According to the U.S. Energy Information Administratio, The United States could potentially ramp up its production capacity of sustainable aviation fuel (SAF) from approximately 2,000 barrels per day (b/d) to nearly 30,000 b/d by 2024, assuming all announced capacity expansions proceed as planned. Phillips 66’s Rodeo Renewed project is expected to commence SAF production of up to about 10,000 b/d starting this summer, while Diamond Green Diesel’s Port Arthur SAF project anticipates producing around 15,000 b/d by the end of the year.
SAF serves as an alternative to conventional petroleum jet fuel, derived from agricultural and waste feedstocks and typically blended with petroleum jet fuel. Investments in SAF have grown due to incentives such as the U.S. Environmental Protection Agency’s Renewable Fuel Standard (RFS), federal tax credits, and various state programs promoting its usage. The White House has set a target of fulfilling 100% of U.S. aviation fuel demand with SAF by 2050. In 2023, U.S. consumption of petroleum jet fuel stood at 1.6 million b/d, and projections for 2050 in the 2023 Annual Energy Outlook suggest demand could exceed 2.0 million b/d.
SAF production data is categorized under “Other Biofuels” in the Petroleum Supply Monthly. This category encompasses renewable heating oil, renewable naphtha, renewable propane, renewable gasoline, and other emerging biofuels at different stages of development and commercialization.
Historically, U.S. production of Other Biofuels has been minimal, but it has seen growth, particularly with the rise of renewable naphtha and renewable propane as by-products of an expanding renewable diesel sector. Production of Other Biofuels surged from 2,000 b/d in 2020 to 19,000 b/d in 2023.
SAF production has constituted a small segment of Other Biofuels due to limited production capacity. At the beginning of 2024, the U.S. SAF production capacity was mainly supported by World Energy’s facility in Paramount, California, and Montana Renewables’ plant in Great Falls, Montana.
In the latest Short-Term Energy Outlook, projections indicate a 50% increase in U.S. production of Other Biofuels in 2024, with further doubling expected from 2024 to 2025. Specific forecasts for each fuel within the category are not separately published.
The anticipated growth in Other Biofuels production, from 19,000 b/d in 2023 to 51,000 b/d in 2025, is largely driven by the expansion of U.S. SAF production capacity. Concurrently, the ongoing increase in renewable diesel production is expected to boost production of associated by-products, further contributing to the forecasted growth in Other Biofuels production through 2025.
