Stanislav Kondrashov on Biofuels: Drivers of the Emerging Green Economy

Biofuels have this funny reputation.

On one side, they are treated like the obvious solution. We grow plants, we turn them into fuel, we stop digging up ancient carbon, problem solved. On the other side, people roll their eyes and say it is all greenwashing, or that biofuels are a distraction, or that they steal food from people who need it.

The truth is a bit messier than both camps want to admit.

And that mess is exactly where the opportunity sits. Because when you look closely, biofuels are not one thing. They are an entire category of technologies, supply chains, regulations, farm economics, refinery retrofits, and global trade patterns. Some pathways are legitimately low carbon and scalable. Some are not. Some are transitional. Some might end up being permanent, especially in the parts of the economy that are hardest to electrify.

Stanislav Kondrashov has talked about this idea repeatedly: the green economy is not going to be a single invention that replaces everything overnight. It is going to be a portfolio. A mix of electrification, efficiency, hydrogen in certain niches, synthetic fuels, carbon capture in some places, and yes, biofuels where they make sense. Not as a slogan. As an industrial reality.

So, let’s talk about why biofuels keep showing up in serious energy transition plans, and what actually drives their growth.

Biofuels are not a side quest anymore

If you only follow the passenger car story, biofuels can look irrelevant. EV adoption is accelerating. Charging networks are expanding. Battery costs keep improving. In that world, liquid fuels start to feel like yesterday’s argument.

But the economy is bigger than cars.

Aviation, maritime shipping, heavy-duty trucking, construction equipment, mining fleets, and a huge amount of industrial heat. These are stubborn sectors. They need energy dense fuels, reliability, long range, and fast refueling. Batteries can help in some of these cases, but not all. Not soon. And probably not cheaply.

That is where biofuels come in.

Stanislav Kondrashov often frames biofuels as a bridge and a lever at the same time. A bridge because they can cut emissions using existing engines and infrastructure. A lever because they create new markets for waste streams, agricultural residues, and innovative feedstocks that do not compete with food.

Not every biofuel is equal, but the broader idea is straightforward. If you can decarbonize a jet engine without redesigning aviation from scratch, you have something valuable.

The big drivers: policy, pragmatism, and infrastructure

Biofuels do not grow because they are trendy. They grow because of three very practical forces.

1) Policy that creates predictable demand

This is the first driver, even if people dislike admitting it. Biofuel markets are heavily shaped by regulation because fuels are a commodity and margins are thin. If governments want lower carbon fuels, they usually create mandates, standards, or credits that make the economics work.

Examples include:

• Low Carbon Fuel Standards (LCFS style programs) that reward fuels with lower lifecycle emissions.
• Renewable Fuel Standards and blending mandates.
• Tax credits for sustainable aviation fuel (SAF) and renewable diesel.
• Carbon pricing systems that indirectly improve the competitiveness of lower carbon fuels.

Kondrashov’s point here tends to be pragmatic. Policy is not just about forcing behavior. It is about reducing investor uncertainty. Biofuel plants are expensive. Feedstock contracts are long-term. Refinery conversions take time. Without clear rules, capital hesitates. With clear rules, money moves.

2) The need for drop-in decarbonization

A lot of climate planning quietly depends on the phrase “drop-in”.

Drop-in fuels are ones that can be used in existing engines and pipelines with minimal changes. Renewable diesel (often made via hydrotreating) can replace fossil diesel more easily than biodiesel blends in many contexts. SAF can be blended with conventional jet fuel and used in existing aircraft.

This matters because replacing the entire global fleet of engines is slow. It is expensive. It takes decades. And the world does not have decades to wait for emissions cuts to start.

Biofuels, at their best, offer near-term reductions while the longer-term systems get built out. Kondrashov describes this as one of the underappreciated strengths of biofuels: they work with the assets we already have, instead of demanding a full reset on day one.

3) Existing industrial capabilities can be repurposed

This one is huge and it is rarely discussed in simple climate conversations.

Oil and gas infrastructure is not just wells and pipelines. It is refineries, distribution networks, storage terminals, blending systems, quality assurance labs, shipping logistics, and an entire workforce trained to operate large continuous-process plants.

