renewable diesel vs. biodiesel: what’s the difference?

A Cleaner Future for Diesel – But Which Fuel Leads the Way?

Did you know that transportation accounts for nearly 30% of global greenhouse gas emissions? As the push for cleaner energy intensifies, alternative fuels like renewable diesel and biodiesel are gaining ground as eco-friendly replacements for petroleum-based diesel.

But what’s the real difference between these two fuels? Which one is the best choice for sustainability, efficiency, and real-world use? Let’s break down renewable diesel vs. biodiesel.

Understanding Biodiesel

Biodiesel is a first-generation biofuel made from organic materials like vegetable oils, animal fats, and recycled cooking grease. It is produced through transesterification, a process that converts fats and oils into usable fuel. Biodiesel is always blended with traditional diesel, with common blends including:

• B20 (20% biodiesel, 80% petroleum diesel) – widely used in fleets and commercial vehicles
• B100 (100% biodiesel) – pure biodiesel, but requires engine modifications in most cases

Pros of Biodiesel:

✔ Reduces greenhouse gas emissions by up to 50% compared to petroleum diesel
✔ Made from renewable and waste resources, reducing reliance on fossil fuels
✔ Can be used in existing diesel engines with minor modifications

Biodiesel Cons & Solutions:

❌ Can gel in cold temperatures → Requires anti-gelling additives or heated fuel systems in extreme climates
❌ Blending limitations → Higher blends (B20+) may not be compatible with all engines
❌ Slightly lower energy content than petroleum diesel → Can lead to a minor drop in fuel efficiency

Real-World Use Case: Many municipal bus fleets in cities like Chicago and San Francisco already use B20 biodiesel to reduce emissions without requiring costly vehicle upgrades.

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Understanding Renewable Diesel

Renewable diesel is a next-generation biofuel produced through hydrotreating, a refining process similar to traditional diesel production. Unlike biodiesel, renewable diesel is chemically identical to petroleum diesel—making it a true “drop-in” replacement.

Pros of Renewable Diesel

✔ Reduces greenhouse gas emissions by up to 80%
✔ No blending required—can fully replace petroleum diesel
✔ Performs well in cold weather, unlike biodiesel
✔ Higher energy content, comparable to traditional diesel

Cons & Solutions of Renewable Diesel

❌ Higher production costs → Costs are expected to decrease as more refineries come online
❌ Limited availability → Expanding production capacity and government incentives will increase supply
❌ Still dependent on feedstocks like vegetable oils and animal fats → Research into algae-based and synthetic diesel could further improve sustainability

Real-World Use Case: Companies like FedEx and UPS are transitioning to renewable diesel to cut emissions without sacrificing fleet performance. California’s Low Carbon Fuel Standard (LCFS) is also driving adoption by offering incentives for renewable diesel use.

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Side-by-Side Comparison: Renewable Diesel vs. Biodiesel

Here’s a more detailed breakdown of the side-by-side comparison for Renewable Diesel vs. Biodiesel, with additional insights:

Feature	Biodiesel	Renewable Diesel
Primary Feedstocks	Derived from vegetable oils, animal fats, and waste oils. Common sources include soybean oil, canola oil, and used cooking grease.	Uses similar feedstocks (vegetable oils, animal fats, waste oils) but undergoes a different refining process.
Production Process	Produced through transesterification, where oils or fats react with alcohol to create biodiesel and glycerin as a byproduct.	Created through hydrotreating, a refining process similar to petroleum diesel production, resulting in a chemically identical fuel to fossil diesel.
Blend Requirement	Must be blended with petroleum diesel (e.g., B5, B20, B100) due to differences in chemical composition. Higher blends may require engine modifications.	A drop-in fuel that requires no blending and can fully replace petroleum diesel without modification.
Cold Weather Performance	Poor cold-weather performance—biodiesel can gel at low temperatures, requiring additives or engine modifications in colder climates.	Superior cold-weather performance—remains stable in cold temperatures without the need for special additives.
GHG Emission Reduction	Reduces greenhouse gas (GHG) emissions by up to 50% compared to petroleum diesel.	Offers an 80% reduction in GHG emissions, making it a more effective carbon-cutting solution.
Energy Content	Slightly lower energy density than petroleum diesel, leading to a small decrease in fuel efficiency per gallon.	Comparable energy content to petroleum diesel, meaning no loss in fuel efficiency when switching.
Engine Compatibility	Works in most diesel engines, but higher blends (B20+) may require engine modifications or dedicated fuel systems.	Fully compatible with all diesel engines without modifications.
Infrastructure Compatibility	Requires separate blending stations and fuel storage to mix with traditional diesel before use.	Can be used in existing fuel infrastructure (pipelines, storage tanks, pumps) with no need for modifications.
Availability & Cost	More widely available due to established production and distribution networks. Typically lower cost than renewable diesel.	Higher production cost and limited availability, as production facilities are still growing. However, demand is increasing due to government incentives.

