- Overview and key findings
- Energy investment in 2023
- Clean energy spending
- Clean technology costs
- Consequences of the energy crisis
- Growing momentum for hydrogen and CCUS
- Critical minerals and manufacturing
- Scaling up clean investment to meet climate aligned scenarios
- Sustainable finance
IEA (2023), World Energy Investment 2023, IEA, Paris https://www.iea.org/reports/world-energy-investment-2023, License: CC BY 4.0
The recovery from the slump caused by the Covid-19 pandemic and the response to the global energy crisis have provided a significant boost to clean energy investment. Comparing our estimates for 2023 with the data for 2021, annual clean energy investment has risen much faster than investment in fossil fuels over this period (24% vs 15%). Our new analysis highlights how the period of intense volatility in fossil fuel markets caused by the Russian Federation’s (hereafter “Russia”) invasion of Ukraine has accelerated momentum behind the deployment of a range of clean energy technologies, even as it also prompted a short-term scramble for oil and gas supply.
We estimate that around USD2.8trillion will be invested in energy in 2023. More than USD1.7trillion is going to clean energy, including renewable power, nuclear, grids, storage, low-emission fuels, efficiency improvements and end-use renewables and electrification. The remainder, slightly over USD1trillion, is going to unabated fossil fuel supply and power, of which around 15% is to coal and the rest to oil and gas. For every USD1 spent on fossil fuels, USD1.7 is now spent on clean energy. Five years ago this ratio was 1:1.
Clean energy investments have been boosted by a variety of factors. These include improved economics at a time of high and volatile fossil fuel prices; enhanced policy support through instruments like the US Inflation Reduction Act and new initiatives in Europe, Japan, the People’s Republic of China (hereafter “China”) and elsewhere; a strong alignment of climate and energy security goals, especially in import-dependent economies; and a focus on industrial strategy as countries seek to strengthen their footholds in the emerging clean energy economy.
This momentum has been led by renewable power and EVs, with important contributions also from other areas such as batteries, heat pumps and nuclear power. In 2023 low-emissions power is expected to account for almost 90% of total investment in electricity generation. Solar is the star performer and more than USD1billion per day is expected to go into solar investments in 2023 (USD 380billion for the year as a whole), edging this spending above that in upstream oil for the first time.
Consumers are investing in more electrified end uses. Demand for electric cars is booming, with sales expected to leap by more than one-third this year after a record-breaking 2022. As a result, investment in EVs (defined as the incremental spending on EVs vs the average price of vehicles sold in a given country) has more than doubled since 2021, reaching USD130billion in 2023. Global sales of heat pumps have seen double-digit growth since 2021.
2022 was an extraordinarily profitable year for many fossil fuel companies, as they saw revenues soar on higher fuel prices. Net income from fossil fuel sales more than doubled compared with the average in recent years, with global oil and gas producers receiving around USD4trillion.
Our overall expectation, based on analysis of the announced spending plans of all the large and medium-sized oil, gas and coal companies, is that investment in unabated fossil fuel supply is set to rise by more than 6% in 2023, reaching USD950billion.
The largest share of this total is going to upstream oil and gas, where investment is expected to rise by 7% in 2023 to more than USD500 billion, bringing this indicator in aggregate back to the levels of 2019. Around half this increase is likely to be absorbed by cost inflation.
Many large oil and gas companies have announced higher spending plans on the back of record revenues. But uncertainties over longer-term demand, worries about costs, and pressure from many investors and owners to focus on returns rather than production growth mean only large Middle Eastern national oil companies are spending much more in 2023 than they did in 2022, and they are the only subset of the industry spending more than pre-pandemic levels.
The headline rise in spending on new oil and gas supply represents less than half of the cash flow that was available to the oil and gas industry. Between 2010 and 2019, three-quarters of cash outflows were typically invested into new supply. This is now less than half, with the majority going to dividends, share buybacks and debt repayment.
Investment by the oil and gas industry in low-emissions sources of energy is less than 5% of its upstream investment. This indicator differs widely by company, with double-digit shares common among the large European companies. Investment by the industry in clean fuels, such as bioenergy, hydrogen and CCUS, is picking up in response to more supportive policies but remains well short of where it needs to be in climate-driven scenarios.
