Global biofuels demand is expected to grow by 38 billion litres between 2023 and 2028, a rise of almost 30% compared to the preceding five-year period, according to the International Energy Agency’s (IEA) Renewables 2023 report, out in January.
By 2028, the total demand for biofuels is seen to increase to 200 billion litres, with renewable diesel and ethanol accounting for two thirds of the growth.
The new biofuel demand is mainly driven by emerging economies, notably Brazil, Indonesia and India, which all have strong biofuel policies, as well as increasing transport fuel demand and abundant feedstocks, says the report. Growth in advanced economies like the EU, the US, Canada and Japan is limited due to factors such as rising electric vehicle use, improving vehicle efficiency, high biofuel costs and technical constraints. Renewable diesel and biojet fuel are the main areas of growth in these regions.
Ethanol demand in Europe rises slightly over the forecast period. According to the report’s main case, ethanol blending remains steady in Germany. In France, ethanol blending rises to 15% assuming ongoing support for E85, and in Spain it climbs to 6%. Finland, the Netherlands and the UK all accomplish close to 10% ethanol blending. Poland implements E10 also reaching almost 10% ethanol blending by 2028. Blending requirements are however scaled back in Sweden and Finland.