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Transition champ: how biofuels are helping set the transport sector on the path to net zero

Release date:
2 March 2023
bp is deepening its investment in bioenergy, including biofuels. Our SVP of biofuels growth, Nigel Dunn, explains their importance in the transition to net zero, the progress we’re making in this space, and why bp is perfectly positioned to succeed 
🕒 5 min read | 📖 Feature| 💡 Why it matters

Where do biofuels fit in the transition to net zero? Why make them part of bp’s transformation plans?

Transition is the key word here. At bp, we’re clear that the world wants and needs a better, more balanced energy system – one that delivers energy that is secure and affordable, as well as lower carbon. This won’t happen overnight and there’s no single solution to the challenge. We are in action to help to solve problems for our customers both now and in the future.


“Biofuels are a great example of action now in the road transport sector – we already use them in many countries and we can deploy more without changing what and how we drive.”


An internal combustion engine (ICE) car that currently runs on mostly (or entirely) fossil fuel can work with biofuels, too. Also, we can provide these fuels to cars using existing infrastructure around the world – terminals, pipelines, storage tanks – meaning we can scale right away with the right regulations in place. 


It means we can reduce emissions levels in the near term, while other solutions, such as electric vehicles or hydrogen, deploy at scale.


Biofuels are also important for aviation – in particular, sustainable aviation fuels.


Where is the demand for these fuels coming from?

Today, the biggest demand is from ground transport, such as cars, vans and heavy goods vehicles. Biofuels are an easy way for our customers to make progress decarbonizing and, over the next decade, we expect demand to rise quickly.


Currently, biofuels are mainly used in low-level blends with fossil fuel. Take E10* as an example, that’s 10% ethanol and 90% gasoline. Drop-in, advanced biofuels used for ground transport can reach much higher blend levels, delivering up to 80% reductions in carbon emissions on a lifecycle basis. As countries around the world adopt these fuel blends, demand will be strong and sustained.   


*E10 is gasoline containing up to 10% (v/v) ethanol and up to 3.7% (m/m) oxygen.

If biofuels are used in part as a stepping stone towards other lower carbon alternatives, do they still have a role to play longer term? 

Absolutely. To start, biofuels will still be a key source of lower carbon energy for ground transportation in many parts of the world where other lower carbon solutions are cost prohibitive. Hard-to-abate sectors, such as aviation and marine, will likely be reliant on renewable liquid fuels such as biofuels to reduce emissions on a lifecycle basis for the fossil fuel it replaces for decades to come. 


Today, the industry produces approximately 5,000 barrels per day (kbd)* of SAF, but global jet fuel demand is close to 5.5 million barrels a day** (and growing as the sector recovers after Covid).

Other types of energy – such as hydrogen or electricity – are being developed for aviation, but these are currently only viable for a handful of short-haul flights with limited passengers. 


In future, we may see more electric aircraft for short range flights and hydrogen for medium range. 


Of course, low carbon hydrogen and renewable electricity both have important roles in making lower carbon fuels, but, in short, biofuel is a key long-term play in the decarbonization of aviation and we aim to be a sector leader in its supply. 


*Based on IATA data, over 300 million litres of SAF were produced in 2022 – equivalent to 2 million barrels.
** According the bp Statistical Review 2022.

Let’s talk about our strategy for biofuels. What progress are we making?  

A good way to explain this is to think about the different ways you can make biofuels and the contribution they can make to decarbonizing transport now and in the future. 


Right now, probably the simplest, cheapest ‘drop-in’ option is to process bio feedstocks through our existing refineries producing a bio/fossil fuel, co-mingled product. That’s where we’ve started – we’ve been up and running for quite some time producing biofuels through this co-processing method and have established a profitable business model. We are increasing our co-processing capability where practicable, like the recent expansion we have announced at our Cherry Point refinery, but there are limits to how far we can go with a conventional refinery. 


We are, therefore, in action to develop standalone plants that produce HEFA biofuels (Hydroprocessed Esters and Fatty Acids) – a term that covers biofuels made from used cooking oil, beef tallow, rapeseed oil, amongst others.

Doubling renewable diesel production at Cherry Point
We are planning major projects at some of our existing bp facilities, which would help to make a significant contribution towards bp’s aim to produce around 100,000 barrels of biofuels per day by 2030.
Six types of biomass used for the production of biofuels

That said, in the longer term, and particularly with the demand for SAF anticipated to be so strong, there simply won’t be enough wastes and residues available to produce fuels from these feedstocks alone. So, we are also exploring alternative pathways.

One of these is using alcohol – specifically, ethanol – to make SAF. This is more complex and potentially more costly to produce. There are several stages involved (adding complexity) and the full process has never been done at scale. We’re pretty far down the road in designing the first commercial end-to-end, ethanol-to-jet fuel facility. 

Another option is to use non-recyclable municipal solid waste – or rubbish. Again, producing fuels from this is potentially costly, but it can help to reduce landfill and the world will need these alternative pathways to keep up with demand. Here, we’re a part owner in Fulcrum, a biofuels company that has recently become the first to to turn municipal solid waste into a synthetic crude for making fuel at scale.

What are biofuels?

A form of renewable energy produced from organic materials used to produce transportation fuels, heat and electricity. There are six main kinds of biofuel.

Beyond that, we’re always investing in innovation to explore new options. We’re interested in the viability of electro-fuels, or e-fuels. It’s in the very early stages of development, but it has huge potential and is likely to be a key technology for low carbon aviation in the long term. 


“This combination of near-term and longer-timeline opportunities is the basis of our biofuels strategy, giving us huge momentum in the pathway to net zero.”


It all sounds very exciting, but what is it about bp that makes us best placed to succeed here? 

When you think about all the different working parts involved in the production and marketing of biofuels, you begin to see why we’re in such a strong position. 

It starts with the feedstock. Producing a global supply of biofuels means you need to be world class at sourcing the raw materials – and managing the associated risks. You can’t just go to one place in one market, meaning it takes an established global network to make this happen. This is exactly what our trading and shipping organization does – and we’ve proven we’re good at it. 

Turning to the manufacturing of biofuels, these are capital-intensive, complex projects to design, build and operate. At bp, we’ve been building complex projects for 100 years and have a track record of doing this in a safe, efficient and timely way. 

The final point is about the end customer – this is really important. We already have an established customer base that we know very well – we’re scaling up, not starting from scratch. For example, we’re selling jet fuel to airlines today. The difference is that we’re becoming their decarbonization partner, driven by, and capable of, meeting their requirements now and in the future. 


Because we’re an integrated energy company, we can help customers to transition on their terms – moving to biofuels, EVs, hydrogen, wind and solar. There are not many companies on the planet capable of all that.


Any final thoughts to leave us with? 

This is a great opportunity for bp, and an important part of how we’re helping the world to transition to net zero. 

Today, we can already provide our customers with a cost-effective way to help them decarbonize while delivering on our own transformation plans. The market demand for biofuels is going to grow, and we have the capabilities, capital and scale to succeed in this space like no other.

💡 Why it matters


Biofuels are a vital part of the energy mix for the world to get to net zero. They can help to decarbonize hard-to-electrify sectors like aviation and shipping. The demand from customers for biofuels is already here, today, and it is growing too.

There isn’t a single solution to decarbonize the world’s energy systems, so biofuels are going to play an important role alongside other forms of lower carbon energy, like wind, solar and hydrogen. That’s why bp is investing in all of these areas to help accelerate the energy transition.

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