Investment in coal supply is expected to rise by 10% in 2023, and is already well above pre-pandemic levels. Investment in new coal-fired power plants remains on a declining trend, but a warning sign came in 2022 with 40GW of new coal plants being approved – the highest figure since 2016. Almost all of these were in China, reflecting the high political priority attached to energy security after severe electricity market strains in 2021 and 2022, even as China deploys a range of low-emission technologies at scale.
The positive momentum behind clean energy investment is not distributed evenly across countries or sectors, highlighting issues that policy makers will need to address to ensure a broad-based and secure transition. The macroeconomic environment presents additional obstacles, with higher short-term returns for fossil fuel assets and rising borrowing costs and debt burdens. Clean energy investments often require high upfront spending, making the cost of financing a crucial variable for investors, even if this is offset over time by lower operating costs.
More than 90% of the increase in clean energy investment since 2021 has taken place in advanced economies and China. There are bright spots elsewhere: for example, solar investment remains dynamic in India; deployment in Brazil is on a steady upward curve; and investor activity is picking up in parts of the Middle East, notably in Saudi Arabia, the United Arab Emirates and Oman. However, higher interest rates, unclear policy frameworks and market designs, financially-strained utilities and a high cost of capital are holding back investment in many other countries. Remarkably, the increases in clean energy investment in advanced economies and China since 2021 exceed total clean energy investment in the rest of the world.
After an unbroken run of cost declines, prices for some key clean energy technologies rose in 2021 and 2022 thanks largely to higher input prices for critical minerals, semiconductors and bulk materials like steel and cement. Solar PV modules were around 20% more expensive in early 2022 than one year earlier, although these price pressures have eased since. Wind turbine costs, especially for European manufacturers, remained high in early 2023, at 35% above the low levels of early 2020. Permitting has been a key concern for investors and financiers, especially for wind and grid infrastructure.
While solar deployment has been increasing year-on-year, the project pipeline for some other technologies has been less reliable. Investment in wind power has varied year-on-year in key markets in response to changing policy circumstances. Nuclear investment is rising but hydropower, a key low-emission source of power market flexibility, has been on a downward trend.
Weak grid infrastructure is a limiting factor for renewable investment in many developing economies, and here too current investment flows are highly concentrated. Advanced economies and China account for 80% of global spending and for almost all of the growth in recent years.
Our analysis presents a mixed picture on the prospects for energy efficiency and end use investments. They rose in 2022 thanks to the stimulus provided by new policies in Europe and North America, alongside exceptionally high energy prices. However, we expect spending to flatten in 2023 amid a slowdown in construction activity, higher borrowing costs and strains on household budgets.
Russia cut pipeline deliveries of natural gas to the European Union by around 80% in 2022, seeking leverage by exposing consumers to higher energy bills and supply shortages following its invasion of Ukraine. This led to strong price and policy incentives for investors to step up non-Russian gas supply, build up alternative delivery infrastructure, and scale up alternatives to natural gas. All of these effects are visible in our analysis.
The amount of new oil and gas resources approved for development in 2022 and 2023 has been below the average level seen over the past decade. However, 2023 is seeing a 25% increase in new approvals relative to 2022 and most of these are for natural gas, reflecting the push to substitute for the shortfall in Russian supply.
A wave of new regasification capacity is also underway as countries look to secure liquefied natural gas (LNG) imports. Europe’s annual regasification capacity is set to increase by 50bcm from 2022-2025, expanding the continent’s overall LNG import capacity by one-fifth. Import projects are growing even more quickly in Asia, which is set to add over 100bcm of LNG import capacity by 2025 (more than half in China).
The crisis has also prompted additional investment in liquefaction capacity, the most expensive part of the gas value chain. Around 60bcm of capacity has been given the green light since Russia’s invasion of Ukraine, nearly double the rate of new approvals compared with the past decade. Along with projects already under construction, this leads to an unprecedented 170bcm of export capacity that could come into operation between 2025 and 2027.
A key dilemma for investors undertaking large, capital‐intensive gas supply projects is how to reconcile strong near‐term demand growth with uncertain and possibly declining longer-term demand. This is a particular issue for Europe, given the continent’s strong climate goals. Many importers have been reluctant to commit to long-term contracts for gas supply. A preference for floating regasification terminals has been a way to avoid locking in future emissions.
