Biofuel shortage curbs airlines’ emission targets
THE airline industry’s plan to ease its impact on global warming hinges on fuels made from vegetable oil, corn and household garbage.
The hitch: nobody has yet been able to produce the stuff in the volumes needed.
JetBlue Airways, United Continental Holdings and Richard Branson’s Virgin Group have begun blending eco-friendly substitutes into traditional jet fuel made from paraffin. Even with that backing, there is still only a handful of producers of the fuels.
They lack the capacity to crank out the billions of litres needed to supply the global aviation fleet, and the pace of investment is slowing.
Even so, airlines are staking their low-carbon future on renewable fuels. The aviation industry, responsible for more than 2% of greenhouse gases, is being pushed to act this week by delegates from 190 nations, who are debating a UN accord in Montreal that would cap emissions from international flights. Ultimately, that means burning less fossil fuel.
With electric planes still experimental, airlines and aerospace companies say biofuels are their best bet.
“There is a tremendous amount of determination to make biofuel work because we just don’t have any alternative,” Julie Felgar, Boeing’s MD of environmental strategy and integration, says.
The biofuel industry has enough factories to produce as much as 378-million litres of jet fuel annually, says Claire Curry, an analyst at Bloomberg New Energy Finance. That barely registers next to the more than 315-billion litres airlines consume each year.
Investments in biofuel, meanwhile, are at a record low, with $322m in backing globally during the first six months of 2016, according to BNEF. That is off 64% from the first half of 2015 and down 98% from a decade ago, when ethanol production for cars took off.
“This is still a pipe dream,” Curry says. “No one has figured out how to make these fuels at scale yet. The technologies are complicated. They often don’t work. And the plants can cost half-a-billion dollars to build.”
Advocates for renewable jet fuel say the industry will develop after the UN accord takes effect and drives up demand, just as ethanol production boomed in the US after legislators passed the Renewable Fuel Standard in 2005.
Patrick Gruber, CEO of Gevo, says its jet fuel works, and scaling up is “cookie cutting”.
“We know how to do this. We just have to make more production lines,” he says.
His company is based in Englewood, Colorado, and makes renewable fuel from corn and other crops. It is backed by the French oil company Total and has sales agreements with Alaska Air Group and Deutsche Lufthansa.
Yet it is not always easy to scale up biofuel manufacturing, a complex process involving tiny microbes. In 2012, a contamination problem temporarily derailed Gevo’s efforts to increase output of its primary jet fuel ingredient, isobutanol, at its refinery in Luverne, Minnesota. Gruber says the issues are “well behind us”.
The aviation industry supports the pending UN accord and has set ambitious environmental goals of its own. Those include improving average fuel efficiency 1.5% a year through 2020, and reducing emissions to half of 2005 levels by 2050.
Jet fuel is among airlines’ biggest expenses.
“Airlines are stepping up and creating demand,’’ Sophia Mendelsohn, JetBlue’s head of sustainability, says.
“It is hard for me to envision a long-term situation where the biofuel industry does not mature and develop.’’
Airlines began testing biofuels in 2008 and have since used them on more than 1,500 passenger flights.
JetBlue agreed in September to buy more than 125-million litres of blended fuel annually, using renewable fuel from SG Preston.
In March, United Continental announced a three-year deal to buy 55-million litres of biofuel from AltAir Paramount for flights out of Los Angeles.
Not all deals have worked out. In 2014, British Airways announced a $550m agreement with Solena Fuels for a factory in London to convert municipal trash into jet fuel beginning in 2017. The airline agreed to buy about 110-millions litres a year at market price. At the time, oil was $109 a barrel. Within a year, it was below $50 a barrel, and Solena dropped the project. “We couldn’t compete with oil that cheap,” Solena CEO Robert Do says.
The products offered by Solena, Gevo and others are almost chemically identical to paraffin. They are considered renewable because their carbon comes from plants that can be regrown to refresh supplies. Fuels made from petroleum, by contrast, are exhausted when they are burned, releasing carbon into the air.
Still, environmental concerns remain. It takes energy to produce biofuel, and emissions from that process may offset gains from using less fossil fuels in the sky.
As the industry expands, advocates worry that growing corn and sugar cane for airlines will affect forests, food supplies and water.
“All of these issues need to be monitored and taken into account,” says James Beard, who focuses on energy and climate at the World Wildlife Fund.
Airlines are not depending on biofuels alone to cut emissions. They’re also working on more aerodynamic planes, cutting cargo weight, improving air-traffic control procedures and enlisting other technological and operations measures.
But in the end, they will also need to wean themselves off petroleum-based fuel.
“You can only push fuel efficiency so far,” says Nancy Young, vice-president of environmental affairs for the trade group Airlines for America. “It is a matter of physics.”
