In the last few years transportation professionals have been increasingly asked what technologies they are using to reduce freight-related carbon emissions. According to recent polling, 65% of U.S. consumers “worry about climate-change” when purchasing goods, and 71% of workers say that they want to work for a sustainable company. These factors have caused many shippers to look for more sustainable transportation solutions. However, battery-based energy storage is not yet advanced enough for us to solely rely on renewable energy or electric vehicles for our energy and transportation needs. This technological gap has left a market space open for a temporary energy solution in the form of HVO (Hydrotreated Vegetable Oil) biofuels.
Biofuels have been championed by sustainability, agricultural, and national security leaders as a way to decrease carbon emissions, strengthen demand for feedstock crops, such as corn and soybeans, and reduce our dependence on foreign fossil fuels. In addition to the listed benefits over traditional diesel, biofuels can be used in diesel engines without costly capital investments. Unfortunately, early biofuels (FAMEs) like ethanol were found to be corrosive to engines and have conflicting economic and environmental effects. Given these limiting factors, biofuels appeared to have a minimal impact until the emergence of second generation biofuels, or HVOs. HVOs are created using a different process than FAMEs, which produces a more sustainable and stable fuel. HVO biofuel is chemically identical to traditional diesel with the added benefits of reducing emissions by 40-60% and having greater resistance to freezing temperatures. In addition, although HVO fuel is currently 10-20% more expensive than diesel, government incentives exist to make it cost competitive while production is scaled to meet the growing demand. Given that gen I biofuels are now cost competitive with diesel, it will only be a matter of years before HVO prices decrease to similar levels. Finally, and arguably most importantly, biofuels give the United States a greater level of energy independence from the Middle East and Russia since they are mostly produced domestically
Although HVOs seem to be a “silver bullet” for transitioning the USA's transportation sector to a cleaner future, there is a big catch. Not all HVO fuels are created equally! As with almost any emerging market, academic research and government regulations have not kept pace with technological changes. This delay in knowledge, further exacerbated by budget cuts for important investigators like the EPA, has led to acquisitive corporations pushing dangerous chemicals through regulatory processes under the guise of being “cleaner” than diesel. HVO biofuel is a very promising new technology, but there are certain manufacturers to be wary of. When navigating a new market with such variations in fuel quality and production practices, it is crucial to have a trusted transportation partner like the Allen Lund Company with 47 years of experience building resilient supply chains while supporting our local communities. ALC is currently in conversation with one of the US’ largest energy companies to bring legitimately clean HVO fuel to interested shippers and carriers. Please reach out with any questions. We are excited and ready to start meeting your green shipping needs!