Sky’s The Limit – Aviation Biofuels About To Take Off?

By John Daly | Sun, 11 August 2013 Benefit From the Latest Energy Trends and Investment Opportunities before the mainstream media and investing public are aware they even exist. The Free Oilprice.com Energy Intelligence Report gives you this and much more. Click here to find out more. For the past decade, commercial production of jet biofuel has become of major interest to international airlines. Renewable Jet A-1 biofuel has two alluring aspects. First, it is a “drop in” fuel – blended 50-50 with conventional Jet A-1 kerosene derived from hydrocarbons, it requires no special engine modifications. Secondly, as the world prepares to institute carbon emissions penalties, biofuel Jet A-1 can reduce commercial airliners’ carbon emissions by 80-85 percent. The eye of the needle for this sunny renewable biofuel future has been twofold. First, the cost – no one has yet been able to produce renewable Jet A-1 at a cost comparable to hydrocarbon Jet A-1. The second problem derives from the first, in that no one has yet been able to produce renewable Jet A-1 in commercial quantities at a competitive rate. But this might all be about to change. AltAir, a major player in the burgeoning biofuels market, has unveiled ambitious plans to provide United Airlines with at 15 million gallons over the next three years of renewable jet fuel from a retooled Los Angeles-based refinery . Needless to say, the development is being closely watched, as the AltAir project will be the first U.S. refinery capable of producing both diesel and drop-in replacements for petroleum-based jet fuels. United has collaborated with AltAir Fuels for the past five years and has agreed not only to the initial purchase, but an option to purchase more. And United scores a march on its competition, as on 5 August Air Transport World magazine named United Airlines the Eco-Aviation “Airline of the Year” Gold Winner by, the top award granted by ATW in its annual Eco-Aviation Awards. United Airlines chairman, president and chief executive officer Jeff Smisek gushed, “This is a great honor for United and I’m proud of the work that my co-workers do every day to be responsible stewards for the environment. Our initiatives are paying off as we reduce United’s environmental footprint and work together toward a sustainable future for our company and our industry. United managing director for global environmental affairs and sustainability Jimmy Samartzis added, “This is a great day for United and the aviation biofuels industry. This agreement underscores United’s efforts to be a leader in alternative fuels as well as our efforts to lead commercial aviation as an environmentally responsible company. We’re excited about what this strategic partnership with AltAir means for United, the industry, the environment, and for our customers.” PR fluff aside, United has solidly put its capital behind its efforts to retool its aircrafts’ fuel consumption. United currently has more than 290 fuel-efficient aircraft on order and was the first U.S. carrier to purchase Boeing’s fuel efficient 787 Dreamliner, which cuts fuel consumption by and estimated 20 percent improvement. Deepening its commitment, United recently increased its order for Boeing 787 Dreamliners to 65 aircraft. Not limiting itself to U.S. domestic aircraft, United has also ordered 35 Airbus A350-1000s, which have reduced fuel consumption rates similar to Boeing 787 Dreamliners. Accordingly, United believes that it will meet its 2013 goal to reduce fuel usage by 85 million gallons and associated carbon emissions by 828,750 metric tons. The attention will now switch to AltAir – can it deliver? Rather than build a new refinery, the company intends to retrofit part of an existing petroleum refinery into an advanced biofuel refinery near Los Angeles. With AltAir’s retrofits, the Los Angeles refinery is set to become the first commercial-scale producer of renewable jet fuel in the world. AltAir CEO Tom Todaro has no doubts about the viability of the project, telling journalists, “United Airlines has been a strategic partner for several years as we work to establish our biofuel facility . We cannot overestimate how important this milestone is for the commercialization of sustainable aviation biofuels, and we at AltAir are proud that United is our first customer.” And AltAir is dreaming big, expecting to expand the refinery’s capacity eventually to produce 30 million gallons of advanced biofuels and chemicals after retrofits are complete. Feedstock for the facility? Non-edible natural oils and agricultural wastes. Can AltAir find sufficient natural oils and agricultural wastes in LA? Can they deliver the promised volumes of fuel? Watch this space. By. John C.K. Daly of Oilprice.com Taylor Scott International