Another avenue is to expand investment in low-emission fuels and in CCUS. New policies are swelling the project pipeline in these areas, driven by energy security and climate imperatives. Europe has a burgeoning number of electrolytic hydrogen projects, and reinforced US incentives in the Inflation Reduction Act have prompted a wave of investor interest in hydrogen and CCUS. After a number of false dawns, the number of large-scale projects and well-capitalised sponsors, along with a string of acquisitions by oil and gas majors (notably in transport biofuels and biogases), suggests that investment in low-emission fuels could grow strongly in the coming years.
A secure transition to clean energy hinges on resilient and diversified clean energy technology supply chains. According to the IEA Energy Technology Perspectives, some USD1.2trillion of cumulative investment to 2030 is needed in clean energy manufacturing and in critical minerals supply to get on track for a 1.5°C scenario, in addition to the energy sector investments covered in this report.
Record sales of EVs, strong investment in battery storage for power (which are expected to approach USD40billion in 2023, almost double the 2022 level) and a push from policy makers to scale up domestic supply chains have sparked a wave of new lithium-ion battery manufacturing projects around the world. If all capacity announcements were to materialise, then 5.2TWh of new capacity could be available by 2030.
For the moment, China is the main player at every stage of global battery manufacturing, with the exception of the mining of critical minerals. The announced manufacturing plans would somewhat erode this position. In 2022, over 75% of existing battery manufacturing capacity was located in China. However, despite accounting for two-thirds of yearly global capacity additions to 2030, China’s share of global capacity could fall by nearly 10 percentage points by the end of the decade.
A key question for battery manufacturers is whether supplies of critical minerals will keep up with demand. Thanks to high prices and growing policy support, investment in critical mineral mining rose by 30% in 2022. Exploration spending also grew, notably for lithium, copper and nickel, led by Canada and Australia and with activities growing in Brazil and resource-rich countries in Africa. But moving from exploration to new production can take more than 10 years, and there remain widespread concerns that critical mineral investment will become a constraining factor for clean technology manufacturing and deployment.
Critical minerals and batteries are among the areas where clean technology innovation remains essential. Public spending on research and development has been on a steady upward trend, as has corporate spending. But venture capital funding for clean energy, after reaching a high in 2022, faces headwinds in a more difficult macroeconomic environment.
For a decade, cheap capital has lowered barriers to investment in riskier bets and thereby concealed potential weaknesses in innovation systems. With the cost of money set to rise, the health of these systems and the level of public support will be a critical determinant of how quickly new technology ideas continue to flow.
In the IEA World Energy Outlook 2021, we wrote that “the world is not investing enough to meet its future energy needs […] IEA analysis has repeatedly highlighted that a surge in spending to boost deployment of clean energy technologies and infrastructure provides the way out of this impasse, but this needs to happen quickly or global energy markets will face a turbulent and volatile period ahead”.
This picture is starting to change: global energy investment is picking up, and the rise in clean energy investment since 2021 is leading the way, outpacing the increase in fossil fuel investment by almost three-to-one. Clean electrification is leading the charge. If it continues to grow at the rate seen since 2021, then aggregate spending in 2030 on low‑emission power, grids and storage, and end-use electrification would exceed the levels required to meet the world’s announced climate pledges (the APS). For some technologies, notably solar, it would match the investment required to get on track for a 1.5°C stabilisation in global average temperatures (the NZE Scenario).
However, progress has been uneven. Investment in expanding and modernising grids is lagging behind in many countries. A rising share of solar and wind needs to be accompanied by spending on technologies that provide greater flexibility to power systems. Supply chain and skills bottlenecks could constrain growth. And, above all, the geographical imbalances in investment need addressing, with clean energy investment in many emerging and developing economies growing only slowly and the number of people without access to modern energy services remaining stubbornly high.
Other pillars of clean energy transitions do not yet show the same positive dynamics as clean electrification. Investment in energy efficiency has been increasing, but is well off track to meet more ambitious climate scenarios. Investment in low-emission fuels is being spurred by new policy measures, but from a very low base.
Spending on fossil fuels is most closely aligned with the 2030 needs of a scenario reflecting today’s policy settings (STEPS), but producers need to watch closely how clean energy spending evolves, particularly the ways in which clean electrification affects demand for fuels in power generation, and for mobility and heat. The risks of locking in fossil fuel use are clear: fossil fuel investment in 2023 is now more than double the levels required to meet much lower demand in the NZE Scenario.
