Petrol Australian Guide to Biofuels

Australians are on the move, and we’re using more fuel than ever. The trouble is, we’re burning through fossil fuels that are eventually going to run out. Enter the alternative: renewable biofuels.

But what are biofuels and can you actually put them in your car? We have your answers.

What are Biofuels?

Biofuels are an alternative to fossil fuels like petrol and diesel, which is what Australia has traditionally relied on for fuel. Biofuels are cheaper and more versatile than fossil fuels, plus they’re better for the environment.

Before discussing what biofuels are, let’s look at what they are not: fossil fuels.

Fossil Fuels

These fuels are created over millions of years from decomposed animals and plants; since it takes them so long to develop, they are not considered renewable.

The three main types of fossil fuels are oil, natural gas, and coal. Once these substances are used up, we’re basically out of luck—unless we’re prepared to wait 65 million years for the next batch.

According to the Australian Parliament, most of Australia’s carbon dioxide emissions come from the combustion of fossil fuels.


Biofuels also come from plant and animal matter, but they don’t take millions of years to develop. These liquid fuels come from a substance called biomass, which is derived from plants and animals that currently exist.

There are two main types of biofuels in Australia, and you’ve probably heard of at least one of them: ethanol and biodiesel. We’ll go into more detail on each of these soon.

Biofuels are highly renewable, which is part of their appeal. They’re made from products that don’t tap into the human food supply, and could boost business for Australian farmers.

Australia relies on fossil fuels for transportation and power; currently, over 90% of that fuel is imported. Consider the fact that fossil fuels aren’t renewable, and you can see the demand for an alternative fuel source like biofuel.

With biofuels, we are able to replace materials like:

  • Petrol
  • Diesel
  • Plastic
  • Oil for heaters

Examples of Biofuels

So what plant and animal matter is used to create biofuel? You might have some of it in your house, out in the shed, or in your car’s fuel tank.

Here are a few substances that can be used to create biofuel:

  • Sugarcane
  • Soybeans
  • Woodchips
  • Molasses
  • Sorghum
  • Algae
  • Cooking oil
  • Corn
  • Manure

These substances are converted into ethanol and biodiesel. They can also be used to generate electricity or heat, but biofuels are primarily looked at as a solution to transport needs.



Most vehicles produced and sold in Australia since 1986 are compatible with an ethanol fuel blend of 10%. You’ve probably seen it at the pump as E10, often the cheapest type of fuel at the petrol station.

Ethanol is created by fermenting products like sugarcane, corn, or sorghum. It is then blended with regular petrol to create the E10 (10% ethanol) or E85 (70-85% ethanol) fuel you put in your car. E10 is more common, while E85 is primarily used in high-performance race cars and may be harder to find at the pump.

While it’s true that ethanol-based fuels may not be as good on fuel consumption—estimates say that you’ll use between 1% and 3% more fuel—it costs less per litre and is better for the environment.

The Future of Ethanol in Australia

As technology becomes more refined, we may be able to create ethanol from a wider variety of materials. For example, the use of waste materials, timber, or grass to develop ethanol may be more sustainable than growing crops specifically for ethanol production.

These advanced biofuels are currently being produced, but at a smaller scale. If more money is invested into developing the required technology, it may diversify our options for ethanol



The original diesel engine, created by Rudolf Diesel in the late 1800s, was designed to be run on biodiesel; specifically, on peanut oil. When petroleum-based diesel became cheaper and more readily available, diesel engines were modified.

Fast forward over 100 years and here we are, putting biodiesel back into our tanks. In some cases, biodiesel is created by blending vegetable oils or animal fats with petroleum diesel, resulting in a fuel that is less toxic than salt.

Biodiesel comes in different blend concentrations.

Nearly every diesel engine can take biodiesel: cars, ships, trucks, and heavy machinery. However, it’s still a good idea to consult your vehicle’s manual or manufacturer before using biodiesel.

Biodiesel blends can reduce greenhouse gasses dramatically, which is especially critical in a country like Australia, who emits approximately 69 million tonnes of CO2 from diesel use each year.

Biodiesel is also better for air quality and can even be created from used vegetable oil, reducing waste. Some mechanics claim that biodiesel is easier on the engine, leading to better performance.

The Future of Biodiesel in Australia

The biodiesel industry in Australia is facing unfavourable conditions. Due to limited resources, Australia only produces around 40 million ML of biodiesel locally. Part of this is due to its largest producer, Australian Renewable Fuels, shutting up shop in 2016.

Other factors include:

  • Low international oil prices
  • High prices for feedstock like tallow
  • Not enough tax relief
  • Limited mandate support
  • Import prices for biodiesel not competitive with standard diesel

For biofuel to gain leverage in Australia, some of these conditions will have to change.


Are Biofuels the Answer to Australia’s Reliance on Fossil Fuels?

Biofuels aren’t the entire answer to Australia’s reliance on fossil fuels, but they are certainly part of it. While biofuels like ethanol and biodiesel are lighter on your wallet and easier on the environment, they do raise issues of sustainability in production.

Even if fossil fuels were completely replaced by biofuels, it would not solve all of Australia’s problems with energy. The answer seems to lie in a combination of factors.

Australia may first need to take a step back and examine why we are so dependent on fossil fuels. From there, we can move forward with finding balance between our energy needs, cost, and environmental impact.

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