India’s 3.5 million commercial trucks and buses collectively consume nearly 70% of the nation’s diesel, making the heavy transport sector a critical battleground in the fight for energy independence and environmental sustainability. With diesel prices hovering above ₹90 per liter and emission norms tightening, fleet operators are searching for viable alternatives. The answer increasingly lies in biofuels – biodiesel, renewable diesel, and compressed biogas (CBG) – that promise cost savings, cleaner operations, and reduced import dependency.
Why Heavy-Duty Transport Needs Diesel Alternatives
Biodiesel: The Proven Alternative
Biodiesel has emerged as the most widely adopted diesel alternative in India’s heavy transport sector. Chemically known as Fatty Acid Methyl Esters (FAME), biodiesel can be blended with conventional diesel in various ratios – B5 (5% biodiesel), B10, or B20 (20% biodiesel) – without requiring engine modifications. The beauty of biodiesel lies in its compatibility: most BS-VI diesel engines can run on B20 blends without any hardware changes.
India’s National Biofuel Policy mandates B20 blending by 2025-2026, and Oil Marketing Companies are establishing distribution networks across major transport corridors. The fuel is produced primarily from used cooking oil (UCO) collected from restaurants, hotels, and food processing units, along with non-edible oils like Jatropha and Karanja. This circular economy approach addresses waste management while producing sustainable fuel.
Real-world performance data from state transport corporations shows promising results. Biodiesel blends offer comparable power output with slightly better lubricity, potentially extending engine life. Fleet operators report fuel efficiency within 2-3% of conventional diesel, while maintenance requirements remain largely unchanged. The particulate matter emissions drop by 10-15% with B20, contributing to cleaner urban air quality – a significant advantage for city bus operations.
However, biodiesel does have limitations. Cold weather performance can be challenging, as biodiesel tends to gel at lower temperatures than petroleum diesel. Seasonal variations in feedstock availability can also affect price stability and supply consistency.
Renewable Diesel: The Superior Drop-In Fuel
While biodiesel requires blending, renewable diesel represents the next evolution in biofuels. Produced through Hydrotreated Vegetable Oil (HVO) technology, renewable diesel is chemically identical to petroleum diesel, making it a true “drop-in” replacement. Unlike biodiesel, it can be used at 100% concentration without any blending, engine modifications, or performance concerns.
Renewable diesel offers several advantages over biodiesel: superior cold-weather performance, higher energy content resulting in better fuel economy, and longer storage stability. European logistics companies have successfully deployed renewable diesel in their fleets, reporting improved engine performance and reduced maintenance costs compared to both conventional diesel and biodiesel blends.
In India, renewable diesel production is still in nascent stages, with a few pilot projects underway. Major refineries are exploring HVO production units, recognizing the potential for premium-priced green fuel in the commercial transport market. While currently more expensive than biodiesel, economies of scale and government incentives could make renewable diesel price-competitive by 2026-2027. For fleet operators planning long-term fuel strategies, renewable diesel represents a compelling option that eliminates compromise on performance.
Compressed Biogas: The Cost-Effective Game-Changer
Perhaps the most disruptive alternative for heavy transport is Compressed Biogas (CBG), promoted under the government’s SATAT (Sustainable Alternative Towards Affordable Transportation) initiative. With a target of 5,000 CBG plants across India, this program aims to convert agricultural waste, cattle dung, and municipal solid waste into vehicle-grade fuel.
CBG is chemically identical to natural gas and can be used in CNG-compatible engines without modification. Existing diesel trucks can be retrofitted to dual-fuel systems, using CBG as the primary fuel with diesel for ignition. Several manufacturers now offer dedicated CBG heavy-duty vehicles, including trucks and buses designed specifically for biogas operation.
The economic case for CBG is compelling. At approximately ₹50-60 per kilogram (energy-equivalent to a liter of diesel), CBG offers 30-40% cost savings over conventional diesel. State transport corporations in Delhi, Maharashtra, and Kerala have already inducted CBG buses, reporting significant reductions in fuel expenses while meeting emission targets.
The SATAT scheme provides capital subsidies for CBG plant establishment and assured offtake agreements with Oil Marketing Companies, creating a stable supply ecosystem. For transport companies operating in agricultural belts or near waste processing facilities, CBG presents an immediate, economically viable alternative. The fuel’s domestic production also insulates operators from international price volatility – a strategic advantage in uncertain energy markets.
Real-World Success Stories
Several Indian transport operators have successfully transitioned to biofuels. Delhi Transport Corporation runs over 2,000 buses on B7-B10 biodiesel blends, achieving measurable air quality improvements. Mahindra Logistics has piloted biodiesel trucks on specific routes, demonstrating operational viability for private fleet operators.
In the mining sector, companies are converting captive fleets to biodiesel, driven by corporate ESG commitments and cost considerations. Maharashtra State Road Transport Corporation has integrated both biodiesel and CBG into its fuel mix, diversifying energy sources while reducing environmental impact.
Making the Switch: What Fleet Operators Should Know
The decision to adopt biofuels depends on several factors. Route profiles matter – urban operations benefit more from emission reductions, while long-haul operators prioritize fuel cost and availability. Regional fuel infrastructure is critical; CBG availability remains concentrated near production facilities, while biodiesel blends are more widely distributed through conventional fuel stations.
Financial analysis should evaluate Total Cost of Ownership over five years, including fuel prices, vehicle modifications (if any), maintenance patterns, and government incentives. Many states offer capital subsidies for fleet conversion, GST benefits on biofuel purchases, and priority lending for green transport initiatives.
Fleet age is another consideration. Newer BS-VI vehicles are ready for B20 without modification, while older vehicles may require assessment. For CBG conversion, retrofitting costs typically range from ₹2-3 lakh per vehicle but deliver payback within 18-24 months through fuel savings.
The Road Ahead
India’s heavy transport sector stands at an inflection point. Diesel will remain relevant in the short term, but biofuels are rapidly becoming mainstream alternatives rather than experimental options. The convergence of supportive policies, expanding infrastructure, and proven economics is accelerating adoption.
By 2030, experts predict that 30-40% of commercial vehicle fuel will come from biofuel sources – a mix of biodiesel blends, renewable diesel, and CBG based on regional availability and application requirements. Fleet operators who evaluate and adopt these alternatives now will gain competitive advantages through lower operating costs, regulatory compliance, and enhanced sustainability credentials.
The transition to biofuels isn’t just an environmental imperative – it’s an economic opportunity that forward-thinking transport companies cannot afford to ignore.
Ready to explore biofuel options for your fleet? Assess your routes, evaluate regional fuel availability, and calculate potential savings. The future of heavy transport is cleaner, cheaper, and already here.
