The trucking industry and the majority of the transportation sector are the biggest contributors to carbon emissions in the US. The trucking industry spends approximately $105 billion every year on diesel fuel. While the industry has been attempting to curb fuel usage, the demand still remains persistent.
Despite the ongoing fuel surcharges, driver shortage problem, and economic crisis post-COVID-19 pandemic within the trucking industry, the demand for transportation and logistics has been thriving across several different business sectors.
Fuel continues to be the second-largest expense for a trucking company. Indeed, as of 2022, the average fuel consumption in the US amounted to around 4 million barrels per day. This accounts for about 20 percent of the trucking industry’s total operating costs.
With this much fuel consumption, a measured change in the source of fuel available can potentially disrupt the entire industry. And, as the use of biofuels or renewable fuels across the US continues to grow and become widespread, companies throughout the industry would start feeling its impact.
Even with the advent of fleet efficiencies, driver behavior improvement, and advanced technology, the standard heavy-duty trucks are only likely to achieve a fuel efficiency of 7 miles per gallon. The goal towards carbon emissions reduction in the US and the desire for cleaner and environmentally friendly substitutes to fuel has increased the demand for alternative fuels.
It has been predicted that the rise of renewable fuels can severely impact the US trucking industry. In this blog post, we will take a deep dive into understanding how the rise of renewable fuels can impact the trucking industry and shift it towards a cleaner, greener future.
Renewable fuels, also commonly known as biofuels, are fuels produced from plants and other living, renewable resources. They are made from previously used materials such as waste and residues. A number of alternative fuels were introduced within the United States in an attempt to reduce the reliance on petroleum.
Some of the alternative fuel sources include alcohol-gasoline blends, biodiesel, ethanol, methanol, natural gas, hydrogen, propane, etc. However, among the many alternative fuel sources, the one that is particularly significant to the trucking industry is biodiesel.
Biodiesel is produced by combining alcohol with either animal fat or vegetable oil, including recycled cooking oil. While most diesel-based engines have the capability to run directly on biodiesel, typically, its current use is as an additive to petroleum-based diesel fuel, helping reduce the vehicle’s overall carbon emissions.
Back in time, fossil fuels were used to power transport, especially steam-powered railway journeys. Sadly, the era of fossil fuels is slowly dying. Now, we are in the middle of an essential paradigm shift of knowing how to power modes of transport.
Today and tomorrow’s modes of transportation will be powered by a different range of solutions, including hydrogen, electricity, and renewable fuels. The main goal behind this paradigm shift is to reduce transport-related emissions in the long run, only to meet greener future goals.
Compared to fossil fuels, renewable fuels produce less harmful vehicle emissions. When used in a standard diesel engine, biodiesel significantly emits lower amounts of carbon monoxide and unburned hydrocarbons in the atmosphere.
Speaking from a wider business viewpoint, the rise in the biofuel industry will eventually provide several benefits to the US economy. It is relatively easier to manufacture biodiesel domestically, helping reduce US’s reliance on foreign-produced fossil fuels.
According to the National Biodiesel Board (NBB), it has been estimated that every 100 million gallons of biodiesel manufactured creates additional job vacancies amounting to 16,455 within the US. This indicates the more biodiesel is produced; the more jobs will be generated within the American economy.
Below, we have explained a few pointers to further understand why renewable fuels, especially biodiesel, should be manufactured and used by trucking companies.
As mentioned above, renewable fuels, including biodiesel, can be easily manufactured domestically. Hence, it is readily available and can prevent the US from depending too much on foreign-produced fossil fuels.
Transportation companies using renewable fuels are already experiencing a significant vehicle emission reduction. Manufacturers across the globe are already advertising several different types of renewable fuels. Moreover, the production capacity is likely to exponentially grow in the coming years.
One of the main characteristics of renewable fuels is their unique ability to be versatile. Renewable fuels can be easily adapted to all major modes of transport, including trucks, cars, vans, ships, planes, etc. Even heavy machinery and equipment can operate efficiently using renewable fuels.
Another good thing about renewable fuels is that they can be easily blended with fossil fuels. This allows most transport companies to gradually shift towards renewable fuels and sustain flexibility within operations.
A variety of new raw materials and processes could allow global production of renewable fuels to substantially grow to over 1000 megatons of oil equivalent by 2040. This quantity would be sufficient to replace all fossil fuels currently being used in road, aviation, and maritime transport.
Renewable fuels can be used in existing vehicles, including trucks. This will help these fuels with quick adaptation.
To every advantage, there is a corresponding disadvantage. When we are talking about the increased benefits of renewable fuels, we should not forget to discuss the disadvantages.
The main downside of using renewable fuels is its increased production cost, which may excessively affect the trucking industry. At present, biofuel production costs are predominantly higher than those for petroleum diesel fuel, and these augmented costs are witnessed in the per-gallon price of biodiesel.
With greater biodiesel production costs, some container trucking companies are replacing their heavy trucks and rigs with more fuel-efficient and lighter ‘featherweight trucks.’ These trucks are lighter than an average rig and can legally make up that weight in freight. Consequently, there will be fewer trips to move freight, saving on fuel and maintenance costs.
According to the Department of Energy, the use of renewable diesel in the trucking industry has increased by 35 percent in the past year. This is largely due to the fact that renewable diesel has a higher energy content than traditional diesel and can be used in existing diesel engines without any modification.
Based on the acceptance and recognition of renewable fuels within the trucking industry, we can say that biodiesel consumption has significantly increased over the last few years in the US.
Apart from the increased costs, trucking companies would not have to witness any other challenges while utilizing renewable fuels instead of petroleum diesel fuel.
To conclude, it would be safe to say that renewable fuels have the potential to be a game-changer for the trucking industry, with their unique ability to reduce emissions, decrease dependence on foreign oil, and leverage local economies.
Trucking companies that are early adopters of renewable fuels can benefit from reduced fuel costs, a more sustainable image, and also meet emissions regulations more easily. With the rise of renewable fuels, the future of the trucking industry is certainly looking bright.
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