When most of us think of highly customized aviation alcohols, we probably think of the little bottles of Johnnie Walker. But a handful of companies such as Cobalt, Gevo, Terrabon, LanzaTech and ZeaChem are shaking up the emerging aviation biofuels markets by developing renewable aviation fuels from ethanol and/or biobutanol.
It’s been an improbable mission, but a handful are getting close enough that we had better explain the background before they achieve massive scale.
Um, how do you make jet fuel from alcohol?
“An alcohol molecule, looking at it one way, is really just a hydrocarbon carrying this extra OH [a hydroxyl group] on its back,” explains LanzaTech CEO Jennifer Holmgren. So, chemically reforming alcohol into jet fuel is not a bizarre form of medieval alchemy.
But in the process, you generally need two ethanol molecules to make a jet fuel molecule, so unless you are interested in trying to sell $6 jet fuel, you had better start with something that produces much better than $3 ethanol.
For that reason, alcohol to jet fuel should be properly seen as a niche market for ethanol producers – but (owning to the early interest in jet fuels from both commercial airline and the military) one that may break out towards commercial scale faster, and for some companies faster than their efforts to make commercial-scale ethanol fuel.
Isobutanol and n-butanol, as made by Gevo, Cobalt and Butamax, is an alcohol with special applications in jet fuel because it is a four-carbon molecule to begin with. Back in 2009, Gevo opined that the first “Sasol Synthetic Jet was C12? centered isoparaffin mixture with similar properties” to Gevo’s jet fuel blend stock. Gevo said at the time that its jet fuel met all ASTM specifications except a slight miss on fuel density, and blended with 25 percent Jet A that met all specs. Gevo also indicated that it could make a jet fuel blend stock at an operating cost equivalent to $65 oil.
The feedstock dilemma
For all the excitement over Hydroprocessed Esters and Fatty Acids” (HEFA) fuels, recently approved as a jet fuel spec by ASTM and now already used in a 50/50 blend with conventional fossil aviation fuels on commercial flights operated by Lufthansa and KLM, alcohol fuels have the attraction of opening up a more feasible pool of feedstocks.
The achilles heel of HEFA fuel is the problem of getting enough fuel made from camelina, algae, jatropha or other non-food renewable oil sources. All three feedstocks check out brilliantly under operating conditions, but camelina and algae are in their infancy in terms of production at commercial scale; jatropha is much farther along, but is far from providing anywhere near the 30 billion gallons of biofuel the aviation industry would buy tomorrow, if the price and performance is on par with fossil fuels.
On the alcohol side, there is the tantalizing prospect of traditional feedstocks like corn and cane, energy crops like miscanthus and switchgrass, or low-cost feedstocks like municipal solid waste or agricultural waste such as bagasse or corn stover. Not to mention the possibilities of utilizing woody biomass.
Progress to date
DARPA jumped into the file this year by funding a clutch of projects.
Terrabon was awarded a $9.6 million, 18-month contract by Logos Technologies to design a more economical and renewable jet fuel production solution for the Defense Advanced Research Projects Agency. Started in April of 2011, a customized production process for DARPA will be engineered, constructed and operated at Terrabon’s Bryan, TX demonstration facility in an effort to yield 6,000 liters of jet fuel through the use of the company’s advanced bio-refining technology MixAlco, in preparation for commercialization of this technology.
“An important focus of this DARPA effort is to produce a sustainable, cost-effective, non-fossil-fuel-based solution to support the military’s jet fuel needs. We thoroughly reviewed many potential processes and solutions for this initiative, and came to the conclusion that this goal can best be achieved with help of Terrabon and their mixed alcohol oligomerization pathway, MixAlco,” said Dr. Greg Poe, CEO, Logos Technologies.
MixAlco converts low-cost, readily available, non-food, non-sterile biomass into valuable chemicals such as acetic acid, ketones and alcohols that can be processed into renewable fuels.
LanzaTech was also awarded DARPA funds to perform research focused on novel, low-cost routes to production of jet fuel from carbon monoxide sources. The LanzaTech project will focus on reducing the cost of alcohol intermediates, which will be thermochemcally converted to JP-8 renewable jet fuel.