The crucial open question is how quickly clean energy investment scales up in emerging and developing economies, where supportive strategies and policies will need to be accompanied by improved access to finance. For the moment, sustainable finance instruments remain concentrated in advanced economies, accounting for nearly 80% of sustainable debt issuance in 2022. Issuances elsewhere (outside China) are growing from a low base, with India’s successful first green bond a landmark in this sector. Scaling up these instruments and mobilising much greater support from development finance institutions will be critical to the continued broadening and acceleration of clean energy transitions
We estimate that around USD 2.8 trillion will be invested in energy in 2023. More than USD 1.7 trillion is going to clean energy, including renewable power, nuclear, grids, storage, low-emission fuels, efficiency improvements and end-use renewables and electrification.What is the global energy perspective for 2023? ›
Global energy consumption will grow by just 1.3% in 2023, amid a slowing economy and high energy prices.What are the IEA energy predictions? ›
Energy-related CO2 emissions rebounded to 36.6 Gt in 2021, the largest ever annual rise in emissions. In the STEPS, they reach a plateau around 37 Gt before falling slowly to 32 Gt in 2050, a trajectory that would lead to a 2.5 °C rise in global average temperatures by 2100.What are the goals of the IEA? ›
The IEA is at the heart of global dialogue on energy, providing authoritative analysis, data, policy recommendations, and real-world solutions to help countries provide secure and sustainable energy for all.Will energy prices go down in 2023 usa? ›
The average electricity bill for households in the U.S. rose from $0.147 kWh in January 2022 to $0.168 per kWh in January 2023. Energy prices aren't likely to decrease, but the rapid increase from 2021 to 2022 may slow in 2023.What is the IEA predicting about renewables? ›
Global renewable capacity is expected to increase by almost 2 400 GW (almost 75%) between 2022 and 2027 in the IEA main-case forecast, equal to the entire installed power capacity of the People's Republic of China (hereafter “China”).
Notably, FactSet predicts this industry group could post 46% year-over-year growth in earnings in 2023, despite the broader sector's expected decline. In sum, limited supply could offset falling demand to help keep commodity prices elevated.Where is the World Future energy Summit 2023? ›
Visit the World Future Energy Summit | ADNEC, Abu Dhabi.What does IEA mean in energy? ›
IEA – International Energy Agency.What is the new policies scenario for IEA? ›
In the IEA New Policies Scenario, China's coal demand will increase by 30% to over 2850 million tonnes per year by 2020 and stabilize above 2800 million tonnes until 2035 (Figure 1.8).
The Net Zero Emissions by 2050 Scenario (NZE) is a normative IEA scenario that shows a pathway for the global energy sector to achieve net zero CO2 emissions by 2050, with advanced economies reaching net zero emissions in advance of others.Who controls IEA? ›
The IEA operates autonomously, with its own budget and governance structure.Who is funding the IEA? ›
The Institute is entirely independent of any political party or group, and is entirely funded by voluntary donations from individuals, companies and foundations who want to support its work, plus income from book sales and conferences. It does no contract work and accepts no money from government.What are the multiple benefits of energy efficiency IEA? ›
The potential benefits of energy efficiency measures include improved physical health such as reduced symptoms of respiratory and cardiovascular conditions, rheumatism, arthritis and allergies, as well as fewer injuries.Will gas and food prices go down in 2023? ›
Food prices are expected to grow more slowly in 2023 than in 2022 but still at above historical-average rates. In 2023, all food prices are predicted to increase 6.2 percent, with a prediction interval of 4.9 to 7.5 percent.Will gas go down in 2023? ›
Will Gas Prices Go Up or Down in the Future? Future gas prices depend on a number of factors that aren't easy to predict, but as a benchmark, the U.S. Energy Information Administration released predictions for lower gas prices, averaging $3.32 per gallon in 2023 and $3.09 per gallon in 2024 for regular gasoline.Will gas prices be high in 2023? ›
Lower natural gas prices in 2023 will lead to a 35-45% “plunge” in the price of on-peak power in most markets across the United States, Moody's Investors Services said in a Monday research note. California is the exception, where peak prices are expected to fall “only around 9%.”What is the IEA outlook for biofuels? ›
Forecast summary. Global demand for biofuels is set to grow by 41 billion litres, or 28%, over 2021-2026 in the main case. The recovery to pre-Covid-19 demand levels accounts for one-fifth of this demand growth.What is the world primary energy supply by source IEA? ›
Total primary energy supply by region, 1971 and 2019
In 2019, renewables provided almost 27% of global electricity, three points more than natural gas (24%). The share of nuclear has plateaued around 10% for eight years, while oil provided less than 3% of global electricity in 2019.
