Aemetis, a key player in the renewable fuels sector, is making significant strides in expanding its biodiesel production capabilities in India. This move comes at a time when India is intensifying its efforts to increase the share of renewable energy in its total energy mix. The company's subsidiary, Universal Biofuels, has already secured $58 million in biodiesel allocations for 2025 from Indian government-owned oil refiners, marking a pivotal step in its expansion strategy.
Universal Biofuels operates an 80 million gallon per year production facility in Kakinada, Andhra Pradesh, which generated $112 million in revenues from biodiesel and refined glycerin deliveries in the fiscal year ending September 2024. The company is set to commence biodiesel shipments to oil marketing companies in March and is gearing up for a potential initial public offering (IPO) this year, signaling its strong growth trajectory and confidence in the Indian market.
India's National Biofuels Policy aims for a 5% biodiesel blend ratio, equivalent to about 1.2 billion gallons per year. However, the current implementation lags at approximately 1%, highlighting a vast untapped potential for growth. Given India's massive 25 billion gallon annual petroleum-based diesel market, the shift towards biodiesel presents a critical opportunity to mitigate air pollution and associated health risks.
Aemetis CEO Eric McAfee pointed out the potential for U.S. agricultural exports, especially soybean oil, should India decide to remove its 27.5% import tariff on renewable oil feedstocks. Such a policy change could unlock a multi-billion dollar market for U.S. farmers while aiding India in its environmental sustainability goals. The company's strategy emphasizes securing renewable oil feedstocks both within India and through international imports, supported by policies that enhance feedstock accessibility.
With the appointment of a new CEO to spearhead the potential IPO and plans to bring on board a CFO with expertise in the Indian stock market, Universal Biofuels is strategically positioning itself to capitalize on the burgeoning biodiesel market in India. This expansion not only underscores Aemetis's commitment to renewable energy but also aligns with global efforts to transition towards more sustainable fuel sources.
