Europe Biodiesel Market Report

Europe Biodiesel Market:

The Europe biodiesel market size reached USD 19.5 Billion in 2024. Looking forward, IMARC Group expects the market to reach USD 32.2 Billion by 2033, exhibiting a growth rate (CAGR) of 5.7% during 2025-2033. The rising awareness about carbon footprint reduction, fluctuating crude oil prices, and the implementation of stringent environment regulations are among the key factors driving the market growth.

Europe Biodiesel Market Analysis:

• Major Market Drivers: Rising demand for renewable energy, stringent environmental regulations, volatile crude oil prices, growing concerns about energy security, etc., are proliferating the market growth. Moreover, many European countries offer financial incentives, tax breaks, and subsidies for the production and use of biodiesel. These financial aids make biodiesel more economically attractive compared to fossil fuels, further adding to the Europe biodiesel market demand.
• Key Market Trends: Integration of circular economy practices, regulatory support, expansion of feedstock diversity, and rising infrastructure development are expected to drive the market growth. Moreover, businesses and fleet operators are increasingly adopting biodiesel as part of their corporate sustainability strategies. Companies are setting targets to reduce their carbon footprints, thereby contributing to the market growth.
• Geographical Trends: Germany accounted for the largest market share. As a pioneer in renewable energy, the country's robust regulatory framework, particularly the Renewable Energy Sources Act (EEG), mandates the use of biofuels, including biodiesel, in the transportation sector. Moreover, Germany's focus on circular economy principles encourages the utilization of waste materials for biodiesel production, aligning with the principles of resource efficiency.
• Challenges and Opportunities: Inconsistent availability of feedstock, sustainability concerns, competition from other renewable fuels, and lack of public awareness are some of the key challenges that the market is facing. However, continued and enhanced government incentives, such as subsidies, tax breaks, and grants for research and development presents significant Europe biodiesel market recent opportunities. Policies promoting advanced biofuels and higher biodiesel blends are also escalating the industry’s growth.

Europe Biodiesel Market Trends:

Stringent Environmental Regulations

The Europe biodiesel market is notably influenced by the stringent environmental regulations enforced by the European Union (EU) to address pressing concerns surrounding carbon emissions and climate change. For instance, according to the International Council on Clean Transportation, in February 2023, the European Commission published a proposal to update the previous CO₂ levels. The legislation was approved by the Parliament of Europe in April 2024, and the European Union updated in May 2024. The initial CO₂ criteria were for most new truck emissions to be 15% lower by 2025 and 30% lower by 2030 than the 2019 reporting year. The updated standards keep the CO₂ reduction objective of 15% for 2025 and raise the 2030 target to 45%, while adding a 65% reduction target for 2035 and a 90% target for 2040. These factors are further bolstering the Europe biodiesel market revenue. Moreover, biodiesel emerges as a pivotal solution to meet these mandates, as it offers a lower carbon footprint compared to conventional diesel fuel. By utilizing renewable feedstocks and producing fewer harmful emissions during combustion, biodiesel aligns seamlessly with the EU's environmental goals. Thus, the demand for biodiesel is fueled by the imperative to reduce carbon emissions, enhance air quality, and contribute to the overall decarbonization of the transportation sector. For instance, according to the article published by the European Biodiesel Board, the usage of biodiesel reduces the impact of global warming, improves European energy independence, and benefits EU agriculture. Biodiesel emits 65-90% less CO₂ than conventional diesel, with each kilogram of biodiesel usage, CO₂ emissions can be reduced by about 3 kg. Biodiesel engines also generate much fewer pollutants, including lower levels of exhaust particulate matter, carbon monoxide, and hydrocarbons. These factors are further positively influencing the Europe biodiesel market forecast.

Rising Renewable Energy Targets

Europe's commitment to achieving renewable energy targets significantly propels the growth of the biodiesel market. The Government in Europe is taking various initiatives to accelerate clean energy by scaling up its share of renewable energy in EU states. For instance, in September 2023, the European Parliament approved a new target of 42.5% renewable energy by 2030, however EU countries are encouraged to aim for 45% - a target also supported by the Commission under its REPowerEU initiative. It was presented in May 2022 and emphasizes the need to speed the transition to clean energy and phase out Russian energy imports by increasing the proportion of renewable energy to 45% by 2030 in power production, industry, buildings, and transportation. Moreover, biodiesel, derived from renewable feedstocks such as vegetable oils and animal fats, emerges as a strategic asset in achieving these objectives. As a cleaner-burning and more environmentally friendly fuel option, biodiesel contributes to the diversification of the energy landscape and the reduction of dependence on fossil fuels. For instance, in May 2023, Vopak introduced 16 new tanks with a total capacity of 64,000 cubic meters at its Vlaardingen terminal in the port of Rotterdam, Europe. The new tanks helped Europe fulfill its growing demand for energy from renewable sources since they are made to store waste-based feedstocks used in the production of biodiesel, thereby reducing the need for fossil fuels. These factors are further contributing to the Europe biodiesel market share.

