Biodiesel and Ethanol: A Brief Analysis of Current Market, Environmental Impact, and Economic Feasibility

The quest for sustainable energy solutions has led us to the foundation of creating exemplary alternatives called biofuels. The 1st generation biofuels, biodiesel and ethanol are accepted worldwide due to their low carbon emission than the conventional fossil fuels.

Depleting sources and GHG emissions are the pressing issues behind using conventional fossil fuels. We are looking for exclusive alternatives with feasible feedstock and sustainable factors. This led us to multiple biofuel alternatives. Choosing among these alternatives to achieve energy independence needs an in-depth analysis of the feedstock, market share, and other factors. Let us know what biodiesel and ethanol are and then proceed for a point-to-point analysis to prove why the former is a better alternative.

Biodiesel and Ethanol: What are they?

Biodiesel is a renewable, biodegradable, non-petroleum-based fuel that can be used as a substitute for fossil fuels. The 1st-gen biodiesel is synthesized from non-edible vegetable oils, used vegetable oil residues, animal fats, recycled restaurant grease, etc. It is named after Rudolph Diesel, the inventor of the diesel engine (1897). The production process involves catalytic transesterification to convert fats (triglycerides) into fatty acid methyl ester (FAME).

 Oil refinery with large tanks and pipes, producing biodiesel and ethanol.

Ethanol, also known as bioethanol, is a renewable fossil fuel alternative synthesized from biological matter such as cane sugar and cellulose-rich feedstock. It is chemically synthesized by following the process of fermentation of sugar and starch components of plant-based feedstocks.

Biodiesel and Ethanol: A Brief Market Overview

The cumulative requirement of petroleum products in India is more than 3.7 barrels/day. Only 17.9% of this requirement is met with domestic production and the rest is imported from oil-producing countries. This import volume results in an economic challenge we have faced over the years.

In this aspect, procuring feedstock and producing biofuel builds a dependable platform to reduce imported fuel consumption. By properly analyzing and procuring feedstock, India can reduce fuel import by 40%. The Indian biodiesel market shows a promising CAGR of 8.2% in 2024 -32 resulting in a forecasted growth volume of US$ 865.4 million. The bioethanol market in India is anticipated to grow at a CAGR of 17.44% by 2027 and is expected to reach US$ 10,644.31 million.

However, land cannibalization and deforestation for bioethanol feedstock production is a concern. In this context, biodiesel turns out to be a viable option for energy transition and economic development.

Biodiesel and Ethanol: Production and Availability

As mentioned, biodiesel is synthesized from feedstock like used vegetable oil, non-edible vegetable oils (karanj, jatropha, neem, etc), animal tallow, restaurant grease, etc. Bioethanol is produced from cellulose-based plant feedstock like algal oils, wood, forestry residues, husks, straw, stubbles, perennial grass, industrial waste, and ecological biomass crops.

A factory building with smokestacks, industrial tanks and pipes, This industrial facility is likely an oil refinery that processes fossil fuels, while biodiesel and ethanol are renewable fuels produced from plant material.

The former option does not pose a threat to food security as its feedstock is widely available. India is the largest consumer of vegetable oil in the world. Hence, procuring its feedstock just needs proper logistic planning. Similarly, the inedible vegetable oils are grown in barren or non-cultivable land.

Biodiesel and Ethanol: Environmental Impact

Biodiesel and Ethanol: Economic Factors

In terms of economic comparison between biodiesel and ethanol, the former is more viable than the latter.

Biodiesel is produced from used cooking oil, animal tallow, non-edible vegetable oils, and grease. These feedstocks are the by-products of industries and are inexpensive. Moreover, the local authorities find it hard to dispose of oil-based industry waste. Hence, biodiesel production offers a unique way to repurpose waste and address pollution issues in the cities.

In contrast, ethanol production generally relies on corn, sugarcane, and other cellulose-based feedstocks. Diverting crops from food to fuel production imposes food insecurity for the highest-populated country in the world.

The cost of producing bioethanol is higher than biodiesel for feedstock reasons. Bioethanol production requires pre-treatment, hydrolysis, fermentation, and distillation. It takes more resources than biodiesel production resulting in a higher capital investment in infrastructure than biodiesel production. The prevalent methods of biodiesel production let investors establish a manufacturing plant more easily than ethanol production. This low-value waste conversion to high-value biodiesel is a feasible investment venue in terms of economic sustainability.

Takeaway: Biodiesel is More Feasible than Ethanol

From the above comparison between biodiesel and ethanol, it is clear that biodiesel is the perfect alternative to fossil fuels for energy transition at this stage. In terms of GHG emission, feedstock pricing, food security, and economic factors, biodiesel is more viable than ethanol. It also offers a feasible platform to solve oil-based industrial waste disposal.

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