US biodiesel use increases outside of transportation sector

A small but increasing amount of biodiesel in the United States is consumed in the residential, commercial and electric-power sectors, according to new estimates now published in the U.S. Energy Information Administration’s State Energy Data System.  

Previously, EIA allocated all U.S. biodiesel consumption to the transportation sector, where the vast majority of biodiesel is consumed. 

Biodiesel is a renewable fuel produced using fats, oils or greases usually blended with petroleum diesel and consumed by trucks.  

In 2023, the most recent year for which EIA has estimates, the transportation sector accounted for about 95 percent of the nearly 46 million barrels of biodiesel consumed in the United States. 

Biodiesel can also be blended with heating oil to heat homes and businesses.  

EIA estimates that the residential and commercial sectors combined accounted for nearly 5 percent of U.S. total biodiesel consumption in 2023, up from about 1 percent a decade earlier.  

The introduction of biofuel-blending mandates for heating oil in some Northeast states is contributing to that growth.  

Although customers in other states likely blend biodiesel to heat homes and businesses, EIA said it only estimates consumption for New York, Connecticut and Rhode Island. 

Consumption of biodiesel in the residential and commercial sectors is higher in New York than in any other state, accounting for 57 percent of the U.S. total for those sectors in 2023.  

New York City passed the nation’s first law requiring biodiesel blending with heating oil, mandating a minimum 2 percent biodiesel blended with heating oil beginning in 2012.  

Later, New York enacted a 5 percent minimum state-wide blend law beginning in 2022, which increases to 10 percent in 2025 and 20 percent in 2030.  

According to the U.S. Census Bureau’s American Community Survey, nearly 16 percent of homes in New York used heating oil as their primary heat source in 2023, about four times more than the U.S. average of about 4 percent. 

Connecticut and Rhode Island also have similar state-wide minimum biofuel-blend laws for heating oil.  

Connecticut’s 5 percent blend law began in 2022 and ramps up to 10 percent in 2025, 15 percent in 2030, 20 percent in 2034, and 50 percent in 2035.  

Rhode Island was the first state to enact a minimum biofuel heating-oil blend law that began with a 5 percent blend in 2017 and increased to 10 percent in 2023. 

Rhode Island’s blend law increases more quickly than the other states—up to 20 percent in 2025 and 50 percent in 2030.  

More than 34 percent of homes in Connecticut and 26 percent of homes in Rhode Island reported heating oil as their primary heat source in 2023. 

Biodiesel can also be burned to generate electricity, and the electric-power sector accounted for less than 1 percent of U.S. biodiesel use in 2023.  

In 2006, a test plant in Tennessee reported the first biodiesel use for electric power in the United States.  

Hawaii has accounted for nearly all U.S. biodiesel consumed for electric power since 2009.  

In 2023, petroleum fueled about 68 percent of Hawaii’s total electricity generation, the highest share of any state, and EIA estimates that biodiesel fueled about 1 percent of the state’s total generation.