The vinasse waste was effectively converted to nanoporous carbon (NPC) via hydrothermal carbonization with potassium hydroxide (KOH) activation. The nanoporous carbon (NPC) exhibited a maximum surface area of 1018 m2/g and it was utilized as a catalyst for the conversion of palm oil into green diesel fuel. The supported NPC catalyst was fabricated via a wet impregnation technique, where finely distributed iron phosphide (FeP) particles were cemented. An investigation was conducted to examine the effects of different temperatures (ranging from 280 to 360 °C) on the conversion of palm oil through deoxygenation reactions. The FeP/NPC catalyst exhibited remarkable particle dispersion and surface area. At a reaction temperature of 340 °C, the FeP/NPC catalyst had the best selectivity for green diesel, reaching 68.5%. The finding implies that FeP catalysts, when supported, hold significant promise for converting triglycerides into renewable diesel fuel. Moreover, they provide the advantage of being more cost-effective than valuable metals, while demonstrating excellent catalytic efficiency in the production of biofuels.