Second generation biofuels or advanced biofuels are the way forward from the first generation biofuels, which is made from vegetable oils and sugar. The only differentiating factor between first generation biofuels and second generation biofuels is the feedstock. Second generation biofuels are manufactured from various types of biomass. Biomass is mainly derived from plant sources. However, second generation biofuels can also be manufactured from animal derived biomass. First generation biofuels were dependent on food crops and production of adequate bio fuel was a challenge, as it competed with food supply. Moreover, greenhouse emissions of first generation biofuels were nominally less than that of fossil fuels. Dependence on food crops also rendered it a costly alternative to conventional petroleum leading to limited acceptance. Second generation biofuels are capable of overcoming these handicaps and produce significantly higher quantities of biofuels with higher environmental benefits and lower cost. The different thermo-chemical technologies currently in use or under development are gasification, pyrolysis and torrefaction.
The market for second generation bio fuel is driven by the need to produce clean and sustainable energy, with minimal environmental impact. Second generation bio fuel manufacturing technology enables production of commercially acceptable fuel from inedible biomass and avoid the “food vs fuel” dilemma. The main feedstocks used for second generation biofuels are agricultural and non food crop residues, wastes procured from forestry industry, energy crops, jatropha and algae. Feedstock cost accounts for over 50% of the product cost, and cheap availability of the feedstocks lead to cheaper product. Second generation biofuels are yet to achieve large scale commercialization and is expected to become cheaper over time with the development of technology. Some types of second generation biofuels are in production as of today. However, large scale commercialization is not expected to come in force until 2020, without government support. Second generation biofuels have tremendous future opportunities as automotive and aviation fuel. In recent years, biofuels have established their importance among various other fuels. With rising oil prices and mounting concerns over energy security, focus has shifted to renewable sources of energy. Biofuels, with ability to fuel transport sector with low carbon emission as compared to conventional fuels, have attracted investments from various large market players. Production of second generation biofuels is attractive for countries with no petroleum reserves as it helps to reduce foreign exchange spending towards import of petroleum.
There are no apparent restraints to the market apart from technology development and feedstock procurement. However, the highly volatile crude oil prices in the global market might reduce the market attractiveness for the second generation biofuels market. With crude oil prices plunging by more than 50% in a year, cost competitiveness is a factor for the market.
North America is the largest producer of second generation biofuels, with high investments in research and development. Europe is the second most attractive market in terms of demand for biofuels. However, Asia Pacific with its enormous resource is gradually catching up with a few Chinese companies investing in the futuristic market. Global laws regarding recution of greenhouse gasses and production of clean energy is expected to drive the market with governments in North America and Europe providing incentive to the second generation biofuels manufacturers. 
Some of the major companies producing second generation biofuels are Blue Marble Biomaterials LLC, Algenol, Chemrec, DuPont Danisco Cellulosic Ethanol LLC, Fujian Zhongde Energy Co., Ltd, Gevo,Inc., Gushan Environmental Energy Ltd., PetroSun, Inc., Sapphire Energy and Solazyme, Inc.
This research report analyzes this market on the basis of its market segments, major geographies, and current market trends. Geographies analyzed under this research report include 
  • North America 
  • Asia Pacific 
  • Europe
  • Middle East and Africa
  • Latin America
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  • Factors limiting market growth
  • Current market trends 
  • Market structure
  • Market projections for upcoming years 
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