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Tax Exemptions on Non Food-based Bio LPG Boost Consumption during COVID-19 Outbreak

The COVID-19 pandemic has radically altered the global energy sector. The European Commission has approved a tax exemption for non-food based biogas and Bio LPG (Liquefied Petroleum Gas) used as motor fuel or for heating in Sweden. The objective of this tax exemption is to increase the consumption of biopropane and biogas to reduce the use of fossil fuels. Due to the ongoing pandemic, companies operating in the Sweden Bio LPG market are capitalizing on tax exemption, as industrialists and individuals are becoming aware about reducing greenhouse gas emissions to safeguard the environment.

Other governments are taking cues from the European Commission and are introducing schemes for 5 year or 10 year plans. This will help industrialists to transition toward advanced biofuels such as Bio LPG. Tax exemptions are becoming necessary to stimulate the production and use of domestic and imported Bio LPG and biogas.

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Cellulosic and Waste-feedstock Facilitate Commercial Production of Bio LPG

Gaseous conversion & synthesis and liquid conversion & synthesis are two advanced chemical processes used to manufacture Bio LPG. However, these processes are technically challenging and not well-established commercially. This is anticipated to cause uncertainty in the Bio LPG market. As such, these chemical processes hold promising potentials to use cellulosic- and waste-feedstock on a large scale to produce significant volumes of biopropane. Manufacturers in the Bio LPG market can capitalize on this business opportunity, since these processes help to break down large and complex molecules of biomass into smaller and simpler molecules that can be synthesized for the production of fuels. As such, the market for Bio LPG is expected to expand at an explosive CAGR of ~83% during the years 2020 to 2030.

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Manufacturers Commercialize Bio LPG with Refining Process of Biodiesel

Bio LPG is being associated with low carbon footprint compared to conventional LPG. Hence, SHV Energy— a global distributor and marketer of LPG is increasing its production capacities with the help of sustainably sourced renewable feedstock. As such, the Bio LPG market is projected to surpass US$ 65 Bn by the end of 2030. Manufacturers are adopting the renewable biodiesel production process, which also generates by-products of biopropane.

The cost-efficient production technique involves collection of Bio LPG from waste off-gases during the refining process of biodiesel. In this way, manufacturers are able to commercialize the large-scale production of Bio LPG. As such, Bio LPG is being purified to produce conventional propane. Companies in the Bio LPG market are harnessing the advantages of biological processes to boost their output capacities. The hydrotreatment of bio-oils is another production technique, which is being used to commercialize Bio LPG.

Renewable Propane Scales Business in Transportation Applications in California

Apart from hydrotreatment of bio-oils and refining process of biodiesel, the fermentation of sugars has reached a demonstration stage for the large-scale production of Bio LPG. The process with the largest potential for volume is the gaseous conversion and synthesis of cellulosics or organic wastes. Bio LPG is being publicized as renewable propane in California. Companies in the bio LPG market are in a profitable position in California, since renewable propane is increasingly replacing conventional gasoline and diesel in transportation applications.

Multi-product processes of renewable diesel and renewable natural gas are being harnessed by manufacturers in the Bio LPG market to produce renewable propane. Thus, renewable propane is gaining popularity as a sustainable fuel solution in California due to constant replenishment of energy with the help of natural decay of organic matter.

Favorable Combustion Attributes of Biopropane Preferred in Vehicles over Diesel

The growing individual acceptance toward reducing, reusing, recovering, and recycling resources is benefitting companies in the Bio LPG market. Manufacturers are unlocking revenue opportunities in millions of the U.S. households, since Bio LPG is replacing methane in space conditioning, cooking, and water heating applications. Increasing number of people is using propane to fuel their outdoor grills. The ever-evolving automotive sector is also creating value-grab opportunities for companies in the Bio LPG market, since propane serves as a good alternative to vehicle fuel.

Favorable combustion attributes and clean burning of renewable propane are highly preferred over gasoline and diesel in vehicles. Moreover, Bio LPG is easily stored on vehicles in low-pressure tanks at a reasonable cost. The multi-node network of retailers is another key driver, which is bolstering the growth of the market for Bio LPG. The concept of autogas is growing popular at vehicle fueling stations.

Low-NOx Propane Engine Technology Being Harnessed in Heavy-duty On-road Vehicles

Even though Bio LPG is transforming the transportation sector, manufacturers need to improve its environmental performances. Stakeholders in the Bio LPG market are increasing their R&D muscle in the advanced engine propane technology, since this technique leads to very low emissions of nitrogen oxides (NOx). ROUSH CleanTech— a specialist in alternative fuel vehicle technology, manufactured a propane engine, which was recently certified to meet California’s Optional Low-NOx Standard. The low-NOx propane engine technology is being preferred in heavy-duty on-road vehicles such as shuttle and school buses.

