My feeling is that diesel-like engines with be with us for decades. Despite thermal efficiencies less than 50% these engines are tough and reliable and seem to be able to work on a range of fuels. For example lipids based diesel includes methyl ester, ‘thermal depolymerization’ and hydrogenated variants which seem to be your ‘green diesel’. There is the US military’s JP8 which I understand powers both Humvees and helicopters. Fischer-Tropsch diesel can be made from both coal and woodchips. Diesel engines can be modified to run wholly or partly on dimethyl ether or compressed natural gas. The different liquid diesel fuels can be blended and even a touch of ethanol added to make diesohol. Now Citroen and other car makers have diesel hybrids not to mention the mythical GM Volt if it ever makes it.

However looking ahead I think the best form of diesel fuel will be from waste biomass probably via gasification. The early signs on algae farming are not good. The population will be too large and hungry and the climate too variable to grow soybeans and oil palms to make fuel. To use the fashionable term diesel is ‘resilient’.

Boof ( However looking ahead I think the best form of diesel fuel will be from waste biomass probably via gasification.)
I think the key words in that statement are "will be". Fusion and, it appears, cellulosic ethanol, are the energy sources of the future, and always will be.

You'll get a kick out of this. I'm looking up old tractors these days (any guesses why?), and found a few great ones. In the book "Farm Tractors 1950-1975" by Lester Larson on page 59, it covers an Allis Chalmers experimental fuel cell tractor from 1959. Apparently the tractor is now in the Smithsonian. In 1961, International Harvester tried a gas turbine engine. That, too, is in the Smithsonian, and probably no where else.

The kicker for me has always been that GM was experimenting with hybrids in the early 60s. When did the Prius really take off? Wasn't it 2004? So, 40 years or so for hybrids to go from experimental to production. Fuel cells even longer.

However, people have used wood gasification before. To answer my "any guesses" question above, I'm looking at old tractors since many of them were gasoline powered. Spark ignition supposedly works much better for burning wood gas. Here is a handy-dandy guide from FEMA for how to run a tractor on wood gas titled "Construction of a Simplified Wood Gas Generator for Fueling Internal Combustion Engines in a Petroleum emergency." PDF version here.

Here's a few guys here in Sweden who modified an old Volvo to wood gasification, and took a tour around all of Sweden this ummer. 5400 kilometers or something.

Around Sweden with Wood in the Tank

http://www.vedbil.se/indexe.shtml

And here's the photo page, including pictures of blonde female groupies. Apparantely wood gasification is hot with the chicks over here... (OK, only one picture, but I bet that got your attention)

http://www.vedbil.se/fotoalbume.shtml

Some facts about the car:

acts:

Top speed: 90km/h (105 km/h with dry birch wood)

Acceleration 0-100: Some times :)

Wood consumption: 1 cu m / 1000 km

Cruising range on one load: 70 km

Start-up time: 2-10 minutes

Kerb weight: 1460 kg

The producer-gas systems weight: 260 kg

On route, they visited and kicked life in an old tractor, to run on wood gasification/producer air. Blog entry, text in swedish, but there is a video of the engine once they got it going:

http://www.vedbil.se/dagbok/resa/20.shtml

And the wood gasification enthusiasts in Sweden have another website at http://www.gengas.nu/ but swedish language only. Sweden more or less survived on wood gasification during the entire WW2 (and that included agriculture), although car use naturally was much, much less than today.

And here we have the Finnish version :)

http://www.ekomobiili.fi/Tekstit/woodgas_as_fuel.htm

Finns are more neat and clean. Must be the great availability of alchohol for ... cleaning purposes. But as I recall, Finland has been a Swedish province for all but the last 200 years, so we get some of the credit. Hrmph.

I am interested in wood gas also and learned through this site
http://tinyurl.com/af8az how this guy processes his wood for use.

Spark ignition supposedly works much better for burning wood gas.

Maybe, but wood gas isn't much of an answer, and spark ignition is simply a pain in the neck on a farm. Animals chew the wires, moisture gets into the distributors, spark plugs always get fouled just when you really need something to run.
Better to just let the housing and credit bubbles take out some of those extra trucks on the roads and bring the price and supply of diesel fuel back where it belongs, instead of fueling all those McMansion Speculators.

Eventually, perhaps we will all have fusion power and I'm currently working on the electric tractors (battery and hybrid power) and machinery to match up. Until then, we should focus on conservation, Descent, and soil building, instead of 'replacement fuels', 'sustainable growth', and soil destruction.
Burning wood gas sounds great from a woodsman's standpoint, but from an ecological one, it's like taking the stuff that gets dumped at your local "don't ask, don't tell" collection site and burning all of it together. Most chemical companies started out as charcoal companies, and they contaminated a lot of land extracting wood gas to make the fine modern conveniences we call 'plastics' and 'chemicals'. Nowadays, they synthesize most of their concoctions from petroleum and coal. Let's not go backward if we can help it.

Despite thermal efficiencies less than 50% these engines are tough and reliable and seem to be able to work on a range of fuels.

That's actually quite good (real world peak effs are low 40s to low 50s, depending on application). A hydrogen fuel cell may be low 50s, if you don't include hydrogen manufacture. A BEV might be 80-85% -- if you don't include battery charging. A methane fuel cell or a combined cycle coal burner (not exactly useful for LDVs) would be competitive.