Nature and Biodiversity

Will the United States run solely on renewable energy in ten years?

A street scene from San Francisco, which is leading the field in renewable energy

California is leading the way in renewable energy in the US. Image: Unsplash/Joshua Sortino

Ashley Winchester
Writer, Neste
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United States

  • The United States is shifting away from fossil energy to renewable energy and other sustainable energy sources, as it works towards energy independence.
  • There is growing political and cultural support for the renewable energy transition in the US, the infrastructure is not yet in place to meet the demand, but it’s getting there.
  • Continuing innovation and development in the ways to refine and use a broader pool of renewable raw materials will also help boost America’s renewable energy conversion.

Over the past decade, the United States has slowly begun shifting away from fossil energy to renewable fuels and other sustainable energy sources, as it works towards energy independence.

The politics of renewables in the United States

Government policy over the last 10 to 15 years has consistently established laws that promote economic investment in climate-friendly technologies. In 2007, California’s then-Governor, Arnold Schwarzenegger, issued an executive order to establish the world’s first low-carbon fuel standard (LCFS), aimed at reducing the environmental impact of transportation.

National policy soon followed. In December of that year, President George W. Bush. signed the Energy Independence and Security Act (EISA), which, among other climate-forward goals, set a new renewable fuel standard that mandated the increase of the production of biofuels into 2022. In June 2023, the Environmental Protection Agency (EPA) extended the nation’s targeted renewable fuel volume growth into 2025.

Tackling the climate crisis has been among the top priorities of the Biden-Harris administration. President Joe Biden’s signature of the Inflation Reduction Act (IRA) of 2022 marked the most significant piece of climate legislation in US history. This landmark bill includes funding and tax credits for building renewable energy projects and provides a stepping stone towards meeting the Paris Agreement's net-zero emission goals by 2050.


What's the World Economic Forum doing about the transition to clean energy?

California kick-starts renewable demand

Trailblazing energy policies, such as the LCFS and EISA, provide a foundation for contemporary climate legislation, such as clean fuel programmes on the West Coast, which set the bar for other states to follow. California has long been a bellwether for environmental policy and change within the US and its leadership in the renewable energy sector is no exception. Last year, the nation’s most populous state passed an ambitious plan to achieve carbon neutrality by 2045. This includes a roadmap to eliminate carbon and air pollution from the entire transportation sector.

Neste, a leader in renewable diesel and sustainable aviation fuel (SAF), started selling renewable diesel in California in 2016. In recent years, more than a third of the company’s global renewable diesel and SAF sales volumes have been to North America. Annika Tibbe, acting President for Neste US, says economic incentives in California and nationwide help support the development of renewable energy solutions.

Tim Johnson, the senior vice president and general manager of Diesel Direct, the largest mobile fuel distributor in the US, says in 2015, demand for renewable diesel began to trickle in, with municipalities and government transportation in California requesting the fuel. Interest and demand grew as potential customers learned more about renewable diesel and its benefits beyond the environment. They were encouraged by incentives driving down the price-per-gallon of this new fuel option.

By the time Diesel Direct partnered with Neste in 2018, “it was almost an immediate hockey stick trajectory of change,” Johnson says. “In 2017, Diesel Direct sold 100,000 gallons of renewable diesel throughout the entire calendar year. In 2018, we had sold a million gallons in that first month. So, we had a lot of customers teed up ready to get started.” Five years later, the volumes sold each month in California and Oregon exceeded what was sold in a whole year in 2018.

Johnson says California’s incentives have helped foster the growth of the renewable fuels market for producers in the short term. Still, he believes future growth in the West and throughout the US over the next decade will also be driven by changing consumer culture.

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A culture shift towards more sustainable alternatives for aviation and road transportation

The International Air Transport Association (IATA), in line with the Paris Agreement, set a goal of net-zero carbon emissions from the global air transport industry by 2050. Keith Sawyer, the manager of alternative fuels at Avfuel, a leading supplier of aviation fuel and services, says a key element helping the aviation industry towards its net-zero goals is the adoption of SAF, a drop-in solution requiring no modifications to aircraft. “There’s no question right now that net-zero is achievable. We’re well on our way,” Sawyer says. “Demand continues to scale in line with net-zero goals.”

For Sawyer, it is clear that this shift to SAF is driven largely by a change in corporate and consumer culture. “Corporations are thirsty for SAF because it meets their environmental, social and governance (ESG) goals, which, in turn, are led by consumer sentiment,” he says. “We have customers looking for SAF on a corporate basis because it's the right thing to do. These corporations are quite serious about their carbon footprint."

Johnson, of Diesel Direct, says there is a similar cultural shift within the trucking industry. He says his own experience with renewable fuels has helped bolster interest from customers, in addition to any pricing benefits due to subsidies. “I'm a truck guy, right? I'm an old mechanic. So, it's fun for me really to see that EGR (exhaust gas recirculation) issues and DPF (diesel particulate filter) issues on my fleets that have only run on renewable diesel since they were born are almost nonexistent,” he says. This is firsthand trust in renewable fuels that he can pass on to his customers.

Johnson adds: “Proof of concept has already been made and we are seeing high demand for renewables. All that remains is the infrastructure to make it all happen.”

Avfuel’s Sawyer says he’s seeing the same in the aviation industry. “Quite simply, demand exceeds supply,” he says. The Avfuel alternative fuels expert forecasts his volume growth to double every year. “Everything that we can put our hands on, as far as blended SAF, we have a home for. So there's less of a need to convince consumers than just two years ago,” he adds. “The need is there and the want is there. I tell my prospective customers and our existing customers, please be patient.”

Meeting the demand for renewables in the US

So, given political and cultural support for the transition to renewable energy in the US, is there enough infrastructure in place to meet the growing demand? The short answer is, not yet. But it’s getting there.

“We already have clients teed up just like we did in California in 2018,” Diesel Direct’s Johnson says. “Once it's available, they'll switch immediately. We’re going to have to see some kind of infrastructure there, but if we're looking at a 10-year span, honestly, I see Arizona, New Mexico, Nevada, for sure. Same thing with the Northeast.”

Moreover, as new renewable fuel startups pass the initial stages of development and regulatory approval, the United States’ capacity for the fuel will expand. Continuing innovation and development in the ways to refine and use a broader pool of renewable raw materials, such as municipal waste and novel vegetable oils, for example, will also help boost America’s renewable energy conversion.

“We are living in a more enlightened era when it comes to global warming, with much greater awareness of the dire threat it poses. In turn, that heightened awareness is driving collaboration and innovation, both critical to combating climate change,” Tibbe explains. “Adopting existing solutions to replace fossil fuels with more sustainable alternatives is equally critical. Energy transition is as much about working with what’s readily available, as it is about driving future innovations.”

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