Blog>Renewable Propane Gaining Momentum in the U.S. Transportation Sector

Renewable Propane Gaining Momentum in the U.S. Transportation Sector

The need for sustainable, clean, and renewable energy worldwide is growing. In the United States, energy leaders such as rLPG North America are taking proactive steps to create new technology and increase the global supply of renewable LPG. rLPG North America is a consortium of North American companies focused on achieving a decarbonization route at scale for LPG supply. While entities such as rLPG North America continue to work on new global supplies of renewable propane, the demand for renewable exists in the U.S. today.

Blossman Gas, Inc. and Blue Star Gas, two Alliance AutoGas Partners, are two of the founding members of rLPG North America and will be selling over 15 million gallons of renewable LPG into the United States transportation sector in 2025. These volumes are currently derived from bio-diesel production with LPG as a co-product. It is estimated that by 2030, the US will have 700 million gallons of renewable LPG derived from bio-diesel and Sustainable Aviation Fuel (SAF) production. However, this volume will not be enough to meet the global LPG goals for the available supply of renewable LPG, which is why research and development is being undertaken on small-scale, “community” based production. Local feedstocks such as landfill gas, animal waste, dairy waste, and other sources of biogas are important to the future of the global LP Gas industry.

Currently, in the U.S., transportation fuels are primarily eligible for Federal RIN credits for each gallon produced. RINs (Renewable Identification Numbers) are generated when renewable fuel is produced, and the credits are used to comply with the Renewable Fuel Standard (RFS) program. The RFS program was adopted to help reduce the nation’s dependence on foreign oil, grow the renewable energy industry, and reduce greenhouse gas emissions. In addition, many states, including California’s Low Carbon Fuel Standard regime, provide additional incentives for increased renewable LPG production.

One example of renewable propane usage is the City of Raleigh, NC, which is using the fuel for its fleet vehicles. On September 28th 2023, the City of Raleigh held a Clean Energy and Renewable Propane ribbon-cutting event at the city’s vehicle fleet facility, celebrating the introduction of renewable LPG as a low-carbon and environmentally effective fuel source. This event launched its new climate action strategy, implemented by transitioning a portion of its fleet vehicles to operate on renewable propane, making Raleigh the first city in North Carolina to do so.

Numerous states and municipalities are encouraging the switch to renewable fuels by adding renewable liquid fuels to their statewide contracts. State contracts are used as tools in procurement for business needs to eliminate repetitive bids. In February 2024, a new state contract was brought forth by James Madison University to provide vehicle fleets in the Commonwealth of Virginia with new pricing on propane autogas vehicle conversion equipment, in addition to access to renewable propane Autogas. Propane Autogas is already a widely used fuel in public and private fleets in Virginia. Still, the supplementary offering of renewable propane Autogas is an enticing opportunity for organizations to achieve their sustainability objectives. Notably, this contract marks a significant milestone as the first to incorporate a renewable LPG (Autogas) component at the state level.

The desire for renewable propane in the U.S. market will increase with a greater supply, accessibility, awareness, and as applications become available to the market. Introducing more renewable propane offerings and incentives, such as state contracts, will allow more organizations access to clean and renewable-sourced liquid fuel.