Renewable diesel

Difference between renewable diesel and biodiesel

Renewable diesel and biodiesel are both produced from renewable biological feedstocks but differ in their production processes and fuel properties:

• Renewable diesel is processed into hydrocarbons similar to conventional diesel and can generally be used as a drop-in fuel, subject to equipment manufacturer requirements. Australia’s Guarantee of Origin (GO) Scheme provides a framework for verifying the origin and lifecycle emissions of low-emissions products and is being expanded to low-carbon liquid fuels. The Australian Government has prioritised development of the Hydroprocessed Esters and Fatty Acids (HEFA) pathway, which converts fats, oils and greases into renewable diesel or sustainable aviation fuel through hydrogen treatment. Other renewable diesel pathways may be considered as the scheme expands.
• Biodiesel is produced by transesterifying oils or fats and consists mainly of fatty acid methyl esters (FAME). It is commonly blended with conventional diesel at low ratios (eg 5-10%), while higher blends may require additional consideration of fuel specifications, engine compatibility, storage and handling.

Current availability and cost in Western Australia

Renewable diesel is not currently produced at commercial scale in Australia, with HVO primarily imported from international producers. Commercial-scale renewable diesel production is proposed in WA, but these proposals have not reached Final Investment Decision (FID) stage.

Currently Western Australia’s HVO supply has been generally supplied in small quantities (20,000 – 30 000L) for specific projects or trials rather than through an established retail network. Larger imports of around one million litres could potentially reduce unit costs, but would require sufficient demand and supporting storage and distribution infrastructure in Western Australia.

Imported HVO is estimated to cost around 1.5 to three times the price of conventional diesel, with recent Western Australian trial experience indicating a cost of approximately AU$4 per litre.

Fuel quality standards in Australia

Fuel quality in Australia is regulated under the Fuel Quality Standards Act 2000 and associated regulations. Since February 2025, separate standards apply to conventional diesel, biodiesel and paraffinic diesel.

The Fuel Quality Standards (Paraffinic Diesel) Determination 2025 sets requirements for paraffinic diesel, including renewable diesel and HVO, covering key fuel properties such as density, viscosity, cetane number, lubricity and cold-flow performance.

Users should confirm fuel compatibility with the original equipment manufacturer (OEM)before using renewable diesel in vehicles, vessels, plant or equipment.

Western Australia Advanced Biofuels Strategy

The Western Australian Government is developing an Advanced Biofuels Strategy under the Made in WA Plan to support development of a commercial-scale biofuels industry. The Strategy focuses on renewable diesel, sustainable aviation fuel (SAF) and biomethane, with priorities government-led initiatives including activating demand, attracting investment, building industry capability and supporting innovation.