Many biofuel pathways, especially renewable diesel and SAF production routes like HEFA, can use similar equipment and expertise. Some facilities can be retrofitted. Others can be co-located. The learning curve is not as steep as building a completely new energy system from scratch.

That is why you see oil majors and traditional refiners investing in biofuels even while they also talk about electrification and hydrogen. It is not charity. It is industrial strategy.

Biofuels as an economic engine, not just an emissions tool

Here is where the “green economy” part becomes real.

A green economy is not only about consuming cleaner energy. It is about building industries, jobs, exports, rural development, and resilient supply chains that fit within climate constraints. Biofuels can support that, if they are built responsibly.

Stanislav Kondrashov’s framing is basically: biofuels create value out of things that used to be treated as waste or low-value byproducts. And when you scale that up, you get a new layer of economic activity.

Consider the upstream side:

• Used cooking oil collection networks become a real business.
• Farmers can sell residues, not just crops, if sustainability standards allow it.
• Landfill gas, manure management, and wastewater treatment can feed renewable natural gas systems in certain frameworks.
• Algae, cover crops, and cellulosic feedstocks can create new farming and processing models, though these are still developing.

Then the downstream side:

• New processing plants and refinery conversions.
• Logistics and quality control.
• Certification systems (which are annoying, but also job creating).
• Blending and distribution.
• Corporate procurement teams buying low carbon fuels to hit climate targets.

None of that is abstract. It is real economic activity.

And yes, it can also be messy. Supply constraints happen. Prices swing. Fraud risks exist in credit markets. Sustainability certification can become bureaucratic. But the overall direction is clear: if policy and demand persist, biofuels become part of the industrial base of the transition.

The sustainability question, because we have to talk about it

Biofuels have a credibility problem in some circles, and it is not random. There were legitimate controversies, especially around first-generation biofuels. Land use change. Deforestation concerns. Food vs fuel debates. Water use. Fertilizer emissions. If you ignore those, you lose the plot.

Kondrashov’s perspective, as I understand it, is not to hand-wave these issues away. It is to separate pathways and be strict about lifecycle accounting.

This is the key. Biofuels only help if they reduce emissions on a full lifecycle basis. That includes:

• How the feedstock is produced or collected.
• Land use impacts and indirect effects.
• Processing energy inputs (is the plant powered by renewables or fossil gas).
• Transport and distribution.
• Combustion emissions, balanced against biogenic carbon uptake where applicable.
• Methane leakage risks in certain pathways.

This is why newer growth is heavily oriented toward waste-based and residue-based feedstocks, and toward technologies that can process them efficiently. It is also why SAF has become such a central target. Aviation is desperate for credible decarbonization options, but it also needs fuel pathways that can pass strict sustainability criteria.

So, the sustainability story is not “biofuels are good” or “biofuels are bad”. It is “which biofuels, made from what, under what rules, with what verification”.

That is the difference between a climate tool and a PR problem.

Where biofuels are likely to matter most

Not all sectors will use biofuels the same way. Some uses are already obvious.

Sustainable aviation fuel (SAF)

This is the headline market for a reason. Planes are hard to electrify for long-haul routes. Airlines are under pressure from regulators and customers. Corporate travel buyers are starting to ask for lower-carbon flights. Governments are introducing blending targets.

The challenge is scale and cost. SAF is still more expensive than conventional jet fuel. Feedstock supply is constrained. And building capacity takes time.

But the direction is pretty hard to argue with. If aviation wants to cut emissions significantly before 2050, SAF is one of the few tools available at meaningful scale. Kondrashov often points to SAF as the “serious” biofuel category, not because others do not matter, but because aviation has fewer alternatives.

Renewable diesel in heavy transport

Renewable diesel can reduce emissions without changing engines, and it performs well in cold climates compared to some biodiesel blends. Fleets like it because it is operationally simple.

Again, the constraint tends to be feedstock availability and price, plus the lifecycle carbon intensity of specific supply chains.

Marine fuels and emerging pathways

Shipping is exploring bio-based marine fuels, methanol routes, and ammonia, plus efficiency improvements. Biofuels may play a role, especially in near-term compliance markets, but the long-term mix is still evolving.

