2024 ESG Report FINAL - Report - Page 10
Low-Carbon Innovation
For Valero, investments in low-carbon fuels that began in 2009 have
Today, Valero is the world’s largest
provided an advantage for the company to capture market opportunities.
producer of liquid low-carbon
As of December 31, 2023, we have invested more than $5.4 billion in our
transportation fuels.
low-carbon businesses, and we expect additional growth opportunities
in this area. These investments, which have been held to the same minimum after-tax IRR hurdle rate as our re昀椀ning
growth projects, have created value for our stockholders and lowered GHG emissions in the transportation sector.
The following are examples of high-return, low-carbon projects that we are producing, developing and/or evaluating:
Renewable Diesel, Renewable Naphtha and Renewable Propane
A drop-in fuel interchangeable with petroleum diesel,
our renewable diesel is manufactured primarily from
waste feedstocks, including used cooking oil, recycled
animal fats and inedible corn oil, as well as other
feedstocks such as soybean oil. These feedstocks
are pretreated and puri昀椀ed prior to conversion
into renewable diesel and niche grades, such as
renewable arctic diesel.
Renewable diesel reduces life cycle
GHG emissions by up to 80%, compared
with traditional diesel. 2
Valero is the world’s second-largest renewable diesel
producer and currently operates two renewable
diesel plants located in St. Charles Parish, Louisiana,
and Port Arthur, Texas, with a total annual production
capacity of 1.2 billion gallons of renewable diesel and
50 million gallons of renewable naphtha.
Renewable naphtha and renewable propane are
produced in the process and recovered as coproducts. With an annual production capacity of 50
million gallons, renewable naphtha can be used as a
gasoline blendstock or a feedstock for producing lowcarbon petrochemicals.
Renewable propane, similarly, has multiple end
uses, including as a low-carbon fuel, a renewable
petrochemical feedstock or a feedstock in the production
of low-carbon hydrogen. Currently, renewable propane
from our renewable diesel plants is co-processed in
the hydrogen plants at two of our re昀椀neries to generate
low-carbon hydrogen. The low-carbon hydrogen is rerouted into the production process further decreasing
the carbon intensity (CI) of renewable diesel, renewable
propane and renewable naphtha.
We are also co-processing renewable natural gas from
municipal solid waste in the hydrogen plant at one of
our re昀椀neries. The low-carbon hydrogen is used in the
production of lower carbon transportation fuels for export
to Europe. This fuel has a higher market value compared
with petroleum fuels, and certain governments in Europe
use it to help meet GHG emissions reduction targets
or goals. In 2023, we processed nearly 2 trillion BTUs
of renewable natural gas, which doubled the amount
processed in 2022.
Since 2013, Valero has grown to become
the world's second-largest producer of
renewable diesel.
Ethanol
Ethanol is a low-carbon, high-octane fuel. When used as a gasoline
blendstock, ethanol boosts the octane rating of the 昀椀nished fuel.
Ethanol offers at least 30% lower life
cycle GHG emissions, compared
with petroleum gasoline. 2
Valero operates 12 ethanol plants located in the U.S. Midwest, with
a combined production capacity of 1.6 billion gallons per year. The
plants are dry mill facilities that process corn to produce ethanol and co-products, such as dry distillers grains
(DDGs) and syrup for livestock feed, and inedible corn oil. DDGs and syrup are sources of supplemental energy and
protein for livestock and poultry.
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