Rapid Technological Advancements

Growing advancement of technology is one of the key factors contributing to the Europe biodiesel market share. These advancements include various aspects of the production process, from feedstock sourcing and conversion technologies to efficiency improvements and environmental sustainability. New pre-treatment technologies enable more efficient use of diverse feedstocks, including waste oils, non-edible crops, and algae. This diversification reduces reliance on traditional feedstocks like vegetable oils and mitigates the competition with food production. For instance, in March 2024, the European Biodiesel Board (EBB) received additional new feedstocks in the revised Annex IX to the Renewable Energy Directive (RED). This addition in feedstock will help to meet the EU's ambition to integrate renewable energy. Moreover, HVO technology, which uses hydrogenation to convert vegetable oils into high-quality renewable diesel, offers superior fuel properties and compatibility with existing diesel engines. This technology is gaining traction as a sustainable alternative to traditional biodiesel. For instance, in November 2023, OMV Petrom, an integrated energy company in Southeastern Europe, purchased 50% of the shares in the Romanian company "Respira Verde", a comapny in the collection of cooking oil. Used cooking oil is one of the primary renewable feedstocks for biodiesel production (hydrotreated vegetable oil - HVO1), resulting in lower carbon emissions in the transportation sector. These factors are augmenting the market growth.

Europe Biodiesel Market Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the Europe biodiesel market report, along with forecasts at the regional and country levels from 2025-2033. Our report has categorized the market based on feedstock, application, type, and production technology.

Breakup by Feedstock:

• Vegetable Oils
• Animal Fats
• Others
   

Vegetable oils represent the most widely used feedstock

The report has provided a detailed breakup and analysis of the market based on the feedstock. This includes vegetable oils, animal fats, and others. According to the report, vegetable oils represented the largest segment.

Vegetable oils are natural, renewable oils, derived from sources like canola (rapeseed), sunflower, and soybean, which provide a sustainable base for biodiesel production. Europe's abundant agricultural resources enable the cultivation of these oil-rich crops, fostering localized feedstock supply chains. The chemical composition of vegetable oils makes them well-suited for conventional transesterification processes, facilitating efficient biodiesel production. Their compatibility with existing diesel engines and infrastructure ensures smooth integration into the transportation sector. Moreover, utilizing vegetable oils as feedstock aligns with circular economy principles, repurposing agricultural byproducts into valuable energy sources. As Europe seeks to reduce dependence on fossil fuels, decrease carbon emissions, and achieve renewable energy targets, the adoption of vegetable oils as feedstock emerges as a major driver, supporting the region's commitment to sustainable energy and fostering economic growth within the biodiesel industry. For instance, the consumption of used cooking oil (vegetable oil) in Europe was more than double between 2015 and 2022, with the majority of it being converted into biodiesel for use in automobiles and trucks throughout the continent.

Breakup by Application:

• Fuel
• Power Generation
• Others
   

Fuel holds the largest share in the market

A detailed breakup and analysis of the market has been provided based on the application. This includes fuel, power generation, and others. According to the report, fuel accounted for the largest market share.

According to the Europe biodiesel market overview, the application of biodiesel as a fuel is gaining immense traction across Europe due to the rising focus on reducing carbon emissions and promoting cleaner energy alternatives. Biodiesel finds extensive use as a direct substitute for traditional diesel fuel in various sectors, including transportation, industrial machinery, and power generation. Its compatibility with existing diesel engines and fuel distribution infrastructure enables a seamless transition to a more sustainable option. The integration of biodiesel as a fuel contributes to meeting stringent environmental regulations and targets set by European authorities. Moreover, its lower greenhouse gas emissions and renewable nature align with the region's commitment to sustainability. As industries and consumers increasingly seek ways to reduce their environmental impact, biodiesel's application as a cleaner-burning fuel becomes pivotal in propelling the Europe biodiesel market forward, supporting a greener energy landscape while addressing pressing environmental concerns.

Breakup by Type:

• B100
• B20
• B10
• B5
   

B100 dominates the market

A detailed breakup and analysis of the market has been provided based on type. This includes B100, B20, B10, and B5. According to the report, B100 accounted for the largest market share.

B100, or pure biodiesel, is an unblended fuel composed entirely of biodiesel. It offers an attractive solution for reducing greenhouse gas emissions and achieving renewable energy goals. Its compatibility with existing diesel engines and infrastructure streamlines adoption, facilitating a seamless transition to a cleaner fuel option. Moreover, using B100 contributes to lower carbon footprints and improved air quality, aligning with the region's sustainability objectives, thereby accelerating its adoption rate. Its versatility in blending with conventional diesel fuels at various ratios also offers flexibility in meeting regulatory mandates, creating a bridge between traditional and renewable energy sources. With the increasing emphasis on decarbonization and renewable energy integration, B100 emerges as a catalyst for advancing the biodiesel market in Europe, fostering a more sustainable energy landscape that benefits both the environment and the economy. For instance, in January 2024, Bunker One and Color Line collaborated to purchase Danish company DAKA ecoMotion's premium B100 biofuel. Locally manufactured in Denmark, the FAME-grade/RED II-compliant B100 biofuel is made from organic waste.

