Oil may be at $50 a barrel, and staying there for now, but airlines are not ready to abandon ambitions to secure alternative sources of jet fuel. They have vivid memories of the price volatility that drove oil above $100 a barrel as recently as mid-2014. Airlines are not yet prepared to turn their backs on emerging biofuel sources that could help stabilize fuel prices and reduce emissions.

But a continuing concern for airlines is that biofuels must be sustainable, not compete with food for land and water, and also be price competitive with petroleum-based jet fuel. With growing concern in Europe and the US that energy crops are driving adverse changes in land use, fuels from waste products are gaining early traction with airlines. Waste does not compete with food and, as its disposal can carry a charge, deals can be struck to supply waste as a feedstock for fuel at low to zero cost.

First to step into the waste-to-fuel arena was British Airways (BA), which in 2012 signed an investment and offtake agreement with Solena Fuels to build GreenSky London venture to convert 640,000 tons of municipal solid waste (MSW) a year to liquid fuels using high-temperature gasification and the Fischer-Tropsch (F-T) process. The plant, at a former refinery in Thurrock, east of London, is to be operational by 2017. BA has agreed to buy all 16 million gallons of jet fuel produced annually by the plant for 11 years—about 2% of its total consumption, but enough to support operations at nearby London City Airport.

Cathay Pacific Airways in August became a strategic investor in California-based Fulcrum BioEnergy, the recipient of a $70 million Defense Production Act (DPA) grant from the US government to build its first commercial-scale plant—Sierra BioFuels in McCarran, Nevada—to convert MSW to liquid fuels. Construction of the facility, planned to be operational by the end of 2016, is also backed by a guarantee from the US Department of Agriculture for a $105 million loan from Bank of America Merrill Lynch.

Cathay has negotiated a long-term supply agreement with Fulcrum for an initial 375 million gallons of aviation biofuel over 10 years—about 2% of the airline’s current jet-fuel consumption. The pre-sorted organic waste will be gasified to produce syngas, which is purified and subsequently converted to syncrude via the F-T process and finally upgraded to liquid fuels. Sierra BioFuels will convert approximately 200,000 tons of MSW into more than 10 million gallons of jet fuel and diesel annually.

Fulcrum, which has refuse-disposal giant Waste Management as a strategic investor, says it has MSW feedstock agreements in place sufficient to support its plans to build another seven biorefineries across North America, all located close to major airline hubs in Chicago, Denver, Houston, Los Angeles, Newark and San Francisco. Together these first eight projects are expected to have a cumulative capacity of more than 300 million gallons a year of jet fuel and diesel.

Cathay, which is studying the feasibility of a waste-to-biojet fuel plant at its Hong Kong home base, says its focus is on biofuels from wastes and residues because of land-use changes associated with energy crops. The airline says Fulcrum has shown its process is viable at its demonstration plant in Durham, North Carolina. Fulcrum says its business model can handle volatility in oil prices, with a cost of production that enables its plants to be profitable with oil at $50 a barrel and still cashflow-positive at $30.

Southwest & Red Rock

Southwest Airlines in September agreed to purchase approximately three million gallons of biofuel a year from Colorado-based Red Rock Biofuels, which was founded to convert forest debris to renewable fuels and reduce the risk of forest fires in the western US. Red Rock’s first biorefinery, in Lakeview, Oregon, is planned to be producing fuel by the end of 2016, helped by another $70 million DPA grant from the US government and investment for venture-capital firm Flagship Ventures.

Southwest says the blended fuel will be used in its California Bay Area operations beginning in 2016. The Oregon facility will convert some 140,000 dry tons of waste biomass from forests and sawmills into at least 12 million gallons a year of renewable jet fuel, diesel and naphtha. The woody biomass will be gasified to produce syngas, which will be converted to syncrude via the F-T process then upgraded to liquid fuels. Red Rock says it has long-term contracts that tie the cost of wood feedstock to diesel prices.

In another waste-to-fuel venture, Virgin Atlantic Airways has partnered with Chicago-based LanzaTech, which has developed a fermentation process to convert industrial flue gases into ethanol. This can then be upgraded to jet fuel. The team expects a demonstration flight to take place toward the end of this year, in a key step toward ASTM approval of the alcohol-to-jet production pathway. LanzaTech’s first commercial gas fermentation plant is targeted to be operational in 2016.

The company’s process captures waste gases from steel mills and other processing plants. The gases, rich in carbon monoxide and carbon dioxide, are fermented and converted by a microbe into ethanol. An alcohol-to-jet process developed by Swedish Biofuels then upgrades the ethanol to jet fuel. In October, UK bank HSBC joined the Virgin/LanzaTech partnership to support scaling up of the process for sample size to demo scale, with production of a sufficient amount of fuel to conduct the proving flight.

Seawater source

A different type of waste, coastal seawater from desert aquaculture, is at the heart of a venture in the United Arab Emirates funded by Abu Dhabi airline Etihad Airways, Boeing and others. Seawater is pumped from the ocean into a fish and shrimp farm and waste water from the aquaculture operation, enriched with fish-waste nutrients, is then used to irrigate and fertilize fields of salt-tolerant plants called halophytes. Water cleaned by the halophytes then drains into a mangrove wetland before returning to the ocean.

Both the halophytes and mangroves are converted to biomass and oils for the production of jet fuel. A large-scale demonstration of the integrated ecosystem is expected to be operational by late summer, conducted by the Sustainable Bioenergy Research Consortium, which in addition to Etihad and Boeing, includes process developer Honeywell UOP, General Electric, Safran and Abu Dhabi’s Masdar Institute.

