The production of biodiesel fuel involves a chemical reaction called transesterification of lipids (those from the vegetable oil or fat) with alcohols to produce alkyl esters. Methanol is most commonly used as the alcohol in these reactions, which leads to methyl esters, though other alcohols have also been used.

Glycerol is a byproduct of the transesterification reaction, and this compound is actually formed in fairly substantial quantities (ca. 10% by mass). This has given rise to research directed toward finding ways to carry out chemical reactions beginning with, or involving, glycerol, such that the cost efficiency of the overall process of biodiesel production might be improved.