrate these sectors’ diesel 

consumption by state. The rail network spreads throughout all states but certain areas such as 

Texas, California, Oklahoma, and Ohio report significantly more diesel consumption by the rail 

industry. The sector is strong in Texas and California due to a concentration of industrial and 

agricultural activities, in Oklahoma due to the state’s somewhat central location, and in Ohio due 

to movements between eastern locations and markets in the Midwest. Diesel use by vessel 

bunkers is naturally high in coastal areas, while highly populated states (namely California and 

Texas) stand out as the largest consumers of diesel by the construction industry. About half of 

the country’s diesel consumption in farm machinery is concentrated in the Midwest; large states

with strong agricultural activities such as California and Texas also report high diesel use by this 

sector. As noted earlier, the military is not a heavy consumer of diesel; most activities are 

concentrated in states with large military bases such as Washington, Texas, North Carolina, and 

California. 

Jet fuel is forming as a large and profitable market for the renewable fuels industry. Success in 

this area could stimulate a significant increase in the production of biofuels and associated 

feedstock. Successful test flights by commercial and military aircraft over the past few years led 

to the adoption of specification D7566 by the ASTM International in July 2011, which enables 

the use of 50% by volume paraffinic renewable fuels with conventional jet fuel. The blending 

level is restricted to 50% to ensure that the final blend contains a minimum level of aromatic 

compounds to prevent shrinkage of aged elastomer seals and subsequent fuel leakage. Since 

then, renewable jet fuel blends have been used by a number of airlines. The German airline 

Lufthansa began regularly scheduled commercial flights using Neste Oil's NExBTL renewable 

aviation fuel derived via hydrotreating vegetable oils and animal fats. This made Lufthansa the 
33

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world’s first airline to utilize biofuel in daily flight operations and Neste Oil the first company to 

provide the biofuel to be used on regularly scheduled commercial flights (Neste Oil 2012). In 

November 2011, Continental Airlines Flight 1403 from Houston to Chicago was the first U.S. 

commercial flight to run on a biofuel blend derived partially from genetically modified algae, 

which was provided by Solazyme. The parent company, United Continental Holdings Inc., plans 

to buy 20 million gallons per year of algae-derived biofuel made by Solazyme (Seeking Alpha

2012). Shortly after, Alaska Airlines and its sister airline Horizon Air started flights using a 

biofuel blend made from recycled cooking oil. More U.S. airlines are expected to join the effort 

to fly with renewable jet fuel in the following years. 

The U.S. military is a promising client for renewable fuels given the fact that the Department of 

Defense (DoD) is the single largest consumer of petroleum in the country. The Defense 

Logistics Agency reports that it purchased about 4.7 billion gallons of fuel in FY 2012, of which 

75% represented jet fuel (DLA 2013). Considering the approval of a 50% biofuels blend, this 

consumption represents a substantial potential demand for biofuels from the U.S. military in the 

near term. Among all services, the Air Force consumes the most energy and uses more than 2 

billion gallons of aviation fuel annually. By 2016, it plans for half of its domestically purchased 

aviation fuel to be derived from renewable resources. Similarly, the Navy’s goal is to use 50% of 

its energy consumption from alternative sources by 2020. This goal came as a result from 

successfully testing an F/A-18 fighter jet and helicopters on biofuel blends.

The military plays a very strategic role in the development and commercialization of advanced 

biofuels. It can afford research and testing of alternative fuels to determine their viability more 

easily than the private sector, which is somewhat limited by concerns about returns on 

investment. Also, it can purchase large volumes of fuel to create demand, which could lead to 

increased production and lower prices. Moreover, early adoption of advanced fuel technologies 

by the DoD provides certainty to investors that there will be a market for these products.
34

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Conclusion

Our examination of the status, opportunities, and feasibility for biomass-based diesel and jet fuel 

in the United States leads to the following findings:

1. It is technically feasible to produce biomass-derived diesel and jet fuel substitutes in the 

United States. Many conversion technology options exist. Some are commercially available

or in demonstrational stage; others are still in the research and development phase.

2. Biodiesel, consisting of FAME produced from lipids, is currently the predominant form of 

biomass-based diesel. Production reached a record 1.1 billion gallons in 2011, kept that level 

in 2012, and is expected to be higher in 2013. Biodiesel blends cannot yet be considered fully 

“drop-in” fuels because they cannot be transported in all petroleum product pipelines. For 

pipelines that transport jet fuel, there is a concern that the jet fuel will be contaminated with 

biodiesel, making it unsuitable for use. Ongoing research aims to determine what, if any, 

level of FAME can be tolerated in jet fuel.

3. In comparison, the current U.S. renewable diesel and jet fuel production capacity is small, 

about 225 million gallons per year. These fuels can be produced from various biomass 

resources and through several different approaches which all target hydrocarbon products 

that are similar to petroleum fuels in chemical makeup, and therefore may be considered 

“drop-in” fuels. It is anticipated that, as “drop-in” fuels, they can be blended with petroleum 

diesel/jet fuel at high levels, or possibly used in neat form.

• Renewable diesel is produced at commercial scale primarily by hydroisomerization of 

lipid feedstock. Currently, there are two commercial facilities utilizing this process:

Dynamic Fuels (Geismar, Louisiana) and Diamond Green Diesel (Norco, Louisiana).

• A number of processes are under development for production of renewable diesel from 

biomass-derived sugars (corn, sugarcane, and sorghum, as well as sugars from 

thermochemical or biochemical depolymerization of cellulose and hemicellulose). 

