The airline industry's biggest climate challenge: a lack of clean fuel

This spiked demand for corn and other crops, spurring land-use changes not just in the US but globally. Those changes included clearing carbon-rich grasslands and forests to plant more crops, which negated most of the climate benefits of corn-based ethanol. Airlines are convinced this can be done with far fewer climate impacts, but doubters abound.

“This industry needs an absolutely huge amount of fuel,” says Alethea Warrington, a senior campaigner at Possible, a UK-based climate charity that is skeptical of SAF and encourages less air travel. “Wherever you try to get this from, it throws up huge systemic problems.”

Freedom Pines will initially deliver scant climate benefits because it will use corn ethanol from the US Midwest to “work the kinks out,” says Jimmy Samartzis, chief executive officer of LanzaJet. As it becomes operational over three to six months, it will transition to using sugarcane ethanol from Brazil, which has fewer land-use impacts. Doing so would reduce heat-trapping emissions by at least half compared to fossil jet fuel, according to the US Environmental Protection Agency.

Samartzis says they’ll also soon use ethanol derived from waste products, like corn stalks and other agricultural residues. That should deliver even bigger carbon savings because they do little to spur land-use changes that could harm the climate.

L.E.K. Consulting, in a report on the SAF market last year, predicted alcohol-to-jet will surpass today’s clean fuels to become the world’s biggest source of SAF by the middle of next decade. “It’s a proven technology and there are abundant agricultural and forestry residues, which work very well with it,” says John Goddard, L.E.K.'s senior partner and vice chair of sustainability.

It’s not the only path forward, though. Several outfits, like Nuseed and CoverCress Inc., which is majority-owned by Bayer AG, are beginning to enlist farmers to plant between their normal rotations of corn and soybeans. This includes carinata and pennycress, which can be converted into biofuels and animal feed. Because these are planted as cover crops when fields would otherwise lay fallow, they don’t trigger land-use changes. But these businesses face a range of hurdles from reluctant farmers to regulatory approvals.

“It’s not for the faint of heart to introduce a new crop,” says Mike DeCamp, chief executive officer of CoverCress, who adds that it could be a decade before the company reaches its full scale. His firm was named a BloombergNEF Pioneer this week owing to the promise of its technology to breed and edit the genes of pennycress to make growing the crop more profitable.

By the 2040s, Goddard and other experts believe a nascent technology called power-to-liquids or e-kerosene will likely eclipse the rest of the market and reduce the risk of land-use change altogether. That fuel is produced by combining a stream of captured CO2 with hydrogen molecules using vast quantities of renewable energy. The output is a liquid fuel with almost no climate footprint.

But the barriers are immense. Capturing CO2 is extremely difficult, and there is little extra renewable energy as governments around the world race to decarbonize. All told, power-to-liquids would cost nearly seven times more than traditional jet fuel, according to L.E.K.

The difficulties are showcased by Transport & Environment, a nonprofit in Brussels, which has tracked proposed power-to-liquids plants across much of Europe. Although the number of announced facilities climbed to 45 as of January — part of a “largely positive” trend, it noted — all of the major projects remain “hypothetical” as they’ve yet to clear the crucial final investment decision, where money begins to flow and the construction truly commences.

Governments have been throwing a mishmash of requirements and incentives at the industry in an attempt to build momentum. The EU has been at the forefront, with lawmakers there mandating that airlines use SAF in increasing quantities through 2050, when it should account for at least 70% of all fuel. This includes a sub-mandate for pricey e-kerosene, which must go from 1.2% of fuels in 2030 to 35% by 2050.

SAF requirements in the US have gained little traction amid forceful opposition from the airlines. Instead, the Inflation Reduction Act created an incentive for SAF worth up to $1.75 per gallon. That expires in 2027, though, well before most proposed plants will be operating.

“That’s not long enough to get projects built and constructed,” says LanzaJet’s Samartzis.

In the case of Freedom Pines, it took a little help to get it over the finish line. Breakthrough Energy supplied a $50 million grant in 2022 to help keep the project on track.

But if Freedom Pines can ramp up successfully and churn out millions of gallons of SAF, it could do a lot to rev up investor appetite, according to Susan van Dyk, a biofuels consultant and researcher at the University of British Columbia.

Nonetheless, she adds, the industry has a long way to go to catch up to its SAF promises, which requires a 50- or 100-fold increase in production by the end of this decade. “I can’t see that happening by 2030,” says van Dyk. “We just need more of these technologies to be commercial and ramping up.”