Led by solar energy, renewables are poised to overtake coal as the largest source of electricity generation worldwide by early 2025, helping to keep alive the global goal of limiting Earth's warming to 1.5 degrees Celsius (2.7 Fahrenheit), according to the Paris-based agency's latest forecasts.
Arguably, the most exciting energy trends in 2023 will be the growing integration of AI and Big Data in the energy industry and the development of green hydrogen energy. Big Data and AI can potentially revolutionize energy efficiency across the board.What is the outlook for natural resources in 2023? ›
Investment in energy and natural resources is on an upward trend. However, cost inflation, bottlenecks and the higher cost of capital add to sector-specific challenges. We expect overall spend on supply across oil and gas, power and renewables and metals and mining to increase by 5% to US$1.1 trillion in 2023.What are the best energy stocks to invest in 2023? ›
|Company and ticker symbol||Performance in 2023|
|Coterra Energy (CTRA)||-5.4%|
|Diamondback Energy (FANG)||-7.0%|
Don't Expect Energy Stock Price Returns of 2022 in 2023
For our rated oil and gas issuers, balance sheets and key credit metrics are the strongest they have been in years.” Indeed, very little money is going into exploration, which is at an all-time low.
With a strong capital pipeline, increasing regulatory support, and corrected valuations that remain historically rich, utilities are poised to return to steady growth without volatility. “After a volatile stretch for utilities stocks, we expect a return to steady, fundamental growth.”What is the summit of the future 2024? ›
Having welcomed the submission of Our Common Agenda, the General Assembly passed a resolution in 2022 (A/RES/76/307) to hold the Summit on 22-23 September 2024. Practical consultations on preparations for the Summit begin in February 2023 and a Ministerial meeting will take place this year.Who are the speakers of World Future Energy Summit? ›
Speakers include: Saeed Al Abbar, Chairman, Emirates Green Building Council, UAE. Ali Al Jassim, CEO, Etihad Esco, UAE. Ramiz Alaileh, Sustainability & Energy Efficiency Director, Department of Energy, UAE.What is the name of the summit taking place from january 16 to 17 2023? ›
The World Future Energy Summit, taking place from 16th – 18th January 2023, is the world's leading business event, focused on the global transition to clean energy.How many countries are in the IEA? ›
The IEA is made up of 31 member countries.Who bought IEA? ›
MasTec Completes the Acquisition of Infrastructure and Energy Alternatives, Inc. MasTec, Inc. is a leading infrastructure construction company operating mainly throughout North America across a range of industries.
In November 2015, China officially became an affiliate of the International Energy Agency. In February 2017, the IEA and China's National Energy Administration formally established the IEA China Cooperation Office in Beijing.Is the IEA a government agency? ›
The IEA is an autonomous inter-governmental organisation within the OECD framework, headed by its Executive Director.What are the IEA emission factors? ›
What is the IEA Emission factors database? The IEA Emission factors database contains emission factors from electricity and electricity/heat generation of national grids, for a set of three different gases (CO2, CH4, N2O), for all countries globally, starting in 1971.What is energy poverty IEA? ›
Energy poverty is lack of access to modern energy services.What are the 4 climate scenarios? ›
- Scenario 1 – Most optimistic: 1.5C by 2050.
- Scenario 2 – Next Best: 1.8C by 2100.
- Scenario 3 – Middle of the road: 2.7C by 2100.
- Scenario 4 – Dangerous: 3.6C by 2100.
- Scenario 5 – Avoid at all costs: 4.4C by 2100.
- Keep fossil fuels in the ground. ...
- Invest in renewable energy. ...
- Switch to sustainable transport. ...
- Help us keep our homes cosy. ...
- Improve farming and encourage vegan diets. ...
- Restore nature to absorb more carbon. ...
- Protect forests like the Amazon.
The carbon in CO2 enables the conversion of hydrogen into a fuel that is easier to handle and use, for example as an aviation fuel. CO2 can also replace fossil fuels as a raw material in chemicals and polymers.How many employees does IEA have? ›
Infrastructure & Energy Alternatives has 882 employees.What is the IEA oil? ›
The IEA Oil Market Report (OMR) is one of the world's most authoritative and timely sources of data, forecasts and analysis on the global oil market – including detailed statistics and commentary on oil supply, demand, inventories, prices and refining activity, as well as oil trade for IEA and selected non-IEA ...Who is the head of public affairs at the IEA? ›
IEA appoints Matthew Lesh as new Director of Public Policy and Communications — Institute of Economic Affairs.
