A new kind of renewable diesel fuel is gaining greater adoption because it's nearly indistinguishable from petroleum-based counterparts and offers a higher quality biofuel to meet federal mandates as well as customer demand, according to data from the U.S. Energy Information Administration.

Unlike other biofuel blends, hydroprocessed esters and fatty acids (HEFA) fuels can be used in diesel engines without the need for blending with petroleum diesel fuel. Globally, more than 1 billion gallons of HEFA fuels were produced in 2014.

HEFA fuels are hydrocarbons instead of alcohols or esters. Hydrocarbons from nonpetroleum sources are known as drop-in fuels because they're very close to petroleum-based fuels. During the refining process, the oxygen present in the alcohols and esters is removed, leaving only hydrocarbons. 

The most common HEFA biofuel production that is marketed as hydrotreated vegetable oil (HVO) abroad, or as renewable diesel in the U.S. HEFA fuels are produced by reacting vegetable oil or animal fat with hydrogen in the presence of a catalyst. The equipment and process are very similar to the hydrotreaters used to reduce diesel sulfur levels in petroleum refineries. There are currently 10 plants worldwide that produce renewable diesel, one of which is U.S.-based Diamond Green Diesel.