The rising cost of gasoline and diesel, along with the rapid depletion of non-renewable resources, has prompted widespread use of alternative fuels
Covid-19 Impact & Market Status
Due to travel prohibitions and business closures, the COVID-19 has had a negative impact on economies and businesses in a number of countries. The closure of various plants and factories has had a severe influence on global supply chains, negatively affecting manufacturing, delivery schedules, and product sales in the worldwide market. Most sectors, with the exception of medical supplies and life support items, had been severely hit, and alternative fuel market had also been severely impacted and the growth of the market was hampered due to the reduced demand for alternative fuel during this period as everything came to a standstill.
Natural Gas in High Demand
Natural Gas, Biodiesel, Ethanol, Hydrogen and others are the different types of alternative fuel available in the market. Natural gas has currently earned the highest revenue share in the market and is predicted to continue during the analysis period due to its widespread availability and widespread use in cars especially the use of LPG in light commercial vehicles. They are also pollution free, hence are seen as environment friendly by most companies.
Automobile Industry to earn Highest Revenue
Automobile Industry, Chemical Industry, Defence and Aviation are some the industries where the alternative fuels are being used. The automobile industry currently earns the highest revenue share in the market, and it is predicted to continue to rise during the analysis period due to the major role of fuel in the operation of the engine. The alternative fuels also have a major scope in this industry due to various innovations and the depletion of the non-renewable fuels. The aviation industry is also expected to rise during the analysis period as the demand for alternative fuels increases in this industry.
Asia-Pacific expected to Dominate
During the forecast period, Asia Pacific is expected to have significant expansion in the alternative fuels market due to the immense popularity of using renewable resources among the people living in these regions. Furthermore, governments in a number of Asian Pacific countries are promoting the use of alternative fuels on a significant scale. This factor could propel the alternative fuels sector to new s.
Europe and North America also earns a significant revenue share in the alternative fuel market, and it is predicted to rise rapidly during the analysis period due to strong demand for these fuels in these regions due to the increased awareness of climate change. The high-income level of the people and the depletion of non-renewable fuels are also propelling the market in those areas.
Furthermore, environmental preservation is an essential factor that is driving up the need for alternative fuels.
Alternative fuels are basically used as substitutes for the non-renewable fuels. When compared to conventional fuels like gasoline and diesel, these emit fewer harmful emissions. Furthermore, domestic availability and job creation are two significant advantages linked with alternative fuels. As a result, these factors point to the market for alternative fuels expanding. Biodiesel, natural gas, hydrogen etc. are some of the alternative fuels and they can be used in various different kinds of industries.
The alternative fuel market is predicted to grow to about USD 438.2 billion by 2029 at a Compound Annual Growth Rate (CAGR) of 12.3 percent during the forecast period 2022-2029.
Environmental concerns, which are limiting the use of non-renewable fuels such as gasoline and diesel, are a major driving reason for the expansion of the alternate fuels sector. The encouragement of many countries' government entities to embrace alternative fuels is expected to significantly boost demand. As a result of these advancements, a greater awareness of alternative fuels is generated, resulting in increased growth potential across the global industry. Furthermore, several government agencies offer a variety of subsidies to encourage the use of alternative fuels. All of these factors are helping the alternative fuels business grow.
The manufacture of alternative fuels is a major problem for the market. In comparison to gasoline and diesel, the manufacturing process is both costly and difficult because it must be scalable and long-lasting. Some alternative fuels must be blended with conventional fuels as an additive, but they are not used on their own. Alternative fuel production is likewise hampered by such traits.
The market has intense competition due to the high demand and consists of several big corporations such as Neste, Archer Daniel Midland, Renewable Energy Group, Cosan, BMW Group, Tesla Inc., Honda Motor Co. etc.
Latest Innovations in the Alternative Fuel Market: A Snapshot
- In June 2020, Shell Aviation and World Energy provided Amazon Air with up to six Billion gallons of SAF in one of the largest deals in the industry. According to IATA, unblended SAF (sustainable aviation fuel), which is made from waste and renewable feedstocks, has the potential to reduce lifecycle emissions from aviation by up to 80% when compared to conventional jet fuel.
Alternative Fuel Market Scope
|Forecast Unit||Value (USD)|
|Revenue forecast in 2028||USD 438.2 billion|
|Growth Rate||CAGR of 12.3% during 2021-2028|
|Segment Covered||Type, End User , Regions|
|Regions Covered||North America, Europe, Asia Pacific, South America, Middle East and South Africa|
|Key Players Profiled||Neste, Archer Daniel Midland, Renewable Energy Group, Cosan, BMW Group, Tesla Inc., Honda Motor Co. etc.|
Key Segments of the Alternative Fuel Market
Type Overview, 2022-2029 (USD Billion)
- Natural Gas
End User Overview, 2022-2029 (USD Billion)
- Automobile Industry
- Chemical Industry
Regional Overview, 2022-2029 (USD Billion)
- Rest of Europe
- Rest of Asia Pacific
- Rest of South America
Middle East and South Africa