At-a-Glance:
Chevron Corp. purchased Renewable Energy Group for $3.1 billion, giving a significant boost to Chevron’s push into renewable fuels. Demand is expected to grow in the coming years as businesses and governments move away from oil and gas to cut carbon emissions. Chevron, like the rest of the fossil fuel industry, is under pressure from investors to help scale up technologies to advance a low-carbon economy as well as reduce its own carbon footprint. For more read Chevron to Buy Biofuel-Maker Renewable Energy Group for $3.1 Billion
Key Takeaways
- Renewable is one of North America’s largest producers of biodiesel, and they also make renewable diesel. The fuels are seen as critical in decarbonizing heavy-duty transportation that cannot be electrified as easily as passenger vehicles, such as airplanes.
- Renewable diesel is almost chemically identical to traditional petroleum and therefore easy for fossil-fuel companies to adopt.
- As more big oil refiners — motivated by federal and state subsidies — gear up to make the climate-friendly fuel, the cost of vegetable oil, discarded animal fats and other feedstocks used to make it has soared.
Path to 100% Perspective:
Decarbonizing the transportation sector will be a key step in realizing a 100% renewable energy future. Investments in renewable fuels like biodiesel, both in policies and infrastructure, will accelerate the timeline for commercial viability. It is also encouraging to see that oil companies have seen the critical need to pivot to remain viable and develop their own decarbonization strategies. Investments and leadership from large traditional oil companies will continue to encourage the transition and development of future fuels.
Photo by Luis Ramirez on Unsplash