Non-road applications of Bio LPG involve alternative fuel options for forklifts and remote agricultural purposes such as the deployment of propane engines to power irrigation equipment, water pumps, and citrus crop heaters. These heaters prevent the crop from frost damage. Companies in the Bio LPG market are enabling engine-related improvements for propane-fueled products that help to minimize greenhouse emissions and other pollutants.

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Analysts’ Viewpoint

The decarbonization strategy is being incentivized by several government authorities in Spain and other countries to achieve a speedy economic recovery during the ongoing COVID-19 pandemic. The U.S. transportation sector is moving toward near zero emission levels with the consumption of renewable propane. However, manufacturers in the Bio LPG market need to take giant strides to improve the environmental performances of renewable propane. In order to achieve this, manufacturers should increase their R&D in the low-NOx propane engine technology, which is gaining widespread application in on-road and off-road applications of heavy-duty engines and forklifts, respectively. Commercial-grade biopropane is helping manufacturers tap into incremental opportunities in European and Asian countries.

Bio LPG Market: Overview

  • According to Transparency Market Research’s latest research report on the global Bio LPG market for the forecast period from 2020 to 2030, demand for Bio LPG is rising across the globe to reduce pollution and eliminate carbon emission. Increase in environmental regulations in various industries is estimated to boost the global Bio LPG market over the next few years.
  • In terms of revenue, the global Bio LPG market is anticipated to cross US$ 65 Bn by 2030, expanding at a CAGR of ~83% during the forecast period

Increase in Demand for Liquefied Petroleum Gas in Developing Countries: Key Driver of Bio LPG Market

  • Globalization, industrialization, and urbanization have increased significantly across the globe over the past few years. However, the flow of investment has changed from developed nations to developing nations due to low infrastructure and labor cost.
  • Increase in investment in industrialization and urbanization has led to a rise in household income as well as disposable income of the middle class and lower middle class population. This has resulted in the adoption of liquefied petroleum gas in residential and transportation sectors.
  • Earlier, kerosene and solid fuels such as coal and wood were used for cooking. These types of fuels led to serious health and environmental issues. However, increase in awareness about health and environmental issues such as carbon emission and air pollution, has propelled the demand for liquefied petroleum gas in developing countries.
  • The Government of India has taken various initiatives such as providing subsidies and free liquefied petroleum gas connection for poor families. This has significantly increased the number of liquefied petroleum gas users in the country in the past two to three years. According to the Petroleum Planning & Analysis Cell, the number of registered liquefied petroleum gas connections in India rose from 106 million in 2008/09 to 263 million in 2017/18.
  • Rise in awareness about environment-related issues and implementation of stringent rules and regulations by regulatory authorities of governments of various countries have compelled companies to seek green solutions. Demand for Bio LPG has increased in Europe and the U.S. as a renewable fuel to reduce carbon emissions.
  • Thus, rise in demand for liquefied petroleum gas in developing countries for cooking, transportation, and various other industrial applications is projected to drive the Bio LPG market over the next few years

Rise in Demand for Bio LPG in Industrial Sector

  • Demand for Bio LPG is rising across the globe, owing to increase in demand for liquefied petroleum gas in the industrial sector
  • Environmental issues have become a major concern across the globe. High carbon emission has led to climate change and various other adverse effects on the planet. Currently, oil is a commonly used fossil fuel. However, usage of liquefied petroleum gas is preferable over oil, as liquefied petroleum gas is cleaner. Furthermore, liquefied petroleum gas releases less carbon dioxide per unit than oil and coal. Bio LPG is a fuel that is derived from production processes using renewable and organic feedstock.
  • Bio LPG is chemically identical to conventional liquefied petroleum gas. It is made from sustainably sourced and technically approved raw materials; more than 60% is derived from waste and residues.
  • Bio LPG gas has 17% lower running cost vis-à-vis biomass boiler in old buildings. This is anticipated to drive the global Bio LPG market during the forecast period.