Unveiled in July, the deal valued IEA at USD 1.1 billion, including net debt. IEA provides engineering, procurement, construction and other related services to developers of infrastructure projects. To date, the company has finalised over 260 utility-scale wind and solar projects across North America.How does IEA work? ›
Points are tracked for individual rider accomplishments AND for overall, team accomplishments. Individuals and teams earn points to qualify for regional, zone and national finals. Teams take turns hosting horse shows throughout the season. New teams are NOT required to host any shows.What is the think tank controversy? ›
Some of the think tanks have been accused of promoting climate change denial, tax havens, and the privatisation of the NHS and BBC, as well as disseminating tobacco and oil industry “propaganda” in schools.What is the most efficient energy sources? ›
Nuclear Has The Highest Capacity Factor
As you can see, nuclear energy has by far the highest capacity facto r of any other energy source.
Using energy more efficiently is one of the fastest, most cost-effective ways to save money, reduce greenhouse gas emissions, create jobs, and meet growing energy demand.What is the difference between OPEC and IEA? ›
OPEC was established in 1960 to reflect the concerns of oil-producing developing countries, while the IEA was formed 14 years later to represent the interests of oil-consuming advanced economies.What is the outlook for utilities in 2023? ›
For 2023, the outlook for the utilities sector is strong. The sector's defensive characteristics could continue to look attractive to investors seeking shelter during market and economic choppiness.What is the outlook for the utilities sector in 2023? ›
With a strong capital pipeline, increasing regulatory support, and corrected valuations that remain historically rich, utilities are poised to return to steady growth without volatility.What is the outlook for renewable energy in 2025? ›
IEA: More than a third of the world's electricity will come from renewables in 2025.What will energy stocks do in 2023? ›
Notably, FactSet predicts this industry group could post 46% year-over-year growth in earnings in 2023, despite the broader sector's expected decline. In sum, limited supply could offset falling demand to help keep commodity prices elevated.
Independent power producers, or IPPs, are privately owned power plants. IPPs operate outside of the traditional utility grid owned, maintained and regulated by a public entity. This is why they are also known as non-utility generators. All non-utility/nongovernment power producers are classified as IPPs.What is the long term outlook for the energy sector? ›
Key Takeaways. The energy sector is coming off a strong year, as tight supplies and rising demand fueled high energy prices in 2022. Those dynamics are likely to continue into 2023, given the long lead time it takes to ramp up new supply and refining capacity.What is the energy and utilities value chain? ›
The electricity energy value chain includes all activities necessary for the production, distribution and consumption of electrical energy. There are five major segments: fuel procurement, electricity generation, transmission, distribution and the end-market or service location.What is the new energy production in 2023? ›
Solar to dominate new U.S. electric-generating capacity in 2023, EIA says. Feb 6 (Reuters) - U.S. developers plan to add 54.5 gigawatts (GW) of new electric generating capacity in 2023, with more than half being powered by solar energy, the Energy Information Administration (EIA) said on Monday.What is the new renewable energy technology in 2023? ›
Arguably, the most exciting energy trends in 2023 will be the growing integration of AI and Big Data in the energy industry and the development of green hydrogen energy. Big Data and AI can potentially revolutionize energy efficiency across the board.Which energy source is projected to increase the most by 2030? ›
Nuclear output is expected to increase rapidly between 2010 and 2030, averaging 7.8% per annum. BP attributes this to the ambitious nuclear expansion programs in China, India, and Russia.Who is the largest producer of biofuel in the world? ›
Biofuel production in the U.S.
The United States is by far the largest producer of biofuel in the world, accounting for nearly. The country is a major producer of biodiesel, with that year's production amounting to 1.64 billion gallons.
Potential economic benefits of biofuel production
Replacing fossil fuels with biofuels has the potential to generate a number of benefits. In contrast to fossil fuels, which are exhaustible resources, biofuels are produced from renewable feedstocks.
When burned, pure biofuels generally produce fewer emissions of particulates, sulfur dioxide, and air toxics than their fossil-fuel derived counterparts. Biofuel-petroleum blends also generally result in lower emissions relative to fuels that do not contain biofuels.