Bloomberg
DEMAND: The aviation industry is responsible for more than 2% of greenhouse gases and delegates at a UN accord in Montreal will this week consider capping emissions from international flights. Picture: REUTERS
THE airline industry’s plan to ease its impact on global warming hinges on fuels made from vegetable oil, corn and household garbage.
The hitch: nobody has yet been able to produce the stuff in the volumes needed.
JetBlue Airways, United Continental Holdings and Richard Branson’s Virgin Group have begun blending eco-friendly substitutes into traditional jet fuel made from paraffin. Even with that backing, there is still only a handful of producers of the fuels.
They lack the capacity to crank out the billions of litres needed to supply the global aviation fleet, and the pace of investment is slowing.
Even so, airlines are staking their low-carbon future on renewable fuels. The aviation industry, responsible for more than 2% of greenhouse gases, is being pushed to act this week by delegates from 190 nations, who are debating a UN accord in Montreal that would cap emissions from international flights. Ultimately, that means burning less fossil fuel.
With electric planes still experimental, airlines and aerospace companies say biofuels are their best bet.
“There is a tremendous amount of determination to make biofuel work because we just don’t have any alternative,” Julie Felgar, Boeing’s MD of environmental strategy and integration, says.
The biofuel industry has enough factories to produce as much as 378-million litres of jet fuel annually, says Claire Curry, an analyst at Bloomberg New Energy Finance. That barely registers next to the more than 315-billion litres airlines consume each year.
Investments in biofuel, meanwhile, are at a record low, with $322m in backing globally during the first six months of 2016, according to BNEF. That is off 64% from the first half of 2015 and down 98% from a decade ago, when ethanol production for cars took off.
“This is still a pipe dream,” Curry says. “No one has figured out how to make these fuels at scale yet. The technologies are complicated. They often don’t work. And the plants can cost half-a-billion dollars to build.”
Advocates for renewable jet fuel say the industry will develop after the UN accord takes effect and drives up demand, just as ethanol production boomed in the US after legislators passed the Renewable Fuel Standard in 2005.
Patrick Gruber, CEO of Gevo, says its jet fuel works, and scaling up is “cookie cutting”.
“We know how to do this. We just have to make more production lines,” he says.
His company is based in Englewood, Colorado, and makes renewable fuel from corn and other crops. It is backed by the French oil company Total and has sales agreements with Alaska Air Group and Deutsche Lufthansa.
Yet it is not always easy to scale up biofuel manufacturing, a complex process involving tiny microbes. In 2012, a contamination problem temporarily derailed Gevo’s efforts to increase output of its primary jet fuel ingredient, isobutanol, at its refinery in Luverne, Minnesota. Gruber says the issues are “well behind us”.
The aviation industry supports the pending UN accord and has set ambitious environmental goals of its own. Those include improving average fuel efficiency 1.5% a year through 2020, and reducing emissions to half of 2005 levels by 2050.
Jet fuel is among airlines’ biggest expenses.
“Airlines are stepping up and creating demand,’’ Sophia Mendelsohn, JetBlue’s head of sustainability, says.
“It is hard for me to envision a long-term situation where the biofuel industry does not mature and develop.’’
Airlines began testing biofuels in 2008 and have since used them on more than 1,500 passenger flights.
JetBlue agreed in September to buy more than 125-million litres of blended fuel annually, using renewable fuel from SG Preston.
In March, United Continental announced a three-year deal to buy 55-million litres of biofuel from AltAir Paramount for flights out of Los Angeles.
Not all deals have worked out. In 2014, British Airways announced a $550m agreement with Solena Fuels for a factory in London to convert municipal trash into jet fuel beginning in 2017. The airline agreed to buy about 110-millions litres a year at market price. At the time, oil was $109 a barrel. Within a year, it was below $50 a barrel, and Solena dropped the project. “We couldn’t compete with oil that cheap,” Solena CEO Robert Do says.
The products offered by Solena, Gevo and others are almost chemically identical to paraffin. They are considered renewable because their carbon comes from plants that can be regrown to refresh supplies. Fuels made from petroleum, by contrast, are exhausted when they are burned, releasing carbon into the air.
Still, environmental concerns remain. It takes energy to produce biofuel, and emissions from that process may offset gains from using less fossil fuels in the sky.
As the industry expands, advocates worry that growing corn and sugar cane for airlines will affect forests, food supplies and water.
“All of these issues need to be monitored and taken into account,” says James Beard, who focuses on energy and climate at the World Wildlife Fund.
Airlines are not depending on biofuels alone to cut emissions. They’re also working on more aerodynamic planes, cutting cargo weight, improving air-traffic control procedures and enlisting other technological and operations measures.
But in the end, they will also need to wean themselves off petroleum-based fuel.
“You can only push fuel efficiency so far,” says Nancy Young, vice-president of environmental affairs for the trade group Airlines for America. “It is a matter of physics.”
Bloomberg
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