Bio LPG Market: Competition Landscape

  • Detailed profiles of providers of Bio LPG have been included in the report to evaluate their financials, key product offerings, recent developments, and strategies
  • Major players operating in the global Bio LPG market are
    • Neste
    • SHV Energy
    • Renewable Energy Group, Inc.
    • AvantiGas
    • Diamond Green, Eni
    • Total
    • Irving Oil
    • Repsol
    • Preem AB

Bio LPG Market: Major Developments

  • Key service providers of Bio LPG, such as Neste, SHV Energy, Preem AB, and Renewable Energy Group, Inc., are focusing on the expansion of Bio LPG facilities, owing to the rising demand for Bio LPG facilities. Other prominent developments in the global Bio LPG market are highlighted below:
  • On October 22, 2020, Repsol announced plans to build the first low-emission advanced biofuels plant in Spain at its refinery in Cartagena. The plant is expected to have an annual production capacity of 250,000 tons of hydrobiodiesel, biojet, bionaphtha, and biopropane/Bio LPG. The plant is projected to be operational in 2023, and would produce advanced biofuels from recycled raw materials to be used in aircraft, trucks, or cars. The new advanced biofuel is likely to help cut carbon dioxide emissions by 900,000 tons per year.
  • On October 23, 2020, Preem AB launched a new project to rebuild the Lysekil refinery to become Scandinavia’s largest producer of renewable fuels. The company plans to carry out redevelopment of the existing Synsat plant, which presently produces environmental class 1 diesel. The redevelopment of the Synsat plant is anticipated to increase Preem’s renewable diesel production by 650,000 to 950,000 cubic meters annually, which is as much as two to three times higher than the current renewable production capacity at Preem AB’s refinery in Gothenburg.
  •  In the global Bio LPG market report, we have discussed individual strategies, followed by company profiles of providers of bio-LPG facilities. The ‘Competition Landscape’ section has been included in the report to provide readers with a dashboard view and company market share analysis of key players operating in the global Bio LPG market.

Bio LPG Market – Scope of the Report

The latest study collated and published by Transparency Market Research (TMR) analyzes the historical and present-day scenario of the global Bio LPG market to accurately gauge its growth potential. The study presents detailed information about important growth factors, restraints, and key trends that are creating the landscape for growth of the global Bio LPG market in order to identify opportunities for stakeholders. The report also provides insightful information about how the global Bio LPG market would expand during the forecast period of 2020 to 2030.

The report offers intricate dynamics about different aspects of the global Bio LPG market, which aids companies operating in the market in making strategic decisions. TMR’s study also elaborates on the significant changes that are anticipated to configure growth of the global Bio LPG market during the forecast period. It also includes key indicator assessment that highlights growth prospects for the global Bio LPG market and estimates statistics related to the market in terms of value (US$ Mn) and volume (kilo tons).

This study covers detailed segmentation of the global Bio LPG market, along with key information and a competitive outlook. The report mentions company profiles of players that are currently dominating the global Bio LPG market, wherein various developments, expansions, and winning strategies practiced by these players have been presented in detail.

Key Questions Answered in TMR’s Report on Bio LPG Market

The report provides detailed information about the global Bio LPG market on the basis of comprehensive research on various factors that are playing a key role in accelerating the growth of the market. Information mentioned in the report answers path-breaking questions for companies that are currently operating in the global market and are looking for innovative methods to create a unique benchmark in the global market so as to help them design successful strategies and make target-driven decisions.

  • Which feedstock type segment of the global Bio LPG market would emerge as a major revenue generator during the forecast period?
  • How are key market players successfully earning revenues in the global Bio LPG market?
  • What would be the Y-o-Y growth trend of the global Bio LPG market between 2020 and 2030?
  • What are the winning imperatives of leading players operating in the global Bio LPG market?

Research Methodology – Bio LPG Market

The research methodology adopted by analysts for compiling the report on the global Bio LPG market is based on detailed primary as well as secondary research. With the help of in-depth insights of the market-affiliated information obtained and legitimated by market-admissible resources, analysts have offered riveting observations and authentic forecasts of the global Bio LPG market.

During the primary research phase, analysts have interviewed market stakeholders, investors, brand managers, vice presidents, and sales and marketing managers. Based on data obtained through interviews of genuine resources, analysts have emphasized the changing scenario of the global Bio LPG market.

For secondary research, analysts have scrutinized numerous annual report publications, white papers, market association publications, and company websites to obtain the necessary understanding of the global Bio LPG market.

Bio LPG Market – Segmentation

TMR’s research study assesses the global Bio LPG market based on end user, feedstock, and region. The report presents extensive market dynamics and progressive trends associated with different segments, and how they are influencing growth prospects of the global Bio LPG market.

Feedstock

  • Bio-oil
  • Sugar
  • Others (including Cellulosic and Mixed Waste)

End User

  • Residential
  • Commercial
  • Industrial

Region

  • North America
  • Europe
  • Asia Pacific
  • Middle East & Africa

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