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Which One is the Better Choice?

Your priorities can guide you when deciding between renewable diesel vs. biodiesel:

If affordability and accessibility are key:

✅ Biodiesel is more cost-effective and widely available. Many fueling stations already carry B20 blends, making it an easy switch for businesses and individuals looking for a lower-carbon fuel.

If performance and maximum sustainability matter most:

✅ Renewable diesel delivers a greater reduction in emissions (up to 80%) while offering seamless engine compatibility. Since it requires no blending or modifications, it’s the best option for large fleets looking to cut carbon without disruptions.

If you operate in cold climates:

✅ Renewable diesel is the better choice since it performs like petroleum diesel in cold weather, unlike biodiesel, which may require anti-gelling additives.

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The Future of Diesel Alternatives

Both biodiesel and renewable diesel will play crucial roles in the transition to low-carbon transportation. As governments enforce stricter emission regulations and businesses prioritize sustainability, renewable diesel is expected to gain a larger market share, despite its higher production costs. However, biodiesel remains a cost-effective and widely available alternative that is easier to implement in industries that prioritize affordability.

Renewable Diesel is Gaining Momentum

• Major energy companies like Neste, Valero, and Phillips 66 are making significant renewable diesel investments to expand production capacity and meet the growing demand for sustainable fuel alternatives.
• U.S. states like California, Oregon, and Washington are incentivizing adoption through Low-Carbon Fuel Standard incentives, which provide tax credits and financial benefits to businesses and fleets transitioning to cleaner fuels.
• The U.S. military and aviation industry are investing in renewable diesel to transition away from fossil fuels.

Biodiesel Will Still Have a Place

• More affordable than renewable diesel, making it an attractive option for industries with tight budgets.
• Blending programs ensure continued usage, particularly in agriculture, commercial trucking, and municipal fleets.
• Farmers, truck fleets, and local governments will likely continue using biodiesel where cost savings outweigh performance benefits.

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Beyond Biodiesel and Renewable Diesel: The Next Wave of Innovation

While biodiesel and renewable diesel are leading the way in reducing carbon emissions, next-generation fuels are on the horizon:

• Algae-Based Biofuels – Offering high oil yields with minimal land and water use, algae biofuels could revolutionize sustainable fuel production and reduce dependence on food-based feedstocks.
• Synthetic E-Fuels – Produced using captured CO₂ and renewable hydrogen, synthetic diesel has the potential to be fully carbon-neutral while working seamlessly in existing fuel infrastructure.
• Waste-to-Fuel Technologies – Advanced processes can convert municipal waste, forestry residues, and agricultural byproducts into low-carbon fuels, further reducing emissions and reliance on virgin feedstocks.

As these technologies evolve and government incentives expand, policies such as sustainable fuel tax credits could further accelerate the adoption of biofuels, synthetic e-fuels, and waste-derived diesel alternatives.

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What’s Your Take?

Do you think renewable diesel will overtake biodiesel, or will both fuels continue to coexist? Drop your thoughts in the comments below!

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References:

• California Air Resources Board. (n.d.). Low Carbon Fuel Standard. Retrieved from https://ww2.arb.ca.gov/our-work/programs/low-carbon-fuel-standard/about
• Internal Revenue Service. (n.d.). Credits and deductions under the Inflation Reduction Act of 2022. Retrieved from https://www.irs.gov/credits-and-deductions-under-the-inflation-reduction-act-of-2022
• U.S. Department of the Treasury. (2025, January 19). U.S. Department of the Treasury releases guidance on clean fuels. Retrieved from https://home.treasury.gov/news/press-releases/jy2780
• Alternative Fuels Data Center. (n.d.). Clean Fuel Production Credit. U.S. Department of Energy. Retrieved from https://afdc.energy.gov/laws/13321
• The Tax Adviser. (2024, June). The clean fuel production credit: A new incentive regime. Retrieved from https://www.thetaxadviser.com/issues/2024/jun/the-clean-fuel-production-credit-a-new-incentive-regime.html