Decarbonizing transport by 2050: which alternative fuels will lead the way?

To align with net-zero goals, emissions from transport must fall by more than 3% per year through 2030 and continue to decline steeply beyond that, despite rising demand and increasing complexity across the sector. (Source: IEA – Transport Sector)

On this urgent but complex journey to decarbonize, the transport sector, especially aerospace and automotive, faces the dual challenge of growing demand while meeting increasingly strict environmental targets. Additionally, rising government regulation and public pressure are pushing airlines, automakers, and other transport operators toward cleaner fuels and energy sources.

The production of biofuels, a critical alternative to fossil fuels, faces several technical challenges. For example, used cooking oil requires significant pretreatment, agricultural waste is difficult to process, and algae-based fuels remain costly and unscalable. These challenges stem from both the type of feedstocks used and the conversion processes required to make them usable across aviation, automotive, and other mobility applications.

There is an expanding range of biofuels in development such as biodiesel, bioethanol, biogas, and others but each presents unique hurdles depending on the raw materials and technologies involved.

Here, Graham Upton (Chief Architect, Intelligent Industry) and Sushant Rastogi (New Energies SME, Energy Transition & Utilities) explore how alternative fuels are evolving and how aerospace, automotive, and infrastructure players can use them to offset carbon emissions while enabling mass sustainable mobility.

Biofuel feedstocks: diverse sources, diverse challenges

Biofuels can be derived from various feedstocks, but each presents distinct technical, environmental, and economic challenges:

• First-generation feedstocks (food crops):
  Derived from crops like corn, sugarcane, and soybean, these are well-studied and widely used. However, they raise “food versus fuel” concerns, consume large land and water resources, and contribute to environmental degradation such as deforestation and nutrient runoff.
• Second-generation feedstocks (non-food boimass):
  Include agricultural residues, forestry waste, and energy crops. While they don’t compete with food supply, they are harder to collect, transport, and process due to their structural complexity and geographic dispersion.
• Third-generation feedstocks (algae and microorganisms):
  Can be cultivated on non-arable land and produce high yields of biodiesel, but the current technology is energy-intensive, water-demanding, and not economically scalable. (Reference: IEA Bioenergy Task 39, “Algal Biofuels: Landscape and Future Prospects,” 2022.)
• Waste oils and fats:
  Sourced from used cooking oils and animal fats, these feedstocks avoid land-use conflict but are limited in global supply and require extensive pretreatment due to high impurity levels.
• Fourth-generation biofuels:
  Produced using genetically engineered microorganisms to enhance yield and efficiency. While promising, they face high R&D costs, regulatory barriers, and significant scalability hurdles. (Reference: IRENA, “Advanced Biofuels – Technology Brief,” 2021.)

Processing costs for many of these advanced biofuels remain 2–3 times higher than conventional fuels, limiting their commercial competitiveness. (Source: World Bank, “Biofuels for Transport: Global Potential,” 2020.)

Achieving net-zero emissions in transport—particularly in hard-to-abate sectors like aviation—requires a multi-pronged approach:

• Optimize biofuel feedstocks and processing technologies
• Scale up production economically
• Align infrastructure development and supportive policy frameworks

A diversified and innovative strategy is critical to reduce costs, increase resource efficiency, and ensure sustainable, scalable biofuel adoption across sectors such as automotive and aerospace.

Biofuel production: a comparative view of process challenges

Producing biofuels is technically demanding. Each type—bioethanol, biodiesel, and biogas—faces unique process-related challenges in terms of efficiency, cost, environmental impact, and scalability. Here’s a side-by-side comparison:

Each of these fuels needs process optimisation to reduce cost and improve performance—such as advanced enzymes, improved catalysts, or integrated upgrading technologies.

Summary insight:

To unlock biofuels at scale in high-emission sectors like aviation and automotive, industry must address core production hurdles by:

• Innovating cost-effective conversion technologies
• Enhancing feedstock flexibility
• Minimising waste and emissions

Can these challenges be solved through material and process optimization?

Producing biofuels efficiently and with minimal environmental impact requires significant technical optimization across the value chain:

• Enzyme and catalyst development enhances performance in bioethanol and biodiesel production.
• Process integration and energy efficiency, particularly in energy-intensive stages like distillation and gasification, are crucial.
• Upgrading technologies for biogas and bio-oil must meet high fuel standards, often requiring expensive, multi-stage purification.

While these innovations support net-zero targets in aviation and transport, most remain expensive and limited in scale without broader industrial and policy support.

Where the focus needs to be: scalability and economic viability

Even with technical solutions in place, scaling biofuel production to meet global transport demand is challenging:

• Higher production costs vs fossil fuels
• Fragmented, globalized supply chains
• Need for new or upgraded processing and distribution infrastructure

Current infrastructure is largely fossil-based. Biofuel integration in sectors like aerospace and heavy mobility requires system-wide investments across storage, pipelines, airport fuelling systems, and more.

To succeed, biofuels must be backed by strong market mechanisms: subsidies, tax credits, blending mandates, and long-term regulation to encourage adoption across carbon-intensive industries.

Conclusion

Decarbonizing the transport sector by 2050 is a critical challenge and to meet net-zero targets, emissions must decline by over 3% annually through 2030 and continue to decline steeply beyond that – despite rising demand. This transition is particularly complex for high-emission sectors like aviation and automotive, which face mounting regulatory and societal pressure to adopt cleaner energy sources. Biofuels, ranging from first-generation food crops to advanced fourth – generation engineered organisms, offer a promising alternative but each type presents unique technical, environmental, and economic hurdles. These include high production costs, limited scalability, and complex processing requirements. Feedstocks such as waste oils, algae, and agricultural residues require significant pretreatment and infrastructure adaptation, while innovations in enzymes, catalysts, and purification technologies are essential to improve efficiency and reduce emissions. However, without strong policy support market incentives, and investment in infrastructure, biofuels remain commercially uncompetitive.

Achieving scalable, sustainable biofuel adoption will require a coordinated strategy that enhances feedstock flexibility, optimizes production processes which aligns with broader energy and transport systems.

How Capgemini can help you decarbonize

Capgemini brings deep expertise in decarbonizing transport and industrial energy systems. We partner with global clients to define, develop, and deliver innovative fuel and infrastructure strategies.

In aerospace, we assessed market demand for medium-range planes by 2030 and evaluated the feasibility of hydrogen-powered aircraft—helping clients plan for the next generation of zero-emission aviation.

In maritime, we partnered with Newcastle Marine Services, the University of Strathclyde, O.S. Energy, and MarRI-UK to retrofit diesel vessels with hydrogen propulsion using Liquid Organic Hydrogen Carriers (LOHCs).

Impact metrics:

• Emissions reduced by >90% per vessel during trials
• GPS and energy data collected over 48-hour missions
• Demonstrated LOHC integration without redesigning onboard systems

Capgemini enables transport clients to make informed decarbonization choices—from strategy to implementation. Our approach includes:

• Strategic fuel and tech assessments
• Infrastructure and policy alignment
• Business case development
• Digital prototyping and scaled deployment

We also leverage Internet of Things (IoT) and Artificial Intelligence (AI) to optimize biofuel supply chains, enhance efficiency, and reduce carbon footprints across the value chain.

👉 Learn more about our experience in energy transition and mobility innovation