The steady increase in human population and a rising standard of living heighten global demand for energy. Fossil fuels account for more than three-quarters of energy production, releasing enormous amounts of carbon dioxide (CO2) that drive climate change effects as well as contributing to severe air pollution in many countries. Hence, drastic reduction of CO2emissions, especially from fossil fuels, is essential to tackle anthropogenic climate change. To reduce CO2emissions and to cope with the ever-growing demand for energy, it is essential to develop renewable energy sources, of which biofuels will form an important contribution. In this Essay, liquid biofuels from first to fourth generation are discussed in detail alongside their industrial development and policy implications, with a focus on the transport sector as a complementary solution to other environmentally friendly technologies, such as electric cars.