U.S. biodiesel use increases outside of the transportation sector

This article was published by the US Energy Information Administration on March 26, 2025.

By Mickey Francis

A small but increasing amount of biodiesel in the United States is consumed in the residential, commercial, and electric power sectors, according to new estimates now published in our State Energy Data System. Previously, we allocated all U.S. biodiesel consumption to the transportation sector, where the vast majority of biodiesel is consumed.

Biodiesel is a renewable fuel produced using fats, oils, or greases usually blended with petroleum diesel and consumed by trucks. In 2023, the most recent year for which we have estimates, the transportation sector accounted for about 95 per cent of the nearly 46 million barrels of biodiesel consumed in the United States.

Biodiesel can also be blended with heating oil to heat homes and businesses. We estimate that the residential and commercial sectors combined accounted for nearly 5 per cent of U.S. total biodiesel consumption in 2023, up from about 1 per cent a decade earlier. The introduction of biofuel blending mandates for heating oil in some northeastern states is contributing to that growth. Although customers in other states likely blend biodiesel to heat homes and businesses, we only estimate consumption for New York, Connecticut, and Rhode Island.

Consumption of biodiesel in the residential and commercial sectors is higher in New York than in any other state, accounting for 57 per cent of the U.S. total for those sectors in 2023. New York City passed the nation’s first law requiring biodiesel blending with heating oil, mandating a minimum 2 per cent biodiesel blended with heating oil beginning in 2012. Later, New York enacted a 5 per cent minimum state-wide blend law beginning in 2022, which increases to 10 per cent in 2025 and 20 per cent in 2030. According to the U.S. Census Bureau’s American Community Survey, nearly 16 per cent of homes in New York used heating oil as their primary heat source in 2023, about four times more than the U.S. average of about 4 per cent.

Connecticut and Rhode Island also have similar state-wide minimum biofuel blend laws for heating oil. Connecticut’s 5 per cent blend law began in 2022 and ramps up to 10 per cent in 2025, 15 per cent in 2030, 20 per cent in 2034, and 50 per cent in 2035. Rhode Island was the first state to enact a minimum biofuel heating oil blend law that began with a 5 per cent blend in 2017 and increased to 10 per cent in 2023. Rhode Island’s blend law increases more quickly than the other states—up to 20 per cent in 2025 and 50 per cent in 2030. More than 34 per cent of homes in Connecticut and 26 per cent of homes in Rhode Island reported heating oil as their primary heat source in 2023.

Biodiesel can also be burned to generate electricity, and the electric power sector accounted for less than 1 per cent of U.S. biodiesel use in 2023. In 2006, a test plant in Tennessee reported the first biodiesel use for electric power in the United States. Hawaii has accounted for nearly all U.S. biodiesel consumed for electric power since 2009. In 2023, petroleum fuelled about 68 per cent of Hawaii’s total electricity generation, the highest share of any state, and we estimate that biodiesel fuelled about 1 per cent of the state’s total generation.