All diesel fuel is subject to adsorbing water. That's why you have a fuel filter with a water separator.
Biodiesel provides additional lubricity that others have mentioned. It helps replace the sulfur taken out of fuel by recent air quality regulations. Biodiesel also tends clean out the carbon in your engine. It can clog your fuel filter, so always carry a spare.
The only real problem is that biodiesel can gel or form wax crystals at a higher temperature than #2 dino fuel, and much higher than #1 diesel. It is possible to run b100 in the winter, but it takes a pre-heater.
Some time in the future, it is likely that the cost of reg #2 diesel will be much higher than biodiesel. That will happen around $5 a gallon mark. When that happens, biodiesel will provide cheaper fuel than any petro based fuel. Biodiesel can be made from waste cooking oil, ag crops like canola and algae among others.
It will be no big deal to retrofit modern diesel engines with a pre-heater for all driving conditions.
