Advanced Biofuels Market Size, Share, and Trends 2025 to 2034

What is the Advanced Biofuels Market Size?

The global advanced biofuels market size is valued at USD 121.68 billion in 2025 and is predicted to increase from USD 168.29 billion in 2026 to approximately USD 1749.48 billion by 2034, growing at a CAGR of 34.85% from 2025 to 2034.

Advanced Biofuels Market Key Takeaways

• North America takes the lead as the largest market for advanced biofuels.
• Biofuels, especially biodiesels, are set to dominate revenue shares, fueled by the increasing adoption of biofuels for engines.
• By Raw Material, Algae raw material is projected to lead in revenue within the forecast period.

Key Market Insights

Compared to petroleum fuels, advanced biofuels are exciting and new types of fuels that will reduce greenhouse gas emissions by at least 50%. The automotive and aviation industries worldwide are focused on the use of efficient yet environmentally friendly fuels that will help decarbonize the transport industry. As it meets greenhouse gas mitigation goals as well as tough aircraft requirements, advanced biofuels have become an ideal option. In order to operate conventional jet engines and use current fuel delivery systems, advanced biofuels are efficient and safe enough. In addition, in the automotive or aviation market, the use of advanced biofuels allows passengers to perceive the same efficiency. In addition, strict government regulations are also another main factor in developing advanced biofuels for use in transport sector. For instance, advanced biofuels in North America allow carbon credits to be obtained and projects to achieve financial equilibrium.

Rising Green Energy: Driving Forces Behind the Growth of the U.S.

The U.S. market is growing due to increasing government support for renewable energy, rising concerns about carbon emissions, and the push to reduce dependence on fossil fuels. Advancements in biofuel production technologies, availability of sustainable feedstocks, and strong investments from key industry players are driving growth. Additionally, supportive policies like the Renewable Fuel Standard (RFS) are boosting biofuel adoption across transportation and industrial sectors.

Powering Sustainability: Unleashing Growth in China's Market

China's advanced biofuels market is expanding due to strong government policies promoting clean energy and carbon neutrality goals. Growing demand for sustainable transportation fuels and efforts to reduce reliance on imported oil are driving investment in biofuel production. Additionally, advancements in bio-refining technologies, availability of agricultural waste as feedstock, and support for innovation in renewable energy are accelerating market growth across the country.

Europe: Driving Decarbonization

Europe's market is expanding due to stringent environmental regulations, ambitious carbon reduction targets, and strong government support for renewable energy. The European Union's Renewable Energy Directive (RED II) encourages the use of low-carbon fuels, driving investment in advanced biofuel technologies. Growing demand for sustainable aviation and transportation fuels, along with rising corporate sustainability commitments, is further propelling market growth across the region.

Fueling Progress: The UK's Surge in Advanced Biofuels Innovation

The UK market is growing due to strong government initiatives supporting renewable energy and net-zero emissions goals. Policies like the Renewable Transport Fuel Obligation (RTFO) are promoting biofuel adoption in transportation. Additionally, rising investments in waste-to-fuel technologies, growing focus on energy security, and the shift toward sustainable aviation fuels are driving the development and expansion of the advanced biofuels sector in the UK.

Growth Factors

• Limited availability of fossil fuel-based resources
• Growing awareness regarding curbing carbon emissions
• Favorable government policies in leading countries
• Use of advanced biofuels in the automotive & aviation industry Government support for research activities and favorable regulations
• Rising awareness about use of renewables

Future of Global Advanced Biofuel Market

Leading players of the global advanced biofuel industry are focusing on the strategic partnerships similar mergers and acquisitions in order to enhance their position in the global market and to get the comparative edge. This trend is anticipated to continue and will flourish growth of target market over the forecast time-frame. For instance, GranBio Technologies, collaborated with Indian Birla Carbon in order to provide the nanocellulose compound.

Market Outlook

• Industry Growth Overview- The market is experiencing strong growth driven by rising demand for clean energy, government policies promoting carbon reduction, and advancements in biofuel technologies that convert waste and non-food feedstocks into sustainable fuel alternatives.
• Global Expansion- The global market is expanding rapidly due to increasing renewable energy investments, supportive government mandates, and rising demand for low-carbon transportation fuels, with major growth seen in North America, Europe, and emerging Asian economies.
• Startup Ecosystem- The startup ecosystem in the advanced biofuels market is thriving, driven by innovation in waste-to-fuel technologies, algae-based fuels, and carbon capture solutions, supported by government incentives, venture capital funding, and growing interest in sustainable energy alternatives.

Market Scope

Significant Trends

Biodiesels Segment Reported Foremost Market Share in 2024

Biodiesels are expected to hold the largest revenue share due to the growing use of biofuels as the engine fuel. This is owing to usage of great yield algae raw material and huge potential of biodiesels to reduce the reduction greenhouse gas emission.

Algae are Projected to Dominate the Raw Material Segment of Advanced Biofuels Market Revenue

On the basis of raw material segment algae raw material segment is expected to dominate in terms of revenue over the forecast time frame. The growth is attributed owing to its quality of possessing more oil content and it can be grown using ocean or wastewater. Algae is capable of yielding equal to 300 times more oil over conventional crops and has a up to 10 day harvest period as it grows almost 30 times faster than other feedstock's.

