An interesting fact about diesel engines is they were not initially designed to use the fuel we run them on.
Rather than crude-oil derivatives, the eponymous inventor of the compression-ignition engine, Rudolph Diesel, demonstrated his machine at the 1900 World Fair using peanut oil, intending for farmers to be able to use their own crops to power their machinery.
History may not repeat itself, but it often rhymes, and today, transport strategists are asking if vegetable oil, and hydrotreated vegetable oil (HVO) in particular, could take on some or all of the work currently done by mineral oil.
What is HVO?
HVO is a ‘drop in’ replacement for mineral diesel, meaning no engine modifications are needed for the fuel to be used. It comes from various sources including used cooking oil (UCO), palm-oil waste, soyabeans, algae and animal fats.
These substances are chemically treated, most often by adding hydrogen to their molecules, a process known as hydrogenation. Hydrocracking, where molecules are broken down by introducing hydrogen, can also be used. The process for creating HVO is similar to that for producing conventional diesel, the key difference being which ‘feedstock’ is used as the base fuel.
When synthesising HVO many of the impurities present in mineral diesel are eliminated, so it produces far fewer particulates (microscopic pieces of soot) when burnt – though it is HVO’s significantly reduced carbon output that makes it a potential fuel of the future.
There is no reason why HVO can’t be used in diesel cars, but haulage is in greater need of a low-carbon fuel that does not involve batteries, hence why the industry is focused primarily on this area at present.
Why HVO?
The main issue with mineral diesel is that when it is burnt, carbon that had been captured millions of years ago by the creatures and plants that went on to form crude oil is re-released into the atmosphere. This fact is at the root of almost all western governments’ thinking on fossil fuels, and all policies that seek to ‘decarbonise’ transport.
Because HVO comes from renewable sources it doesn’t introduce what is effectively new carbon into the atmosphere. Instead, the carbon absorbed by the recently living organisms that were used to create HVO is emitted when the fuel is burnt, while new crops or animals grown to produce more HVO can in-turn absorb this carbon. This effectively creates a closed-loop system, and one that cuts out the millions of years of anaerobic decay and carbon rerelease involved respectively in the formation and combustion of mineral oil.
If that sounds like a too-good-to-be-true perpetual-motion machine, Rudolph Diesel had idealism in mind when he invented his engine as he sought to make the Carnot cycle, a theoretical concept that promises up to 100% efficiency, as close to a reality as possible.
This was clearly aspirational, as the laws of thermodynamics mean 100% efficiency will forever remain just out of reach, as when energy is changed from one form to another (EG the chemical to kinetic change involved when combusting fuel in engines), some energy always goes to waste, often as heat.
Electric motors offer far greater efficiency than internal combustion engines, but short of a revolution in cell chemistry the poor energy density of batteries renders EV rather challenging for haulage, as a 44-tonne truck needs around four tonnes of batteries to move a load just 300 miles or so, giving over 10% of a vehicle’s capacity to its power source. Enter HVO.
HVO at present
HVO is caught in something of a chicken-and-egg situation as things stand. While it is an effective replacement for diesel it also tends to be a few pence per litre more expensive, and as fleet managers keep a close eye on bottom lines, it might seem that making the switch has to be done on carbon, rather than fiscal grounds.
That’s not necessarily the case, though, because as well as conventional diesel and HVO achieving price parity for a period earlier this year (though softening crude prices put a stop to this), avenues are available to offset additional costs.
James Hitchman works for Portland Pricing, which is the official price information service for Logistics UK, and the official pricing partner of the Fleet Operator Recognition Scheme (FORS).
Hitchman explains that running vehicles on HVO generates Renewable Transport Fuel Certificates (RTFCs), and these can “be traded and monetised which effectively reduces the net cost of the fuel”. He adds that once RTFC values are factored in, “renewable diesel can approach price parity with standard diesel”.