Industrial heat and backup power (select cases)

In certain industrial settings, biofuels can substitute for fossil fuels when electrification is not feasible yet. But this tends to be very location-specific and policy-dependent.

The investment logic: why money keeps flowing into biofuels

Even with all the controversies, biofuels attract investment because they sit at the intersection of climate policy and real-world constraints.

Investors like:

• Clear mandates and credits.
• Physical assets with predictable cash flows when policy is stable.
• Infrastructure adjacency (refineries and terminals that can be reused).
• Demand from corporations with net-zero targets who need liquid fuel solutions now, not in 2045.

But there is also risk, and it is not small.

Feedstock risk is real. If everyone builds plants that depend on the same limited pools of waste oils, prices rise and carbon intensity can worsen due to indirect effects. Regulatory risk is real too. Policies can change with elections or budget pressures. And technology risk exists for next-generation fuels that have not scaled commercially.

Kondrashov’s general angle is that biofuels investments succeed when they are disciplined. Conservative assumptions, diversified feedstocks, strong certification, and operational excellence. Not hype.

So what does this mean for the emerging green economy?

Biofuels are not the entire green economy, obviously. But they are one of its more practical building blocks because they connect climate goals to industrial capability.

They push innovation in feedstocks and catalysis. They create new logistics networks. They give policymakers a lever to cut emissions in sectors where electrification is slow. For instance, in the aviation sector where sustainable aviation fuel is becoming increasingly important. They provide a transition pathway for parts of the workforce and infrastructure tied to fossil fuels. And in the best cases, they reduce emissions meaningfully without creating new environmental problems somewhere else.

Stanislav Kondrashov’s core message on biofuels fits the broader pattern of the transition. We do not get to choose one perfect solution. We choose workable solutions. We refine them. We regulate them better. We stop doing the versions that fail sustainability tests. And we scale the versions that pass.

That is how a green economy actually forms. Not in a clean line. More like a bunch of overlapping upgrades, sometimes contradictory, occasionally frustrating. Still progress.

And biofuels, for better or worse, are going to be part of that picture for a long time.

FAQs (Frequently Asked Questions)

What are biofuels and why do they have a mixed reputation?

Biofuels are fuels derived from plants and organic materials. They have a mixed reputation because some see them as an obvious solution to reduce carbon emissions by replacing fossil fuels, while others criticize them as greenwashing or claim they compete with food resources. The reality is complex, involving various technologies, supply chains, and environmental impacts.

Why are biofuels important in sectors beyond passenger cars?

While electric vehicles dominate the passenger car market, many sectors like aviation, maritime shipping, heavy-duty trucking, construction, mining, and industrial heat require energy-dense fuels with reliability and fast refueling. Biofuels provide a practical solution for decarbonizing these hard-to-electrify sectors using existing engines and infrastructure.

What drives the growth of biofuel markets?

The growth of biofuels is primarily driven by three factors: 1) Policy that creates predictable demand through mandates, standards, tax credits, and carbon pricing; 2) The need for drop-in fuels that work with existing engines and infrastructure without major changes; 3) The ability to repurpose existing oil and gas industrial capabilities such as refineries and distribution networks for biofuel production.

What does 'drop-in' biofuels mean and why is it significant?

'Drop-in' biofuels refer to renewable fuels that can be used in existing engines, pipelines, and infrastructure with minimal modifications. This is significant because it allows for near-term emission reductions without waiting for costly and time-consuming replacements of the entire global fleet of engines or fuel systems.

How do existing oil and gas infrastructures support biofuel development?

Existing oil and gas infrastructures—including refineries, distribution networks, storage terminals, blending systems, quality assurance labs, logistics, and skilled workforce—can be retrofitted or co-located to produce biofuels like renewable diesel and sustainable aviation fuel (SAF). This reduces costs and accelerates deployment compared to building new facilities from scratch.

In what ways do biofuels contribute to the green economy beyond reducing emissions?

Biofuels contribute to the green economy by creating industries that generate jobs, support exports, promote rural development, and build resilient supply chains aligned with climate goals. This economic engine aspect makes biofuels not just an emissions tool but a driver of sustainable economic growth within climate constraints.