Value Chain Analysis

Resource Extraction

Resource extraction for advanced biofuels involves cultivating non-food biomass like switchgrass, woody crops, or algae, and harvesting agricultural or forestry residues. The feedstock is then pretreated through mechanical or chemical processes to break down tough lignocellulose, making it ready for conversion. Key companies active in this initial phase include POET LLC, GranBio, and Clariant.

Power Generation

Advanced biofuels are primarily used as transportation fuels, but they also contribute to power generation. In integrated biorefineries, byproducts like lignin or waste streams can be combusted for combined heat and power (CHP), boosting process efficiency. Major players in the broader power and advanced biofuels generation space include large energy companies like BP, TotalEnergies, and Shell, which are transitioning to cleaner energy solutions.

Distribution Network Management

Distribution involves the efficient movement of the final biofuel products from biorefineries to terminals and end-users via trucks, railcars, or barges. Management ensures seamless integration into existing supply chains and infrastructure, including potential blending with conventional fuels. Companies like Neste, Chevron, and Renewable Energy Group (REG) manage these complex logistical networks to meet market demand.

U.S. Advanced Biofuels Market Size and Growth 2025 to 2034

The U.S. advanced biofuels market is valued at USD 27.31 billion in 2025 and is expected to grow to around USD 395.24 billion by 2034, at a CAGR of 34.95% from 2025 to 2034.

North America is Estimated to be the Largest Market for Advanced Biofuels

The research report deals with the industry prospects of advanced biofuel products around regions including Europe, North America, Latin America, Asia-Pacific, and Middle East and Africa. Advanced biofuel market is taken by North America owing to growing demand for the cleaner burning transportation fuels particularly in the U.S. of the North America. Addition to this, presence of leading players in the region along with strategies that are implemented by the major players in the countries of North America is expected to witness substantial growth in the target industry in the near future. Asia Pacific is likely to list the noteworthy CAGR, on account of rising awareness about the usage of advanced biofuels in emerging economies. Also, Most of the key players operating in the industry are investing heavily in order to get the competitive edge in the advanced biofuels market in Asia Pacific. For instance, in 2020, The Asian Development Bank has approved a $ 2.5 million technical assistance in order to support advanced biofuel development in India.

Top Vendors and their Offerings

• GranBio- Focuses on converting non-food lignocellulosic biomass (like agricultural residues) into 2nd-generation ethanol and sustainable aviation fuel (SAF) using its proprietary technologies.
  Inbicon A/S- Developed and demonstrated biomass-conversion technology using straw and other residues to produce cellulosic ethanol, lignin, and animal feed, enabling advanced biofuel production from waste.
• Clariant- Offers its sunliquid technology to convert agricultural residues into cellulosic ethanol, with full licensing, services, and supply for advanced biofuel plants globally.
• A2BE Carbon Capture, LLC- Utilises industrial COâ‚‚ emissions captured and algae-based photo-bioreactor systems to create biomass that can be converted into fuels and other products
  value-added products.
• Algenol Biotech- Uses proprietary algae cultivation and processing platforms to produce ethanol and other high-energy biofuels from COâ‚‚, salt water, and sunlight, aiming for low-carbon fuel production.

Advanced Biofuels Market Companies

Major market companies are aiming towards innovative advancements in order to enhance their position in the target industry. Major companies are:

• Fujian Zhongde Energy Co., Ltd
• Bangchak Petroleum Plc.
• Abengoa Bioenergy
• DowDuPont Inc.
• Chemtex company

For improved recognize the current status of advanced biofuels, and policies adopted by the foremost countries, Precedence Research predicted the future evolution of the advanced biofuels market. This research study bids qualitative and quantitative insights on advanced biofuels market and assessment of market size and growth trend for potential global market segments.

Key Market Developments:

In year 2020, GranBio declared a planned agreement along with the leading layer NextChem, in order to co-license company's patented technology in order to produce the advanced biofuels worldwide. The collaboration will allow this technology to be commercialized globally, combining the expertise of GranBio in biomass as well as advanced biofuels with the engineering intelligence of NextChem and the global presence of the Company, to deliver integrated services such as feasibility studies, production, engineering and factory construction worldwide.

Segments Covered

By Process

• Biochemical Process
• Thermochemical Process

By Advanced Biofuel Type

• Cellulosic Advanced Biofuels
• Biodiesels
• Biogas
• Biobutanol
• Others

By Raw Material

• Lignocellulose
• Jatropha
• Camelina
• Algae
• Others

By Geography

• North America
  • • U.S.
    • Canada
• Europe
  • • Germany
    • France
    • United Kingdom
    • Rest of Europe
• Asia Pacific
  • • China
    • Japan
    • India
    • Southeast Asia
    • Rest of Asia Pacific
• Latin America
  • • Brazil
    • Rest of Latin America
• Middle East & Africa (MEA)
  • • GCC
    • North Africa
    • South Africa
    • Rest of Middle East & Africa