Refineries Increase Revenue and Reduce Carbon Footprint with Renewable Propane: Study

A new study by the U.S. Department of Energy's National Renewable Energy Laboratory (NREL) shows biorefineries can increase their financial returns by selling renewable propane versus using it as a processing fuel or as a hydrogen feedstock.

The financial findings complement the proven carbon reduction benefits of renewable propane for the transportation, commercial, agricultural and residential sectors.

"Our models show that capital expenditure investments have the potential to be returned in as little as two months for large biorefineries or up to 14 months under the worst-case scenario," said Bob Baldwin, NREL principal scientist and lead author of the study. Baldwin along with NREL researchers Mark Nimlos and Yimin Zhang spent six months studying the economic feasibility of recovering renewable propane from HEFA biorefineries. HEFA stands for Hydroprocessed Esters and Fatty Acids and refers to vegetable oils and fats used to produce renewable fuels.

The NREL study considered several alternate use cases for renewable propane at biorefineries, including using it as a process gas, using it to produce renewable/green hydrogen or selling it to a propane marketer or retailer.

The study concluded that when sold as a fuel, biorefineries would receive significant revenue by leveraging renewable fuel credits even without a premium on the price of wholesale propane.

"NREL's study shows the financial upside of renewable propane for refiners, but the carbon footprint story is even more exciting," said Tucker Perkins, president and CEO of the Propane Education and Research Council (PERC) that commissioned the study. "When you realize the carbon intensity of renewable propane is significantly lower than grid electricity and other fuels, it is a clean energy breakthrough."