Global Industry Analysts Inc. has released a comprehensive global report on ethanol and biodiesel markets. The global consumption of ethanol and biodiesel is projected to reach 135 billion gallons by the year 2018. Biofuels are fast growing to become a prominent alternative energy resource, driven mainly by the growing environmental concerns with regard to the usage of fossil fuels. Besides environmental concerns, limited fossil fuel resources, complete dependence on oil exporting countries for supply, and increase in energy prices are the other factors expected to drive production as well as consumption of biofuels in the near future.
Several growing concerns prevail with regards to the usage of fossil fuels, foremost among them being the impact on the environment, followed by energy price increases, complete dependence on oil exporting countries for supply, market volatility as in 2008 and 2009, and limited resources. This, together with the fact that some of the important fossil fuel reserves are distributed unevenly across the globe, makes the issue of equality in terms of energy supply highly controversial. The continuing high level economic growth in several countries across the globe, more particularly in the developing countries, also resulted in the need for alternative sources or fuels, including biofuels, which provide an opportunity for improving energy security, while reducing the dependence on fossil fuels. Though biofuels form a very small share of the overall energy source pie currently, these alternative fuels are expected to hold much better position over the coming years in the form of clean alternatives to fossil fuels. Development of biofuel projects is underway in many countries across the globe owing to several benefits offered by these alternative fuels over fossil fuels. Biofuels are currently attracting generous governmental support for R&D and large-scale production. Regulatory frameworks and policies are also in place in several countries for guiding and promoting the usage of biofuels in the respective transportation sectors.
The United States represents the largest consumer worldwide, as stated by the new market research report on Biofuels (Bioethanol and Biodiesel). Given the recent shortages in supply from Brazil and the consequent high prices of sugar in the country, the US is expected to outperform Brazil, thereby becoming the leading ethanol exporter in the world in the near term. The emerging market for advanced biofuels in the US continues to attract policy makers and investors. Leading players in the industry continue to make investments towards technological developments and setting up of production facilities. Governmental support, higher investments by manufacturers and technological innovations are also contributing to the industry’s faster growth. The biofuel industry is exploring other feedstock, such as algae, jatropha seeds, and palm oil to reduce the dependence on corn so as to overcome the controversy associated with food as well as the supply and pricing issues. Growth-wise, however, the Asia-Pacific is showing immense potential for future growth for biofuels, including bioethanol and biodiesel, and is projected to grow at an overall fastest compounded annual growth rate of 28.8% over the analysis period.
Next generation biofuels, including the second and the third generation biofuels, which are currently under development, are predicted to offer more benefits when compared to the first generation biofuels. These include cellulosic ethanol, BTL from solid biowaste, and renewable diesel to name a few. However, with the process of conversion of cellulose into sugars for fermentation being quite difficult, research is underway for developing microbes, enzymes, and fungi that could breakdown celluloses into sugars. Nevertheless, despite the significant investments in research and development, commercialization of the next generation biofuels is not expected to happen anywhere in the next 8-10 years owing to the several technical barriers on the way.