At the time, LanzaTech CEO Dr. Jennifer Holmgren said that the economics of alcohol-to-jet fuel are driven by the cost of alcohol intermediates – LanzaTech’s technology, which produces alcohols by gas fermentation of CO-rich feedstocks such as industrial off-gases, has the potential to be an economically and environmentally sound approach to alternative aviation fuels.
Over in Colorado, Gevo announced it has signed an engineering and consulting agreement with Mustang Engineering to convert Gevo’s renewable isobutanol to bio-jet fuel. This effort will focus on the downstream processing of isobutanol to paraffinic kerosene (jet fuel) for jet engine testing, airline suitability flights and advancing commercial deployment.
Once completed successfully, the company will initiate jet engine testing with engine manufacturers. Mustang is a global project management, engineering, procurement, and construction operations company serving the upstream oil and gas, refining and chemicals, pipeline, automation and control, and industrial markets.
In Oregon, ZeaChem is proposing a 15 million-gallon jet fuel output from its proposed integrated biorefinery in Boardman, Oregon (which would, alternatively, be able to produce 25 million gallons of ethanol), and said that it can have such capacity ready by 2014.
In the case of LanzaTech, the company has signaled that it expects to be able to produce up to 15 billion gallons of renewable jet fuel (yes, that’s “billion”) from existing steel waste gases that are generally flared after being generated in blast furnaces, at an operating cost of $1.50 for the alcohol, suggesting a cost range of around $3 per gallon for jet fuel. Even adding in capital costs and margin, it’s getting to be in the ballpark of conventional fuel costs. LanzaTech is expecting to have its first 100 million gallon facility (ethanol) completed in China in 2013.
At the Paris Air Show this past summer, Gevo presented test results conducted by SRI International and the Air Force Research Lab to the alcohol jet review (ATJ) committee of ASTM. The next step in the ATJ specification will be work with engine manufacturers to complete commercial engine testing.
Full certification of ATJ is expected in 2013, by which time Gevo expects to have 110 million gallons of isobutanol capacity for use in the jet fuel and chemical markets. United Airlines and Gevo have previously signed a non-binding offtake agreement from ORD, starting in 2013.
The market and drivers for aviation fuels
Worldwide demand for aviation fuels is growing fast primarily due to growth in the robust Chinese aviation market. According to the International Energy Agency, aviation fuel demand will reach “7.6 million barrels per day in 2012, up from about 6.8 million barrels per day in 2007″. That translates into 116 billion gallons of jet fuel, globally, by 2012.
Aviation accounts for 12 percent of the fuel consumed by the entire transportation sector, which is equivalent to roughly 1.5 to 1.7 billion barrels of kerosene annually (about 70 billion gallons). Analysts project that aviation biofuels will replace roughly one percent of kerosene by 2015, 25 percent by 2025, and 30 percent by 2030. This represents a market value of US $2 billion, $56 billion, and $68 billion in delivered fuel respectively, assuming current kerosene prices.
The emissions driver for renewable fuels
Among demand drivers for Bio-SPK are the prospect of big carbon credit payments by airlines operating into, out of, or within Europe. Commencing in January 2012, the airline industry is scheduled to enter into the EU Emissions Trading Scheme, which will cap carbon emission levels, and is expected to cost airlines up to $19 billion in 2012 alone, according to a March report from Point Carbon.
The bottom line
So there you have it – from hooch to jet fuel by the numbers. Generally, expect a fuel spec to be OKd in 2013, and fuel contracts to ramp up significantly in this decade. Not every producer is going to target ATJ – most companies make alcohol too expensively to make jet fuel work, and those that have transformatively low operating costs for alcohol production may simply focus more on the road transportation markets where mandates can create higher per-BTU prices for selling ethanol fuel than jet fuel.
Two huge variables are the underlying price of conventional jet fuel and the impact of low-carbon standards. If the trends on oil prices and carbon work out as expected, ATJ could well be the major driver of aviation biofuel supply between now and the late 2010s or early 2020s when platforms such as jatropha and algae get more traction.