Breakup by Production Technology:

• Conventional Alcohol Trans-esterification
• Pyrolysis
• Hydro Heating
   

Conventional alcohol trans-esterification accounts for the majority of the market share

A detailed breakup and analysis of the market has been provided based on production technology. This includes conventional alcohol trans-esterification, pyrolysis, and hydro heating. According to the report, conventional alcohol trans-esterification accounted for the largest market share.

Conventional alcohol transesterification involves chemically reacting renewable feedstocks, such as vegetable oils or animal fats, with alcohol, typically methanol or ethanol, to produce biodiesel and glycerol. Moreover, it is widely adopted due to its efficiency and compatibility with existing infrastructure and ability to produce biodiesel that meets stringent quality standards while offering reduced emissions compared to traditional diesel fuel. Furthermore, the reliance on proven technology streamlines production, enabling scalable operations that contribute to meeting the region's renewable energy targets. With biodiesel produced through conventional alcohol transesterification meeting both regulatory requirements and consumer demand for cleaner fuels, this process remains integral to driving the sustainable growth of the Europe biodiesel market, bridging the gap between environmental responsibility and energy needs.

Breakup by Country:

• Germany
• France
• United Kingdom
• Italy
• Spain
• Others
   

Germany exhibits a clear dominance in the market

A detailed breakup and analysis of the market has been provided based on country. This includes Germany, France, United Kingdom, Italy, Spain, and others. According to the report, Germany accounted for the largest market share.

According to the Europe biodiesel market statistics, Germany exerts a prominent influence through a combination of proactive policies and innovative strategies. As a pioneer in renewable energy, the country's robust regulatory framework, particularly the Renewable Energy Sources Act (EEG), mandates the use of biofuels, including biodiesel, in the transportation sector. This commitment to sustainability is complemented by Germany's strong emphasis on research and development, leading to advancements in biodiesel production processes and the exploration of alternative feedstocks. The country's strategic location and well-developed infrastructure also facilitate the efficient distribution of biodiesel across Europe. Moreover, Germany's focus on circular economy principles encourages the utilization of waste materials for biodiesel production, aligning with the principles of resource efficiency. By spearheading sustainable practices, fostering technological innovation, and advocating for biofuel adoption, Germany plays a pivotal role in steering the trajectory of the Europe biodiesel market toward a greener and more diversified energy future, thereby favoring the market growth. For instance, Germany provided about 9% more biodiesel to other EU member states during the first nine months of the 2023 calendar year than during the same period in 2022.

Competitive Landscape:

• The market research report has provided a comprehensive analysis of the competitive landscape in the market. Detailed profiles of all major companies have also been provided. 
• The key players in the market are actively driving innovation to advance sustainable solutions. They are also investing in advanced feedstock sourcing, utilizing waste oils and residues for biodiesel production to minimize resource waste. Additionally, there is a heightened focus on enhancing production efficiency through cutting-edge processing technologies, including enzymatic transesterification and continuous flow reactors. The large-scale integration of digital solutions is gaining prominence, enabling real-time monitoring and optimization of production processes. Ongoing collaborations with research institutions are fostering novel approaches, such as algae-based biodiesel, further expanding the range of viable feedstocks. These collective efforts are reshaping the industry landscape by introducing eco-friendly feedstock options, efficient production techniques, and digitalization, aligning with the sustainability goals of Europe and reinforcing the industry's position as a driver of renewable energy.

Europe Biodiesel Market News:

• March 2024: Trafigura Group Pte Ltd. acquired Greenergy's European business, a UK-based road fuel supplier and biodiesel generator from Brookfield Asset Management and its publicly traded partner Brookfield Business Partners.
• March 2024: Repsol and Bunge partnered on the creation of new options to address the growing demand for low-carbon feedstocks for renewable fuel production in Europe. Repsol planned to start its 250,000 tons per year advanced biofuels plant in Cartagena, Spain.
• January 2024: BioAdvance made an investment of 22 million Euros to build one of the largest European biofuel units in the Port of Figueira da Foz.

Europe Biodiesel Market Report Scope:

Key Benefits for Stakeholders:

• IMARC’s industry report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the Europe biodiesel market from 2019-2033.
• The research report provides the latest information on the market drivers, challenges, and opportunities in the Europe biodiesel market.
• The study maps the leading, as well as the fastest-growing, markets. It further enables stakeholders to identify the key country-level markets within the region.
• Porter's five forces analysis assist stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the Europe biodiesel industry and its attractiveness.
• Competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.