• Processes are also being developed for direct conversion of lignocellulosic biomass by 

fast pyrolysis, gasification, and other thermochemical means. The first commercial plant 

is operated by KiOR in Columbus, Mississippi and became operational in early 2013.

4. The costs for producing renewable diesel and jet fuel are not well known and involve a high 

degree of uncertainty. The process economics for these fuels is highly dependent upon the 

cost of the feedstock, similar to biodiesel. Additionally, variables such as plant size and coproduct credits can have a significant impact on the overall production cost. 

Hydroisomerization of lipids is performed commercially by Dynamic Fuels and Diamond 

Green Diesel, and internationally by Neste Oil. The KiOR technology, utilizing pyrolysis, is 

at an initial commercial scale. Other technology routes are not yet commercial and display a 

wide range of estimated costs in public sources. As these technology pathways mature and 

become more widespread, more specific information regarding their economics will be 

available, which would enable a more detailed analysis and performance comparison.
35

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5. From a feedstock perspective, enough lignocellulosic material is projected to be available in 

support of the RFS mandate of 21 billion gallons of advanced biofuels. Crop and forest 

residues alone could yield about 8-24 billion gallons of biomass-based diesel/jet fuel in 2022 

(assuming a conversion via fast pyrolysis). This potential could be larger if the conversion 

technologies achieve higher yields and if additional feedstock, such as dedicated energy 

crops, become available. However, there will be competition for lignocellulosic feedstock 

with the ethanol industry and renewable gasoline producers to meet the RFS mandate. Thus,

it is unclear what share the renewable diesel/jet fuel would have in the total biofuels 

contribution. Ultimately, it will depend on the rate of commercialization of these 

technologies, selling price, and the transportation market demands. 

6. Based on current statistics, and as proven by the biodiesel industry, there is enough lipid 

feedstock to support the production of 1 billion gallons of biomass-based diesel mandated by 

the RFS. Today, roughly half of the biodiesel in the United States is produced from soybeans. 

The remaining portion consists of animal fat, used cooking oil, canola, and some other minor 

feedstocks. While soybean production is projected to grow in coming years, the biodiesel 

industry hopes to achieve higher output through advanced technologies for increasing oil 

supply and production of new feedstock. If algal oil becomes commercially available, as 

projected within the next 5-10 years, it would greatly benefit both biodiesel and renewable 

diesel/jet fuel industries. Given the right resources, algal oil productivity can be quite high.

Algae are a potential aquatic oil crop, but may also yield carbohydrates that can be converted 

to sugar.

7. Demand for diesel and jet fuel in the United States is projected to grow. As easily 

recoverable crude oil resources are diminishing and as their prices rise, more substitutes are 

expected to enter the market. 

• Among the diesel consumers in the country, freight trucking has the largest share. The 

number of light-duty vehicles using diesel is projected to increase, the rate of which will 

depend on the market penetration of other alternatives such as hybrid and electric 

vehicles.

• Jet fuel is forming as a large and profitable market for the renewable fuels industry. 

Success in this area could stimulate a significant increase in the production of biofuels 

and associated feedstock. It is expected that jet fuel consumption by commercial carriers 

will continue to grow over the next years, whereas jet fuel consumption by the military 

will remain flat.

8. For biomass-based diesel and jet fuel to be successful among the trucking and aviation 

companies, they must be cost-competitive with petroleum-based fuels. It is uncertain what 

the future holds for these substitutes, but it is expected that the next several years, as more 

facilities come online, will answer many questions about the economic viability of these

technologies. Much will depend on the rate of recovery of U.S. and world economies, oil 

prices, carbon market, and political climate.
36

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References

1. Advanced Biofuels & Biobased Materials Project Database. Biofuels Digest. (2012).

Release Q3 2012: http://bit.ly/MP7MHv. 

2. American Trucking Association (ATA). (2012). “Renewable Diesel and Biodiesel.”

Accessed December 2012:

http://www.trucking.org/advissues/energy/pages/renewabledieselbiodiesel.aspx.

3. Amyris. “Breakthrough Science.” Accessed July 2012,

http://www.amyrisbiotech.com/Innovation/155/BreakthroughScience.

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Appendix

Table 8. Distillate Fuel Oil and Kerosene Sales by End Use

In thousand gallons. Data source: EIA 2013b 
42 

This report is available at no cost from the 

National Renewable Energy Laboratory (NREL) 

at www.nrel.gov/publications.

Table 9. No. 2 Diesel Sales for On-Highway Use

In thousand gallons. Data source: EIA 2013b 
43 

This report is available at no cost from the 

National Renewable Energy Laboratory (NREL) 

at www.nrel.gov/publications.

Table 10. Diesel Sales for Farm Use

In thousand gallons. Data source: EIA 2013b 
44 

This report is available at no cost from the 

National Renewable Energy Laboratory (NREL) 

at www.nrel.gov/publications.

Table 11. Sales of Distillate Fuel Oil for Railroad Use

In thousand gallons. Data source: EIA 2013b 
45 

This report is available at no cost from the 

National Renewable Energy Laboratory (NREL) 

at www.nrel.gov/publications.

Table 12. Sales of Distillate Fuel Oil for Off-Highway Use

In thousand gallons. Data source: EIA 2013b 
46 

This report is available at no cost from the 

National Renewable Energy Laboratory (NREL) 

at www.nrel.gov/publications.

Table 13. Distillate Fuel Oil Sales for Vessel Bunkering Use

In thousand gallons. Data source: EIA 2013b 
47 

This report is available at no cost from the 

National Renewable Energy Laboratory (NREL) 

at www.nrel.gov/publications.

Table 14. Diesel Sales for Military Use

In thousand gallons. Data source: EIA 2013b