CAAFI® works with fuel producers to identify specific, actionable opportunities for commercial deployment, including facilitating the connections between airlines that want to purchase Sustainable Aviation Fuel and those fuel producers who want to sell their fuel by providing commercialization engagement opportunities. CAAFI is working with fuel producers to help bridge the “Valley of Death” between Sustainable Aviation Fuel (SAF) technology development and full commercial production, including providing SAF development guidance, facilitating of industry approval and specification of fuels under ASTM, and helping establish partnerships to develop supply chains. CAAFI sees the most appropriate technology and feedstock solutions as being regionally based, and therefore is feedstock and technology agnostic. To ensure a reliable supply of SAF, CAAFI’s stakeholders would like to see a diversity of feedstock and SAF technology producers reaching commercialization and achieving industry approval for use as jet fuel.
Fuel Technology Maturation
One of the greatest technical challenges for a new technology is successfully scaling up from the lab bench to full-scale commercial production. For this reason, fuel maturation along the Fuel Readiness Level (FRL) involves sequential scale-up of production from lab-scale through pilot plant to demonstration facility and finally to commercial-sized facilities. CAAFI has developed a series of AJF and feedstock maturation tools, including the FRL, a set of FRL exit criteria, and a fuel testing user’s guide for ASTM D4054 to help technology developers identify, understand and communicate the maturity of their fuel production technology, and help them understand the steps to bridging the Valley of Death for AJF. CAAFI is integrally involved helping new fuels qualify under ASTM (see our Fuel Qualification page).
CAAFI has provided fuel producers with additional guidance on achieving commercial deployment of SAF: Path to Jet Fuel Readiness and Guidance for Selling Alternative Fuels to Airlines.
Existing and Planned Production Facilities
There are already a number of commercial scale facilities using pathways that have been qualified under ASTM International specification D7566 for use by the aviation industry (although not all of them are currently producing jet fuel). Many other technology developers are working toward production facilities at various scales to provide the assurance of scaled-up performance and potentially provide the fuel volumes and data needed to get through the ASTM approval process.
The first year of commercial scale alternative jet fuel production (AJF) in the U.S. was 2016, during which the aviation sector used over a million gallons of AJF, primarily from the AltAir facility delivering tallow-derived hydroprocessed esters and fatty acids (HEFA) fuel to Los Angeles Airport (LAX).
The map below shows existing and planned facilities for producing drop-in fuels, all of which are capable of producing jet fuel. View the current state of sustainable aviation fuel deployment.
For airlines, the cost of fuel is a significant driver of overall operating expenses and the extreme price fluctuations of crude oil (and jet fuel) since 2006 have been detrimental to the industry. Enabling significant AJF supply should help address the extreme variations in fuel price, but fuel price is also a significant challenge for AJF producers, and there is a perception that AJF cannot be produced at a cost competitive with conventional jet fuel. A variety of efforts are being undertaken to reduce production costs across the supply chain in order to make a wider array of AJF more cost-competitive.
Given existing incentives—such as the Environmental Protection Agency (EPA) Renewable Fuel Standard (RFS2) Renewable Identification Numbers (RINs) and the California Low Carbon Fuel Standard—current AJF and renewable diesel production can be cost-competitive with petroleum-based fuels. The AltAir/U.S. Navy fuel contract for fiscal year 2018 is an encouraging sign that renewable fuels are becoming cost-competitive with petroleum-based fuels. The Defense Logistics Agency’s 2017 Rocky Mountain/West Coast region solicitation resulted in a supply contract being awarded to AltAir Fuels for F76 marine diesel with 30% renewable content with a unit price of $1.43 per gallon of fuel. Nevertheless, production costs for AJF generally remain higher than traditional petroleum-based jet fuel.
Fuel producers face major challenges in securing capital investment to establish commercial-scale fuel production facilities due to perceived risk on the part of investors. Risk may be related to policy uncertainty, offtake/market uncertainty, feedstock availability issues, and other challenges in addition to the risks associated with the technology itself. Therefore, de-risking the supply chain is of critical importance. Tools for reducing risk to facilitate commercial-scale production facility investment can include programs such as:
- Research and development (R&D) programs that can reduce technical risk (including federally supported R&D, as outlined in the Federal Alternative Jet Fuel R&D Strategy).
- Loan guarantees, such as the U.S. Dept. of Agriculture’s (USDA’s) Biorefinery, Renewable Chemical, and Biobased Product Manufacturing Assistance Program and the Dept. of Energy’s (DOE’s) Loan Guarantee Program.
- Incentive programs with a reliable, long-term and predictable life span that can ensure economic competitiveness of alternative fuels.
- Programs that provide payments to producers to ensure long term production and energy security (e.g., USDA’s Advanced Biofuels Payment Program.
- Insurance tools such as crop insurance (e.g., USDA’s program for camelina) and other forms of insurance, such as on insuring facility performance.
CAAFI is also working with the Aviation Sustainability CENTer (ASCENT) on related risk-reduction efforts focused on enabling supply chain development.
Some producers are enhancing their economic viability by developing high-value products such as synthetic chemicals and cosmetics. Such high value products can aid in establishing the business case for also producing high volumes of alternative fuel resulting from the same processes. Both economics and sustainability should be considered when evaluating the potential for co-product contributions to company viability. Fuel and feedstock producers may also want to consider the option of incorporating non-traditional co-products, such as environmental services, as a source of revenue. CAAFI is engaged with ASCENT researchers investigating opportunities to leverage payment programs for environmental services such as nutrient runoff reduction and water quality improvement as contributors to the economic viability of SAF operators.
Tools & Resources
Finance/Investment/Offtake Agreement Tools
- Guidance for Selling Alternative Fuels to Airlines
- Path to Alternative Jet Fuel Readiness
- IATA’s Aviation Fuel Supply Model Agreement
- Defense Production Act (DPA) Memorandum of Understanding (MOU)
- USDA Energy Programs
- DOE Energy Efficiency and Renewable Energy Bioenergy Technologies Office Funding Opportunities
- Other DOE Energy Related Funding Opportunities
Technoeconomics and Commercialization Research
- National Labs
- U.S. Department of Energy’s (DOE) Bioenergy Technologies Office (BETO) work on Aviation Fuels work on pathways
- ASCENT Project 01 Reports:
- Stochastic Techno-Economic Analysis of Alcohol-to-Jet Fuel Production
- Field to Flight: A Techno-Economic Analysis of Corn Stover to Aviation Biofuels Supply Chain
- The Costs of Production of Alternative Jet Fuel: A Harmonized Stochastic Assessment
- Environmental and Economic Assessment of Transportation Fuels from Municipal Solid Waste
- Stochastic Techno-Economic Evaluation of Cellulosic Biofuel Pathways
- Quantifying Breakeven Price Distributions in Stochastic Techno-Economic Analysis
- Biorefinery Site Selection Using a Stepwise Biogeophysical and Social Analysis
- CAAFI State Initiatives page
- CAAFI White Papers (challenges)
- Alternative Jet Fuel Production Facilities Status
- ICAO Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA)
For more info on how to work with aviation end users see CAAFI’s End Users page