Trucks
Trucks
HVO has the potential to help truck owners achieve significant CO2 reductions with minimal disruption to their operations or the need for additional investment. Could it be your quickest path towards decarbonization?
Over the past 15 years, global production of HVO (hydrotreated vegetable oil) has grown rapidly and it has become an increasingly viable alternative fuel for many businesses. Will this growth continue, making HVO the future of trucking? Or is its growth potential limited?
HVO – also known as renewable diesel – is a biofuel produced from feedstock, such as vegetable oils (canola, rapeseed, sunflower, etc.), animal fats, used cooking oils and agricultural waste.
Chemically HVO is near identical to conventional diesel, so it is fully compatible with existing diesel vehicles and infrastructure. It can also be used in diesel engines in blends of up to 100% without requiring any modifications to the engine. This means truck owners can directly substitute diesel with HVO and immediately achieve significant CO2 reductions with minimal disruption to their operations and without having to invest in new vehicles or refueling infrastructure. Truck owners can also use HVO and diesel interchangeably without any complications.
While both fuels are produced from organic materials, HVO can be produced from a broader variety of feedstock and is less sensitive to feedstock quality. This makes HVO production less reliant on food crops since it can also utilize waste material. Compared to biodiesel, this lessens any potential negative impact on the environment and food production.
Another important difference is HVO’s compatibility with diesel engines. While HVO is fully compatible and can be used directly as drop-in alternative to diesel, biodiesel can only be used in limited blends, typically around 5-20%.
The actual tailpipe emissions (tank-to-wheel) from using HVO is zero.For the fuel’s life cycle emissions (well-to-wheel), the CO2 reduction depends on the feedstock used. If the HVO is produced from rapeseed oil for example, it will achieve a 25% reduction compared to diesel. If it is produced from waste oils and fats, it can reduce CO2 emissions by up to 90%.
The feedstock also has a large influence over HVO’s broader environmental and social impact too. If made from food crops, this can put HVO production into direct competition with food production and have an adverse effect on land-use and food prices. The worst-case scenario is HVO made from virgin palm oil, which can contribute to deforestation and biodiversity loss, and can have a carbon footprint up to three times higher than fossil diesel.
For this reason, it’s important to have clear transparency on how a given HVO fuel has been produced and what materials have been used. There are already allegations that non-waste material and virgin palm oil are covertly being used in HVO production. And in the near future, HVO containing palm oil will almost certainly be banned in the EU under its planned Deforestation Regulation.
HVO potentially offers truck owners the simplest and easiest path to decarbonization.
HVO is a relatively new fuel and commercial production did not start until 2007. Yet, it has since increased rapidly. Between 2014 and 2023, global production nearly tripled.As of 2023, the US was producing 11 billion liters of HVO per year, 4 billion liters was being produced in the EU, and 1.4 billion liters in China.
HVO100 – a 100% HVO fuel produced from sustainable feedstock – is now widely available in Scandinavia and Benelux region, and is expanding in Germany.Italian energy company ENI is one of a growing number of oil producers who have converted its oil refineries to HVO production, and currently distributes its own brand of HVO in Italy under the brand name HVOlution.
In the US, Diamond Green Diesel continues to grow and expand and is now the second-largest producer in the world (the largest being Neste in Finland). Meanwhile oil producers including Marathon, Phillips 66, and HollyFrontier have also converted some of their oil refineries to HVO production. Overall, it is estimated that HVO production in the US could exceed 22 billion liters by the end of 2025.
HVO is expensive to produce and typically costs around 10-15% more than diesel.In markets where it is thriving, this is because various government incentives and subsidies help bridge the cost difference and make it more financially viable.
Increasing production will help reduce the cost however, this could be limited by a global shortage of sustainable feedstock. As mentioned earlier, waste oils and fats are the optimal materials from an environmental perspective, but these are now in very high demand. In fact, the IEA estimates that under current forecasts and production trends, the biofuel industry will experience a feedstock supply crunch by 2027.
HVO’s compatibility with conventional combustion engines means that it potentially offers truck owners the simplest and easiest path to decarbonization. Unlike electromobility or gas, transitioning to HVO does not require additional investments in vehicles or refueling infrastructure – it’s just a matter of refueling with HVO instead of diesel.
However, the reality is that not all truck owners will have ready access to affordable HVO. And issues with sourcing sustainable feedstock supplies mean that global HVO production cannot be increased to meet industry demand. For this reason, it alone will not solve the industry’s climate challenge – and in the long-term we still need other alternative fuels.
Nevertheless, HVO still offers a lot of potential. For some truck owners at least, it does offer a long-term solution, while for others, it could act as a transitional fuel. Either way, it has an important role to play in decarbonizing the transportation industry.
If you would like to learn more about the different paths towards decarbonization, you might be interested in reading:
● What is the best alternative fuel for your truck?
● Different routes to a fossil fuel-free future
Or you can learn more about the development of other alternative fuels including bio-LNG, battery-electric trucks and hydrogen
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Williment, Chloe; “Does the EU need to examine the sustainability of biofuels?”, Sustainability Magazine, 17 October 2024
“HVO biodiesel production volume worldwide from 2014 to 2023”, Statista Research Department, 6 January 2025.
“Global bioenergy statistics report 2024 summary”, World Bioenergy Association.
“ORLEN launches sales of HVO100”, Orelen, 2 October 2024
Gerveni, M., T. Hubbs and S. Irwin. "Overview of the Production Capacity of U.S. Renewable Diesel Plants for 2023 and Beyond." farmdoc daily (13):57, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, March 29, 2023.
“How much does HVO fuel cost compared to fossil diesel?”, Prema
“Is the biofuel industry approaching a feedstock crunch?”, International Energy Agency (IEA), December 2022.
