Leading commodity and energy price provider S&P Global Platts has launched the first hydrotreated vegetable oil (HVO) values in Europe, Markets Business Insider reported on 10 November.
The company had been providing daily assessments to the markets since 17 August, Markets Business Insider said. Published in US$/tonne, the assessments reflected the cost of HVO produced from used cooking oil (UCO) on an ex-refinery basis in northwest Europe.
"The EU has clearly signified the direction of travel for policy over the next 10 years and even the next 30 years with a revised Renewable Energy Directive and an ambitious Green Deal,” said Ian Dudden, global content director, metals & agriculture, at S&P Global Platts.
“As greenhouse gas-based mandates intensify across Europe, and with COVID continuing to cause market uncertainty, we are seeing increased demand for price transparency in renewable fuels such as HVO. These new HVO assessments provide transport market participants with the conviction to trade in changing markets."
The company was quoted as saying it had noticed a growing interest in renewable fuels across transportation markets partly driven by the transition to lower carbon fuels.
"European HVO demand is forecast to increase to more than 3M tonnes for road transport alone in 2030, up from 2M tonnes in 2020, with the majority of the production made out of waste and residues," added Patricia Luis-Manso, head of agriculture & biofuels analytics, S&P Global Platts.
"At the same time, HVO capacity is expected to nearly quadruple globally over the same period."
HVO, commonly referred to as renewable diesel, is produced via hydroprocessing of oils and fats and can be used as an alternative fuel in diesel engines, offering more than 90% greenhouse gas (GHG) savings compared to fossil-based diesel.
The HVO assessment calculation assumptions, provided by Platts Analytics, are based on existing Platts assessments and other fixed costs.
S&P Global Platts, a division of S&P Global, covers the oil, gas, LNG, power, petrochemicals, metals, agriculture and shipping sectors.
In September 2020, the company launched a Sustainable Aviation Fuel (SAF) price assessment for the Americas. This followed the launch of independent price references for SAF in Europe in August 2020.