The roar for Diesel, Diesel, Diesel: UPS jumps its renewable diesel use by 15X

August 2, 2015 |

UPS_truckUPS brings overall use of drop-in fuels over 10% of fleet use in REG, Neste , Solazyme buy.

In Georgia, UPS announced agreements for the purchase up to 46 million gallons of renewable fuels over the next three years from Neste, REG and Solazyme, constituting a 15-fold increase over prior contracts and making UPS one of the largest users of renewable diesel in the world. Specific volume agreements by company were not made available.

UPS will shift more than 12% of its purchased ground fuel from conventional diesel and gasoline fuel to alternative fuels by the end of 2017. UPS has previously announced a goal of driving one billion miles with our alternative fuel and advanced technology vehicles by the end of 2017. UPS has been using renewable fuels for more than a year in trucks operating in Texas and Louisiana. The new agreements pave the way for expanded use across the U.S. and potentially in parts of Europe.

UPS embraces low-carbon fuels as part of its sustainability strategy

“Advanced alternative fuels like renewable diesel are an important part of our strategy to reduce the carbon emissions impact of our fleet,” said Mark Wallace, UPS senior vice president, global engineering and sustainability. “We have used more than three million gallons of renewable diesel to date with positive results. Renewable diesel has a huge impact significantly reducing lifecycle greenhouse gas emissions by up to 90 percent less versus conventional petroleum diesel. Renewable diesel also performs well in cold weather, does not have any blending limitations and can be easily ‘dropped in’ to our fuel supply chain without modifications to our existing diesel trucks and equipment.”

Renewable diesel is an advanced hydrocarbon-based fuel that is fully interchangeable with petroleum diesel and offers superior performance and benefits, much like how synthetic lubricants are used in cars instead of petroleum-based lubricants. Bio-based feedstocks from fats, plant oils and waste residues are converted to renewable diesel using advanced refining technologies. These new bio-refineries also have the capability to produce other renewable fuels such as renewable jet fuel, renewable gasoline and renewable propane.

“UPS believes these agreements are especially important because they  will help stimulate demand for investment in refinery technologies and sustainable feedstocks needed to produce renewable fuels at a total cost that is comparable to more carbon-intensive petroleum fuels,” said Wallace.

Deeper look behind the story.

Our 2015 5-Minute Guide to REG
Our 2015 5-Minute Guide to Neste
Our 2015 5-Minute Guide to Solazyme

The Digest’s Take

Bottom line — biodiesel is America’s favorite advanced biofuel, representing more than 80% of all advanced biofuels consumed in the country, and more than tripling in output in the past six years.

At the same time, diesel prices are insanely great for consumers. Consider that diesel generally gets 30% higher mileage per gallon because of higher energy density and engine compression — but is available at 3% less in the wholesale markets right now. If, for example, you are driving a Volkswagen Jetta, you’re paying 10 cents per mile for gasoline, but 7.5 cents per mile for diesel. Those pennies add up over 15,000 miles per year.

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