Despite all the attention on the new Biden Administration’s efforts to combat climate change, one state, California, is reshaping the world’s oil markets through its progressive climate policies.

Most dramatic has been the state’s shift to renewable diesel (RD). Unlike its green cousin, biodiesel, RD is molecularly identical to conventional ultra-low-sulfur-diesel (ULSD), making it a “drop-in” fuel. No modifications to engines, gas stations or pipelines are needed. It can be mixed with conventional diesel seamlessly. It is made from bio feedstock such as vegetable and animal oils such as canola, soybean, and corn oil, used cooking oil, tallow, and even municipal solid waste; the exact recipe varies. Current production methods reduce carbon emissions 50 to 85% compared to conventional diesel. RD burns cleaner than conventional diesel, producing 30% less particulates. In addition to less air pollution, this also means less wear on engines.

A 20% RD mixture is called R-20. The ferry boats in San Francisco Bay are running on R-100. UPS, Amazon Prime, and Cherokee Freight Line trucks are now switching to RD, at least in California where the fuel is available. Internationally, cargo vessels with diesel-electric engines are adopting the fuel.

Renewable diesel already accounts for 20% of California’s diesel supply and is projected to grow well beyond 50% by 2024, expanding to include jet fuel, where it is called “sustainable jet fuel”. Renewable propane is also produced during the refining process. Renewable gasoline, unfortunately, is still not economically feasible.

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