ECONOMIC AND ENVIRONMENTAL CHALLENGES OF BIOFUEL PRODUCTION AND CONSUMPTION IN THE TRANSITION TO SUSTAINABLE ENERGY

Abstract

It is essential to assess the impact of biofuel production and consumption on the economy and the environment to identify key challenges and opportunities for sustainable energy development. This study analyzed the economic factors of biofuel production, identified environmental challenges related to consumption, and examined the prospects for the development of advanced biofuels as well as regulatory measures. The application of scientific literature analysis, document systematization, and synthesis methods revealed that although biofuels contribute to regional economic growth and strengthen energy independence, their production is associated with high costs and raw material price fluctuations. From an environmental perspective, conventional first-generation biofuels may lead to deforestation and biodiversity loss. Therefore, for the sustainable development of the sector, it is crucial to promote the production of biofuels from waste and non-food feedstock. To ensure the sustainability of biofuel feedstock production and enhance the sector’s competitiveness, it is necessary to improve sustainability regulation mechanisms and encourage investment in biofuel production infrastructure, which would help reduce dependence on first-generation biofuels and strengthen the sector’s resilience.