The first waste feedstock to be made into jet fuel was used cooking oil, which has been used in most biofuel demonstration and revenue flights so far. In March, Hainan Airlines and Boeing conducted a scheduled 737-800 flight on a 50% blend of biofuel produced from waste cooking oil—called gutter oil in China—by oil company Sinopec (see sidebar). In October 2014, Boeing and Comac inaugurated a pilot project in Hangzhou producing 160 gallons a day of biofuel from gutter oil to establish feasibility and cost. The companies estimate China could produce 500 million gallons of biofuel annually from used cooking oil.

Concern about land use for energy crops is not the same in all regions, and a massive sugarcane industry has given the biofuel business a head start in Brazil. In 2014, Brazilian airline GOL began revenue flights with a biofuel called farnesane, derived from sugarcane by Amyris-Total. Amyris’s process is the fourth synthetic jet-fuel pathway to be approved for use in aircraft, initially in blends up to 10%.

Avianca Airlines is working with fuel developer Byogy Renewables to conduct the testing required to gain approval for an alcohol-to-jet biofuel produced from sugarcane—and agave, a plant that grows in semi-arid soil and which Byogy is introducing to Brazil in partnership with AusAgave Australia. Byogy’s process converts ethanol to jet fuel, initially for a 50% blend, but potentially 100%. Agave produces both sugar and fiber, which can be sold to reduce the cost of the fuel. Qatar Airways is an investor in Byogy.


Hainan 737 takes flight with
waste cooking oil

A Hainan Airlines Boeing 737-800 completed China’s first passenger flight with sustainable biofuel made by Sinopec from waste cooking oil collected from restaurants in China. Both of the aircraft’s CFM International CFM56-7B engines were powered by a fuel blend of approximately 50% aviation biofuel mixed with conventional petroleum jet fuel.

Pu Ming, VP-Hainan Airlines and pilot of the March 23 biofuel flight, said, “As a fast-growing domestic and international carrier, Hainan Airlines is demonstrating our environmental commitment by showing that aviation biofuel can play a safe and effective role in China’s air transport system.”

In 2011, Air China conducted China’s first aviation biofuel test flight in a Boeing 747-400 using China-grown, jatropha-based biofuel. China Eastern Airlines conducted an Airbus A320 biofuel test flight using so-called “gutter oil” in April 2013.

Boeing partners with the Commercial Aviation Corp. of China (COMAC) and several research institutions, including the Chinese Academy of Science’s Qingdao Institute of Bioenergy and Bioprocess Technology (QIBEBT), on aviation biofuel development.

— Katie Cantle

Sustainable Strategies

United Airlines plans to launch biofuel flights from Los Angeles by mid-year under the first fuel-supply agreement to result in commercial-scale deliveries of renewable jet fuel. The airline signed a three-year, 15-million gallon contract with AltAir Fuels in 2013.

AltAir’s converted refinery in Paramount, California, is expected to be operational by mid-year, using Honeywell UOP’s process to produce renewable diesel and jet fuel. With an initial capacity of 30 million gallons of liquid fuels a year, the facility is “feedstock flexible,” but is beginning with locally sourced animal fat and camelina oil.

The fuel is expected to be certified as sustainable by the Roundtable for Sustainable Biofuels, and to qualify for a subsidy under the US Environmental Protection Agency’s Renewable Fuel Standard. This will help make the biofuel cost competitive for United, which plans to use it in a 30%-40% blend with conventional jet fuel.

While United is taking a lead in North America, Air France-KLM is the leader in use of sustainable biofuels, according to a scorecard compiled by the National Resources Defense Council (NRDC), an international environmental organization. But the scorecard is based on 2013 data from 17 airlines that made only very limited use of biofuel.

In 2014, KLM conducted 26 Airbus A330 scheduled flights from Amsterdam Schiphol to Aruba and Bonaire in the Caribbean under a European Union-funded project to establish a European supply chain for sustainable fuel. In September, Air France began a year-long program of weekly Toulouse-Paris A321 flights using a 10% blend of Amyris-Total’s sugarcane-derived biofuel. KLM and Lufthansa also plan to use this fuel.

In March, Norway’s Oslo Airport Gardermoen became the first airport to offer a regular supply of biofuel. Under an agreement between airport operator Avinor and airlines KLM, Lufthansa and SAS, fuel supplier Statoil is providing 660,000 gallons of biofuel to support around 3,000 flights at a 50% blend. The fuel, made from used cooking oil, was sourced by KLM-backed SkyNRG.

The other top-ranked airlines in NRDC’s scorecard—British Airways, United, Virgin Atlantic, and Cathay Pacific Airways—also have offtake agreements in place for sustainable biofuels. And Alaska Airlines (ranked seventh) has signed an agreement with Hawai’i BioEnergy to supply biofuel derived from woody biomass for flights from Hawaii beginning in 2018.

Other regions are catching up. In Japan, the Initiatives for Next Generation Aviation Fuels was formed in April 2014 with the goal of launching commercial biofuel flights by the 2020 Tokyo Olympics. Members include All Nippon Airways (ANA), Japan Airlines and Nippon Cargo Airlines. ANA is a partner in Japanese bioventure Euglena Co. Ltd., which with Chevron Lummus Global is to build a biorefinery near a major airport, to be operational by 2018. The fuel will be derived from Euglena, an algae-like freshwater organism.

—Graham Warwick