New process improves the climate performance of bio-oil as a fuel raw material

A comparison between four process paths for using hydrogen to remove oxygen from bio-oil, a raw material for fuel that can be used in existing biorefineries, shows that one process, called IH2, has unmatched system efficiency.

Bio-oil can be produced e.g. from forest residual biomass. As a bio-based raw material for producing drop-in fuel in the form of petrol and diesel, it is a suitable choice because it can be used in the refinery process in the same way as ordinary fossil crude oil. However, the oxygen content in it must first be removed. This can be done through hydrodeoxygenation (HDO), meaning that hydrogen is added to react with the oxygen in the bio-oil and form water. To achieve the climate target by 2045, the process would require between 0.17–0.42 million tonnes of hydrogen annually.

HDO and its efficiency can significantly affect the entire process, the yield and efficiency. Analyzes of techno-economic and climate performance of all four studied process paths show that one process, the IH2 process, is superior. In the IH2 process, pyrolysis of residual biomass, HDO and hydrogen production are integrated into one whole. This gives it a system efficiency of 60 percent; the corresponding figure for the other studied processes is around 25 percent.

Efficient utilization of carbon in biomass is a key factor for the production of bio-based products. In the HDO process, carbon efficiency is generally low. More than 50 percent of the carbon is lost in the form of carbon dioxide. However, if incentives for negative emissions are introduced, for example by integrating bio-CCS with biofuel production, production of HDO bio-oil will become attractive.

Compared with the use of fossil crude oil, the IH2 process presents the opportunity to reduce carbon dioxide emissions by 91-96 percent with bio-based fuels.

The price of drop-in fuels produced from bio-oil where the oxygen has been removed with IH2 technology will be 56–75 percent lower than the current market price for fossil-based fuels.

The IH2 process has already been demonstrated commercially. More research is needed to improve the performance of the other processes.

Results were presented in a webinar on 3 May, 2022:

At KTH, a webbsite has been created for the project. 


Shareq Mohd Nazir, KTH Royal Institute of Technology


Klas Engvall, Lucio Rodrigo Alejo Vargas and Shivani Ramprasad Jambur, KTH // Simon Harvey, Chalmers // Elin Svensson and Pontus Bokinge, CIT Industriell Energi // Rolf Ljunggren, Cortus Energy AB

Time plan
1 July 2020 - 31 January 2022

Total project cost
1 764 000 SEK

The Swedish Energy Agency, the f3 partner organisations, KTH, Chalmers and Cortus Energy.

Swedish Energy Agency's project number within the collaborative research program

A focus group with members from relevant industry will be tied to the project.