Recent trends in policies, socioeconomy and future directions of the biodiesel industry

Abstract

The growing uncertainty of available petroleum reserves and the associated environmental impacts from the usage of fossil fuels has led to a worldwide search for renewable energy sources. Biodiesel is currently placed at the forefront as the most viable alternative fuel for compression ignition engines as it can be produced from renewable sources through simple cost-effective transesterification, while being compatible with existing infrastructures. Despite these, biodiesel is still not economically feasible for large-scale adoption at present day, mainly due to the high cost of conventional feedstocks. Governmental policies, fiscal incentives and emissions laws have all shown to encourage the uptake of biodiesel in the early stages of market development. The rapid growth enjoyed by the biodiesel industry thereafter has raised concerns of various ethical issues, which must be addressed if the industry is to maintain its positive growth. The strategies required for a stable and sustained biodiesel industry will predominantly be based on the principles of a free market with minimal artificial interventions from policy makers, and the appropriate technological advances in production techniques and feedstocks options to stay competitive economically. This paper reviews the recent trends in global policies and legislative measures governing the economy of the biodiesel industry, and how these will impact the future outlook of the industry as a whole. Historical backgrounds and pertinent issues on socioeconomical and ethical aspects of the industry are also addressed here.