Renewable Diesel in Oakland, California, Demonstrates Cost-Effectiveness of Drop-In-Ready Fuel

Renewable diesel is a drop-in-ready fuel that fleet managers can use to reduce carbon emissions for little to no additional cost, which is why the city of Oakland, California, began shifting its diesel vehicles to renewable diesel in 2015. Today, the entirety of the city’s diesel fleet runs on this renewable alternative fuel produced from waste cooking oils collected from local restaurants.

The city’s fuel transition kicked off under a pilot project managed by East Bay Clean Cities Coalition (EBCCC), whose director, Richard Battersby, is also the assistant director of Oakland Public Works. Battersby knew Oakland’s municipal fleet of about 1,500 mixed-weight vehicles included more than 360 petroleum diesel vehicles and that switching to renewable diesel would reduce both petroleum dependency and emissions.

“Renewable diesel is not like other alternative fuels, since there’s really no financial investment,” Battersby said. “You don’t have to modify your process or procedures, equipment, vehicles, or storage.”

In the pilot program’s first year, the city of Oakland displaced 230,000 gallons of petroleum from the city’s fleet use. Since the pilot’s inception, the city’s fleet reduced its greenhouse gas emissions by 74%, its fine particulate matter by 33%, carbon monoxide by 24%, and nitrogen oxide by 9%.

The city’s pilot program demonstrated that renewable diesel can replace conventional diesel fuel without any adverse side effects, and more than 600 public renewable diesel stations have opened as a direct result.

“We also encouraged public and private agencies to make the transition,” said Joey Williams, manager of equipment services for the city of Oakland’s Public Works Department.

Advantages of Renewable Diesel

Made from fats and oils, such as tallow or used cooking oil, renewable diesel is processed to be chemically the same as petroleum diesel. But, depending on the feedstock and conversion process, the renewable alternative fuel yields a 25% to 75% reduction in carbon intensity compared to its petroleum counterpart. Renewable diesel offers other advantages for fleet managers, such as reduced diesel exhaust fluid use and lower nitrogen oxide and particulate matter.

Renewable diesel adoption is a cost-neutral endeavor. Fleets don’t have to make significant financial investments to transition because renewable diesel can be produced at petroleum diesel refineries, and vehicles require no modification, fuel storage capabilities, or fuel dispensing infrastructure. The switch is so streamlined that California’s renewable diesel consumption grew from one million barrels to 28 million barrels per year between 2011 and 2021, according to the U.S. Energy Information Administration. And because of its chemical similarities to petroleum diesel, renewable diesel does not require explicit labeling at the pump.

Finding Power in Partnerships

When Battersby launched the city of Oakland’s renewable diesel fleet pilot program in 2015, he knew several fuel producers and dispensers were interested in renewable diesel. He also knew municipal fleets wouldn’t switch to an emerging fuel without sufficient proof of functionality and cost effectiveness.

“With any new fuel that comes along, fleet managers, by nature, are very skeptical to make a wholesale switch because we've seen different fuels come and go,” Battersby said.

To help fleets overcome this apprehension, EBCCC organized and hosted educational programs in California’s Bay Area, presenting workshops on the benefits of renewable diesel in partnership with petroleum and biofuel producers and distributors who are technical experts.

EBCCC partnered first with distributor Golden State Petroleum, then with Western States Oil as the pilot program expanded. To procure renewable diesel, EBCCC aligned with Singapore-based oil refiner Neste, who, with help from local collectors, gathered waste cooking oils from restaurants and cafeterias in the Oakland metropolitan area to convert to fuel. Neste transports the waste oils to Singapore for refinement, but this does not result in increased overall emissions.

“Neste explained that their boats went back to Singapore empty after fuel deliveries, so taking our waste oils back would be more efficient,” Battersby said. “They do this with other entities too. It creates a closed loop, or circular economy.”

Once the city of Oakland’s pilot program was running smoothly, EBCCC began presenting workshops to public and private fleets to encourage their transition to renewable diesel.

“We started the workshops and asked Western States Oil to join us. They liked it so much because they were getting all this new business,” Battersby said. “We would also present at membership meetings for local fleet organizations.”

Demonstration projects showcased renewable diesel’s functionality in all types of vehicles, including emergency response vehicles, such as firetrucks and ambulances, to ensure new customers that renewable diesel performed like its petroleum counterpart, if not better.

As EBCCC and Western States Oil began to convince fleet managers of the benefits of renewable diesel, purchases of the alternative fuel increased significantly enough by 2018 to warrant broadening the reach of the workshops, first to northern California, then to the neighboring states of Oregon and Washington.

Supportive Legislation

Legislation has acted as a catalyst to California’s renewable diesel transition, starting in 1992 with the federal Energy Policy Act (EPAct) followed by the state’s Global Warming Solutions Act (GWSA) in 2006. Both required fleets to shift to alternative fuel vehicles (AFV), and GWSA required California to reduce its greenhouse gas emissions to 1990 levels by 2020. As part of this effort, California’s Air Resources Board implemented the Low Carbon Fuel Standard in 2011, which reduces the cost of renewable diesel in the state by creating a dedicated market for it.

“High carbon intensity fuel producers—companies that extract fossil fuels that release a lot of carbon dioxide when they produce energy—are required to purchase credits from companies that produce low-carbon fuels like renewable diesel,” Battersby said. “It incentivizes production and use of renewable diesel, which drives down its cost. The more credits a renewable diesel producer generates, the lower their overall cost per gallon.”

While many municipal fleets, like Oakland, were well on their way toward adopting AFVs and reducing emissions by the time the Low Carbon Fuel Standard was implemented, more needed to be done for the state to meet its emission goals. In response, California’s Air Resources Board presented new renewable diesel mandates in 2018.

“The California Air Resources Board requires renewable diesel use in transit buses through the Innovative Clean Transit rule,” Battersby said. “While the state has never legislatively mandated the use of renewable diesel, its approach has been pretty thorough.”

Addressing Concerns and Differentiating from Biodiesel

As a relatively new fuel, many fleet managers and other alternative fuel purchasers are unaware of renewable diesel and its advantages over petroleum diesel. Some may confuse it with biodiesel, which differs from petroleum diesel chemically and in its refining process.

Battersby heard fleet managers express a range of concerns, from potential invalidated manufacturer warranties to fuel storage restrictions, from cold weather conditions to affordability. With input from partners at Western States Oil, EBCCC had answers and solutions.

Renewable diesel meets conventional petroleum ASTM D975 specifications, which means it can be used in all diesel engines, according to the Alternative Fuels Data Center (AFDC). The cold temperature properties of renewable diesel can be tailored to meet seasonal and local conditions, and Battersby noted that renewable diesel blends are specified by distributors to blend, store, and perform well in cold weather. Renewable diesel can have better cold-weather performance than biodiesel, which can be challenging to use in cold wintertime temperatures at higher percentage blends. Also, while engine warranties only cover defects in materials and workmanship, biodiesel blends above B20 may not be supported by engine manufacturers.

Further, renewable diesel can be less expensive than petroleum diesel. In July 2024, the average price at the pump for renewable diesel in California was $4.96 per gallon, compared to $5.06 per gallon for petroleum diesel. Additionally, each of the nearly 20 renewable diesel refineries tracked by EBCCC has expanded production over the past 10 years. Approximately 30 new or converted refineries are slated to open in the near future.

“It's a miracle fuel,” Battersby said. “I've been a part of Clean Cities and Communities for 30 years, and I’ve never seen a fuel like this come along. That's why people have a hard time recognizing just what a unique product this is.”