Renewable Fuel Market Growing Faster with 7.86% by 2030

As per Precedence Research, the global renewable fuel market is growing at a noteworthy CAGR of 7.86% over the forecast period 2022 to 2030.

Technological developments and the adoption of novel technologies are two significant drivers propelling the global renewable fuel market forward. The increase in electricity consumption is also strengthening the worldwide renewable fuel sector.


Furthermore, increased government measures to boost the power industry are adding to the worldwide renewable fuel market's growth. The government offers subsidies and incentives to market participants in the worldwide renewable energy industry. The leading market players are putting an even greater emphasis on long-term value, and several of the region's largest market participants have developed sustainable sourcing methodologies for evaluating long-term contracts.

The global renewable fuel market size was estimated at US$ 887.19 billion in 2021 and it is expected to hit around US$ 1,753.6 billion by 2030.

Regional Snapshot

Asia-Pacific is the largest segment for renewable fuel market in terms of region. China and India are dominating the renewable fuel market in the Asia-Pacific region. By 2021, China will have surpassed the United States as the global leader in renewable energy. The overall renewable energy capacity of the country was 894 GW in 2020, up 17.9% from the previous year. Solar, hydropower, and wind are the nation's primary renewable energy sources. Furthermore, the Asia-Pacific region's renewable fuel industry is being driven by increasing government initiatives.

North America region is the fastest growing region in the renewable fuel market. The U.S. hold the highest market share in the North America renewable fuel market. Because of the increased demand for biofuel in the region, the renewable fuel market in North America is expanding. In the North American region, biofuels like biodiesel and biogasoline produced 623 thousand barrels of oil equivalent per day in 2020. Ethanol contributed over 500 thousand barrels of oil equivalent per day, far more than biodiesel.

Report Highlights

On the basis of type, biofuel segment holds the largest market share in the global renewable fuel market. Because the feedstock utilized can be regenerated more quickly than typical fossil fuels, they are designated as renewable fuels. The finite availability of fossil fuel-based resources and greater awareness of the need to minimize carbon emissions are two factors that are expected to enhance the industry. Additionally, the availability of various supportive regulatory rules and financial incentives on the use of biofuels around the world is predicted to increase demand, notably in the transportation industry.

On the basis of end use, industrial segment holds the largest market share in the global renewable fuel market. The growing demand for clean energy is expected to increase utility projects and the market for renewable fuel in the industrial sector. The expansion of industrial projects is also propelling the industrial category forward.

Market Dynamics

Drivers

Surge in demand for electricity


The population growth has increased worldwide electricity demand significantly. The growing demand for power is being driven by rising living standards and infrastructural development. According to Enerdata, China's electricity demand climbed by 4.5% in 2019 over the previous year. Many of the nations are building new solar plants or increasing the capacity of existing ones to meet the rising demand. As a result, surge in demand for electricity is boosting the growth of global renewable fuel market.

Restraints

Threat of substitutes or alternatives


Despite the fact that alternative fuels have become increasingly common in global fuel markets, oil will continue to dominate the transportation industry, even as demand for biofuels develops. Despite a fall in market domination in the next year, oil's global supremacy as a significant transportation fuel is not in risk. Thus, this factor is restricting expansion of worldwide renewable fuel market.

Opportunities

Growing demand for natural gas


Theglobal renewable fuel market is expanding in respect with the world's demand for natural gas and coal. Furthermore, as a result of increased commercialization and industrialization, people are moving towards the technology that consumes ever increasing amounts of electrical energy. As a result, growing demand for natural gas is creating lucrative opportunities for growth of global renewable fuel market.

Challenges

High cost of deployment


The high cost of using renewable energy sources to create power is the main barrier. As a result, many people cannot afford it, which will have a detrimental impact on renewable fuel sources' market domination in the near future. However, due to recent technological developments, it is expected that low-cost power generating technologies will become accessible over the forecast period.

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