Another obstacle to be overcome is to be found in the relationships between oil companies and petrol stations. If a forecourt operator commits to buying a million litres of diesel a year for a site and installs an HVO tank that does roaring trade, they may find themselves in a bit of a bind as they struggle to shift the mineral diesel they are contracted to buy.
Given these issues, there is a fair amount of inertia around HVO, and fewer than 100 forecourts offer the fuel. But that hasn’t stopped some HGV operators from making the switch.
Fleet management firm Silvey Fleet details that Wren Kitchens has switched 94% of its trucks to HVO, while PepsiCo UK is using HVO to power “over a million miles of HGV journeys”. FedEx, meanwhile, runs 170 of its lorries on HVO, while Howdens has also introduced the fuel to its fleet. A number of local councils have decided to run their vehicles on HVO, too.
HVO in the future
One major current sticking point is that governments across Europe adhere to a strict and specific interpretation of what ‘zero emission’ means.
Burn diesel and natural gas to mine and refine the materials for an electric truck’s battery? No problem: as it produces no on-the-road exhaust gases it’s zero emission. Burn coal to smelt the steel for its body? Still zero emission. Freight the finished vehicle halfway around the world on a container ship powered by bunker fuel? Yep, still zero emission. Junk perfectly good diesel trucks and buy shiny new EV ones, creating more carbon due to the manufacturing processes involved in these? According to policy this is a zero-emission endeavour.
The moment a single carbon atom leaves a truck’s exhaust pipe, however, that vehicle is deemed not to be zero emission. So while HVO is an effective fuel that reduces lifecycle carbon emissions by 80-90% and produces far less particulate matter than mineral fuel, while also allowing large vehicles to perform their vital roles in the same manner they do today, its long-term future is incompatible with policy – as things currently stand.
Also of note is that the UK is a net importer of HVO feedstock, while the government’s Trade Remedies Authority is investigating American HVO amid concerns fuel coming from the US has been sold at “unfairly low prices”. These, while significant matters, are arguably side issues given the uphill battles the HVO industry faces in having to sell what is effectively a new type of the fuel to the market, while simultaneously convincing politicians it has a role to play in the future. In HVO we find an ideological battle as much as a commercial challenge.
Source issues
A recent investigation by the BBC found that some HVO is produced using ‘virgin’ palm oil, rather than palm-oil waste, despite being labelled as containing the latter. As palm oil agriculture is linked to issues including deforestation and land conflicts this raises ethical questions, and the Department for Transport is investigating the matter.
Nonetheless, the UK certification process for HVO is one of the strictest in the world, while in 2023 around 41% of all ‘verified renewable fuel’ (this includes HVO, plus biodiesel and bioethanol, mineral fuels with ~10% added renewable content) was produced from used cooking oil.
Ollie Bradshaw, sustainability manager with Certas Energy, the UK’s largest independent fuel distributor, says that HVO “will continue to play an integral role in the sectors that are most reliant on diesel engine road vehicles (DERV), such as haulage”
Bradshaw adds that demand for HVO has grown “significantly” over the last 12 months, making it all the more important for the industry to “continue to support voluntary assurance schemes, like the ISCC [International Sustainability & Carbon Certification]” to ensure “the highest quality supply chains” are used for HVO feedstock. Highlighting that Certas’ HVO is verified by the Department for Transport’s Renewable Transport Fuel Obligation scheme, Bradshaw encourages the rest of the industry “to ensure there is complete transparency and traceability in the system”.
A final word from Rudolph
The inventor of the diesel engine died over a century ago in mysterious circumstances, vanishing from a ship as he journeyed from Antwerp to London, his diary entry for the day of his disappearance marked with an ‘X’, his wife left with a bag containing cash equivalent to £100,000 today, along with bank statements showing empty accounts. A year before he died, Diesel gave a speech in which he said:
“The use of vegetable oils for engine fuels may seem insignificant today, but such fuels may become, in the course of time, as important as petroleum.”
Diesel was clearly a man ahead of his time – the only question is by how significant a margin.
